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Gas Price

            
             Have you ever wondered why the gas prices around the Miami Valley and the nation so high? Do you guess it is just the gas companies" way of making lots of money? How much does of a roll does the government plan in the prices? I am here to answer some of these if not all of these questions.
             One of the main reasons that gas prices are so high is because of the cost of the crude oil. Crude oil cost is the price paid for a barrel of crude oil on the international market divided by 42 gallons in a barrel. This will give the price of crude per each gallon of gasoline. This is often the most volatile price of the fuel. Crude is trade as a commodity, and as the price goes up, prices for gasoline can change very quickly. When prices for crude come down, the price for gasoline also comes down -- but very slowly. This is typical for most commodities.
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             For every one dollar increase of the cost of a barrel of crude oil, there is an increase of about 2.5-cents per gallon of gasoline. So, a $10 increase per barrel in crude prices means a 25-cent increase at the pump. A $15 increase in crude oil means a 37.5-cent a gallon increase in gasoline prices. This additional cost will not go away until crude oil prices start to come down. (1).
             Now with that said do you believe that the companies are just trying to make a lot of money? Gas prices are established primarily through two key factors: cost and competition. In terms of cost (what the gasoline station has to pay for a gallon of gasoline), the cost per gallon changes often - sometimes on a daily basis. Factors determining the cost per gallon of gasoline include issues such as supply/demand, clean-air regulations, and world events. Competition (other gasoline stations) is the other key factor in determining the retail price (what the consumer pays) for a gallon of gasoline. It should be noted that a significant portion (exact percent varies by state) of the retail gas price is comprised of state and federal taxes - none of which go to the individual gasoline companies.


Essays Related to Gas Price

1. The Lowdown on Rising Gas Prices

Anatomy of a gas dollar To get a clear picture of why gas prices go up or down, it is useful to have an understanding of where your money goes when you pay for gas. ... The rise in gas prices aren't always linked to supply issues, though. ... Perhaps the biggest reason for state-to-state variances in gas prices is taxes, but competition among gas stations and distance from oil refineries can also impact the price we pay. ... War, world events, and even the weather can raise gas prices. ... There are many factors that contribute to the rising price of gas. ...

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2. Got Gas?

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3. Obama Defends His Energy Policy Despite Rising Gas Prices

At a crucial point in the presidential race, President Barack Obama defended his energy policies but offered no reprieve from the climbing gas prices. As is the norm, gas prices slowly creep up with summer just around the corner, but this year they began even earlier in the year. In fact, gas prices are a staggering 25 cents per gallon above the norm for this time of year. ... "Just like last year, gas prices are climbing across the country - this time, it's happening even earlier. ... Despite his efforts, gas prices will continue to climb this year (Landler). ...

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4. Oil

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5. The Rising Cost of Natural Gas

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6. Secret Formulas Set the Prices For Gasoline

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7. Gas Prices Fall

Gasoline pump prices again fall Average price per gallon down 10.81 cents at $1.43 Associated Press, MSNBC, no date pf publication In the Midwest, especially, gasoline prices have increased in previous months. However, within the past two weeks gas prices have fallen "a record 10.81 cents." According the Lundberg Survey, the reasons for the fall of the gas prices is due to the lack of demand, which is a result of the resent terrorist attack, scaring travelers from venturing far from home. The consumer's fear of traveling has caused the decrease because without a desire to travel, the...

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8. Unexpected Financial Plummets

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9. Gas Prices Forcing Some To Be Unemployed

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