An article in the news today reported that gasoline prices were going up because demand was increasing. For some reason, I find this hard to believe. Gas prices have jumped almost 20 cents per gallon in the past 2 weeks. Has demand increased that much in 2 weeks? I don't think so! The article states that gasolnie is up 20 cents over this time last year! They say it's because of increased demand by countries like China. So come on.....that many more Chinese are driving than a year ago? For some reason I highly doubt that all of a sudden the number of Chinese driving went from 20% to 95%.

What also amazes me is that America is running all of the oil operations in Iraq. Seems like if we wanted to lower costs, we could pump out more oil.

I just don't buy oil companies saying costs are gonig up because of an increase in demand.

What do you think?


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"Strong demand pushing gas prices higher

Refiners already building stockpiles for summer

Average gasoline prices are about 22 cents per gallon higher than this time a year ago.

Updated: 6:00 p.m. ET March 8, 2005

With crude oil prices sharply higher than a year ago — trading near $55 a barrel on Tuesday —gasoline prices already have begun to climb. And with the winter heating season soon coming to a close, gasoline is once again the focus of attention among producers, traders and consumers. Much of this summer’s increase will depend on how much gasoline the nation’s already-stretched refineries can crank out.



But strong demand — fueled by strength in the U.S. economy — also is pushing prices higher. And despite the howls and whimpers often heard at the pump, high gasoline prices apparently have done little to reduce the American driver’s thirst for gasoline.

With the summer driving season months away, some forecasters already are warning of record prices this year. The U.S. Department of Energy is forecasting a peak average price of $2.18 a gallon in the second quarter of this year — up 22 cents from last year's second quarter.

“All of the dynamics are in place for U.S. motorists to pay new record high prices again this year,” said Geoff Sundstrom, a spokesman for AAA.

Those dynamics include growing demand worldwide, especially in rapidly developing countries like China and India. Crude oil prices — which make up about half the cost of a gallon of gasoline — have risen largely because oil producers can barely keep up with demand. And refining capacity is stretched tighter than ever, as tougher environmental regulations have made it costly to expand production. All of which makes it difficult to predict just where gasoline prices are headed.

As of last week, AAA said U.S. gasoline prices averaged $1.92 a gallon, about 22 cents higher than this time a year ago. But crude oil prices have risen even faster.

With gasoline demand coming off a seasonal winter low, retail prices have risen just 9 percent since the start of the year, while the price of crude is up 22 percent. If crude oil continues to trade above $50 a barrel, analysts expect gasoline prices to march quickly higher to catch up.

No letup in demand
Though consumers have complained loudly about gasoline price increases, there are no signs of slowing demand. That could be because, adjusted for inflation, gasoline in the U.S. is still cheaper than peak price of roughly $3 a gallon in 1981.

If gasoline demand remains strong, pump prices will depend heavily on whether producers can keep up with that demand. Refiners have already begun building up stockpiles for the summer after running at more than 90 percent capacity all winter. That’s hardly a surprise: With prices at these levels, refiners are booking big profits and trying to squeeze every drop of product they can.

“This is as good as we have ever seen it, and it’s going to get better,” Bill Greehey, the Chairman and CEO of Valero Energy, told CNBC last month when the company posted record profits of $1. 8 billion for 2004 — nearly triple the year before.

Total gasoline inventories at the end of February were 10 percent above last year’s levels and higher than they have been in 5 years. But because demand has increased, bigger stockpiles likely will be needed to get through the summer.

For truckers and owners of cars burning diesel, the news has been worse. Pump prices for diesel fuel are well above $2 a gallon — about 50 cents higher than a year ago — hitting $2.45 a gallon on the West coast.

That’s largely because supplies of diesel and heating oil have been tighter than usual, according to the Energy Department.

As the U.S. economy continues to pick up, demand for diesel — which is used to ship virtually every product made or consumed in the United States — has picked up as well. Though demand for gasoline and heating oil typically slows at this time of year, so far it has shown no signs of letting up.

All of which is expected to put a strain on the world’s refining capacity, according to a recent report by the International Energy Agency. Construction of new refineries and expansion of existing plants is expected to raise refining capacity by over a million barrels per day, the agency said. But it expects oil demand this year to grow by 1.44 million barrels a day."

I think this is nothing more than the oil industry testing the consumer to see what his/her bottom dollar is for fuel.

This is just crazy gas prices are this high. I really hope its not the oil companies over pricing oil. If it is you can expect everything you can put your eyes on to increase in price.

I once saw a bumper sticker on the back of a tractor-trailer that read:

"If you own it a trucker delivered it"

Everything we use is dependent on oil. If these gas prices don't go down. The next thing you will see is higher prices on everything, job cuts and maybe some businesses closing for good.

Even the head of OPEC has admitted that gas should probably be around $40/barrell right now.

Yes, we are being gouged by self-dealing oil companies who are recording record profits at our expense.

Gasoline prices climb to record in metro area

By Adam Wilmoth
The Oklahoman

Soaring crude oil prices continued to force gasoline prices higher Tuesday as Oklahoma City consumers paid a new record high for fuel.

Soaring prices

Gasoline prices have soared nationwide in recent weeks largely because of soaring oil prices, which have been driven up largely because of strong demand, tight worldwide supplies, geopolitical uncertainties and the relatively low value of the dollar.

The price of light crude for March delivery rose 70 cents to $54.59 a barrel Tuesday on the New York Mercantile Exchange. Oil is about 45 percent more expensive than a year ago.

The national average price for a gallon of unleaded hit nearly $1.98 on Monday, up about 9 cents in the past two weeks. In Oklahoma, the average price was $1.91, up 12 cents in the same time period.

The Oklahoma City average price was more than $1.91, up 14 cents over the past two weeks. Tulsans paid an average of about $1.90 Monday, up nearly 12 cents.

The average price for a gallon of regular unleaded gasoline in Oklahoma City climbed to more than $1.91 Tuesday, breaking the previous record set in May. The statewide average is less than a penny below the record of about $1.92.

High prices affect most Oklahoma consumers, but even small changes translate into steep additional costs for Sharon Moore and other Oklahomans who travel long distances to get to work each day.

The media specialist at Edmond’s Russell Dougherty Elementary School drives 56 miles each way between her home in Wayne and her school in Edmond. With two or three refuels each week, the more than 8 cent per gallon increase in the average price of gasoline in Oklahoma is quickly adding up, she said.

“Lately I’ve been more conscious of traveling and not making unnecessary trips because of gas prices,” Moore said. “I plan my routes more carefully, and I’m more conscious of watching the prices at gas stations along the way.”

With the nearest mall and Wal-Mart Supercenter more than 25 miles away in Norman, Moore said she makes sure to do her shopping on the way to or from work so she doesn’t have to drive as much on the weekends.

Clete Straub makes a similar commute from his home in Tulsa to his office 55 miles away in Cushing.

The manager of midcontinent business development at Enbridge Energy Co. Inc. traded in his Ford Explorer for an S80 Volvo when he accepted the job so much farther away from home. But even with the more fuel-efficient car, Straub said higher gasoline prices also make it harder for him to commit to driving to the office.

“I find myself questioning whether I need to make the trip every day because of the high gas prices,” he said. “I’ve been working out of my house about one day a week or when I have appointments in Tulsa.”

Gasoline prices probably will jump an additional 15 cents this spring and remain well above $2 a gallon through the heavy driving season, forecasters say. There’s also little relief in sight for crude oil prices, which are pushing gasoline costs higher. Crude prices probably will remain “near the high to mid-$40” a barrel range well into 2006, the Energy Department’s Energy Information Administration said Tuesday.

Will somebody please tell me when life was ever fair? My expierence with fairness is sometimes thing go your way other times you just roll with the punches.

I'm sick and tired of every time someone doesn't like something they feel a law should be written or changed.

What ever happened to good old fashioned competition in the buisness world. If some other company is beating your gas prices, why not make a counter offer to compete?

How about a free carwash? A free soft drink? A free sandwich? Anything?

Instead we cry whine and moan about how its just so unfare someone sells gas three cents cheaper than we can. WhaAAAAAAA! Whaaaa!

I'm really starting to hate politics in this state. Instead of writing bills to help Oklahoma are politicians are writing bills that are nothing more than pure stupidity.

My biggest problem here is that price fixing and self-dealing are interfering with free trade (let's not mention the idiocy that should not even get a second thought in the Oklahoma legislature). Oil is at an all time high not because of a world-wide shortage, but speculative buying based on fears on attacks on oil infrastructure has kept prices up. In other words, terrorists are making people rich. It's an unholy alliance that is really quite interesting to see -- oil and gas allied with terrorists...

Here's a link to a story in the New Zealand Herald from March 6th where the Saudi Foriegn Affairs Advisor says that oil prices are "unrealistically high".

http://www.nzherald.co.nz/index.cfm?c_id=62&ObjectID=10114168

I'm a big believer in the free market taking care of things. Unfortunately, when you have collusion of the 'big guys' to jack up the prices, the free market is damaged severely. This is one fo the few times that government should step in in the form of some sort of anti-trust action to make sure that this doesn't occur.

Rampant speculation never lasts too long; there's too much pressure to cash out at the top, which hastens the trip back to the bottom. Still, I think they can sustain $45-50 a barrel through the summer easily.