Thursday, September 01, 2005

Gas Prices

In case you missed it, gas jumped about $0.45 in a day or two because of the Gulf Coast Hurricane. Now, it is true that the oil and gas industry was damaged, and on a long term basis I would expect prices to rise. Why did they jump that much in a couple of days? Answer? I don't know, but why doesn’t an enterprising young journalist seek out the pricing methods of the gas companies? Why not publish the formula they use to judge how much to charge for gas. People can bitch and moan about taxes and the EPA all they want, but there is no fair reason for gas to have jumped up that much, that quickly. It is about profit, not about passing on cost. If gas companies are going to market prices, then they should use a fairy tale market where they set the price they want and instead stick to real market pricing, not just what they think they can get away with.

Alas, we are stuck. Even after 100 years, gas companies are an oligopoly, and can do damn near what they want to the consumer. Having energy competition would be the best way to push our economy forward. If we had options outside of gas to power transportation on a wide scale, we would be able to move around everything with far greater ease. Why is the government not making that priority one in economic development?

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