Gas prices go up immediately as oil prices spike, yet when oil prices drop gas prices remain high as “old high price stock” is cleared out. How is this anything but exploitation by oil companies. Is this even sustainable?

Gas prices go up immediately as oil prices spike, yet when oil prices drop gas prices remain high as “old high price stock” is cleared out. How is this anything but exploitation by oil companies. Is this even sustainable?

What do you think?

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  1. It is direct exploitation, and it has far reaching consequences. A really great year for oil and gas means another rate hike from Central banks to combat inflation by removing spending power from the middle class. So not only is gas more expensive but so is everything else in a misguided and brick-fucking-stupid attempt to keep everything else from getting more expensive.

  2. There will be some lag in gas price reduction because of what you mentioned about high price stock. It takes some time to clear those reserves and companies will keep prices high for as long as they can to take advantage of higher-than-usual willingness to pay. In theory, competition between oil companies will drive prices back down relatively quick.

    An interesting question to consider is what the role of a private company is in society. Do they have an obligation to lower prices out of the goodness of their collective corporate hearts? I’d argue that they don’t. Government, competition, and consumers should make it financially impossible for them to keep high prices (or engage in other undesirable behaviors). Relying on large money-making entities to also do social good is a losing strategy. We should structure incentives and markets in a way that align corporate interests with those of society more broadly.

  3. You sell dolls. Your dolls are incredibly popular right now because a shipment fell in to the ocean. The prices go up. You sell 20 of the 100 you were able to get at an exorbitant price. Then it turns out the shipment was actually just a shipping error and was really just parked on the dock. Now you get the 100 for half that price. Do you just eat the cost and sell the now 180 dolls at the lowered price and possibly not break even or do you recoup the cost of the original higher priced shipment and ensure you will make at least some money?

    I know what I’m doing. I got bills to pay.

  4. My economics theory says that as the cost of the inputs go up – the cost of the actual technology used to develop the oil, the cost to ship and insure it, the cost of labour, the cost of parts and maintenance, and the supply goes down – the cost of the finished good goes up.

    My Great Reset Tin Foil Hat says that high oil prices hasten the shift to electric vehicles, which handily side-steps the ‘freedom of movement’ right most democracies have. Sure, you’re free to move around, but only within the range allowed by the batteries. And I hope you have the time it takes to recharge it baked into your travel plans. And that’s assuming the grid has capacity to charge your vehicle on-demand, and hasn’t been throttled or rationed because of the unstable nature of renewable technology. And whatever the electricity costs to keep up the decentralized grid with all the turbines and solar panels that need to be maintained. Good luck fleeing the big city to somewhere in the middle of nowhere (where the government has less control over you) if you can’t actually drive your car and stuff there.

  5. It’s exactly exploitation, and even more reason we need to go green, or at least nuclear powered.

    If the government required solar panels on top of shopping centers, walmarts, malls, etc., we’d make more power than we could use. Then, in the future we can put them over parking lots for shade and rain protection.

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