The price of gas dropped another five cents this morning

[Prisoner_Number_Six]

I now see Regular priced locally at $2.49, and Premium at $2.75. I'm extremely concerned at how many fence-sitters this will draw over to the dark side. Time is running out, and this is one hell of a powerful weapon on their side.

[gmoney]

1. I'll be 75 cents a gallon by election day...

Then, November 8, zoom! $3.50

[yourout]

3. You can bet there will be a November supise from Bushco.

Right after the elections something will happen with either Iran or Syria.

[Bonhomme Richard]

10. LOL, Not if the Dems win.

When that happens the oil companies will be running for cover and writing checks to the DNC.

[Skidmore]

2. Oil men buying votes. Disgusting to behold.

[PurpleChez]

6. I just hope that this is obvious to other folks

and that they are repulsed also. It was very recently that I read something from 'the industry' that we shouldn't expect prices below $3 for a very, very long time. And then -- Surprise! -- Dim Son's numbers tank and the price drops a dime a day. Hmmmmm

[bamacrat]

4. And its so obvious, and people are stupid enough to fall for it

[tulsakatz]

5. at first, I couldn't figure out why this is happening........

...and then it hit me, the election!! That's why they're lowering prices.

About 3 weeks ago, gas in Oklahoma was about $2.90 and it's been going down a few cents each day. Yesterday I bought gas for $2.45.........

[napi21]

7. I can tell you, I talked to another Dem a few days ago, and HE

brought up the fact that he was filling hiscar for under $30! Said he couldn't believe it! Then he said"Gee can ya tell there's an election coming up?

I agreed. This is proofthe admin. is in the pocket of the oil companies, and they are willing to sacrifice a bit of their greed to help out the Shrub & his Party!

[n2doc]

8. Still 2.70 in Georgia

It has only dropped about 25 cents here. I still wonder about people who think over 2 buck a gallon gas is "great", though....

[Missy M]

9. It is very maddening that the 'powers that be' manipulate the....

gas prices the way they do. They are playing with our pocketbooks and they don't give a damn. The oil companies and Bush administration are doing this to us for votes and it is criminal. Why can't Americans wake up and stop supporting that criminal in the White House.

[ktowntennesseedem]

11. Another gulf hurricane would prove interesting.

God forbid we ever have another Katrina, but it is inevitable that someday another hurricane will manage to get into the gulf and wreak havoc on oil production again. If another Katrina-like storm disrupted supplies of oil in the gulf again, one would expect a similar spike in prices to follow as it did last year. But I bet prices won't budge at all this time around. Which would only prove, at least to anyone with any functioning brain-cells, that the political machinery running the country is also running the show for Big Oil, and that last year's price spikes were not really necessary.

Too bad for the victims of last year's fiasco. They would have had a much better chance of escape and survival and a much quicker recovery had Katrina hit during an election year.

[happyslug]

12. This was discussed yesterday

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=364x2031161
My comment on why was as follows:

Traditionally Gas prices peak around Memorial day, and then decline slowly all summer long. The reason for this is in April the refiners switch from making fuel oil to making gasoline, but Gasoline is generally in short supply as people drive more do to the warmer weather till about Memorial day. Gasoline is produced all summer then about September the makers switch back to making Fuel oil for the coming winter.

Now, Gasoline and Fuel oil is produced at the same time in the same process, but the refiners can switch, to a degree only, between the two. The key is WHAT is the primary AIM of the production, Gasoline or Fuel oil? You always produce BOTH, but which one do hyou want MORE of out of a barrel of oil? In winter it is Fuel oil, in Summer Gasoline. Given the different demands, you always have a surplus of one or the other during the time period just before the changeover.

Thus we are at the time of the year when Gasoline should be at its LOWEST price. People vacation plans are done and people will be driving less than in the Summer Months, but production of Fuel Oil has not yet begun. This is complicated by the effect of HIGH PRICES. One of the affects is people driving less (or otherwise using LESS Gasoline). Thus you had people who canceled trips do to high Gasoline prices, people who bicycled to work do to high gasoline prices, and even people who took Mass transit do to high Gasoline prices (and people who traded in low mileage cars for high Mileage cars). All of these groups would be buying less gasoline causing a drop in demand and with less demand for Gasoline comes downward pressure as to prices.

BOTH of the above (i.e. excessive stocks do to 1. production in favor of Gasoline over fuel oil and 2. drop in demand do to people using less gasoline) may explain the dropping prices of Gasoline. Oil prices, by the Barrel, is still staying above $70 a Barrel, the price it has been for months. My guess is that the oil Companies produced to much Gasoline during the Summer (Do to a drop in DEMAND do to the high price of Gasoline) and the refiners now are pushing gasoline onto any retailer who wants it (More to free holding tanks for Fuel oil that is being made now for use this winter).

The above is enough to explain the drop in Gasoline prices. Now it is possible that someone in the Government is selling gasoline to keep the price low, that would ADD to the pressure for the price to drop, but the Government emergency fuel reserve is NOT refined oil (Through some is gasoline, Diesel Fuel and Fuel oil), but mostly unrefined oil. Thus selling the oil reserve would reduce oil prices generally, not just gasoline (and the present drop seems to be lead by Gasoline, not general drop in the price for oil products). Is it possible that the price of Gasoline being manipulated for the election? yes, but unlikely, seems more to do with more normal causation.

[Prisoner_Number_Six]

13. It's not "declining". It's PLUMMETING.

There's a BIG difference.

[happyslug]

15. No, it is declining

Plummeting would be a drop of $1 or more, which I do NOT see happening. The oil refineries area about to switch their primary focus of production to fuel oil instead of gasoline. When that happens Gasoline prices will stabilizes.

One fact that has held constant in previous oil prices ups and downs, it takes about 4 weeks for a price INCREASE at the well held to hit the pump, but eight weeks for a Decrease in Well Head prices to hit the pump (This is an example of the economic Concept of Price stickiness, most people do NOT want to take a lost thus they raise prices to match what they think they will have to pay, but keep prices up based on what they have paid for the oil).

I have no inside information on the oil business, but this price drop will continue till the excess gasoline stocks are gone. What caused these excess stocks is another matter, I suspect it is do to world wide drop in oil usage do to the high price of oil. I fully expect this pattern to continue well past peak. i.e. prices go up, people stop using oil. Do to drop in Demand, price of oil drops, demand increases, with increase demand, increase price and the whole trip starts all over again.

Except when you had someone or something controlling the price of oil (Standard Oil 1870-1912, Texas Railroad Commission, about 1930-1970 and Saudi Arabia from 1975 till 2005) prices go up and down radically (and do to these prices variation people can not budget, so they opt for someone who can bring price stability to the product, this is how Standard Oil developed its Monopoly, people where willing to pay a premium to Standard oil as long as the price was steady. When production and demand is expanding making such control is NOT difficult, you just control how much oil is being produced. Today's problem is NOT excess or insufficient demand, but insufficient PRODUCTION and excessive demand. Thus today's prices are DEMAND driven, not Supply Driven. In the old days, one could control price by increasing or decreasing the production of oil. Today, you can no longer do that, you have to control price through the control of demand. Right now, under traditional rules, Demand for Gasoline is its lowest in months (Do to the end of the Summer Vacation Season). Thus demand is dropping. Furthermore you have people, world wide, you can NOT afford to pay $3 a gallon for gasoline, which has also destroyed demand. These two pressures are enough o cause the price of Gasoline to drop starting about mid-August when the South started School and this week when most northern Schools start School.

In previous posts I suggested that $3 a gallon seems to be the tipping point for gasoline all summer long. Enough people were refusing to pay $3 plus per gallon for gasoline to keep the price steady all summer long. If the price went up, people stop buying gasoline, if the price went down people went back to using gasoline. You had a rough equilibrium. Now, with additional downward pressure of the end of the Summer Driving Season you are seeing the price of Gasoline drop. I suspect it will drop till October, when people start to buy their fuel oil for next winter. I do not suspect the price to go up, but I do expect it to stabilize and if we have a cold winter for the price of both Fuel Oil and gasoline to go up (I also expect the price to go up if Iran is attacked or someone attacks the Saudi's oil exporting terminals).

Thus I see this as a temporary drop in prices, and I suspect to see a lot more of these drops as the overall price keeps going up (do to drop in Demand do to high gasoline prices). Furthermore I do NOT put much faith in this drop in price. It is temporary (i.e. may last a few months but the upward drive of price will resume by mid-winter).

[TheCowsCameHome]

14. Over $3 where I live. (Still tourists here to gouge)

When they leave we get gouged anyway, but not quite as much.

[aquaman]

16. I just paid 2.32 a gallon......

Near Columbia, SC.

[SoCalDem]

17. I predict...

that gas will level off at $2.00 a gallon and there will be dancing in the streets because the sheep will all had forgotten all those years when oil companies made nice profits on $1-1.50 gas...
The increased prices on everything we consume will stay at their elevated prices since we have already accepted them, and all will be well in Oil-Tycoon-land....

This is what it was all about folks... getting us to be happy with $2 gas..

UP to $2 and we were pissed off....but DOWN to $2 and we are happy as clams :puke:

[mykpart]

18. I won't be impressed until it drops below $2 a gallon!