In the 6 weeks ending 4/15, the rate of increase of retail gasoline prices (national avg) effectively DOUBLED that of the price of spot oil prices, oil futures, or gas futures. The whole idea of demonizing “speculators” over prices at the pump is just shameful nonsense.

Ultimately, it’s easier for all beneficiaries involved to make people believe they are nothing but confused victims of mysterious forces, rather than to draw attention to any actual responsibility for the situation, or any meaningful ability to change it.

Pricing decisions are made by the seller, end of story. Look at it rationally. Input costs are only about 50% of the actual cost at the pump. If the price of oil goes up 7%, a $3.50 gallon of gas would realistically go up to $3.62, if profit per gallon were kept level, because the refining costs, distribution costs, and taxes would remain stable. Unless, of course, the seller chooses to take advantage of the situation to increase profits along with revenue.

The U.S. Congress and President are helping oil companies create a smoke screen. And most of the media, on both sides of the political divide, would rather engage in fear-mongering and rabble-rousing than make the effort to do any reporting or even pull out a calculator before disseminating this nonsense. 

Data sourced from US Energy Information Administration, 23 April 2011