Why oil prices are dropping this summer

The Hill ^ | 06/08/19 | Ellen R. Wald

[Milton Miteybad]

We drill so much that gas should be a dollar a gallon. I don’t understand why we get screwed in this country. Even with federal and state taxes, it should be half at least.

At $1.00 per gallon, you would have no gasoline at all, because that price is so far below today's cost of production that nobody would bother making any available. In fact, at $1.00 per gallon, it would probably be cheaper for gas retailers to just rig the gas pumps to dispense dollar bills.

The reason? Inflation. You're buying gas today with comically depreciated dollars. The dollar would have to increase its purchasing power by roughly threefold in order to justify pricing gasoline at $1.00 per gallon.

I don't see anything like that happening at all.

[ChildOfThe60s]

Rough calculations, but pretty close.

When I was buying gas for 35¢ a gallon the dollar had (at least) 4 times the purchasing power it does now. IOW a quarter bought what a dollar buys now, and more in many cases.

So, that would make $1.40 a gallon now roughly. But that isn’t factoring in the enormous increases in taxes all the way through the process of production to retail.

Get rid of the dozens and dozens of regional formulations, get rid of ethanol, and cut the federal and state taxes in half and I bet we’d be seeing pretty impressively low gas prices.

Here’s another way of showing the trashing of our currency as a major factor: When I was buying gas for 35¢ I had a full time job making the minimum wage of $2.10. That would buy 6 gallons of gas. How many gallons of gas would the minimum wage buy today? 2 or 3. Gas hasn’t gone up. Government taxes, regulations, and the criminal devaluation of our fiat (fake) currency is your enemy. Your money is worthless.

[gogeo]

We drill so much that gas should be a dollar a gallon. I don’t understand why we get screwed in this country. Even with federal and state taxes, it should be half at least.

Seriously?

[gogeo]

At my local Costco regular peaked at $3.35 within the last month. Now at $3.09.

[IronJack]

Dropped a nickle a gallon yesterday. Woot.