Supply and Demand Issues Effect in Gas Prices
From an early age, most Americans are taught that supply and demand effects the price of goods and services that we consume. While for the most part that teaching is correct, when it comes to the price of crude oil which then filters down to the price of gas - supply and demand has been manipulated for years by OPEC and other large oil and gas producing countries. Yes, the greater the supply of gas available on the world market does cause the price of gasoline to go down - but the nations that make up OPEC and others manipulate the world supply of oil and gas by either producing more oil when supplies are low or closing off the supply of crude oil when supplies are high. This manipulation of gas and oil prices is the reason why American politicians are wrong when they say that the oil and gas marketplace should be left to itself to regulate the price of crude oil and gasoline based on supply and demand.
There is nothing fair or capitalistic about the worldwide oil and gas marketplace. The people that have the oil, set the price and supply and demand plays only a small role in the price of crude oil or gas. Much of the huge wealth that is generated from big oil and gas producing nations is filtered back to Washington D.C. in the form of lobby money to encourage lawmakers to follow the old supply and demand formula. In most cases, that is an easy sale for lobbyist to make because all of us have been taught that the U.S. system of supply and demand is how the American system of business should work. While Democrats at every turn make the mistake of blaming big U.S. oil companies for the current high price of gas - in reality it is foreign nations and the money that they send to U.S. lawmakers that is a much great source of problem.
The time has come for Americans to stop looking at the price of crude oil and gas as a supply and demand issue and start looking at it from a self serving point of view, the same way member nations of OPEC view the worldwide oil marketplace. While members of OPEC and other large oil producing nations have continued to manipulated the price of oil for decades, our elected leaders in Washington are all to ready to listen to their next supply and demand sales pitch when a huge contribution to their reelection campaign is attached to their propaganda message. While the Democrats can't seem to hit the right target when it comes to who is to blame, Republican lawmakers are so brainwashed by the free markets are always good slogans that they are missing the real issue entirely. High oil prices are a result of member nations of OPEC doing a better job of working the American system than the citizens of this country.
For supply and demand to work, the marketplace must be a as close to fair as possible and when companies or countries work to manipulate the system they must be punished for breaking the rules. Right now, the biggest rule breakers are the ones that are receiving the biggest financial windfalls and that is part of the reason the U.S. economy is going down. Rather than drilling for additional supplies of oil or spending the money necessary to find alternative forms of energy here in the U.S. - knee jerk Washington politicians are looking for someone else to blame for this problem instead of themselves. The time has come to call the oil and gas business what it really is and that is a Monopoly and not a product of the American supply and demand system. If we keep treating the oil and gas business like every other business - this nation will continue to slide downhill and our economy will slip even further into recession.
The ongoing crisis of gas prices is not really a shortage of gas, but a manipulation by gas producing countries. The demand for gas is very high because it is essential for transportation, therefore people are willing to expand their paying ranges for gas. Gas producing countries set the prices on gas. However, the growth of demand does not alter these prices. Oil producing countries know other countries essentially need this oil, thus producers take advantage and set high prices and do other things such as producing excessive amounts of oil when supplies are low. For supply and demand to take part in this gas economy, the petroleum oligarchy needs to stop and production needs to start happening at its possibilities frontier rate.
