pudge's Journal: Oil

A headline last night on NBC News was, "Why are gas prices staying up as oil prices drop?"

If we're going to force people to carry health insurance (I'm looking at you, MA and CA), can't we also force them to take an Econ 101 course?

well

[stoolpigeon]

every time gas prices go up and gas company people publicly say things like, "We can't help it- oil prices are going up." it leads people to think that if oil prices weren't as high, gas prices wouldn't be as high. that's why you see these headlines - not due to a lack of understanding of economics but rather as a way of pointing out lies by an industry.

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[pudge]

every time gas prices go up and gas company people publicly say things like, "We can't help it- oil prices are going up." it leads people to think that if oil prices weren't as high, gas prices wouldn't be as high. that's why you see these headlines - not due to a lack of understanding of economics but rather as a way of pointing out lies by an industry.

What lies are you referring to? You didn't offer any. Gas prices DO go up because of oil prices going up. But adjustments doesn't happen necessarily immediately, nor linerally.

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[stoolpigeon]

gas prices go up because the oil companies will charge whatever the market will bear. they go up in anticipation of oil price increases. they never come down as quickly, if they come down at all. i personally don't have a problem with it. i ride a bike to work. but the thing is, they have - through their own publicity machine - created a false impression that they are interested in not charging more than they 'need to'. they are not open about the fact that they operate in a fashion (like any other bu

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[pudge]

gas prices go up because the oil companies will charge whatever the market will bear. they go up in anticipation of oil price increases. they never come down as quickly, if they come down at all.

Well, you just said two contradictory things. That they will charge whatever the market will bear, and that they go up in anticipation of oil price increases. If they will charge whatever the market will bear, they would be higher than the oil price increases would drive them, already.

Basically, the oil companies charge whatever the market says oil should cost (or, as you said, what they anticipate the market will do). That's the overwhelming majority of what goes into the price of oil.

i personally don't have a problem with it. i ride a bike to work.

I fail to see ho

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[stoolpigeon]

i'm not sure what to say. i think the oil industry has built up a perception among the american public. i think they've done it in a way that is not really forthcoming (call it whatever you want - lieing quite often involves what is not said just as much as what is said. so i'm not sure why you think this is a 'gotcha'). and i think this article reflects that perception more than it reflects a lack of understanding about economics. that's all.

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[pudge]

lieing quite often involves what is not said just as much as what is said. so i'm not sure why you think this is a 'gotcha'

Quote them saying, or not saying, ANYTHING that supports your position. I am asserting that they do not say, or imply, what you say they do. You can prove me wrong with quotes.

and i think this article reflects that perception more than it reflects a lack of understanding about economics. that's all.

What article?

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[stoolpigeon]

I'll look and see what I can find.
 
by article I meant the headline you are originally posting about. sorry that wasn't clear - been kind of a long day.

You've made good points

[dr_turgeon]

No need to apologize... Pudge simply can't lose gracefully ;)
You've proven yourself a worthy adversary!

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[pudge]

I pointed out the fact that a. I do not recall anyone from the oil companies stating or implying what was proposed they did, and that b. no evidence of it was presented. If you call that losing ... I don't know what to say, other than, "no." Also, to tell you to look up what "fungible" means.

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[stoolpigeon]

I don't think we will necessarily come to an agreement on this - and the more I've read, the more I understand the original point you have raised. But I do think it is somewhere between where you are and my original statement. I think I was over stating it to say that they 'lie'. I'll say they 'spin' it strongly in a certain direction. As an example - an interview Jim Lehrer did. This is from last summer. I'm only going to quote a couple very small pieces here - but I'll link to the entire thing so th

They're not

[multimed]

Here in Wisconsin, we just dropped under $2.00 for the first time in awhile. We have among the highest gas taxes in the country - our state legislators passed a law quite awhile back that automatically bumps up the state gas taxes every year - so every year, they get more money without being required to take the heat for voting for the increase. We also have minimum markup laws for gas prices for both wholesale and retail prices (3% and 6% if I recall correctly). But I suppose that's just whining & a