SBJ.net Poll

Who or what do you think benefits most from higher gas prices?

For poll results, click here.

What Readers Think

Oil companies

Oil companies are receiving record profits in the past three years. When you see profits rise in excess of 400 percent, it is apparent to me that someone is being legally robbed. Do the political leaders really need a full-blown investigation to understand who is getting gouged here? I think not. Maybe we need to see how much of the oil companies’ profits are being sent to line the pockets of these leaders. We see retail prices increase 20 cents to 40 cents in overnight changes that are blamed on some foreign index, yet those same prices do not decrease when the same information shows a drop in those indexes.

I can only imaging the average consumer is once again taking the brunt of these ridiculous price swings. The term “thieves” comes to mind.

–Steven F. Wise, Boeing

Other

Gas refineries have had to shut down to modify equipment to conform to government-imposed formulas. This has reduced the supply of gas, and this is a supply-and-demand market, as it should be. The commodities traders monitor these kinds of things, and their buying and selling is the most influential factor in the price of gas next to the cost of crude oil. They are the ones who benefit from the higher price – if they play the market right.

–Brad A. McKenzie, McKenzie Architectural Services PC

Ethanol producers are beneficiaries because state mandates for ethanol kick in only when gas prices are higher than ethanol blends. Two-dollar-a-gallon gas and $4 a bushel will kill the domestic ethanol industry. Most ethanol models are predicated on the “three-and-three” scenario, i.e., $3 a gallon gas and $3 a bushel corn.

Ironically, I think all of us are beneficiaries from higher gas prices because of the elasticity of demand. Higher prices equal lower demand. Lower demand equals lower imports. Higher prices also force us to consider more fuel-efficient vehicles. These market-driven forces should lead auto manufacturers to produce more fuel-efficient vehicles.

In the late 1970s and early 1980s, our government mandated better fuel economy. This increased efficiency resulted in a drop of foreign oil imports to 25 percent of total U.S. consumption. Today, with lax efficiency standards, foreign imports are well more than 60 percent of U.S. total consumption – simple economic principles at work. Serious students will recognize these as long-term benefits, both for our environment and for our national security interests, and ultimately for our economy. But we have been conditioned as consumers to focus on today’s provincial interests and not future consequences. Hopefully, we can reverse this trend.

—Scott Pogue, Agrisa LLC

The option you left off … was the people who use the gasoline and have it available due to the oil companies solving the problems of production and distribution. It is not the oil companies who benefit most as your poll indicates but the consumers who would be living in the horse-and-buggy days without a fully supplied gas station on the corner. If there was less worry about whether or not someone else is making money and more concern with the overspending politicians who regulate and spend what they cannot earn and/or supply, this country would have a more accurate recognition of where to place priorities.

–Dale Netherton, Martin’s NP Consulting

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