After the summer peaks, it had settled down to about $1.50/gal. Diesel was about $1.25.
Today, at the cheap gas joint on the corner, it was $2.89 (diesel was the same). It was at, or near $3/g most everywhere else. Diesel, too.
Now here's a strange thing: Nothing has changed with respect to the actual, physical costs of maintaining the chain of enterprises extracting, or refining or distributing gasoline, except perhaps for them to have become cheaper for reasons of efficiency, declining wages, and advances in technology. Yet the price has almost DOUBLED, in just six years? While the actual costs of extraction and refining have declined?
True, supply has decreased marginally, with the reduction in Iraqi oil production occasioned by the violence of the ICORP and the coincident destruction and disruption inflicted on the civilian infrastructure. But Iraq, while sitting atop a considerable percentage of the world's proven/known reserves, does not now--and really never did--pump a very significant fraction of the daily or yearly production figures. And Iraq never contributred very much to US supplies, most of which come from the southern Atlantic Basin, latin America and equatorial Africa. Nigeria supplies far more of Murka's awl than does Iraq.
And demand has risen too. And the underlying price of oil is a constant, excluding spot markets, across the global economy. That's the one thing OPEC made stick, reliably, and still does.
Still...DOUBLE? The only comparable to that return on investment is California beach-front acreage, or manhattan-anything-habitable.
And, one supposes, for the pretty much the same reasons: Cuz there ain't any more of it, they're not making anymore, and what there is is going fast. so take it, and take it while you can.
Did any of this ever show up in a Jared Diamond book?
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