23 while Shell, a half of a mile down the road, is $1. Which price do we choose? In the recent increases and decreases of gas prices, this simple one-cent difference is causing Americans in the U.S. to consider driving an extra half-mile for just a penny less. Supply and demand of gasoline is fluctuating greatly, and society and markets are experiencing the after effects of it. Why are gas prices increasing and decreasing at such great rates? Why do prices go up and down? These are just a few of the questions Americans are facing today. Current gas prices in the United States have become too extreme for the American society, and are causing the behaviors of people themselves, to be extreme also.
Many Americans are asking why the prices of gas have increased so much and so fast. According to the Organization of Petroleum Exporting Countries, or OPEC, the price of gas has climbed more slowly than most of our common goods in the past thirty years. Most people would disagree with this. It seems gas prices have risen more than anything, and they have, but only recently. High gas prices, experienced in 2001, were caused by the constrained domestic productive capacity. The cause of this was the strong economic growth followed by the unusually high demand. The terrorist attacks of September 11, 2001 dramatically increased the prices of gasoline. This was because people panicked and everyone was going out to buy gasoline. In turn, this caused the .
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demand for gas to increase and the supply of gas to decrease. When this happens, the price of gas goes up, just like any other market in the world. Gas stations had lines out to the road, from the rush of people wanting gasoline. Another reason gasoline prices increased was because while the demands for gasoline were increasing, the number of refineries in the U.S. was decreasing. For example, in 1976 there were 315 refineries, while today there are only 152.