Posted: April 8th, 2011 | Author: Joe | Filed under: Economy | Tags: causes, Gas prices, libya, Obama | No Comments »
I just came across this silly article from the Washington post about 5 myths about gas prices. Here are their myths, and why I think they’re mostly silly or not really myths at all.
Fighting in Libya causes higher gas prices.
Wapo’s line:
“Libya is not a big enough global oil supplier for the battles there to have a meaningful effect on gas prices”
The truth:
It’s Libya so much as general unrest in the middle east that causes wide swings in oil prices. If too many oil producing countries fall into the wrong hands (i.e. those who don’t like the U.S.) then supply becomes limited, and the price goes up. Speculators cause this effect at the mere suspicion of a disruption in the oil supply, hence the rise in price accompanying any rise in unrest.
Tapping Strategic Petroleum Reserve is a good way to reduce gas prices.
Here, Wapo correctly calls New York Democrat Senator Chuck Schumer out on his ridiculous position on the Strategic Petroleum Reserve (SPR):
“Sen. Charles Schumer (D-N.Y.), for instance, has been calling for oil releases from the SPR for more than a decade. In a letter to President Bill Clinton in 1999, he endorsed the release of several hundred thousand barrels a day from the SPR because, according to a news release about the letter, oil prices had made a “meteoric ascent to nearly $25 per barrel.””
Schumer’s short-sighted political game illustrates the general thought behind calls to tap the Strategic Petroleum Reserve any time prices rise.
The SPR exists for cases when there is no oil available, not for times when the price is not as low as we’d like. It’s to limit or prevent effects like the gas lines of the 1970′s when the OPEC Nations began to manipulate production.
All in all, this one seems like a pretty common belief and since using the SPR to lower prices at the pump is a bad idea, it clearly falls into the realm of myth.
Oil companies produce less in the spring to make prices rise.
Production does go down in the spring, but not because of conspiracy. It’s because heating oil is chemically different from gasoline, and refineries switch production from a majority of heating oil to a majority of gasoline at the end of winter.
Again, a pretty common myth.
Obama is driving up gas prices.
This one is silly because it’s only part myth – the part they presented.
Wapo calls out Sarah Palin and Mitch McConnell for saying that the Obama Administrations policies affect oil and gas prices in a negative way for the U.S..
Wapo’s line:
“Just one problem: Even if domestic supplies were developed, American presidents couldn’t really control oil prices. “
The real problem here is that neither Palin nor McConnell accuse Obama of “controlling oil prices.” They merely state that the administration’s energy policies have a negative effect on prices. It’s true that no U.S. President can set the price of gas, but it’s also true that denying permits to drill, enacting moratoriums on current drilling activity and importing less foreign oil without increasing domestic production all contribute to less supply than demand and will cause the price to rise.
Americans can’t live without cheap gas.
This one is just plain stupid.
Wapo’s line:
“Yes, Americans love to drive, and Americans love cheap gas. But across an ocean, there’s a continent filled with people a lot like us who’ve lived with high gas prices for years. They’re called Europeans.”
Of course American can live without cheap gas, but it’s not as easy as it may be for Europeans. For starters, America is much more diverse than most European countries, geographically speaking. Public mass transit simply isn’t a reality nor is it likely to become one anytime soon for much of the country.
The other fallacy here is that Europeans pay more for gas than Americans because it somehow costs more to get the oil to them. The reason they pay high gas prices is due to taxes. Just because Europeans are willing to pay high taxes doesn’t mean Americans should.
Related Posts:
Posted: September 3rd, 2010 | Author: Joe | Filed under: Saving, spending | Tags: AdvantEdge, Gas prices, Price Chopper, Save money on gas, Sunoco | No Comments »
If you live in the Northeast, and have a Price Chopper and Sunoco nearby you might want to look into this…
It’s the Price Chopper Sunoco gas promotion, and here’s how it works.
You use your Price Chopper AdvantEdge card (free to apply for) when buying groceries at any Price Chopper store, and you get money off your gas purchase at Sunoco stations.
Here are the details.
I saved $0.60 per gallon last week!
- To qualify for a 10¢ per gallon savings on your next fill-up, you must spend $50 using your Price Chopper AdvantEdge Card at a participating Price Chopper locations.
- Only purchases made at registers where the Price Chopper AdvantEdge Card is scanned are eligible.
- Offer is valid only at select Price Chopper and Sunoco locations.
- The promotion is valid for a limited time and may end or be modified at any time without prior notice. Fuel AdvantEdge discounts expire 2 months after the last day of the month in which they’re earned. Discount totals and expiration dates will appear on your Price Chopper receipts.
- Discounts will be tracked electronically on your Price Chopper AdvantEdge card. You must use your “wallet size” AdvantEdge Card at participating Sunoco locations to redeem discounts.
click here for official Fuel AdvantEdge rules
Discounts are only good for one purchase, and expire at the end of each month, but my wife and I usually gas up the minivan at the end of the month and save quite a bit. I saved $9.33 last Monday just from the groceries we buy every month!
Unfortunately for those not in the northeast U.S., you don’t have Price Chopper stores near you, but you may be able to find similar deals. I’m sure that the program would discontinue if gas prices shot up to pre-recession levels again, but it’s a nice deal while it lasts!
Related Posts:
Posted: July 2nd, 2008 | Author: Joe | Filed under: Saving, spending | Tags: Gas, Gas prices, MyGallons, Pain at the pump, Save money on gas, Saving Money, Scam | No Comments »
Here’s an Intriguing idea: What if you could buy gasoline tomorrow, at today’s prices? Would you do it?
It’s basically a gamble that gas prices will be higher in the near future than they are today, but I’m not sure that’s much of a gamble in the current environment.
That’s what MyGallons.com is offering, but is it worth it?
How MyGallons Works.
You sign up for a MyGallons account and provide your credit card information. This is required to purchase, among other things (more on this later), your gallons of gas at today’s price.
After you’ve got a membership account, you are free to buy your gallons. You specify your home area, presumably a zip code, and they calculate the average price of regular (87 octane) gasoline for your area. That then becomes your “MyGallons Price.” This is the price at which you purchase your gallons. It’s updated constantly, so you don’t really get a discount at the time you purchase the gas, but you do if gas goes up in price between the time you purchased your gallons and the time you purchase the gas at the pump.
For example, let’s say that the price of gas in your home area today is an average $4.19 per gallon. You buy x gallons at $4.19 today. Now fast forward a few weeks and gas is now averaging $4.69 a gallon. You use your MyGallons card and pay only $4.19 a gallon, thus saving you $.50 per gallon.
Sounds great. It gets even better.
The MyGallons Card itself is really just a debit card so you can pay at the pump just like your credit card or debit card today.
When you run low, less than 15 gallons left on your card, MyGallons will automatically pre-purchase more fuel for you and bill directly to your credit card. If you don’t sign on for the auto refill feature, you can get notified when your balance runs low via email and/or text message. Sounds pretty cool, but there may be a 72 hour delay.
You can also get up to 3 cards per account, which is nice for families.
“Sounds great,” you say? “Where do I sign up?” Whoa… hold on there cowboy… now for the other side of the arrangement.
The Catch.
OK, so MyGallons offers a great way to provide a sort of pricing insurance against the meteoric rise of gas prices. But you have to ask yourself, how do they do it? How do they stay in business.
Well, for one thing they could make out on the deal if gas prices fell sharply after you purchased your gallons. This would be like you buying high, and being left holding the bag.
But chances are that the price of gasoline is not going to go into a spiraling decline any time soon, so what’s in it for them?
Remember above, when I said your credit card was:
“required to purchase, among other things (more on this later) your gallons of gas at today’s price”
Well those “other things” are fees.
The Fees.
- There’s the annual membership fee, of course! That runs $29.95 with auto-refill program; $39.95 without.
- There’s the $15 overdraft fee if you use more gas filling your tank than you had on your MyGallons card. (If you sign up for the auto-prepay, you avoid the overdraft.)
- If you choose to sign up for the auto-prepay feature (to avoid the overdraft fee), then you pay a “small” $1.95 fee every time you reload your MyGallons Card.
Is It Worth It?
You’ll have to do the math and decide for yourself, but I don’t think it is. In my example above, you’d save 50 cents per gallon. At that rate you have to have to buy an additional 60 gallons of gas in a year to break even on the membership fee.
Despite how it feels, gasoline doesn’t go up fast enough for that to work to your advantage. As it stands now the national average for regular gas has only gone up $1 since this time last year.
Having said that, I suppose if you stock piled your MyGallons card (I wasn’t able to find any limit to the amount you could purchase), and have to fill up a large tank of gas frequently enough it may work out in your advantage, but minimally.
In short, I think it sounds great and plays on the psychological effect of “sky-high gas prices”, but it’s not worth it for the average driver.
Photo by elvis santana
Technorati Tags: Gas prices, MyGallons, Saving money, Scam
Related Posts:
What others are saying