The random political thoughts thread (Part Deux)

[scaeagles]

Originally Posted by Ghoulish Delight

All those numbers don't change the fact that price fixing is illegal.

Really? Price fixing is illegal?

[Ghoulish Delight]

Originally Posted by scaeagles

Really? Price fixing is illegal?

If it's done by communication and agreement between different companies, yes it's illegal.

[scaeagles]

Originally Posted by Ghoulish Delight

If it's done by communication and agreement between different companies, yes it's illegal.

(psst....I think you missed my sarcasm)

[€uroMeinke]

But politicians need to get re-elected and the public by and large doesn't understand economics, they just want free stuff.

[Nephythys]

Originally Posted by €uroMeinke

But politicians need to get re-elected and the public by and large doesn't understand economics, they just want free stuff.

amen and amen- ain't that the truth

[Gemini Cricket]

I hug my Subway T Pass joyously.

[innerSpaceman]

Forget that the price of gas goes up as soon as oil prices do, but delays going down when the contrary happens. It's bogus in the first place. The price of producing gas is not tied in any way to the current market price of oil. True gasoline price adjustments reflecting a rise in oil prices would take nearly a year to wend through the system in place.

Raising gas prices in reaction to news of oil price increases is purely a market tactic. And if it's done in colusion with other oil companies, it's a criminal market tactic.

Yes, an investigation is called for. Too bad it's the foxes always guarding the hen house.

[BarTopDancer]

How does potential action in Iran in the future effect gas prices now. The oil supply is the same. Are they calling it preventitive action or what?

[scaeagles]

Well, it's a bit more involved than that. Right now there are genuine shortages driving prices up, which always happens at this time of year. All the refineries are having to go through their summer reformulation process, and from what I've heard (no confirmation or link on this aspect) it takes 3 days to completely finish that process.

It is all speculation. It is a commodity open to speculation. The gas price is not based on the production cost of the current stocks of fuel, but the speculation on what it will cost the companies to replenish their stock that they will then sell.

It is true, however, that the companies use two different arguments. If the price of oil is increasing, they base their prices on speculation of what the oil to replace their stocks will cost them. If the price of oil is decreasing, they base their prices on produciton costs. Sucks, but not illegal.

[Ghoulish Delight]

Originally Posted by scaeagles

Sucks, but not illegal.

Unless they are communicating with each other to make those decissions.

Actually, the things that are having the biggest effect on the price of crude right now is the significant under-production in Iraq and Nigeria. If they were producing to capacity, there'd probably be about a 15-20% drop.