see this shows the evil of trying to control the price system. If we just let the price go to where it hould naturally be there would be enough fuel available for everyone. Please see this article by a phd professor for a better explaination of this.
http://www.econlib.org/library/Columns/y2007/Mungergouging.html

"All refineries shut down by Hurricane Gustav are either restarting or operating. The last remaining refinery shut down by Hurricane Gustav – ConocoPhillips Belle Chasse – had power restored on September 11, and has entered restart procedures." DOE Energy Assurance Daily 9/12

The Department of Energy’s Kevin Kolevar said that Hurricane Ike will likely cause fuel supply constraints but added that impacts would likely be limited to the Gulf Coast and Eastern Seaboard.

U.S. West Texas Intermediate Crude Prices:
Today: $101.19
One week ago: $106.18
One year ago: $ 79.91

JW:

There is no such thing as natural fossil fuel price. It is 100% arbitrary fixed by very few people.

Yesterday, I paid $USD 4.63/US gal at the local PetroCanada station for regular gas while the price was $5.38 USD at another PetroCanada station about 10 miles away. Total, they are both at $5.46 USD/US gal. This is what we paid when the barrel was at $148 US instead of $100 US today.

Can you figure it out?

They only way to bring fuel price down is with a worldwide switch to electrified vehicles.

Yes I can. The retail oil business in an oligopoly. With limited competition there will be prices above market equilibrium creating an economic profit for the companies. They have learned that a market pricing system such as the situation you experienced will maximize profits. They are following their own best interest and in turn the best interest of society. This is a less then optimum state of competition in the study of economics however. With increased substitutes available the economic profit of an oligopolistic company will be reduced and will make the market price closer equilibrium. You are correct that electric powered vehicle will be part of the solution to the transportation issue, however the electricity must be produced by some source. In the US most of that is by coal and nuclear. The ability to ramp up “green sources” is hindered by the supply of inputs leading to a shortage and increased prices making them inefficient on any massive scale at this time. Complete electrification of the vehicle fleet will lead to the same pricing issues that we have now with liquid hydrocarbons. There must be a mix with inferior goods available to make liquid hydrocarbons more responsive to market pressures.

Get rid of the ethanol tarrif of 54 c/gallon.

Allow gas to be up to E25, like Brasil.

Drive 55!

Shut down at redlights.

A/C OFF!!! / Windows down to 55mph

Get rid of the ethanol tarrif of 54 c/gallon.

Allow gas to be up to E25, like Brasil.

Drive 55!

Shut down at redlights.

A/C OFF!!! / Windows down to 55mph

@ JW:

That was a lovely summary of the economics of oligopoly pricing.

I only disagree with one aspect: "They are following their own best interest and in turn the best interest of society." They are obviously acting to protect their interests, but the best interest of society?

In my humble opinion, the action that would be best for SOCIETY would be to drive prices so high that there would be no alternative but to adopt alternative technology.

But, from a capitalist bourgeois perspective, I suppose keeping the price low to maximize the consumption of the unnatural surplus is what is best.

Also: "Complete electrification of the vehicle fleet will lead to the same pricing issues that we have now with liquid hydrocarbons."

Not necessarily, as it is difficult for your average American driver to drill and process his/her own gasoline or diesel fuel, anyone can legally own and operate a small wind turbine or a photovoltaic array. In this way, rather than reverting to an oligopoly, we may be able to convert to a distributed generation scenario.

Bike Commuter Dude:

JW's example does a fine job of pointing to exploitation in a market under duress (post cataclysm). There is a very good reason for price controls under certain circumstances - a post hurricane urban center is not a real market at all - merely a triage area. People under duress should not be exploited, period.

As for raising prices on oil to push people into alternatives - first it is flawed psychology. Forcing people to behavioral change is a prescr*ption for failure. As we have seen the virtual rise in oil price has solidified the *drill now* community. Heretofore frozen offshore and sensitive parkland areas are under threat. As cartels see western drilling increase, the oil price keeps going down - now $100/bbl.

Your comment regarding distributed generation is right on correct. That is precisely the direction we must go in. Not only because the technology to do so is waiting in the wings (it is) - but because Residential Power Units supported by local area grids - is a model to be applied the world over. It releases us from centralized oligopoly, greatly strengthens security, and grows an enormous new market for energy systems. Distributed generation as you call it - is a solid direction forward.

NOTE to Mike: "prescripti*n" is a banned word????

Think about how many spams have that word.

As it is there is a very sketchy return on the investment of a micro turbine or PV cell. If you suddenly create a MASSIVE demand what will happen to the price and in turn the return on investment? As to the price controls, we have seen what that does. Mr. Nixon tried that. In emergency situations the use of price controls/antigouging laws creates shortages that could be avoided if the price system was allowed to work. If ice is 8 bucks a bag you will only get just enough to take care of the very important things. At 1.25 a bag you grab as many as you can for drinks and just to have extra. This creates a shortage and people who need the ice such as a person with insulin that must be kept cold may do without because we think we should have price controls to protect people. The same goes for fuel. At 4 bucks a gallon you fill up your cars and as many gas cans as you can, at a high price you conserve allowing more people to have access to a product that is in short supply. Mike Munger a PhD professor has a great paper explaining this at this link
http://www.econlib.org/library/Columns/y2007/Mungergouging.html

What am I missing? Continuation of what shortage?
Gas prices in Arizona have dropped to $3.40/gal.
However, I think JW is basically correct.
Too many people assume supernatural evil entities control their lives, when it is just natural financial forces.
There are many profiteers out there, like people who bought a house in 1990 and sold it for twice their cost in 2002, shameful.
My kids stopped saying "someone stole my pencil" (when they simply lost it) at about age 6.
My wife wants an Expedition, partly because she wants to fit many sons, daughters and grand kids on trips.
She also claims this will help save the planet by driving gas prices so high that there will be no alternative but to adopt alternative technology.
SUVs are GREEN.

my kid stopped sayin they stole my bike, when we put the thief behind bars...

SUV's are green if all seats are filled, you are correct. When vehicles are used at design capacity, they in fact have a lower seat cost per mile. Ask the airlines about this, that is why the new giant superjumbo is cheaper to operate than a 747.

Now, on the flipside, if Joe Q.Public buys an expedidtion to drive back and forth to work, himself, alone not filling the other seats, than this is waste.

I drive a 34 mpg 2008 model "green" vehicle because my commute is 80 miles round trip.

SUV's do have their place, if used as designed.

Me