By Douglas V. Gibbs
Hey, California, notice the big jump in gas prices? Forty cents a gallon, or more, in a day or two.
The problems with the heat of summer has oil refineries shutting down, and rationing supplies. Less supply is causing the prices to rise.
That is the lesson of supply and demand.
So, the opposite is also true. Add to the supply, prices go down. . . yet the Democrats say that won't work. They say we can't drill ourselves out of this.
No?
Domestic drilling would drop prices below two dollars a gallon.
Back to the present, the problems have gotten so bad that some gas stations, like Valero, have stopped selling gasoline.
California gas prices have soared, with some stations topping $5 per gallon.
“Product supply in California has tightened, especially in Southern California, due to refinery outages,” Bill Day, a Valero spokesman at the company’s headquarters in San Antonio, said by e-mail.
The Exxon Torrance refinery lost power, and has now restored operations. Phillips 66 and Chevron have been experiencing similar refinery shutdowns.
The profit margin is so low for stations, that many of them are shutting down for the time being.
An independent industry analyst in Terry, Montana, said by e-mail yesterday, “The mom- and-pop gas stations are having to close down from either not being able to obtain gasoline from their regular distributor or cannot afford the break-even price of almost $5 per gallon.”
Costco is working on a plan to alert its members as gasoline runs out at the company’s stores “so customers don’t have to guess where to go,” Cole said. The company will sell whatever premium gasoline it has stored for regular gasoline prices wherever supplies run out, he said.
The price hike is a short term problem, but Californians are feeling the pain. The question is, "How long with this last?"
If it lasts much longer, families will begin shutting down, too.
-- Political Pistachio Conservative News and Commentary
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