Who Do We Blame for High Gasoline Prices?

As gasoline prices have increased over the last several years – for example, right now gas prices are 19% higher than what they were one year ago – many Americans have searched high and low to pinpoint who or what is to blame.

Is it the evil empire of Big Oil? The Bush Administration and their policies? The growing economies of China and India? Something else? All of the above?

Obviously, this isn’t a clear cut issue, and there isn’t one thing in particular to blame. This is a very complex and integrated problem with plenty of moving parts. However, it’s very likely that there’s one reason that’s more at fault than any of the others.

With that in mind, I wanted to see who or what we blame the most for the run of record gasoline prices. To see what people thought, I recently had a poll up on Daily Fuel Economy Tip which asked: “Who/what do you blame most for record high gasoline prices?” Here’s how people responded:

  • 41% blame the Bush Administration
  • 17% blame “Big Oil”
  • 15% blame supply and demand
  • 13% blame commodity traders
  • 6% blame OPEC
  • 5% blame China/India
  • 3% blame “other”

While I expected a lot people to blame the Bush Administration, I really had no idea it would be nearly half of the nearly 200 respondents. Maybe it’s their disenchantment with the administration’s policies, the current economic situation, the fact that Bush was an “oil man” and still has ties to the industry, or a combination of these and other factors.

While I think these are mostly circumstantial arguments, I guess when you combine everything together, it may provide a somewhat compelling argument. Unfortunately, I don’t buy it. (For the record, I would consider myself a moderate that leans towards the liberal side. Whatever that means.)

Not to discount nearly half of the respondents, but I generally it very hard to believe that the current administration is behind this. Why would the President of the United States deliberately direct policy that is clearly harmful to the U.S. and world wide economies? I can understand being unhappy with current administration, but blaming them for record high gasoline prices seems to be a pretty big stretch.

I think the people who blame supply and demand as the major factor behind the rise in gasoline prices are probably much closer to the actual answer. Over the last several years, as developing nations have become more industrialized, demand for petroleum and petroleum based products (such as gasoline) has increased dramatically. Because there’s only so much oil to go around, and because of a significant decrease in refinery output due to razor thin profit margins, simple economic theory has to take over:

As demand for a product increases while supply of the product decreases, the price will naturally trend upwards.

Maybe I’m just completely naive and the conspiracy theorists are correct, but I just have a very difficult time getting my head around the idea that this is more than a basic economic issue.

Comments

  1. Given that the first victim of war is truth; when the full story about the economics of the war on Iraq see the light of day I have a feeling that more than 41% of the world will view Bush and Blair as being culpable of kick starting the world economic crisis we’re now facing.

  2. It all boils down to GREED. Thats what has made gas prices so high. as a country we should band together and protest aganst this outright stealing of our money thats already to hard to come by as it is. I belive that a protestis due and if we would only set a date such as a weekend to where no one purchased a drop of gas for that entire weekend it might just get the message across that we are not going to stand for this. Then mabye the oil companies and the politicial parties would get up off their butts and stop this ongoing atrocious money hungery attack on the American people.

  3. Hello, anyone in there? Its basic economics(supply and demand),and the wheels were
    in motion lonnnng before President Bush even thought about running
    for the White house. Also, do some research as to how much, in tax you
    pay at the pump. And one last thing look up U.N. Resolution #1441 on google!

  4. No, of course the Bush administration is not conspiring to raise gas prices, but yes they are to blame. Most economists understand that running up a huge budget deficit results in the decline in the value of the dollar. Since oil is sold on the world market in US dollars, this means the price of a barrel of oil must increase for the sellers to maintain the same profit margin. George Bush a crook? No. George Bush an idiot about economics? Most definitely. The apple does not fall far from the tree.

  5. Desert Tripper says

    My reasoning:

    8 years of Reagan? Gas prices relatively steady.
    4 years of GHWB? Gas prices relatively steady.
    8 years of Clinton? Gas prices relatively steady (and, in 1999, hit an almost all-time low.)
    8 years of GWB? Gas prices TRIPLE.

    If it were really an issue of supply and demand, we would have seen a gradual run-up of prices over the past 20 years, not a relatively flat line for most of the duration followed by a precipitous climb over the last 6.

    Oh, and by the way, gas prices didn’t get really insane until after “MISSION ACCOMPLISHED…”

  6. Here is the fact of BIG OIL stock prices and why Bush isnt making as much money that some people think. The following is stock percent increase during each president.

    Clinton – BP had increase of 400% 1993-2001
    Bush – BP had increase of only 40% 2001-2008
    Clinton – Chevron increase of 150% 1993-2001
    Bush – Chevron had increase of 120% 2001-2008

    So if Clinton had investment in oil he made a hell of lot more than Bush has. So you can not blame Bush for making money in OIL from increaseing the gas prices.

  7. Susan Rayner says

    It’s OPEC! Their sole purpose in being created was to keep gas prices steady. They have failed in their mission and have failed us!

  8. The bottom line is that we as a nation have to stand up and say NO MORE! By banding together and not buying fuel helps for a shot time but they start to increase slowly. First the price will jump 10 cents then we all cry out and they drop the price 5 cents. As they continually do this we are back up before you know it. Mean time the oil and gas companies make record profits with no thought to the working poor and the middle class. And its not as simple as just blaming the President, you give him more credit and power than he really has on his own. The corruption comes in with the bribing of Senators, of course they don’t call it this but it is what it is no matter what they want to call it. My daughter and I are looking at being homeless if these keeps up. I know millions are in the same boat as I am and it makes me wonder if there isn’t some hidden agenda. What do they have planned for the overburdening of the system? Something to think about.

  9. The overall fault is the american people. We buy 5000 pound vehicles to go get groceries or to drive to work. PIckups, SUVs, and other large vehicles. IT IS OUR FAULT THAT WE ARE IN THIS SITUATION. I would blame reagan, bush senior and clinton more then GW Bush because those are the idiots who kept gas prices down and keeping gas tax down, allowing society to adjust and become complacent with low prices, buy 8000 pound itiotmobiles and allow city designs that are purely moronic. If GW is actually the cause of higher gasoline prices, he is doing us the favor of forcing us to FACE THE MUSIC and to change society before the entire USA is one huge suburb and people drive 250 miles to work in 200,000 pound tanks. Stop this stupidity, plan ahead, buy the smallest car that can fit your needs and ride your bike, move close or into the city center. I hope gas hits 10 bucks soon.

  10. We’re not stupid but what can we do. Don’t expect people not to drive to the point that the oil companies start to hurt. People will curtail driving habits a bit because of these prices but not enough to get things changed. And don’t expect the feds to do anything either because there is a lot of windfall tax revenue from these increased prices that they reap the benefit from. The oil cans know that the life of oil is limited – maybe about another 20-30 years and they want to get as much as they can out of it till it dies.

    So demand is demand and the oil companies know you got to buy one way or the other. Don’t expect them to be good corporate citizens where profits are involved. Would you if you were in their enviable position?? It’s obvious that the oil bunch reached a consensus that they can rake us for what ever they want and are cooperating with each other by suppressing competitive activity between them – you know, it’s bad for business (I wonder if there was another meeting of the commission at Appalachia in upstate NY). I am certain they are feeling out for a pain point now and you can be certain it’s going to get a lot worse.

    Here’s what you can do. Exxon/Mobil is the biggest profit taker of them all and is probably leading this assault so they are the ones that need to be targeted. You have to use boycott creatively. People need gas – they need to drive so don’t expect them to leave their cars at home and use a bicycle or the bus. It ain’t gonna happen. But what you can do is buy your gas anywhere else but Exxon/Mobil or anyone who is supplied by Exxon/Mobil. The way to win is to single out one of the oil cans to show the others what can happen to them if they play these games. The beauty of it is that it fucks up Exxon/Mobil in a way they can’t easily recover from. Oh sure, they will lower their prices temporarily to get you back and many people will take advantage of that but the moment they bring their prices back up, you boycott them again. They are constantly running a deficit because they can never make up for the losses of gas sales sold at lower prices and if the boycott is widely respected by americans, the only way Exxon/Mobil can sell gas is if it is at lower prices than the others. They will be forced to keep their prices lower which will force the other oil cans to match up with. When that happens, Exxon/Mobil gets boycotted again and the downward price cycle starts all over. In the mean time Exxon/Mobil retailers will start jumping ship further aggravating the backlash situation for Exxon/Mobil.

    I think it can work if the boycott gets good enough traction but I am a busy business man who really would like to but can’t afford the commitment to make this thing work. It needs someone who can spend some time getting the word out . Please send this plan to whomever you think can help get it rolling.

    Albert

  11. I don’t care who’s to blame. I know that nobody’s doing anything about it. Bush is obsessed with the well-being of Iraq while his own country goes to hell and all anyone else can come up with are short term solutions like a “tax holiday” that ultimately won’t do jack.

  12. Larry housley says

    Learn your economic facts, folks! Oil prices are up globally, not just in the US. Sure, they’re up more in the US, thanks to our weakening dollar, courtesy of the Feds knee-jerk reaction to the housing slump. I guess in some people’s Americentric pea-brains they think that the US president controls the economy of the entire world, but in reality it is the unbending economic law of supply and demand.

    ExxonMobil, like most oil majors makes about 10 cents profit on every $1 of sales. They could waive all profits and turn into a non-profit corporation and their gas prices would drop maybe 30 cents a gallon — for a short period. But since investment for exploration comes out of earnings, there would be no money to look for new discoveries and soon supplies would get even tighter — and prices higher.

    ExxonMobil also pumps about 2% of the oil produced daily in the world. Kind of hard to control prices with that market share. The real “Big Oil” companies are national monopolies like Saudi Arabia, Kuwait, UAE, and Venezuela. They’re not going to do anything to produce more because they like these high prices, so our only option is to consume less.

  13. Why are we wasting our time talking about this loosing topic. Remember one thing,the less we use the more they will have to charge in order to make the same amount. AGAIN WE LOSE!! It is time someone is held responsable for our poor country going down the tubes! COME ON PEOPLE CONTACT THE PEOPLE WE PUT IN OFFICE ON A STATE LEVEL.

  14. Wake up people. Who is to blame? We are. We’ve enjoyed decades of cheap gas prices and top notch industrialization compared to countries like China and India. Now, open the doors of commerce to the world and allow a pheasant to afford a car and guess what, you’ve got to pump more oil or increase demand. Meanwhile, we’ve been cruising down the highway in our guzzlers at 75 mph for more than 30 years and thinking nothing of it. We’ve demanded more oil, we’ve demanded bigger cars, we’ve demanded cheaper imported products on the shelves at our local Wal-Mart. Now it’s time to pay. Shut up and trade in that gas pig you’re driving, slow down, downsize to an economical ride, reduce the demand for fuel. Get used to higher heating costs too, they’re here to stay. Embrace alternative forms of energy and I don’t mean corn. Corn is for bread, not gas. Technology, technology, technology, that’s the future of our energy engine. Hey, we might even save our enviroment.

  15. Yes, price are high and we have a few choices: we can do nothing, complain about them or find ways to reduce or fuel cost and maybe even make a profit at the same time 4ourfuture

  16. Obviously, for those of us that can still do remedial math, by far and large the federal and local governments are the largest money makers in the oil business. In fact the oil companies DON’T EVEN COME CLOSE in profits. One has to question why we have crumbling highways and bridges that fall into rivers in Minnesota. I wonder what our congress is doing with these revenues? Secondly, why do americans feel that they are some how exempt from paying world prices at the pump? We will probably never know the answer to these questions from this web site. I guess it’s easier to blame George W. Bush.
    MG.

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  1. Who Do We Blame for High Gasoline Prices? | politikly.com

    \r\nIs it the evil empire of Big Oil? The Bush Administration and their policies? The growing econom

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  3. […] china and India? Supply and demand? Nope. Nearly half of those polled blame the Bush Administration.https://www.dailyfueleconomytip.com/miscellaneous/who-do-we-blame-for-high-gasoline-prices/Oil prices retreat from record high – Oil &amp energy- msnbc.comBut other investors see continued […]

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