Ouch, did you feel that? It was your wallet being pinched at the pump - again. Gas prices are on the rise and, according to AAA at the time of this writing, the national average is $3.64 per gallon.
One might think that Ohio would be cushioned a bit from inflated prices simply because higher prices tend to hit the coastal states first. However, the Buckeye State is on the auto club’s list of the top ten greatest weekly gas price increases averaging a bump of more than 7 cents in as many days.
As a writer and publicist, I regularly work from a home-based office, but family, professional and entrepreneurial duties require a surprising amount of driving. Since my speaking events, conference presentations and entertainment performances are often contracted up to a year in advance, there is usually no way to foresee radical changes in fuel costs several months out. And, like so many other small businesses, income depends on controlled overhead.
Regardless of the price of gas, I tend to be pretty conservative. After all, if fuel costs go up, so do my expenses and somewhere, sometime I have to pass that increase on to customers. So I do what I can to conserve fuel and save money.
I rarely drive at the new 70 mile-per-hour limit, I don’t leave my car running any more than necessary and I purchase only the amount of fuel I need rather than filling up every time I stop, unless there is a surprisingly low gas price. I guess my experience doing research in refineries back in the 1990s gives me a unique perspective.
The oil industry is all about profit - as much as possible - without regard to customer concerns simply because we have no choice. We are dependent on a product that costs millions to produce and returns billions to the manufacturer and every ounce generates profit.
In a nutshell, an oil refinery is a bit like an assembly line with various stations running 24 hours a day, 7 days a week, 365 days a year. Crude oil comes in one end traveling through miles and miles of pipeline as it’s broken down within each section of the refinery into gasoline, propane, butane, fuel oil, kerosene and so on.
At the end of the line, all that’s left is a solid carbon byproduct known as “coke.” It’s used for fuel, pencil lead, and a number of other products. Nothing gets wasted. Every ounce of the crude oil is converted into something that makes money for the producer, each of whom will offer an endless list of issues that cause consumer prices to rise ranging from production problems to political unrest.
According to Michael Greene, AAA public relations manager, the most recent price hike has been attributed to problems in Ukraine. “International geopolitical issues continue to keep global crude oil prices elevated,” he says. “Tensions remain heightened in Ukraine following Russia’s annexation of Crimea and there are concerns that sanctions imposed by Western countries might impact exports from Russia.”
Sorry, Michael. I don’t buy any of that. Excuses like this are nonsense designed to cash in on the misfortunes of people who can often scarcely afford to buy bread, much less fill the tank on their SUVs.
We are regularly patronized by the White House and Congress as they fain concern over ever increasing gas prices. But, while they have the power to do something about it, they sit by and collect the dividends from the oil companies in which most politicians - as millionaires themselves - are personally invested, Republican and Democrat alike.
Demanding government intervention, such as reduced fuel taxes or caps on gasoline prices, would be just as pointless as suggesting that the White House regulate health care costs rather than force another tax on the people. No one will listen. The oil companies are too big and too powerful.
So until something changes, each of us needs to be more responsible about how we use gasoline and keep costs down. If we spend less, then oil companies will be forced to respond with lower prices to maintain profits for shareholders. It’s simple supply and demand.
Gery L. Deer is an independent columnist and business writer based in Jamestown, Ohio. More at www.gerydeer.com.