Friday, March 25, 2016

Oil companies determined to push up gas prices


There is little question that the Big Oil companies have taken the low prices of gasoline very personally and will do all they can to raise those prices. The jawboning part has begun as their many spokesweasels have spread out to all the media to tell everybody the prices are coming, the prices are coming!
Prices at the pump are climbing quickly as oil prices firm and the summer driving season approaches. On Thursday, the national average for a gallon of regular gasoline rose above $2 a gallon for the first time since Dec. 31 — albeit by only a penny.

Across the country, according to the AAA motor club, drivers are paying 31 cents more per gallon than only a month ago.

The principal reason for the rise in gasoline prices is the roughly 50 percent spike in the American oil benchmark from $26 a barrel on Feb. 11 to just over $40 a barrel before crude prices sputtered in the last couple of days.

But there are a variety of other factors pushing gasoline prices up, particularly on the West Coast. A recent power outage at Exxon Mobil’s refinery in Torrance, Calif., a plant that has still not fully recovered from an explosion early last year, has slowed gasoline production. Californians are paying an average of $2.73 a gallon for regular gas, according to AAA, 72 cents higher than the national average and 42 cents more than they were paying a month ago.

Much of the recent price rise is from changes in seasonal driving habits, including spring break road trips. At the same time, many refineries are retooling to produce summer blends, which leads to a temporary decline in local fuel production.
All the usual reasons for jacking up the price, but in the end it all comes down to how much the Saudis are pumping and how much are we using. Pay attention to those numbers and ignore all the talk-talk.

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