Do you understand that they are in competition with each other for your business? Oil producers compete with other oil producers; refineries compete with other refineries; gas stations compete with other gas stations. If one gas station sells gas for $3/gallon and the one across the street can make more money by undercutting him, they will. But when costs get high enough, it's not worth it.
This is kind of beside the point, but on what basis do you claim that "the ablility for the general public to pay $3 or more per gallon was greater 5 years ago than today"? I can't imagine any sense in which that's a true statement.
That kind of leaves a few holes in your theory.
My "theory" is just basic economics. Buy this book by Thomas Sowell and read it. I'm dead serious - if conservatism is to survive we need people who understand economics, and Sowell is the best out there at explaining it. That's how I learned.
“Do you understand that they are in competition with each other for your business?”
Then why is it world events, rather than competition, that seems to be determining the rise in oil prices? How has the level of competition changed?
“But when costs get high enough, it’s not worth it.”
What costs? I don’t see any labor shortage for getting the oil out of the ground or running the refineries, refineries getting carpet-bombed into oblivion..etc. They don’t raise the prices because they need to...they raise the prices because they can. Because they figure they’ve got the general public over a barrel.
“....but on what basis do you claim that “the ablility for the general public to pay $3 or more per gallon was greater 5 years ago than today”?
The loss in purchasing power due to the dollar’s decrease in value.
“....if conservatism is to survive we need people who understand economics,....”
If conservatism is to survive we need people who are real conservatives running the GOP. So far the GOP is on the slippery slope to becoming Dems Light.