You misunderstood. What I meant was there is a lower bound on price. IE a price it cannot drop below or the whole process won’t be economical.
Essentially meaning there is only 1 limit on the price of oil and gas. That being a price it cannot drop below unless the company is willing to operate at a loss for a prolonged period. The price on Gas and Energy however has never gotten near that lower limit in decades.
The Price remains skyhigh in part because of the speculative nature of the pricing model. And in part because they know they can get away with price gouging. People complain but they still fork over cash. Because American Cities and Society by and large is built around privately owned personal cars. Public transport is limited to non-existent in significant parts of the country. And where it does exist. It can be of dubious quality and run on inconsistent schedules. So it’s not like you can vote with your wallet and protest gas prices by taking a Bus or Train to get where you’re going. If you can’t guarantee the transport will get you there on time. Or be safe to use.
That and the entire objective of a Business in Modern America is to hopefully make piles of money. Not break even or only make a little profit. So there’s no reason why a Company would price their products to only break even or only come out a little ahead in their business model.
The TLDR: The Price is high because of the speculative nature of the Business Model. American Corporate Culture as a whole considers Greed and Avarice admirable.That and the Companies are well aware they can get away with being greedy because everyone needs gas and energy. In part because there is no truly viable alternative anymore to privately owned personal vehicles based off how we have decided to structure our towns, cities and broader society. Making it near impossible to vote with your wallet at the pump as you still need to commute and do any multitude of chores and other things that require driving.
Gas is priced speculatively.
There’s a lower bound on price. Where the oil/Energy companies are essentially breaking even. Maybe coming out a little ahead. But not by much.
But there is no upper bound on price. Essentially they’re just tossing a dart at a board and saying it’s the new price.
They justify with rhetoric about threats and global factors. It’s mostly noise to justify the arbitrary price points they decide on.
If they're barely breaking even or slightly above, why are they registering record profits year after year for the last 25+ yrs?
Is it because of the speculators?
You misunderstood. What I meant was there is a lower bound on price. IE a price it cannot drop below or the whole process won’t be economical.
Essentially meaning there is only 1 limit on the price of oil and gas. That being a price it cannot drop below unless the company is willing to operate at a loss for a prolonged period. The price on Gas and Energy however has never gotten near that lower limit in decades.
The Price remains skyhigh in part because of the speculative nature of the pricing model. And in part because they know they can get away with price gouging. People complain but they still fork over cash. Because American Cities and Society by and large is built around privately owned personal cars. Public transport is limited to non-existent in significant parts of the country. And where it does exist. It can be of dubious quality and run on inconsistent schedules. So it’s not like you can vote with your wallet and protest gas prices by taking a Bus or Train to get where you’re going. If you can’t guarantee the transport will get you there on time. Or be safe to use.
That and the entire objective of a Business in Modern America is to hopefully make piles of money. Not break even or only make a little profit. So there’s no reason why a Company would price their products to only break even or only come out a little ahead in their business model.
The TLDR: The Price is high because of the speculative nature of the Business Model. American Corporate Culture as a whole considers Greed and Avarice admirable.That and the Companies are well aware they can get away with being greedy because everyone needs gas and energy. In part because there is no truly viable alternative anymore to privately owned personal vehicles based off how we have decided to structure our towns, cities and broader society. Making it near impossible to vote with your wallet at the pump as you still need to commute and do any multitude of chores and other things that require driving.