Dropping Gas Prices

[Gelsemium]

This was explained to me once, so I will try here. The gas we buy at our local corner store we pay the price for that gas that is already in the tanks at the station at the price the vendor paid per gallon plus a few cents extra for profit. Truth be told the people who own the Sunoco or BP stations don't make a lot of money like their parent companies (Sunoco and BP) - they make more money on the sale of concessions (beer, pop, pizza, etc.)

When the price of gas falls it's because when the new shipment comes in you'll pay the lower price because that gas was at a lower price when refined. Eventually it evens out when the price of oil starts to go up - there will be short (very short) leveling period and you'll price begin to rise (sometimes as high as 5 to 10 cents per day)!

It's usually cyclical - gas prices tend to drop in the winter and rise in the summer (at least in the U.S.) that is NOT always the trend, but if you look at it historically, that is USUALLY how it works - sometimes you will see spikes in the winter months but usually this time of year you'll see gas prices come back down a bit.

What you have hopefully noticed over time is that gas prices have NEVER returned to their all time lows - the low gets progressively higher each year to prepare consumers. Can anyone remember gas at $.99 a gallon or cheaper? I can - those days (at least in New York) are long gone!

Pretty much, good post here! The fact is that they raise the price let's say 10, than they lower it, and after that they raise it 10 again and so on and on. Scam? Fishy? No, it's the government. LOL.

 

[Charity]

I do not know if this was mentioned before or not, but I seen that a lot of the politicians were making outlandish claims that if the price of gas stayed low it would cause the economy to collapse. I know where I live the price of gas is back up by 30 cents what it was Monday. However, when it was lower I seen quite a few people buying items from the store that they normally would not buy.

 

[missbishi]

Are the prices not going up because of the holiday season? I don't know how it is in the US but since food prices always go up here during the December holiday, I figured it might have been a reason for there too.

Here in my country, the dropping prices of gas has resulted in the lowered fare for the jeepneys, which is one of the most commonly used means of transportation here. It went from Php 8.00 to Php 7.50 so a drop by 6.25%. I haven't checked the current market prices but it was up during the last week of December in preparation for the NYE rush. There are also talks about lowering the fares of buses and taxis because of the gas price.

That would never happen here in England, Rising public transport costs are always blamed on fuel price increases. However, the prices are never lowered when there's a drop. I think it's great that the jeepney fare has gone down, this will encourage people to keep on using them.

 

[ClassyTulip]

With the price of gas finally dropping down to $50 a barrel, how is this effecting the worlds economy. I have been looking around and seeing the dropping gas prices but that is all that is dropping. The price of food (which is effected by the price of gas) is going up and not down, this means people are forced to pay more out to feed their families. This in turn means they have less to save to purchase other items such as cars, houses, etc... which greatly feed into the economy. I understand that we had a drought that made food production hard and as a result the prices would increase due to that, but the price over exceeds the amount of markup it should be for this reason. Stores are keeping the prices high as if the gas prices are still high. What are your thoughts on this?

Oh and here is a link to an article I read about the dropping price of oil.

Crude Oil Dips Under $50 A Barrel, A Price Last Seen In 2009

The lastest prices of gas has influenced the economy, in my opinion, in the south. I've experienced a gallon of milk price from six dollars to four dollars, since gas prices fell, at my local Wal-mart. I think that once the gas prices fall to a steady rate, over time, we'll see more decrease in goods and merchandises.

 

[Nur]

That would never happen here in England, Rising public transport costs are always blamed on fuel price increases. However, the prices are never lowered when there's a drop.

For the record, it DID take a long time for the fare to lower too. But since the prices for oil have been fluctuating so much, I guess that might be why it was only lowered now when there's a significant and consistent drop in the prices.

The electricity has also gone down some because of the dropping oil price. I hadn't been aware that it's been going down monthly (marginally! But still going down) for three months now but the recent report from the company providing electricity to the Metro Manila area (the largest city here in my country) has stated that the drop in prices for oil and coal was the reason why.

 

[KimberlyD]

The lastest prices of gas has influenced the economy, in my opinion, in the south. I've experienced a gallon of milk price from six dollars to four dollars, since gas prices fell, at my local Wal-mart. I think that once the gas prices fall to a steady rate, over time, we'll see more decrease in goods and merchandises.

Here in the Mid-West and West coast, there has been little or no change in food prices since gas began dropping. Everything in the South is always cheaper. I'm originally a Georgia Peach and I remember when I first left 7 years ago, I could get gas for .89 a gallon. I get to California and it almost 4.00 a gallon. Major difference. But maybe your right and the effect just hasn't hit yet. I guess I should just be patient and see what happens.

 

[Peninha]

It makes sense that the prices in other goods drop too because transportation is also cheaper, but those prices might take a will to drop, no one is in a rush to do it.

 

[InspiredToWrite]

I agree that the price of oil has a ripple effect across all other sectors of the world economy. Here in the U.K. the price of unleaded petrol has fallen from 126p to 105p since September 2014. (This is price per litre.) This is good news to the everyman at the gas pump but also for all the haulage and manufacturing companies that exist here.

 

[Onionman]

I think people should enjoy it will it lasts but not adjust to what is an effective tax cut too much. A lot of people will be more tempted to buy gas guzzlers. But in a year's time we may be in a situation of a rebound in oil prices (who knows, but it is possible) and a rising US interest rate environment. That could be a double whammy on anyone's pocket. So people should be grateful for what's happening at the moment but they should keep an eye on changing conditions.

 

[KimberlyD]

It makes sense that the prices in other goods drop too because transportation is also cheaper, but those prices might take a will to drop, no one is in a rush to do it.

Of course they are in no rush. They want to make as much "extra" money as they can. The longer they keep the prices high the more money they get.

A lot of people will be more tempted to buy gas guzzlers.

Not me. I fully intend to get an electric car. Possibly a Tesla. The crazy rise and fall of the gas prices is giving me whiplash. I want something I can rely on to stay constant. Besides, an electric car would cost me nothing in fuel. My property is to far from any power source and it would cost me almost $20,000 to get it... so we are doing all wind and solar energy. So I wont have to pay for the fuel unless I travel out of town or state.

 

[cyberpinoy]

That is the deal here, everything turns around money, it's just business and people's needs are not considered, what it matters is that the ones with power are making money...

you are right here. The people making the money keep taking it from the ones earning the money. You can never avoid this, What is fair to one person is unfair to another. But one thing is for sure, these large corporations and energy companies always win.

 

[weepforsweep]

Russia is taking a hit since there economy heavily relies on oil sales. In America, it is giving the average citizen a little more pocket change.

 

[kittyworker]

In New Zealand this is VERY good news for us. We are very much an export driven economy. We rely on our exports performing well overseas and also we import the majority of our products into New Zealand. Being a bit isolated petrol(gas) is usually the same price here per L as it would be for the same grade per Galleon in the US. I am now hoping that these savings are past onto the consumers, through discounted bus/plane fares and the cost of food going down (one of the reasons they used when it was increasing was rising oil prices). Time will tell though.

 

[Peninha]

you are right here. The people making the money keep taking it from the ones earning the money. You can never avoid this, What is fair to one person is unfair to another. But one thing is for sure, these large corporations and energy companies always win.

Yep, we are just numbers to them and as long as the money keeps rolling in the price fluctuation and wars will keep happening. The model for our society is not working correctly, people are not first.

 

[003]

Such a significant change? But with the drop in gas, can we expect drop also of prices of other products consumed as frequently as the the gas? And how about the passenger's fee? There must be also a decrease in it, to favour the commuters, and not just those who drive their car and those transportation company. But anyway, this is really a good new to hear. Let's just hope that it continues long.