Two Cents

No, not my two cents' worth... which is what I usually spew forth in here. But check this out:

Since Katrina hit and gas prices spiked dramatically, crude oil priced have decreased steadily. "Plunged" is actually the way several media outlets have phrased it. At its peak, a barrel of light crude was up over $70. It's trading today at $64.20. Gasoline futures have dropped below $2 a gallon. The stock market is rallying tremendously in the wake of these indicators.

So have prices at the pump dropped accordingly? Of course not.

Even though they seem to have no problem ratcheting up gas prices 50-60¢ a gallon overnight (forgetting that the gas they have in their tanks onsite has already been paid for at a much lower price), gas stations never really drop their prices nearly as quickly or as significantly as they raise them.

In the wake of a week of plummeting oil prices, the most substantial drop in pump price I've seen has been two lousy cents a gallon. Most stations haven't dropped their prices at all. If this isn't taking advantage of a situation, I don't know what is. Given that the largest component of the cost of a gallon of gas is the price of crude oil, the gas we're paying $3 a gallon for should really be costing us about $2.75 or so (based on the 9% drop in crude oil cost in the last week).

In other news, it turns out Bush staffed FEMA largely with his buddies and people to whom he owed favors. Experience and legitimate qualifications were purely secondary criteria. As bad luck would have it, many of them had neither. The Bush-appointed head of FEMA, in fact, had virtually no emergency management experience, and it looks like some of his credentials were falsified altogether. Amazing, isn't it?