Getting Gassed

Gasoline prices are now around $3.35 around the Chicago suburbs. Why? For once, it's not OPEC's fault. The price per barrel has remained relatively stable at around $60 give or take. So what's with the price spike? Essentially it comes down to the oil companies' refusal to invest in their own infrastructure and pocketing the profits.

British Petroleum has had some wide spread oil pipeline breakdowns. Many oil refineries in the United States are working undercapacity because of shut downs caused by faulty facilities. Would a government mandate ordering the oil companies to spend on upgrading and maintaining their infrastructure violate a "free market"? Not really when you consider the protections and natural monopolistic natures of the oil industry. It's not like local mom and pop stores can just jump into the market and threaten Amoco's niche. Even the local gas station owners are feeling the squeeze as the oil giants continue to extract every dime out of a nation obsessed with oil consumption. The small franchise ower is finding that the parent companies are bent on cannibalizing their off-spring.

Bill O'Reilly writes a very level-headed article about the oil companies' failure to maintain their facilities. Even the most hardened liberal will be hard pressed to find fault with his analysis. Additional information about the current price spike can be found here.