The Bottom Line
Slicing up the profit pie may or may not surprise some of you. 50% of the cost of gas goes to the crude-oil suppliers, determined mainly by our friends at OPEC. 28% of the cost is given to the refining process that creates the different designs of fuels ordered by our states. 14% belongs to state and federal governments for some justified tax reason and last but not least, distribution and marketing gets a whopping 8% for those stations that are trying to run and maintain their small business.
Don't Hit the Panic Button
What came first, the chicken or the egg? Is the price of gas driving up the cost of the overall economy or is the rising cost of the overall economy driving up the price of gas? Believe it or not, gas and foodstuffs are way down on the list of inflation indicators because of their wild swings back and forth in pricing. Remember Hurricane Katrina in 2005 and the rising fuel costs? What was that all about? Sometimes all it takes is an impending doom to convince the public that there will be a higher demand on the horizon and the costs just spiral out of control.
I'm Touching You!
And then there are those who remain optimistic and logical in their determination that it is all a game, that we will never actually run out of oil and just keep moving along at their normal pace, sucking up the fuel like there's no tomorrow. It is true that there are pockets of oil in different areas of the world yet to be explored. Exploration and testing are taking place right now by major oil companies and China is close at their heels. Who will claim it first? Who will refine it first? I don't see America claiming a 150-acre plot of ground for a refining facility. We might hurt someone's feelings, or take away someone's rights. So I guess we better make friends with China and pay whatever they demand.
Whether we like it or not, the fuel crisis is a global problem. We Americans are not going to make enough of our own fuel to continue our lives as we have become accustomed. We are not going to make a dent by boycotting the neighborhood gas station. We may dislike the major oil companies but who is abroad dealing for future oil to fulfill our needs and providing the dollars to investigate and make it happen. Global communication and leadership will be our answer in the end.
