Sunday, November 21, 2010

Gas prices on an increase?

I just finished reading an article on the CourierOnline.com site about gas prices have been increasing. Even though the average price for a gallon of gas in New Jersey is less then the national average, it's still a $0.30+ per gallon increase from a year ago.
But you have to give the oil companies credit. They do learn from the past. How many people remember the gas shortages of the 70's? In those days the shortage was for gas under $1.00 per gallon. When the price of gas was allowed to stay above that price, by some miracle that gas shortage disappeared.
Now, we fast forward 30 years. The oil companies try the same ploy again by shoving the gas prices up near $4.00 per gallon. In some places in the US the price IS over $4.00. But the public didn't sheepishly accept the price increases. There were accusations of price fixing and price gouging. There were calls for state and federal government investigations (even by those hypocritical Teabaggers who want no government regulation of any industry). The oil companies have to back off with their price increases. Interesting how the price of gas dropped under the threat of government investigations. Hmm. Anyone remember how much in profits they posted every year? All I remember that they were obscene profits all the while they were crying poor-mouth.
So, what are they doing now? Now the oil companies increase prices slowly over a period of time. They use the frog analogy as their price increasing strategy. What's the frog analogy?
It goes something like this. If you drop a frog in a beaker of hot water, the frog will immediately react by jumping out. However, if you drop a frog into a beaker of room temperature water and slowly raise the water temp, the frog will sit contently until it is boiled to death. This latter example is what the oil companies' pricing strategy is based on. This is the method they will use to increasing take more money out of the consumers' pocket and put even more into their own.
What's the future have in store?
The oil companies will stay with this strategy because this keeps government investigations off their "backs" and allows the politicians, that the oil companies bought, to deflect the consumers' complaints. They will maintain the gas prices artificially high so that when the oil companies release alternative means of powering our cars and industry (which will validate the rumors that the oil companies have bought up, procured those patents and locked up), they can price them just below the current gas prices but still extremely artificially high. All to insure the obscene profits for the oil companies. Want an example of how the oil companies think? Just look at how they acted during the Gulf Oil Spill.

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