Possible reasons behind Gas Price Hike
Dr. Satyajit Ghosh, professor of Economics at the University of Scranton has been studying the influencing factors of Gas price. He has mentioned three crucial points that are controlling the cost of Gas and oil nowadays.
1. Increasing demand of Gas from the Asian countries, like India and China.
2. The present situation of the world and what the industry anticipates about the Oils and Gas market. Obviously he pointed out the instability of Middle East here.
3. The third factor is the use of ETHANOL instead of MTBE as an additive in the oil in USA. ETHANOL is more costly, but oil refineries have been instructed to use it in place of MTBE for the sake of pollution control.
Then there are state and federal taxes. However, the economist has forecast that Gas price might go down a little once all the refineries switch over from MTBE to ETHANOL.
April 23rd, 2006 at 7:58 am
This is fairly accurate but I feel it does not cover the fact that Global warming issues are being adressed by the EPA. The EPA are setting stricter guidlines for fuel processing plant to produce cleanner burning fuels. Diesel fuels are now producing fuels with no sulfer. Which act as a lubicant in Diesel fueled vehicles. And as you read, it is causing a pandora’s box of problems on all levels.
The Ethanol plants are growing like corn…(Sorry I couldnt resist the pun) but their problem now is us… Most consumers have not yet made the switch to a Duel fuel or hybrid fuel consuming car. So, like many of us, who still drive the old cars, are now running into mechanical issues caused by the ethonal fuel. IE: low or poor flash points, Burned out and fowled plugs, clogged fuel filters, just to name a few.
Thus, in turn, raising the consumption and production level of said parts.
Look, I’m debt free for the most part. But I had to make a choice to make the switch to a more modern hybrid fuels consuming vehichle. The first car I paid for out right but the second vehichle I had to get a loan for. Now I’m back into debt but the cost I was paying in fuel for the old cars is paying for the new one!
Just thought I pitch in my 2 cents
JD
May 10th, 2006 at 7:14 am
You are right on the global warming issue Daniel. I do think global warming has rung the alarm and this is the high time to open our eyes. We should do whatever we can do to protect our soul against this problem.