Down with the evil Gas lords. (yes, i am brave enough to post another from myspace)

[Zkribbler]

Originally posted by Arrian
Or at least ... buy more fuel efficient cars.

You may have noticed that sales on gas-hogging SUVs have tanked to the point where GM is teetering on the edge of bankruptcy

And just try and buy a Prius ... it'll be a looooong wait before one is delivered to you.

[KrazyHorse]

I agree the whole world uses oil, but prices are not the same everywhere

They're pretty damn close, kid.

[Kaak]

Pretty damn close != the same.

[GhengisFarb™]

Originally posted by Zkribbler
And just try and buy a Prius ... it'll be a looooong wait before one is delivered to you.

Is that some kind of slow roasted meat dish?

[Imran Siddiqui]

Is any good EXACTLY THE SAME in all areas of the world? Have you never heard of Purchasing Power Parity?!

[KrazyHorse]

?

WTF are you talking about?

So now your point is that the cost of a barrel of oil is 5% different across the Atlantic?

[Arrian]

Originally posted by Zkribbler


You may have noticed that sales on gas-hogging SUVs have tanked to the point where GM is teetering on the edge of bankruptcy

And just try and buy a Prius ... it'll be a looooong wait before one is delivered to you.

Oh bah, GM was screwed regardless of SUV sales. It was just a matter of when.

As for hybrids... they're still not economical (gas needs to hit 5 or 6 bucks per gallon for that) and I've got concerns about long-term maintenance. But maybe someday. Until then, my (normal) Honda civic is just fine. 30-32 mpg on my commute.

-Arrian

[Kontiki]

Originally posted by Kidicious


I doubt if much gas is imported. I think the norm is to import the oil and refine it for local markets.

The US does import a decent amount of refined gas. Irving Oil, one of Canada's largest refiners, is a significant supplier to New England, for example. Apparently they ship over 150k refined barrels a day into the NE market, and also do shipments to California. According to their website, the 150k represents 19% of the refined shipments into the US, so I guess that makes total refined imports over 750k bpd.

[Kaak]

And i'm curious about this. Considering the Oil refining capacity of the US, and that we have about 40% ( -50%?) of the oil we need produced domestically, ~20% coming from Canada, and a fair amount coming from central and south america, why should the price here be so similar as to Europe? And is it the refining capacity that makes Gas prices here cheaper? Or taxes or what?

[GhengisFarb™]

Well bloody heck, someone's gotta keep the Canadian economy going.

[Spiffor]

Originally posted by KrazyHorse
If oil goes up in price then refined products go up in price, and vice versa. The only exception is when refining capacity is especially tight. We saw that for a few weeks after Katrina. Usually, gas and oil are pretty tightly knit (with some, but not that serious fluctuations)

I was talking about the supposed rules of a market. In a theoretical market, the costs of raw materials don't have an immediate impact on the price of the final product, because the market price of said final product is dictated by supply and demand (supply and demand being the Econ 101 principles you enjoyed so much remembering to Kaak ).

Yet, in the gas industry, prices are not set that way. There doesn't seem to be particular competition among the suppliers to attract customers. Many Yanks are frowning because of the gas hikes, and many people are considering buying a fuel-efficient car (which is a good news actually), yet in the face of these tendencies that could reduce demand on the long run, no company is launching an aggressive price campaign, where it accepts to sacrifice some of its profit-per-unit in order to increase its market share (and thus in order to increase its total profits).

It seems the gas prices, instead are not being dictated by the rules of competition (supply and demand). Rather, they seem to be guided by a rule of thumb which says that the refiners are entitled to a "tithe" that largely depends on the price of the raw product.

[Arrian]

Taxes. Europe tends to tax the hell out of gasoline, whereas our gas taxes are (relatively) tame.

-Arrian

[Zkribbler]

I have an econ-genius for a friend. He's figured out that as long as gas stays above $2/gallon, he'll be better off with his Prius. Right now, he's not worried.

[KrazyHorse]

why should the price here be so similar as to Europe?

BECAUSE OF THE EXISTENCE OF A GLOBAL MARKET. IF THE PRICE WAS RADICALLY DIFFERENT THEN PEOPLE WOULD SHIP OIL FROM THE CHEAP PLACE TO THE EXPENSIVE PLACE. SHIPPING COSTS ARE RELATIVELY LOW, SO THE PRICE IS BALANCED.

[KrazyHorse]

refining capacity that makes Gas prices here cheaper? Or taxes or what?

taxes