Pages

Saturday, February 25, 2012

Superficial Story on the Price of Gasoline -- ABC

A reader sent me this link early today: from ABC, disparity of gasoline prices across the US.

They say the disparity is "abnormal." That's an unusual word to describe the disparity. Although the demise of the Keystone XL has nothing to do with the current price of gasoline, one can make a demagogic jump that the "abnormal" disparity is due to the fact that Obama killed the Canadian pipeline. There's always a disparity in the price of gasoline across the US, but ABC suggests it is "abnormal" this time. I think Obama's killing of the Keystone XL will be the 800-lb gorilla in the liberal news rooms every time they want to do a story on high gasoline prices. Again, the Keystone has nothing to do with current gasoline prices, but invariably a reporter will ask if gasoline prices are so high, and oil costs so much, why did we kill the Keystone. The answer that more time was needed to study the proposal is preposterous when one notes that the Keystone has been studied for a longer period of time than it took for the US to decide to enter WWII, engage, and win that global war, both in the European theater and the Pacific theater.

The report linked above, as with all network reports, is incredibly superficial. I assume the real reason for the higher prices in California has to do with regulations requiring unique blends that are expensive to manufacture. It is also possible state taxes vary significant across the country.

If the price of gasoline continues to trend higher, I think it will become more and more difficult not to report on it, and it will become more and more difficult not to talk about Obama killing the Keystone.

The Keystone, of course, as noted, has nothing to do with the current price of oil/gasoline, but it is emblematic of the president's national energy policy which is to kill coal, slow roll the oil industry, and funnel money to his friends and former staffers on the payroll of solar companies. It is interesting that there appears to be more Obama interest in solar than in wind, when, in fact, solar has even less potential than wind, as a real source of energy for large urban areas.


Folks say that the Obama administration has no national energy policy. That is completely wrong. There is a strategic vision. Whereas some would argue that the GOP strategy is a three-point plan (drill, drill, drill), one can as easily argue that the Obama plan is also a three-point plan (kill the coal industry; slow-roll the oil industry; and, funnel money to friends in solar energy). The fracking success that led to a surfeit of natural gas and unthinkably low prices has thrown the strategy off and the administration is now caught in a difficult place to ban fracking which under "normal" circumstances would be part of "slow-rolling the oil industry" but now is problematic due to high oil and gasoline prices. Folks are able to offset their gasoline expenses with low heating bills (due to low cost natural gas, and due to a very warm winter) but that won't hold true a month from now when heating bills are no longer a budgetary issue for most Americans.

8 comments:

  1. Think they should raise the voting age for voting to 21.

    ReplyDelete
    Replies
    1. I haven't thought this through completely, so I may be off base, but I do think that paying taxes should be a requirement also.

      Delete
  2. embraceyourinnerhillbillyFebruary 25, 2012 at 3:25 PM

    We pay .412¢ per gallon in California in excise taxes.

    Here's a pdf of taxes by state.

    http://www.taxadmin.org/fta/rate/mf.pdf

    ReplyDelete
    Replies
    1. And, of course, in California there are the hidden costs associated with special formulations required by law.

      Delete
  3. I received this Canadian commentary on the cancelation of the Keystone XL pipeline. I will reserve my own political views but it does leave a lot of unanswered questions. Unfortunately this link is through a group that supports Sarah Palin but the message is still valid.

    Larne

    http://conservatives4palin.com/2012/01/video-canadian-talk-show-host-destroys-obama-over-keystone-decision.html

    ReplyDelete
    Replies
    1. Great video. I was able to find the video by itself and placed it on a stand-alone post.

      This video (the narrator's opinion) adds another dimension to the President's decision. Combined with his support for "Arab Spring" it really does lead one to ask to whom he is aligned.

      Delete
  4. Bruce-

    Here is another story with a bit more explaination on the wide differences in gas prices throughout the country. Here is link:
    http://finance.yahoo.com/news/why-gasoline-prices-different-around-175244870.html

    ReplyDelete
    Replies
    1. Great post. I believed I blog about the east coast refineries that were scheduled to shut down; I had forgotten about them. It's hard to keep track of all the moving pieces.

      But my hunch is that differential in state taxes and environmental rules (particularly in California) account for the bulk of the difference, although I could be wrong. It would be unlike CNBC (part of the NBC family) to talk about environmental rules/regulations contributing to rise in price at this time of year.

      The article notes a 40 cent/gallon rise in price. If one fills up when the Honda Civic's tank is about 3/4 empty, one puts in less than 10 gallons, I believe. Ten gallons x $0.40 works outs to $4.00 -- hardly anything for a Honda Civic driver to get excited about. In addition, most Washington bureaucrats formulating CAFE standards to not own cars, which I have blogged about before. I think that among the committee of 10 or 12 that was formulating rules had no one that actually drove their own car. That's an old story; I will never find it again.

      Delete

Note: Only a member of this blog may post a comment.