If you don’t like the price of gasoline, closing in on $4 a gallon in Oregon again and way beyond that point along I-5 in California, don’t buy any. That sounds like a useless thing to say. But it hits the mark.
The main reason the price of fuel jumps this time of year is that demand goes up. And this year, demand is soaring.
CNN said the other day that crude oil inventories were down by 24 million barrels since the end of May. The drop in supplies was said to be 24 percent greater than during the same period last summer. “And a tighter oil supply equals higher prices,” CNN said, stating the obvious.
The same report cited a sharp increase in summertime driving. You can see it on the interstate, which seems more packed than usual even in stretches that normally see no heavy traffic in the middle of the week. Apparently people are better off economically. Or they’ve decided that the price of fuel is not going to keep them from taking long drives.
The news lately has been full of the increase in oil production in parts of North America. If there’s all that much oil, we seem to reason, why worry about trying to conserve? We forget about other market forces, including the perennial trouble in the Near East, and the activities of traders in oil futures.
So the producers can charge almost what they want, the retailers pass the higher costs on to us, and rather than cutting out optional trips, we drive and we pay. (hh)