Thursday, May 17, 2012

The real reason gasoline is so expensive

This article was eye opening for me. I knew there were a number of reasons our gasoline was nearly $4 a gallon, and always seeming to get more expensive over the years. But I had forgotten that "[c]artels, by definition, exist to maximize the profits of their members." And OPEC members are exactly that, a cartel. For the most part, OPEC countries don't export anything of significance, other than oil. According to the linked article, every time we fill up, we are sending 35 cents per gallon to the "fund" to save the Saudi Arabian king from having unhappy citizens storm the palace -- that is, he is using the "extra" money to pay them off through billions of dollars of spending since the Arab Spring got his attention.

The only way around this is to stop using so much petroleum.  OPEC sits on 80% of the world's reserves. As long as we keep using petroleum, we will keep paying oil monarchs to stay on their thrones.

No comments:

Post a Comment