Recent gas prices are ridiculous. Do you agree? In 2004-2005 school years I wrote a research paper on how the prices would continue to fluctuate due to gas gouging as time moved forth. I’m finding it rather interesting how accurate some of the information is. I am also finding it interesting that at least the topics I wrote about were legit and that I truly did deserve the A that I got for that paper. Below is the paper I wrote my junior year in high school... take a peek.
First of all…what are prices that people are currently paying in their area? I live 10 minutes from Detroit, Michigan and last week gas was around $3.45-$3.47 and in my hometown (2 hours north) it was around $3.40-$3.42. This week is different, only slightly though. When I filled up my gas tank yesterday I paid $3.19 and was happy about it. How pathetic.
Moving onward with the research (remember it was written in 2004-2005):
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Think America is being taken advantage of with gas price gouging? Gas price gouging is when a large amount, as of money is being extorted, and is considered a serious crime. With gas prices quickly increasing and catching people off guard by the amount it is inflating to leaves some thinking that they are being victimized from the Oil Company robbing them of their money?
Since mid 2004, as gas prices started to increase they have been affecting many American’s quality of life. As people are unaware of the reasons why it is increasing so abruptly and questioning whether or not they are being gouged from their money. Not only do American citizens feel as if they are being short changed of extra money in their wallets because they are wasting what was once extra pocket change on gas that is needed to fuel their vehicles they use daily, but the auto industry is starting to feel the impact as well. The auto industry is starting to plummet in amount of sales with SUVs (sports utility vehicles) and bigger sized trucks. The sales of certain types of vehicles are decreasing because of the size of the gas tank and how much it costs to fill up the tank. “Consumers are now responding differently this year than they did last year when gas prices were high. They are fundamentally changing their spending,” says reporter Mark Zandi (2005). Thinking that the citizens and the auto industry companies are suffering dig deeper and look how hard the airline industry has been struck. The airlines are hit the hardest by the rising fuel costs. The United States airline industry uses about 17.8 billion gallons of jet fuel a year. A one-penny-a-gallon increase alters into one hundred and eighty million dollars annually of fuel for the industry.
The current gas price increase and gouging is not just happening in one set area over the United States; so far California is up and over $3.50 a gallon. Part of the reason why the prices are augmenting is because the United Stated is dependant on imported oil. All six presidents of the past thirty years, Democrat and Republican, have tried to break the United States off imported oil, but all have failed while trying to do so. Michigan is the worst state for the increasing prices and is currently averaging about three dollars and eight cents a gallon. Gouging is being investigated on because of when and where gas prices start to jump. Not only do the gas prices periodically and gradually increase they tend to increase when more people will be traveling the roads; which is considered gouging. Prices have been rising during certain days of the week and month, around holidays, and still plan on going up even more during the summer months when people are always expected to be traveling.
Many would assume that every American that owns a vehicle and his money in their pockets would not like the way the prices are increasing, but one citizen is actually supporting the prices not against them. “I am one of the few not complaining about the rapid rise in gasoline prices. Instead, I am celebrating it. What I have always disliked most about living in an urban area has been the air and noise pollution caused mainly by our own cars, trucks, and busses. Maybe if prices remain high it will drive the market force in the direction of a country filled with cleaner and quieter hybrid fueled cell and electric vehicles. At the very least, it may encourage many people go give fuel efficiency greater consideration when purchasing a vehicle,” explained Thaddeus J. Hejka (2000)
OPEC, Organization of Petroleum Exporting Countries, is an association of eleven nations that rely heavily on oil exports for their incomes. In 1973 OPEC stopped consulting with oil companies and decided to raise oil prices in keeping up with the rate of inflation, the rise of all prices. OPEC members produce about forty percent of the world’s oil and seventy-five percent of the world’s recoverable oil reserves. Recently with the rise in prices at the pump OPEC members are also happy with selling above the fifty-dollar mark per barrel of crude oil.
Gas prices are spreading in a wide range across the country and are also in a wide range of prices. Since this point in time two years ago crude oil has jumped in cost forty-six percent and sales of fuel efficient hybrid vehicles are also up. Analysts predict that the price of oil will go up and over sixty dollars per barrel causing gas prices to raise another twenty-five cents per gallon at the pump. “While gasoline prices should peak in May, the nationwide price for the summer should average two dollars and twenty-two cents a gallon, up thirty-seven cents from last year, and not far from this weeks two dollar and twenty-two a gallon average. When adjusted for inflation, the most expensive U.S. gasoline was in March 1981 at three dollars and twelve cents a gallon,” the EIA states (2005).
Majorities of the people all over the United States are trying to figure out different ways to save money on gas or to get the prices to start to fall again. Some people think that they could carpool or use other forms of transportation to get to their destinations. Carpooling would be a good strategy because it would limit money individuals are spending to fuel their automobiles.
Another strategy that could potentially work is for the owners of gas stations to sell gas cards. The gas cards could offer a certain amount off per gallon than the people at the pump without the cards would be able to receive. The gas cards would serve as incentives to the buyers.
The government should be investigating this situation and keeping a tight watch on everything that is taking place. They should investigate more with the oil industries gas stations to see why the prices are increasing so quickly and high. “I think there is a very strong gas right now and we are being gouged,” Langley said. “It is just not adding up and we think it merits some close scrutiny and investigation,” (2003). The government should be investigating to see if gouging is taking place and if and when it is they should be taking care of it right away because it is short changing many Americans, their living, and it is illegal.
Every plan is backed up with many pros and cons and some may start to outweigh the others over time. Benefits for carpooling with friends or family would give consumers more money that they would not feel like they had to be spending on filling their gas tanks weekly. Not only would consumers be benefiting from carpool so would the environment. The environment would be getting cleaner and quieter without as many vehicles traveling around constantly. Although the benefits would be nice if the strategy went into affect, there is also a downfall to the situation. Carpooling may seem like the thing to do, but it may not always fit conveniently with each person and their busy schedules.
Offering gas cards at gas stations would be good because the stations would be making a profit off the cards. After the word got around that consumers could be saving money on gas at the pump ore people would want to buy the cards. Although people may feel as if they are saving more money there is also cons for this plan. Some businesses may be getting more service than other stations which would result in buyers purchasing more cards from certain stations, and others would not profit as much. Another con to this gas price situation is that the airline industry is really suffering and they would not be able to save money from gas cards like the day-to-day Americans are.
If the government investigated more with the gouging prices around the United States and found problems in what was going on the prices would start to fall again because they would take care of it immediately, but if they waste time in investigating the situation and find no glitches they would most likely just be wasting more of the tax payers dollars during the investigation process.
The strategies all have potential to work because people would be appreciative to save money on gas, and stations would be profiting from selling numerous amounts of cards once the word spread that it was an effective way to save money on gasoline. Over time the people saving money would be very appreciative and maybe not even have a problem with a slight raise in gas prices in the years to come because they would be carpooling and would not have to spend money as often on gas.
Some of the reasons that the strategies were thought about so much is mainly because every one-dollar increase in crude oil translates to another 2.4 cents per gallon at the pump, and prices do not plan on decreasing anytime soon. “A combination of higher crude cost, season’s fluctuations, and low fuel inventories are the reason for the recent leap in gas prices,” states Verne Kopytoff (2003). As a result from the gas prices climbing individuals are realizing that they are limited money for other things: events, activities, bills, personal expenses…etc. The auto industry is also suffering and industries are compiling ideas of ways to decrease the prices, save money, make everyone happy, and benefit from the final outcome.
If the strategies are tried consumers will be saving and benefiting from a decrease in money spent on gas giving them spare money back for desirable activities. Gas stations will be profiting from the amount of cards sold, the environment would be quieter and cleaner, and maybe even possible that the auto industry will start to even out again. In result to everything that has been happening with gas prices every consumer hopes that the prices may tend to fall back down sometime soon.
Without a doubt the American people are recently and surprisingly stuck with the change and increase of gas prices at the pump. Many unsure and curious citizens are unaware if they are even being gouged or why the prices are increasing. Little do many know that gouging, or when a large amount as of money, is being extorted, is highly illegal and unjust. Do you think America is being gouged from gas prices at the pump? Many would like to find out the truth. Find out now before it is too late and before prices hit a new record high. ”
My boyfriend goes to a different university than I and told me a story how just a week or two ago his professor was speaking of the high gas prices and asked a question, “How high does gas have to get PER GALLON in order for you to reconsider your driving habits?”
At his surprise a girl was the first to shout out an answer, but what was her answer…?? Something reasonable perhaps? No, not even close. She said when gas hits $7 A GALLON then she would finally reconsider her driving habits. People have already begun to reconsider long time ago.
Another interesting side note. My roommate is from Saudi Arabia and was taken aback when I told her at most it has cost me to fill my tank before was around $48. She couldn’t figure out why we pay so much. Yeah, it’s obvious that where she is from has a large abundance of oil, but she said AT MOST to fuel a car it costs them $8. Could you imagine? BUUTTTT on a downside she said they also pay more for water than they do for gas so I guess we have them beat there.
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