Gasoline in California

[citivolus]

Originally Posted by Desert_Seg

Yep, that, unfortunately, is capitalism and is why I really am not a fan of OPEC (they are a cartel, setting the price of oil, and in Europe and the US this collusion is illegal so why do we put up with it?)

Legality has nothing to do with it. They are a cartel of soverign countries and as such, laws of other countries don't matter. The best we could do is not buy from them but that really limits resources.

Originally Posted by Desert_Seg

Everybody I read recommends we have SGRs as these will have a much greater impact on lowering or stabilizing gasoline prices....so why don't we?

Just to hazard a guess, but I would say that the US Gov't keeps a reserve of oil more for a defense purpose than to interfere with the open market. I grant that the oil business isn't exactly what I would call open, given the enormous barriers to entry, but it really isn't the Gov't's job to muck with prices and they generally bung it up when they try. When the SOR has been opened in the past it always seemed to me more like political pandering, done with a wink and a nod to pollsters, to quiet the squeaky wheels.

[citivolus]

Originally Posted by pam

Ah, so then, if the refineries are actually making more gas (except for a a "negligible" decrease this year, then why is gas sooooo much higher this year than previously? Gas jumped 23 cents this week here. The gas companies say it's because of the refinery fires. Every year when gas prices go up (and up), the gas companies have a different "excuse" - usually based on refineries, which haven't been built in 30 years or so.

Pam,
I did see on the ABC news just the other night that demand for gas this year is much greater than last year even at these prices. The last time I checked, higher demand + lower supply = higher price. Given the inelasticity of this particular curve, we probably have another half dollar or more to go before people really back off the throttle.

As an aside, according to California, adjusting for inflation shows this to be a peak but not much worse than 1981. I know, everyone screamed then too.

On the upside, many of my mutual funds are doing wonderful things at these prices.

[pam]

Oh, I'm guessing we'll go $4 a gallon easily before the end of the summer (and even higher in California). We're higher right now than we were with Katrina, when we had whole refineries off-line big time. And oil companies will continue to drag in huge profits.

Pam

[polo_pro]

Originally Posted by pam

Oh, I'm guessing we'll go $4 a gallon easily before the end of the summer (and even higher in California). We're higher right now than we were with Katrina, when we had whole refineries off-line big time. And oil companies will continue to drag in huge profits.

Pam

As I shot through my old stomping grounds (Santa Barbara) during last weekend's trip, I noticed that gas stations were already at $4/gallon. Sure, these were the higher priced gas stations, but the part that amazes me is how people actually fill up there with surprising regularity?!

[citivolus]

Originally Posted by plo

...the part that amazes me is how people actually fill up there with surprising regularity?!

It really shouldn't. Assume the average fuel economy of any given vehicle to be 25 mpg and the average fuel up to be 17.5 gallons. The question is how far would you drive to save 5 cents or 10 cents per gallon?
Case A, 5 cents: a fill up saves 87.5 cents on what would be $70 so the break even distance is 2.75 miles out of your way or 5.5 miles round trip.
Case B: roughly... double it.
Add to that the fact that if you don't know for certain that the next stop is cheaper and it quickly becomes the futile exercise, often practiced by government, of sparing no expense to save a nickel.

What I do is check prices on the way out and fill up at the cheapest place on the way back. Also, if I'm travelling any substantial daily distance for any period of time and gas prices are on the rise, I fill up every day. That way I can "fill cost average" my fuel investment which minimizes the amount I spend on fuel.

I just got back from Prescott, AZ. Gas is $1.00 to $1.50 per gallon cheaper. Other than supply and demand in CA, how can the companies justify the price difference? If the price is higher here because of maintenance, reduced production, etc., I don’t understand why the cost isn’t the same one state over. Maybe I’m just stupid? Apparently, that’s what the oil companies think.

[Five-Flags]

Originally Posted by citivolus

...What I do is check prices on the way out and fill up at the cheapest place on the way back. Also, if I'm travelling any substantial daily distance for any period of time and gas prices are on the rise, I fill up every day. That way I can "fill cost average" my fuel investment which minimizes the amount I spend on fuel.

Another way is to check http://www.gasbuddy.com for the best reported prices. It's becoming more and more popular these days. I've found it to be very accurate in my area, YMMV (pun intended).


Sorry.....

[citivolus]

Originally Posted by beachrider

I just got back from Prescott, AZ. Gas is $1.00 to $1.50 per gallon cheaper. Other than supply and demand in CA, how can the companies justify the price difference?

Well, about $0.40 / gal is accounted for in just taxes. Have a look at the excise tax map (pdf warning) and it shows about 21 cents more in CA. Now add to that CA's double dip with a percentage based sales tax to bring it up another 20 cents. I can believe a few cents per gallon might be due to a higher labor, utility, or other operating cost. In the end without knowing the specifics of business operating requirements of the two states, I wouldn't automatically assume they're "throwing a handful of sand into the vasoline" just because they can. It doesn't mean they aren't, I just won't assume they are.

Originally Posted by Five-Flags

Another way is to check http://www.gasbuddy.com for the best reported prices.

Great site, even better is that I know I'm paying only 5 cents more than the lowest price in the state... but I'm not driving to Wyoming for it, even at 62 mpg.