Post 625: supply and demand

Those who support laissezfaire capitalism probably don’t realize that’s what’s behind the price of energy, a market driven by the forces of supply and demand, essentially unregulated, though heavily taxed.

The dramatic change in the cost of a gallon of gasoline in my area (Western Nebraska-South Dakota Black Hills) between last July, when I actually made some trips out of town, to December, when I pretty much limited my trips to around town, can be seen in this table:


Days before the per gallon cost of gasoline dropped to the low in the orange section above, I actually thought I was making out like a bandit paying 30¢ a gallon more, or, rounded, $2.30 a gallon.

So dramatic was the change in those few days that I had to go around the block to verify I actually saw gasoline priced at slightly less than $2.00 a gallon for regular unleaded, a price so low I can’t recall when I last pay that little. Then, driving across town, I noticed three independent stations were charging even less than that by  5¢ a gallon!

I rarely drive more than 3000 miles a year (4828 km), so the cost of gasoline is a minor consideration for me. I refill the tank every month to six weeks, and pay whatever the market demands. In high months like July, I am grateful I don’t have a truck with two tanks to fill.

Though I drive a full-sized car, it actually gets 32 mpg on the highway, and a bit more than 23 mpg in combined driving. My first car, a 1970 VW Beetle, got pretty much the same mpg!

What are you paying for gasoline these days? For those who blamed high energy costs on President Obama, I hope you now give him 100% of the credit for the low costs, though only very ignorant people think he has a damn thing to do with either. It’s all about laissezfaire capitalism, supply and demand driven economics.