May 7, 2001
Where is the price of gasoline at the pump going to end up this summer? At $2.00? At $2.50? Or even $3.00? It's clear the oil industry is pushing prices as high as they can go.
The Big Oil companies say they haven't been able to build new refineries because "environmentalists" have prevented them from doing so. They also say they have to put in additives, which complicates production. As a result –or so they say –they have a problem of "supply and demand."
Even if there were a problem of "supply and demand," that doesn't mean that prices have to be raised in this fashion. It costs no more –or very little more –to make gasoline just because demand catches up with supply.
In fact, all the talk about environmental restrictions and gasoline additives is nothing but a smokescreen to cover up what the oil companies themselves are doing –just like the talk of OPEC was a smokescreen last year. Big Oil is reducing output in order to drive up prices and produce a still bigger profit.
Even the Wall Street Journal, the bible of big business, admits that a "surprising number of refineries have been shut down for maintenance and repairs" right now –just at the point when the refineries usually run at top capacity to produce the gasoline needed for the summer driving months.
It's the same con game, the same excuses given by the utilities and the electricity generating companies in California. They talked about "supply and demand" in California, too –in order to get higher rates from consumers and other handouts from the state of California. But when the last wave of blackouts rolled through California in March, almost one-third of all electricity generating facilities were shut down for "routine maintenance."
It was not "routine maintenance" in California electricity. It's not routine maintenance of oil refineries. It is routine extortion, routine price gouging.
One thing is true: Big Oil has not been building new refineries despite all the profits they've amassed over these last few decades. Right now that doesn't cause a problem of capacity. Why? Because they increased their capacity to refine oil by expanding their old refineries. It was their way to get around pollution requirements which apply only on their new ones.
But sooner or later, there can be a real problem of too little capacity. And that problem has consciously been created by Big Oil in order to maximize their profits at the expense of the population, which suffers increasingly high prices for gasoline and a polluted atmosphere.
Big Oil controls a resource which is absolutely necessary for life in any industrialized country. If it is not able to use that resource for the benefit of the population, then let that resource be taken away from them.
If they are not able to plan for the production which is needed, if they are not able to put in the few dozen additives without messing up production, if they are unwilling to limit pollution –then let them step aside.
"Supply and demand"? There is a big enough supply of resources to meet all the demands for energy: gasoline, electricity, fuel oil and natural gas. The problem is the big companies who control the "supply" in order to "demand" higher profits. So get rid of THEM!