According to this USATODAY article gas prices have climbed a few cents recently. To me, thats not a bit shocking. What lies within the article is the shocker.

A USA TODAY poll conducted in mid-September found that 42% of Americans believe the price of gasoline is being manipulated by the White House to help Republicans win the Nov. 7 elections.

Now, thats just insane. Are 42% of Americans retarded or do they just not know the slightest bit about how this little thing called the economy works? Supply and Demand coupled with speculation is what effects the price. Rising usage in developing countries added to speculation that fuel supplies would not be able to meet demand, thus the price goes up. We then went ahead and ran into a little rain shower called Katrina which knocked out a fair amount of the Gulf's fuel oil manufacturing. This resulted in true lack of supply, and not speculation, thus the price of fuel rises.

This election season, the hurricane season which is nearly exactly average and half as intense as as it was predicted to be lowered speculation of the same true shortages that occurred last year. OPEC has to protect a certain price to keep the income flowing, and at the price fuel was at, alternative fuels start to look a lot cheaper. OPEC boosts output to lower the price to a level that is reasonable enough to the world to not warrant exploring alternative fuels and lowering the dependence on their product.

Historically, this period of the year has always had the cheapest fuel prices.

Another intresting part of the article...

Cutting consumption 10% would lower the price of oil to $30 a barrel, he says. That's about half Monday's price of $58.36 a barrel, down $2.39.

...so I guess all those hybrid and smart drivers aren't such a bad thing for all of us petrol heads.

Labels: cars