There may be no facet of day-to-day American life that is widely and fundamentally misunderstood than gas prices. It seems, from observations of media reports and the sort of griping one hears in day to day life, that most Americans feel like they?re fleeced very time they go to the pump, and that it?s the result of some grand oil industry conspiracy.
That gas prices are really just a reflection of extremely complicated (and heavily taxed/regulated) energy markets seems to escape them. They?re being cheated, and it?s all ?big oil?s? fault.
The latest manifestation of this nonsense is the fact that the highest gas prices in North Dakota are in the west, in the middle of the world-famous Bakken oil boom.
?We have all this oil here,? a Dickinson resident told the local newspaper. ?Why are prices higher??
That?s really a silly question. While there may be more oil coming out of Bakken oil fields, that oil doesn?t go straight to the gas pump. Western North Dakota is served, for the most part, by the Tesoro refinery in Mandan. While that refinery has expanded capacity in recent years, demand for gasoline in western ND brought about by the explosion in economic activity there has driven up prices.
And it?s not just refining capacity. It?s retail capacity too. The number of new gas stations in the west isn?t exactly keeping up with demand either.
So there really is no conspiracy. It is simply a lot of new people, and a lot of new activity, in a certain area where supply hasn?t quite been able to keep up.
Maybe that won?t satisfy people upset with prices at the pump, but we should be clear on cause and effect instead of resorting to wild stories about mustache-twirling oil executives.
Tags: bakken, Gas Prices, North Dakota News, oilhoya casa de mi padre corned beef and cabbage diners drive ins and dives jeff who lives at home 49ers news saint louis university
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