Originally Posted by Jayhawk
Dumber than your average cigar, you are! This is a perfect example of the free market system in action, clearly reflecting the law of supply and demand. Get a clue, not a conspiracy!
The "laws" of supply and demand aren't of significance but for discussions of economic theory. The laws of the nation, on the other hand, are of significance for all citizens.
This graph demonstrates a blatant effort by oil companies to generate additional profits by fixing prices, because they can. There have been no naturally-occurring problems that have reduced our countries refining capacity in quite some time. Had there been, gasoline prices would have been at current levels long ago, when crude oil prices were basically where they are today.
Especially in light of the profits oil companies have recorded lately, it's abundantly clear that the reduction in refining capacity is a matter of another law - the Law of Human Nature, which states that people will always do what they're incented to do.
When corporate interests run contrary to the interests of citizens, the government must step in. The situation with oil price volatility caused by factors other than mother nature is unlike any other situation with any other commodity.
People can live without orange juice - there are drink alternatives. People can live without pork bellies - there are food alternatives. People can live without sugar - there are sweetening & cooking alternatives. The economy cannot live without oil. There are no alternatives to select from.
That situation immediately disqualifies oil and gasoline as commodities, and trading in them (particularly futures trading which is purely speculative) is criminal. It's akin to insider trading and sabotage, in my opinion. If sugar farmers scorched their own crops to reduce supply, the price of sugar would go up. If orange farmers defoliated their trees prior to harvest, the price of FCOJ would go up. They would have created an artificial condition of demand outweighing supply, allowing them to make more money with less work.
These anomalies would be every bit as artificial - and criminal - as trading in the futures of crude oil. Factor in the importance of oil to the nation's economy as a whole, and you have the clearest possible case for making America self-sufficient and for regulating oil prices that there has ever been.
Still don't think so? I'll point your attention to the fact that the federal government doesn't maintain strategic reserves of sugar, FCOJ, or pork bellies...it's not really rocket science to determine that crude oil isn't really a commodity. Electricity is regulated. Enron is what happens when you allow companies to engage in the predatory exercise of theoretical laws of economics like "supply and demand". Enron realized that demand for electricity isn't cyclical, and those who buy & sell it speculatively assume a monopoly on the resource. Bottom line: Companies get rich, people get fucked. California had enough power production capacity for itself, but because Enron had plants shutting down for 'maintenance', California had to buy power from elsewhere. Since Enron bought virtually all of it, they could name their price. Remember rolling blackouts? Sounds a lot like futures trading in gasoline, doesn't it?
Radical, I know.
Allowing private investors to hike or sink the price to suit their collective positions in deference to naturally occurring situations is criminal. It must come to an immediate end, but that won't happen until America can meet it's oil consumption demands internally.