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Gas has jumped about 25 cents here in KC... A station I pass on the way to work was 2.29 a gallon when I filled up last week, and it was 2.55 this morning. Luckily I have over half a tank left, or not? I wonder if it'll continue rising?
No changes here this week in the Seattle area. I paid $3.49 for premium last week and this week it's still $3.49 ($3.29 for regular). I do expect that there will be an increase in the next few weeks, though.
There is almost no gas in the DFW area. Most of the stations around here (McKinney, TX) are completely out. The ones that aren't have raised prices drastically in an effort to curb demand. I have passed gas stations with lines around the station and down the block to the next light. One RaceTrac had a line that was half a mile long, and the price? $5.89 a gallon for regular. That isnt the norm though, most of the stations are under $3. I filled all 3 of our cars and 3-5 gallon cans yesterday, when gas was still $2.18 for regular. Of course the Lexus got the premium treatment at $2.58.
Not wishing to be sarcastic here, but can someone please explain what is "price gouging" and how is it different from pricing based on the law of supply and demand.
Suppose I have a gas station. Normally I sell my product based on my costs plus a slight margin for profit. Suddenly gas is very hard to come by. Do I continue with the usual price and run out quickly, or do I raise the price so that customers know I will always have some, but it will cost considerably more? What if I shop around and find I can buy a tanker of gasoline but at a price 3x before the shortage. Am I allowed to pass my costs on to my customers?
There are numerous examples of the absurdity of price controls. Look at Nixon and gasoline back in 1973 (74? Can't recall). We assist the Israelis in their fight against some Muslim countries and the Saudis retaliate by cutting off oil shipments to the US. The cost of delivered oil goes up. Refineries raise prices. Gas stations raise prices. Nixon jumps in and freezes prices. As a direct and immediate result, we have severe shortages. Even and odd days, stations completely empty, a horrible disaster of our own making.
So was the price controlling a good idea or bad idea? Without controls, gas WOULD have instead remained available, but it would have been expensive.
In any event, from what I read we have generous inventories of gasoline and the refinery situation will be affecting only 1/3 of the country, so I think the impact this time will be modest and quickly resolved.
Not wishing to be sarcastic here, but can someone please explain what is "price gouging" and how is it different from pricing based on the law of supply and demand.
Suppose I have a gas station. Normally I sell my product based on my costs plus a slight margin for profit. Suddenly gas is very hard to come by. Do I continue with the usual price and run out quickly, or do I raise the price so that customers know I will always have some, but it will cost considerably more? What if I shop around and find I can buy a tanker of gasoline but at a price 3x before the shortage. Am I allowed to pass my costs on to my customers?
There are numerous examples of the absurdity of price controls. Look at Nixon and gasoline back in 1973 (74? Can't recall). We assist the Israelis in their fight against some Muslim countries and the Saudis retaliate by cutting off oil shipments to the US. The cost of delivered oil goes up. Refineries raise prices. Gas stations raise prices. Nixon jumps in and freezes prices. As a direct and immediate result, we have severe shortages. Even and odd days, stations completely empty, a horrible disaster of our own making.
So was the price controlling a good idea or bad idea? Without controls, gas WOULD have instead remained available, but it would have been expensive.
In any event, from what I read we have generous inventories of gasoline and the refinery situation will be affecting only 1/3 of the country, so I think the impact this time will be modest and quickly resolved.
I think price gouging is a well-documented concept, but the way I see it is that it's when a seller inflates the price to a level most people would agree is unfair or exploitative. In this case, let's say gas stations or refiners crank up the price in anticipation of, but not in reaction to, an actual shortage, by 100%. That would mean gas is now about $5 per gallon. I'd say something like that would be considered price gouging.
In anticipation of a shortage, what would you do if you were the refinery general manager? Is 0 output at a conventional price a better solution than a reduced output at a higher price? Now if we find out that all the general managers get together on a massive conference call and agree to collectively goose the prices (kind of like OPEC?) then that's price fixing.
And I know that some folks think refineries in particular are rapacious bastards. Really? From what I hear that business is extremely competitive with lots of players and modest profit margins. I know, some will respond that "the refineries made a bazillion dollars last year." Right, on revenue of a bazillion bazillion dollars.
Obviously something is happening, whether it's a local shortage due to fuel hoarding or a structural issue with refineries now going offline. That means in a libertarian world the "invisible hand" of Adam Smith will magically fix it. Not so much. Even Trump and his sock puppets have intervened. Remember, these are Republicans in a Republican administration that loves free enterprise.
The Energy Department is cracking open the nation's emergency stockpile of oil reserves for the first time in five years to help ease the impact of Hurricane Harvey on gasoline prices. Energy Secretary Rick Perry on Thursday ordered the release of 1 million barrels of oil from the Strategic Petroleum Reserve, a massive government underground storage system designed to provide an emergency backup in event of oil supply disruptions.
... Thursday's ordered release will allow the Energy Department to deliver the crude oil to a Phillips 66 refinery.
Interestingly enough, we obsess over fuel but we forgot about how price gouging works in other ways. Water everywhere but not a drop to drink... so in the tradition of supply and demand we see $42.00 - $99.00 cases of water. And yet again, more government intervention threatening legal consequences for those caught gouging.
2008 was the worst. There were gas stations charging $7 a gallon but the doozie was when I was (ironically) driving over a rice field listening to the radio station that Costco & Sam's club were rationing rice. The limit was one twenty five pound bag per customer. Vietnam stopped all exports of rice, fisherman in the southern states couldn't afford to fill their boats up to go fish. This country in 08' was coming off the rails. Yet we somehow clawed our way back. Texans are a mighty tough bunch. I wish all of them a fast recovery.
Researched the above reason Best buy charged so much for a case of water. First Best Buy doesn't sell cases of water but an employee multiplied the price of ONE bottle times the number in a case to come up with a "total". A mistake.
Maybe yes, maybe no. I'd grill that manager.....
I just filled up premium yesterday @ $2.519, and on my way in to work today, $2.699 regular......last Oct., premium was $1.809
Generally any type of price control has ill effects, think about rent control in Manhattan? How long is the wait for an apartment in Stockholm? I would say in a decade, your needs would likely change, so what good is that one-bed you signed up for when you were 22, now that you're 35, married, and have one kid?
I buy milk on my way home in NJ, as it's like $1.40/gal. cheaper than where I live.....
2008 was the worst. There were gas stations charging $7 a gallon but the doozie was when I was (ironically) driving over a rice field listening to the radio station that Costco & Sam's club were rationing rice. The limit was one twenty five pound bag per customer. Vietnam stopped all exports of rice, fisherman in the southern states couldn't afford to fill their boats up to go fish. This country in 08' was coming off the rails. Yet we somehow clawed our way back. Texans are a mighty tough bunch. I wish all of them a fast recovery.
Researched the above reason Best buy charged so much for a case of water. First Best Buy doesn't sell cases of water but an employee multiplied the price of ONE bottle times the number in a case to come up with a "total". A mistake.
Maybe yes, maybe no. I'd grill that manager.....
Yeah, we had a contractor who tried to claim that, made a mistake in multiplication. Let's just say it doesn't stand up (he tripled the price of a job and then tried to say he made a mistake--doesn't pass muster with common sense). At least J LO donated $25k and bragged on Instagram, proving that society is back to normal.
Not wishing to be sarcastic here, but can someone please explain what is "price gouging" and how is it different from pricing based on the law of supply and demand.
Suppose I have a gas station. Normally I sell my product based on my costs plus a slight margin for profit. Suddenly gas is very hard to come by. Do I continue with the usual price and run out quickly, or do I raise the price so that customers know I will always have some, but it will cost considerably more? What if I shop around and find I can buy a tanker of gasoline but at a price 3x before the shortage. Am I allowed to pass my costs on to my customers?
Of course you are allowed to pass the cost on to customers...
But when the cost of gasoline was $1.89 at 10am when I drove by, and at 9pm its this when I drove back through:
I am sorry, but that is just ubsurd. There is no way the wholesale cost went up so much in that short amount of time, that the station owner had no choice but to retail at $10 a gallon.
Of course you are allowed to pass the cost on to customers...
But when the cost of gasoline was $1.89 at 10am when I drove by, and at 9pm its this when I drove back through:
I am sorry, but that is just ubsurd. There is no way the wholesale cost went up so much in that short amount of time, that the station owner had no choice but to retail at $10 a gallon.
When they ran out of gas, they change the sign to that number, or 8.88.
08-31-17, 01:59 PM
Luckily I have over half a tank left, or not? I wonder if it'll continue rising?
