Re: Gas prices are soring---AQMD??
Author: BOB2
Date: 10-07-2012 - 07:34
Gasoline is clearly being manipulated in the California market, national and world prices are far lower, oil prices have been in a very stable and low range compared to the run ups in 07 and 08.
This years annual "accidental" shut down of the (entire") power supply to the pipeline, and regularly scheduled refinery fire, and accidental shut down of another small refinery is happening later than usual. They usually do this in the Spring when they add all of the useless and expensive ethanol to reduce hydrocarbon emissions. That stupidity to subsidized farm states adds between 20 and 40 cents a gallon to California gas prices, and is completely unnecessary as there a much cheaper additives we could use to reduce the smog producing summer hydrocarbon levels. This is what happens when you allow 90% of all refining capacity to be monopolized by four firms, and Congress mandates a massive consumer subsidy to farmers and ADM under the guise of reducing air pollution and fuel "independence" through expensive ethanol.
The fire was over a month ago, and the tankers from India and Indonesia should be unloading refined gasoline by now? Manipulation of markets in an oligopoly like this are easy, with no need to even meet and "collude" directly, you only need to know a little game theory, and you can pretty much rape the consumer at will, with a commodity on which we've become dependent, like this. It's called an inelastic demand curve, where these small set of producers have us by the short hairs.
It's these unstable fuel costs that are really now driving heavy duty conversion to natural gas trucks, not love of the environment. But, this is good for the bottom line, good for the consumer (puts pressure on the liquid fuels monopoly), and good for the environment.
Many people have suggested a boycott, and you always hear that this won't work, from the "experts", who just happen to mostly work for this industry. Actually because this demand is inelastic, consumers do have power, and reducing fuel use can and will have a real effect on prices. Reducing gasoline and diesel use by things as simple as, doing more teleconferencing, walking rather than driving to lunch, taking transit once a week, shopping closer to home (factor in driving costs, including depreciation, the next time you drive twice as far to save a few buck, and you'll often find you are not saving anything?), and most important (back on subject for this site), take a train or transit when you can (USC home games are now all transit accessible, with the added advandage of being able to drink without driving?)
The good news is that Amtrak will set a record this year (again), our tranist ridership is way up, and counted vehicle trips on many corridors are way down, especially on weekends and midday. The bad news is that all of our trains are way over capacity during peaks, and we don't have much new equipment in the pipeline other than the newly arrived metrolink cars.
I went to a meeting a SCAG this week and took the Gold and Redlines just after rush hour and the trains were SRO. So while many folks like to bash these investments, in some places we are at least in a position, to have an alternative to bending over for the oil refiners.