Everyone who drives an automobile realizes the price of a gallon of gas has been on a steady upward trend. Prior to this upward trend gas prices were steadily going down below the $2 mark for a regular gallon of gas because there was a huge surplus of oil and gas on the world market and growing. So the oil producing countries decided to cut back production by 1.8 million barrels a day of crude oil to work off the surplus so prices for a barrel of oil and gallon of gas could increase. Their agreement expires in March 2018. The price of a gallon of regular gas in the Metro New Orleans area averages around $2.25 a gallon.
Now we read where those oil producing countries are meeting again and want to extend the cuts that expire in March to the end of 2018 to continue working off the surplus and keep the upward trend for the price of oil and gas. They will meet again soon for a final decision. PolitiDose has commented about this price fixing many times in the past and even explained why the U.S. would never achieve oil independence.
The oil and gas industry are able to have it both ways. They can over produce at high prices and then when prices begin to fall because of that over production, they meet and decide to cut that production and never really pay a price for their manipulation of the market. And for that, the American oil industry receives billions of dollars in tax breaks.
What the U.S. should be doing is following Europe and Asia's lead in developing alternate fuels for the present and future in a big way. That new industry will fuel the economy and jobs for many years to come. But Trump has other ideas, he is turning the oil industry loose to develop oil and gas in the most pristine places in the U.S. and suspending safety regulations imposed on the industry for good reasons.
So in the U.S., the merry go round continues on the price of a gallon of gasoline and barrel of oil because of manipulation. Prices at the grocery store, the malls, on line and other retail purchases stay within the norms of price fluctuations and all those outlets offer price reductions on a regular basis. Competition rules, but in the oil industry, prices are manipulated by the greedy oil companies.
It is really a sad story that our elected officials have failed to address. And to top it off, the industry is allowed to destroy the environment with impunity by their operations. Thank goodness Trump and the GOP were not in power when the BP oil explosion and spill took place in the Gulf of Mexico.
This commentary written by Joe Lorio
