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This Chart Implies Something Very Troubling About the Price of Gas

Dec. 4, 2012 12:50pm Becket Adams

Crude oil prices account for about 66 percent of the price of gasoline, according to the U.S. Energy Information Administration.

Granted, other factors play a role in deciding the price we pay at the pump, including taxes and the cost of distribution, but it’s clear that the price of crude directly affects the price of gas. As crude oil increases in price, the price of gasoline tends to increase. Likewise, when markets are calm and the price of crude oil decreases, the price of gasoline decreases.

With that in mind, take a look at the following chart and try to make sense of what’s going on:

Does this crude oil chart suggest price gouging?

The price of gas is represented by the light grey line and the price of oil by the dark black line (courtesy Zero Hedge, UBS, WSJ)

See that? Although the price of crude has fallen in recent months, as the above chart clearly indicates, the price of gasoline remains at a record high.

“Anecdotally, it feels like when oil prices rise, gas prices at the pump rise; but when turmoil pauses in global geo-politics – or some entity decides that high oil prices just will not do for the world’s economy – gas prices at the pump seem not to drop so quickly,” writers are Zero Hedge note.

“Yes there are pipeline, inventory (and even tax) issues but the following chart suggests ‘gouging’ on a national level,” they add.

It’s also worth noting that what we’re seeing today with the price of gasoline and crude is eerily similar to what we saw right before the economic collapse of 2008.

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Featured image courtesy Getty Images.

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Comments (207)

toledofan
Posted on December 4, 2012 at 2:16pm
History is sure a good teacher and I think what we are seeing is the calm before the storm. Once everyone realizes what is going on in Washington, you know the game of blame the other party, do nothing and divide America even more, and that starting January 1 Obama will have more of our money to spend, people are going to just sit back and say enough, stop buying, companies are already cutting back, and prices are going up. The Democrats got a slim majority to go along with Obama agenda, so now, the real problems will continue.

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- TomFerrari
  Posted on December 4, 2012 at 2:24pm
  “Under my plan, ENERGY PRICES would NECESSARILY SKYROCKET”
  - Barack Hussein Obama
  
  Report this comment
- ICSPADES
  Posted on December 4, 2012 at 2:29pm
  Until people make a stand against our Government, it will be more of the same. About five or six top Generals need to come together and take control of this mess with our troops. If your against that idea, then shut up and let things continue down the same path. We are not far from being unable to turn it around.
- CALLMEMSGT
  Posted on December 4, 2012 at 2:32pm
  Mudhens, Walleye or Rockets?
  
  Report this comment
- chucksue351
  Posted on December 4, 2012 at 3:00pm
  real energy (oil gas coal hydo to some extent) is the lifeblood of any economy, cut it off in the name of sustainability (read destroy) then you will extinquish the economy of the usa, it has nothing to do with the earth, only communistic control of the whole world
  
  Report this comment
- desertspeaks
  Posted on December 4, 2012 at 3:17pm
  and all this time everyone thought Bush was big oil’s best friend, when the entire time it was Obama!
  
  Report this comment
- Mutiny
  Posted on December 4, 2012 at 3:31pm
  This is due to the the devaluation of our dollar. Dollars, gold, and oil move together. If the dollar goes down, gold goes up followed by oil. We are currently printing 40 billion a month. We will never see gas again under two dollars. We have been conditioned to like gas under 3 dollars. Next summer we will conditioned again to like gas under 4 dollars.
  
  Report this comment
- jeann
  Posted on December 4, 2012 at 3:45pm
  We have the most corrupt President ever to live in the peoples house. It’s about to get worse.
  
  Report this comment
- Proverbs17-12NLT
  Posted on December 4, 2012 at 3:45pm
  It’s all Bush’s Fault. LMFAO
  
  Report this comment
- SendTheMeteors
  Posted on December 4, 2012 at 4:25pm
  Well, oil companies are making larger profits than ever in history, and, thanks to Republicans, are still substantially subsidized by the taxpayer to the tune of billions of dollars per year (that’s sure a case of the poor giving to the rich). I wonder if those record breaking profits are related somehow to the price of gas at the pump?
  
  http://www.mediaite.com/online/oil-companies-spin-billions-in-profits-while-charging-more-for-gas-its-good-for-america/
  
  Report this comment
- rickc34
  Posted on December 4, 2012 at 5:23pm
  This is all Obama’s baby. When unemployment skyrockets then less people paying taxes and energy costs going through the roof those that voted for Obama the poor will suffer the most and it will be his fault. No tax revenue = no welfare or food stamps. Buckle up baby.
  
  Report this comment
- brother_ed
  Posted on December 4, 2012 at 5:28pm
  @MUTINY
  
  I agree…Obama wants the price of gas to be $4.00+ per gallon. The question is, why the big discrepancy between crude and gas? Where is the extra money going?
  
  @SENDTHEMETEORS
  
  The amount in dollars of profit is different than the percentage of profit.
  
  Oil companies:
  
  “As production costs push ever closer to the retail price ceiling, profit margins fall. Consider Canada as an example. Oil production there will likely turn a mere 5 to 8 percent annual return on equity for the next several years, according to analysis by ARC Financial.”
  
  Nike:
  
  “Gross margin, or the percentage of sales left after the cost of goods sold, narrowed 2 percentage points to 43.8 percent from a year earlier.” (Bloomberg)
  
  Report this comment
- khandahar&jalalabad
  Posted on December 4, 2012 at 5:54pm
  @sendthemeteors
  Why did post that link? It explained nothing of tax subsidies. It mentioned tax deductions, a subsidy is money given for free by the government like solyndra got. A deduction is an expense that is written off of the tax payment you owe. I write stuff off my taxes am I being subsidized?
  
  Report this comment
- Joe_The_Patriot
  Posted on December 4, 2012 at 6:04pm
  @mutiny
  I think we’ve been conditioned to like gas under $4 and soon it will be $5 then $6 then $7 Then $8 by the end of Barry’s 2nd term.. That will be another 100% increase
  
  Report this comment
- turkey13
  Posted on December 4, 2012 at 6:04pm
  Good Lord where have these people been. Back in 1971 when premium was $.33 a gallon it always went up $.02 a gallon about a week before and fell back a week after. This always happened during the summer when all the country went on vacation after school turned out. Nothing has changed in all this time.
  
  Report this comment
- Bum thrower
  Posted on December 4, 2012 at 6:23pm
  I think you’ll find its a distribution issue. Big jam in Cushing, OK; getting the crude to the refiner so it can be made into gasoline; actually, other crudes are cheepe than WTI at this time.
  
  Report this comment
- Keatonc33
  Posted on December 4, 2012 at 6:23pm
  what a pain in the gas hole! ; )
  
  Report this comment
- Jim S
  Posted on December 4, 2012 at 7:33pm
  I missed it, what’s the scarey part ?…Do you want price controls ?…do the oil companies “know” something ?…gosh so many thing to fear, which one should we pick?…
  
  Report this comment
- RebelPatriot
  Posted on December 4, 2012 at 7:37pm
  Come on people, we have been giving our wealth away to the middle east for 60 years, because we didn’t want to become energy independent.
  
  Now after having our manufacturing base taken away from us, we are left with nothing to off set the import-export difference, which means we continue to send more wealth out of our country than we keep in our country.
  
  They are sucking us dry in order to take us down to the level of a 2nd world nation.
  
  Thank all your politicians for screwing us over, 24 years of Harvard and Yale and we have 16 trillion in debt and a bogus economy where the private sector has no stability and the public sector continues to suck the tax payers dry with the wages, benefits and pensions.
  
  Report this comment
- ButtHurtBob
  Posted on December 4, 2012 at 7:43pm
  @SendTheMeteors
  I don’t like paying high gas prices either, but the liberal talking points are BS. Oil related companies don’t get any special breaks over any other company. So they make 8.5% profit. What the heck is wrong with that? If my company couldn’t do better than that, I would shut it down. It sounds like a lot because we’re talking billions, but they are also providing hundreds of thousand of good paying jobs, along with good insurance. And they are paying tons of taxes and are a huge benefit to our great country. WAKE UP!
  
  Report this comment
- Ralleo
  Posted on December 4, 2012 at 8:23pm
  Go Mudhens and Walleyes!
  
  Awesome game last friday against Kalamazoo
  
  Report this comment
- Secret Squirrel
  Posted on December 4, 2012 at 8:50pm
  What’s the surprise?
  Gas is as much as people will pay.
  Obama wants it to be $8/ gal.
  Green light to Exxon/Mobil.
  
  Report this comment
- SendTheMeteors
  Posted on December 4, 2012 at 9:23pm
  Brother ed, you’re not an accountant are you? Please stop pretending to be one and please stop pretending you know anything about finance. Profit is profit, the bottom line, after expenses. And some of your taxes go to directly toward that bottom line. In addition, you pay more at the pump, and oil executives get millions of dollars in bonuses and rich investors get richer.
  
  And If you feel sorry for Niki because their gross margin is only is only 43.8%, you are a seriously confused.
  
  ButtHurtBob, do you mean to state that the government gives the same tax breaks to your company, and to McDonald’s and Walmart and every other company in the US? Seriously? Better Google and inform yourself a little!
  
  I do give credit to the brainwashing however. Yes, oil companies are making record profits, and gas prices are high, but those two things aren’t at all related you say, and how Big Oil, the most profitable industry in the world, deserves our sympathy because their record profits still aren’t big enough and we should continue to subsidize them. And somehow, somehow, it’s President Obama’s fault that the price at the pump is high.
  
  Report this comment
- JustMeHere_01
  Posted on December 4, 2012 at 9:23pm
  @SendTheMeteors
  Posted on December 4, 2012 at 4:25pm
  Well, oil companies are making larger profits than ever in history, and, thanks to Republicans, are still substantially subsidized by the taxpayer to the tune of billions of dollars per year (that’s sure a case of the poor giving to the rich). I wonder if those record breaking profits are related somehow to the price of gas at the pump?
  
  http://www.mediaite.com/online/oil-companies-spin-billions-in-profits-while-charging-more-for-gas-its-good-for-america/
  ————————————————–
  The Democrats had a veto proof majority from 2008 -2010 and could have passed any legislation that they wanted. They chose to spend that time passing the Health Care Act and came near to passing the Cap & Trade bill which was only stopped because Scott Brown won the Senate Seat held by Ted Kennedy.
  
  Blame whomever you deisire but the Presidency, Senate and Congress was owned by the Democrats for 2 years.
  
  Report this comment
- Grey Eagle
  Posted on December 4, 2012 at 10:10pm
  Things are going to get really tough for us in this country. I expect a major depression will occur, something like what happened before WW II. We had major hits to the economy right after 9/11, but the difference is that Bush was smart and had excellent economic advisers. Obama isn’t and neither are his advisers. Obama will raise taxes sharply, push that global warming crap, the let the EPA regulate business to the point large numbers go broke or live the country. Either way you will see the destruction of America.
  
  Report this comment
- brother_ed
  Posted on December 4, 2012 at 11:09pm
  @SENDTHEMETEORS
  
  It doesn’t take an accountant to figure out which one is the more lucrative business, the company that makes 5-8% on their investment or the company that makes 48%.
  
  Report this comment
- SavvyCowboy
  Posted on December 4, 2012 at 11:10pm
  Hey @SendTheMeteors – I’m not sure which pile of porcine excrement you crawled out from underneath but please return there – there is a slug calling for its mama and I am convinced a huff-n-blow-po blogger like you would only hatch a slug since you are incapable of conceiving a human and would murder it if you did. B*&ch!!!!!
  
  Report this comment
- 666Sucks
  Posted on December 4, 2012 at 11:11pm
  ICSPADES you are spot on! We must decide weather we want capitalism or communism and the only way back to a free market capitalist republic is civil war. The scales have finally tipped and more people want government entitlement then want to be in control of our own destiny. They have committed murder, treason, theft, forgery, extortion, to defeat America, and they did it as evidenced by this country knowingly RE-electing a Marxist communist to the White House. And whats worse, they have flooded the country with enough of our enemy that they know we are all but defeated. The only thing left for them to do is to confiscate our guns and then it’s just as Ayers wanted, gas chambers for the lot of us. The most powerful military in human history in front of us, and they just waltzed in the back door only having to execute a handful of Americans, and like a cancer, they defeated us from within. Every day is a gift my friends!
  
  Report this comment
- sillyfreshness
  Posted on December 4, 2012 at 11:17pm
  It’s called price gouging by the oil companies.
  
  Report this comment
- ButtHurtBob
  Posted on December 5, 2012 at 9:36am
  @SendTheMeteors
  Have done some searching and although the liberal sites do claim the oil companies get special breaks, I can’t find any that say what they are. The energy industry is huge and really helps carry this country with all of the billions in taxes it pays and the tones of good paying jobs it creates. Take away the tax breaks and what will they have to do? Raise prices of course. Again, 8% profit is small. Like any business, they need to continue to spend on improving their business. You gotta have profits to do that. This article seems to explain it pretty well.
  
  http://www.americanthinker.com/2011/05/about_those_oil_subsidies.html
  
  I don’t know why it’s so hard to look at the percentage a company makes instead of the total dollars? Of course a bigger company is going to have a bigger dollar amount in profits, at least it needs it to survive. Like the insurance industry. They have been vilified by the current admin to get health care through. Their average profit is a measly 2-3%. How can insurance companies be the problem then? They aren’t.
  
  brother_ed, is making the same point. OK, the article he pointed out for Nike was gross margin, I admit I don’t understand all of that accountant talk either, but Nike still had 8.5% profits last year. Same as the record oilfield profits. An they charge a high price for shoes over some other companies. Why don’t you have a problem with them?
  
  Report this comment
- Evileye
  Posted on December 5, 2012 at 12:16pm
  It is interesting that the people that complain about Oil Company profits.Namely School teacher,State workers, environmentalist Etc.All have there retirement portfolios heavily invested in companies like Exon.
  If Corporation are supposed to be profitless as the socialist contend who hold the investment?
  
  Report this comment
- SELECT
  Posted on December 5, 2012 at 2:08pm
  @SendTheMeteors – the oil companies make less per gallon of gasoline than does the taxing state and federal governments. look it up!!! the government(s) make 12%—or almost 50 cents per gallon today—goes directly to federal, state and local governments in an array of sales and excise taxes.
  Exxon, for example, made only seven cents per gallon of gasoline in 2011. That’s a drop in the bucket compared to the nearly 50 cents per gallon that federal, state and local governments rake in on an average gallon of gas pumped in the U.S.
  
  Report this comment
- develdog84
  Posted on December 6, 2012 at 12:00pm
  The cause is obvious, the rise in price is from EPA mandates that went into effect in “11 and “12″. Including heavy fines on gas producers for not using a type of ethanol that has yet to be developed. The price gouging is on the part of the goverment.
  
  Report this comment
GuruMeditation
Posted on December 4, 2012 at 2:11pm
It’s call robbery.

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- GuruMeditation
  Posted on December 5, 2012 at 8:10am
  *called
  
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Harvey1
Posted on December 4, 2012 at 2:04pm
If some of you want to not pay taxes on gasoline and food I will have to differ with you. Paying taxes on food and gasoline is the only way the government gets the 47% of the people to pay any taxes.

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- republic2011
  Posted on December 4, 2012 at 2:22pm
  Not really.. the 47% get their food via food stamps (our tax dollars) and they rarely use gas, because most of them don’t have cars (and I am sure the ones that do get it from our government in the form of some welfare entitlement). The problem isn’t that we pay taxes for food and gasoline, it is the amount and “where” that money is spent. i.e. We the taxpayer don’t have much influence on where that tax money goes (that is the major problem).
  
  Report this comment
- Really2012
  Posted on December 4, 2012 at 2:38pm
  Now you’ve done it. First the Obama-phone. Now the Obama-car…
  
  Report this comment
- Torimom
  Posted on December 4, 2012 at 3:23pm
  EBT users don’t pay taxes on their food purchases here (AL). And I noticed recently that EBT cards are now accepted at gas pumps.
  
  Report this comment
- loriann12
  Posted on December 4, 2012 at 5:44pm
  Just the fact that they get EBT cards that you can put ANYTHING on is a way of getting gas. That’s what erks me so much. I see welfare recipients with perfect ****, nails with gems in them, perfectly manicured, and designer clothes buying the most expensive food at the grocery store. I cut my kids **** a couple times in between getting a “real” **** cut and my **** hasn’t come back so it doesn’t need done and my husband shaves his head. I shop at Aldi’s, the cheapest place in town, for my groceries. The poor don’t care about gas prices. Cut back on how much you give them in compensation and then they’ll care. That’s why they voted for Obamaclause.
  
  Report this comment
- pudssweetie
  Posted on December 4, 2012 at 8:47pm
  Harvey, last I looked we already pay State and Federal taxes on gas and each State can raise or lower the gas tax.
  
  @Republic, Your ignorance is showing with the comment you made. Just because people are receiving Food Stamps does not mean that they don’t own a car or buy gas. I was on Food Stamps for a while after both my Husband and I lost our jobs and we owned a car. There is also a big difference between those who go on Food Stamps who truly need the help from those who use the system to get whatever they can for free and cheat the system by taking jobs that pay cash.
  
  @ Loraine, cutting benefits is not the answer as it will only hurt those who truly need them. What we need is a total revamp of the system itself and to limit the length of time someone is on them. If you give a person 6 months of benefits and cannot reapply for benefits for 2 years, I guarantee it will motivate people to get a job and be more self sufficient.
  
  Report this comment
Ragnars Repos
Posted on December 4, 2012 at 2:01pm
When Tony Soprano (aka, US gov’t in 2012) is making his cut from oil sales of course he wants the price to stay high.

They take more money from the dumb American slave (that’s you) and blame it on ‘capitalist’ oil companies.

It’s perfect!

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- daveycrokett
  Posted on December 4, 2012 at 7:28pm
  exactly the govt makes more than the oil co’s, here in upstate ny between federal and state, taxes are about $.80 a gallon dont think the oil co’s are making $.80 a gallon profit
  
  Report this comment
drphil69
Posted on December 4, 2012 at 1:51pm
Must be a vast right-wing oil conspiracy!! Gouging at the national level… exactly how would that work? collusion among tens of thousands of individually owned gas stations??

It actually looks from the chart that a “cost” was added. It still follows the trends. My bet – OBAMA’s permitorium, which is costing oil companies who purchased/leased equipment that they cannot now use.

Well, no worries… obama wants high gas prices, so don’t expect gas under $3 a gallon, ever. It will probably be $5 by summer 2013, $7 by 2014, $10 by 2015… and that assumes no inflation.

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- deeberj
  Posted on December 4, 2012 at 2:12pm
  Yep. I am stunned at myself sometimes when I find myself happy that the price of gas is going down a few cents. Because it’s still over $3 per gallon and when POTUS took office it was $1.89 avg. Why am I happy with $3.29? I need to be mad as hell.
  
  Report this comment
- captbrogers
  Posted on December 4, 2012 at 2:14pm
  My sister-in-law is a manager at a Chevron, and no, she nor the owners set the price of gas. Chevron does. Every few days they get a report from Chevron that dictates what gas prices will be for them. If they do not set the price according to what Chevron says, they lose their licensing with Chevron and all the gas is taken back. It is the people at the top that choose what you see at the pump, not the owner of the Quick-E-Mart around the corner.
  
  Report this comment
- Silvertruth
  Posted on December 4, 2012 at 3:23pm
  Gas Stations do not set their prices, they are set by the parent company. A station owner may raise prices only a certain level beyond the ‘minimum’ that is dictated to them by the providing oil company. There is no such thing as a truly independent gas station. They are just distribution points.
  
  The collusion comes from the industry being so inbred. Those prices are set by formula’s that are essentially the same across all major oil brands. If you all follow the same formula, you all get the same price. It’s a convenient dodge against ‘price setting’ claims and it gets trotted out every time someone gripes like in this article.
  
  The best way to stop the oil companies is to cripple one of them. Pick one, I don’t care, at random. If nobody purchases the product of that company, it will force that company to actually LOWER prices to compete. The last time consumers did this, they did lower prices. All of them are worried about regulation, it’s time they worried about pleasing their captive audience a little bit more. It’s not a boycott because it’s strictly a matter of principal. Brutalize one of them, the others will respond.
  
  I vote for Exxon just because they are the biggest. If you can cripple them, you can do it to any of them.
  
  Report this comment
- Gringo Lingo
  Posted on December 4, 2012 at 3:33pm
  Thats funny, “Indiidually owned gas stations’!
  There as but a few Companies that refne the gasoline we use in the US. They set the prices, not the individual gas stations. Individual gas stations don’t even set their own prices on that soda you buy from them!
  WAKE UP!!!!
  
  Report this comment
- VRW Conspirator
  Posted on December 4, 2012 at 4:20pm
  what…i didn’t do anything about oil prices…wha..huh…oh..nevermind..forget I said anything… LOL
  
  what is keeping things high is QE3 and the fiscal cliff and the fact that Obama has told the rest of the world, mainly the Middle East, he will not stop them from driving up the price. In fact he is helping them by stalling the Keystone Pipeline, closing all drilling in the gulf, and doing every thing he can to stop private land drilling and development in the USA…
  he is destroying coal and once that is done he will destroy oil and force us all into hybrids or tin can cars that get 40 mpg but fall apart when they hit a pop hole bigger than a baseball…
  
  just wait….there isn’t a conspiracy among the oil companies but among the countries that sell oil and the US government that taxes and restricts the free flow of the oil…
  
  Report this comment
Flag-Man
Posted on December 4, 2012 at 1:50pm
When crude oil prices go up oil companies have to raise the price to cover what they will pay
for new oil they buy.
When crude oil prices go down they have to sell off what they have already paid the
higher price for or lose money.
Same as any other business

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- tckid17
  Posted on December 4, 2012 at 1:57pm
  Thanks for sharing that viewpoint, that would explain the higher prices at the pump that dont react to daily crude oil prices that fluctuate.
  
  Report this comment
- ICSPADES
  Posted on December 4, 2012 at 2:31pm
  And I have some beach front property in the mountains. BULLCRAP
  
  Report this comment
- Flag-Man
  Posted on December 4, 2012 at 5:40pm
  icspades; I see you have economics 101 down real good.
  It is very plain to see you have never run or owned a business.
  Maybe you should get educated before you comment.
  
  Report this comment
- teebubba
  Posted on December 4, 2012 at 6:29pm
  The explanation is a lot simpler than we are making it. $ 4.00 a gallon is a magic number which causes the average run of the mill American like us all to subconciously begin to conserve fuel…eliminate all unnecessary driving, combine various errands into a single trip….car pool etc. As Americans purchase less fuel (let’s say 25 %) the whole regular price distribution system is disrupted with storage inventories filling to capacity and those who speculated on higher price fuel futures contracts suddenly having to meet their financial obligations. They must keep the system moving because they are committed to buying the gasoline and there is no where to store it so the price begins to take drastic cuts to where it should have been all along.
  
  Report this comment
- keepfaith78
  Posted on December 5, 2012 at 9:09am
  you need to keep in mind the price of a Barrel of oil today is in the futures markets usually 3 to 4 months out it is called speculating and i think that king insane stated before taking office in his first term that he would go after the speculators on wall street people need to think all are elected officials are part of those speculators they make money as well off of the prose’s personnely how do you think they live in there mansions in the sky while the rest of us dig are way out of the dirt each day they are all theifs and liars if we keep this is mind we will all be better off
  
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- lucasjsr
  Posted on December 5, 2012 at 11:18am
  I do not understand how legally any company can change their accounting/pricing method. When they raises prices to account/cover current cost they are using a First In First Out (FIFO) method. When the charge prices to account/cover older inventory that may have cost more they are using a Last In First Out (LIFO) method. I do not think the IRS allows any company to change their method of accounting at will. Following your methodology prices would drop rapidly as the company who was smart enough to keep the least inventory of higher priced crude would be able (and more than willing) to sale their current inventory at a much lower cost than a competitor who bought higher priced crude. I believe the game is rigged and the smoke and mirrors of government regulations and used car salesmen/women we have in leadership combined with a dumbed down masses with a gimme mentality has more to do with the working man/woman getting robbed in the name of “social justice”. The masses have been trained to fight against something (any thing you name it from race, income levels, union affiliation, etc, etc,) and know more about a football player or team than they do about their president of members of congress. Tell a person you can not actually tax or regulate a corporation and they have this “deer in the headlight look” and do not realize all tax increases end up on the consumers back. Corruption, laziness and STUPIDITY are the problems that have plagued and will destroy our nati
  
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tckid17
Posted on December 4, 2012 at 1:47pm
I used to be an Oilers fan but my purse strings have Titaned.

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krod2516
Posted on December 4, 2012 at 1:45pm
The high gas prices in 08 was the main reason that started the recession. It was a domino affect. We had to make fast adjustments to our lives. We were so used to having a large income coming in and it stopped so quickly. One day we could go on vacations, go shopping, go out to eat, and the next, there was no more money, we were pouring it in our SUV. A new car was not an option because as we also saw our income disappear we could no longer make payments on our SUV. As we tried everything in our power to come up with money, we were using every penny we could scrape together on gas. Cant by new gas efficient car with no money and newly bad credit. Very scary time for my family that is for sure. We actually ended homeless with eviction on our credit too. Never in my adult life have I not had a home for my family. For 15 months we lived in friends homes and finally we were able to get on our feet. I’m in Houston TX, so we had to deal with Hurricane Ike also. Now that We are earning a modest living we can afford a small 2 bedroom for my family of 5. People love to look down on us and say we were irresponsible, but how would we have known the forces working against us at that time. I don’t regret a dime I spent on vacations, eating out, or shopping. With these gas prices the way they are, I may never get to do those things for my family again.

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- chavezmr25
  Posted on December 4, 2012 at 2:21pm
  You really believe this? This is the most illogical argument I have ever heard. The subprime mortgage crisis sent us into recession, not high oil prices. People were buying homes well above their means and it backfired. Foreclosures led to empty homes and falling real estate prices. You want to balme it on oil prices? Think real hard, you didn’t realize you should have sold your SUV and cut back to be able to pay the mortgage? That Obama line in the debates is a baseless fallacy and you’re choosing that to repeat? Good God man, educate yourself.
  
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- JungleTrump
  Posted on December 4, 2012 at 3:07pm
  Chavez: you realize how you contridicted yourself don’t you? Answer the question why the people could not pay their mortgages. They were obviously paying their mortgages before the upswing in gas prices which stagnated the economy which caused reduction in demand which cause layoffs. Then and only Then the people could not pay their mortgages. Things are rarely as simple as you try to paint it.
  
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- Hopestar-B-COHIPER
  Posted on December 4, 2012 at 3:35pm
  @ChavezMR25
  
  You are correct about as far as you go with subPrime loans.
  
  But the subprime loans were caused by what?
  
  Hint the 1970′s… liberal’s concern about the ‘poor’….
  
  What law was passed?
  
  CRA…….. (Community Reinvestment Act)
  
  Which then allowed organizations like ACORN to FORCE banks to make those subprime loans as well as some banks could now legally be ‘predator lenders’.
  
  Who came up with the CRA?
  
  Who passed the CRA?
  
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- Hopestar-B-COHIPER
  Posted on December 4, 2012 at 3:46pm
  @JungleTrump
  
  What you said may be true. But, more than likely they got their mortgage with zero down and a monthly payment that was more than 12% of their gross income. They probably were paying 25% or more of their gross income on the mortgage. 25% was fine in the 1950′s and early 1960′s but was way to high after the 1960 because of the increase of the FICA tax, increase in the Fed Income tax rates, increase in state income taxes etc.. With those increases, by the 1970′s, 25% of gross income for monthly payments was too high. Predator lenders knew this and quickly either sold the mortgage to another banks (after getting their lender fees of thousands) or waited for the buyer’s inablity to pay so they could foreclose..
  
  In today’s market anymore than 8% of one’s gross income is too high a mortgage payment for most people. Banks still try to base loans on the 1950′s 25% rule rather than an adjusted reality percentage and they can get away with it because it’s legal under the CRA. They also know that if the buy fails, the government (taxpayers) will pay off the loan.
  
  Don’t just blame subprime loans; blame the cause of subprimes. Actually, blame the politicians who passed the CRA and the President who signed it into law.
  
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- Jowolf
  Posted on December 4, 2012 at 4:59pm
  I believe it was the housing market that plummeted the economy into a recession. Our government pushed the home affordable act back in the Clinton Administration. Banks were required to loosen their lending requirements so that lower income earners, those with not so good credit, were allowed to purchase a home with no down payment. It became a vicious cycle because banks required down payments, closing costs that were required, etc. guess who paid that….the seller…so house prices increased to accommodate those costs a typical buyer didn’t have. Plus there was a lot of creative financing to make it all happen. Thus, house prices kept going up and up. Underwriting got sloppy, true house valuations were fudged, and on and on it went until some of those creative loans programs (ie: ARMs) went into interest readjustments and people couldn’t make their house payments. Mortgage notes were sold over and over again….another problem. Finally, it burst and burst BIG. Home valuations were grossly over valued which is why so many are under water in their homes. An attempt was made under Bush administration warning of this crisis but nothing got done in Congress. The housing market, not oil, was the primary push over the cliff on our economy. I think this is the straw that broke the Camel’s back. Now that we are going to buy another house, I am amazed at how the industry has changed for the worst since I sold real estate.
  
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- krod2516
  Posted on December 4, 2012 at 5:32pm
  Chavez, it happened so fast and we were upside down our truck. We Thought that we could come up with the money, we even had an agreement with the bank to pay it, they did not follow through with their end of the agreement. The last thing we had time to do was take them to court. We did not own our house so unlike someone in a mortgage that could go months and months without payment, we were evicted 30 days past due rent. Hurricane Ike made things very difficult because people could not spend extra money, they had to use every dime to fix the damage that insurance and FEMA were not covering. I put many request to FEMA, but never was able to get any response. Me and my husband tried everything we could think of that had always worked in the past. There was nothing more we could do. The high gas prices caused people to not be able to go out eat, shop, vacation. This crippled the economy. As far as others who have been treated like lazy people who just didn’t want to pay their mortgages, adjustable rates went up on people, they had no extra money to pay their higher mortgages. Gas prices were very key in final nail of the failing economy.
  
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- krod2516
  Posted on December 4, 2012 at 5:53pm
  It is interesting and frustrating how many false assumptions have been made about our situation. I am used to it though, and I learned very quickly how judgmental people can be. No one walked in my shoes. It was the most devastating thing I have ever been through, and that is saying a lot. My Husband felt that he did not deserve his family because he could not provide like he had always done. Watching such an amazing man feel so helpless was heartbreaking. He actually felt that we would be better off without him. I made sure he knew that I would rather be with him in box on the side of the road, than our family breaking up. We have become even closer and our children have learned to appreciate good things, times, and people, while you have them. Thank God we never had to live in that box.
  
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- sootsme
  Posted on December 6, 2012 at 11:40am
  FOLKS!!! FOLLOW THE MONEY, Y’ALL: All the world’s actual value is worth X, and with real money prices are pretty stable. With Federal Reserve “money”, we now have 10 times as much “money” chasing approximately the same amount of actual value; therefore, stuff costs ten times what it should/used to. THIS ISN’T ROCKET SCIENCE, JUST IGNORANCE. If you need proof, look at how much bread, milk, silver, or whatever have gone up compared to gas. Pretty close overall… this is why old Baron Von Rothschild said many years ago that whoever runs the money doesn’t give a hoot who runs the government… Until this idea is common knowledge and folks start storing their wealth in real valuables and dealing in something other than Monopoly “money”, this is all a huge joke… on you…
  
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KevINtampa
Posted on December 4, 2012 at 1:35pm
Crude oil needs to be refined. Refineries used to be able to keep up with supply, but over the last few years we have seen several major US refineries shut their doors. I don’t think this chart shows gouging at the pump as hinted at in this article, I think it shows the basic rules of supply and demand. The refineries can’t keep up with demand, so naturally the cost will go up.

Not surprising considering the current administrations stance on deliberately causing energy prices to sky rocket.

http://news.nationalgeographic.com/news/energy/2012/04/120404-northeast-us-refinery-closures-gas-prices/

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RoDogg
Posted on December 4, 2012 at 1:34pm
I think its funny how every economist and politician will agree that high energy costs will weigh down and strain the economy and yet they tax it on multiple levels.

I personally think it should be unconstitutional to have any tax or gov fee on something that people must purchase to survive like energy and food for example.

they know the revenue will keep coming because we have to buy things like food and energy.

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- toiletclogga
  Posted on December 4, 2012 at 1:53pm
  When your party agrees that the root of all evil is carbon emmissions, you are apt to tax the hell out of anything oil based!
  
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Sandy
Posted on December 4, 2012 at 1:33pm
Get it together people and understand MARKET MANIPULATION……. The BERNACK prints money, oil…..gold……silver…….bonds……stocks go up……. most unusual market action in history. When inflation starts to rear it’s ugly head…… The BERNACK has to push the market down again…… Check out Maiden Lane I, II, III…..etc…… these are the accounts the bernack is using to prop up the false market. It is what he is using to sell American Bonds to other countries. OIL is purchased in USA $$$$$ , the dollar is going down which causes gas to stay at the level it is……..

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- checkmate0831
  Posted on December 4, 2012 at 3:15pm
  Stocks go up and bonds go down. Inversely proportional…
  
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- sootsme
  Posted on December 6, 2012 at 11:55am
  YEP, Bernanke has given us 10 times as much money to chase the same amount of value, so now everything costs 10 times as much, even though you still earn about the same number of “dollars” as before. Makes me want to work for something other than “dollars”, or at least convert them into something else that can keep up, such as silver, food, tools, ammo, etc. just as fast as I can… anybody getting this yet???? This is the key concept that will separate those who make it from those who sit around and cry “wha’ hoppen???” The flip side of Liberty is Responsibility- get some!
  
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smokeysmoke
Posted on December 4, 2012 at 1:32pm
this is how a market rations a product that it sees in a few years the supply will not equal the demand… markets are not looking just today, but how today will effect tomorrow and they try to price accordingly… that is what markets do… they are a mechanism to FIND A PRICE OF A GOOD…

check out a committment of traders report on gas futures… and then crude futures… and look at the difference bettween longs and shorts in gas and crude…

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Shamrock241
Posted on December 4, 2012 at 1:28pm
No suprise here just another underhanded way the government has raised taxes on us with no reporting from the main stream media. Just yesterday i pass a gas station on I-75 Gas was $3.27 disel was $4.03 Hello Business tax, i remember before odumbo came into office disel being only 10 to 15 cents higher.

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ArmedAndReallyPissed
Posted on December 4, 2012 at 1:27pm
The plan of the CLOTUS is working.

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smokeysmoke
Posted on December 4, 2012 at 1:27pm
i think it shows there is a problem with refining petrol/ we have been exporting GAS… we should slightly raise taxes on exported GAS to slow this trend and make some money…

we have also been increasing taxes on the refiners, and as a result we had REFINERYS ON THE EAST COAST SHUT DOWN IN 2011….

there were also fires recently in cali refiners…
we should promote new refinerys, BUT THEY ARE TOO EXPENSIVE, and NO ONE KNOWS HOW THE EPA MIGHT TREAT THEM IN a YEAR OR 3 and IS WILLING TO TAKE THE RISK…

so were stuck with our current gas refining capability, and there are large taxes on gas, and oil… and they are talking about raising their taxes cause they make so many billions of dolalrs…

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diamondcutter
Posted on December 4, 2012 at 1:26pm
possibly also shows we are getting ready for a financial collapse. look at chart just before 2008 . same as right now. need to see farther back on chart to get a better idea if possible or not. one simarlarity i see.

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FightingBear
Posted on December 4, 2012 at 1:25pm
Well, let’s think for a minute…who is in the White House?

Oh yeah, I remember it’s that guy whose plan it is for our energy costs to get to a level that we no longer have the ability to pay.

….and ….The citizens of the good ol’ US of A voted this embicile a second term.

Enjoy the great recession part two that you idiots on the left voted for. You deserve every single bit of misery that you feel each time you pump gas in your car or attempt to heat or cool your homes.

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Depressed_American
Posted on December 4, 2012 at 1:25pm
For those who forgot the CURRENT President’s 2007/2008 campaign speech……

He wants Gas/Energy to cost 6 to 7 dollars a gallon. We are too dependent on fossil fuels. If he can’t get his agenda passed through Congress, then he WILL regulate his agenda through the EPA, DHS, TSA, etc….. His UNELECTED CZARs are making the laws in this country, NOT CONGRESS!!! That is why costs are going up despite the cost of crude oil. That is what is very disturbing about this President, HE DOESN’T CARE ABOUT THE US CONSTITUTION!!! And the LAZY CONGRESS allows him to get away with it…….

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huey6367
Posted on December 4, 2012 at 1:24pm
The cost of gas is more because the dollar is devalued.

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- TSUNAMI_22
  Posted on December 4, 2012 at 1:48pm
  Agreed. It’s a hidden tax. Try to tell that to an Obama drone. They don’t get it. The Obama drones will only notice when it affects their Obama-phone usage, cable TV, welfare payments, or EBT accessibility.
  
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- Cavallo
  Posted on December 4, 2012 at 1:52pm
  While that may be the case, oil would also be more expensive. The point of the article is a misunderstanding of the myriad of articles that go into pricing a gallon of gasoline. Demand, taxes, regulation, supply, refining capacity, transport capacity, union contracts, gasoline mixtures, seasonal mixture adjustments. They have had multiple and nearly constant investigations into price collusion and gouging among the energy companies and only very rarely have they found anything untoward.
  
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- GuruMeditation
  Posted on December 4, 2012 at 2:12pm
  The deliberate devaluing of the dollar is robbery also.
  
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4xeverything
Posted on December 4, 2012 at 1:22pm
Wow.

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Snowleopard {gallery of cat folks}
Posted on December 4, 2012 at 1:20pm
Translations – Obama and friends are once again making money for themselves in the traditional way of Chicago Politics at their finest.

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cessna152
Posted on December 4, 2012 at 1:19pm
Prices at the pump need to stay high so the government can collect MORE in taxes. Once again, Americans LOSE and everyone else wins…

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The_Jerk
Posted on December 4, 2012 at 1:17pm
I’d say we caught them, or should I say, “Zero Hedge, UBS, WSJ,” caught them.

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- scuba13
  Posted on December 4, 2012 at 1:31pm
  But Obama caught Bin Laden, so I guess it doesn’t matter.
  
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longknifed
Posted on December 4, 2012 at 1:17pm
Ask the hot talkers on fox neocon radio and they will tell you that high prices are a good thing because corporatism = capitalism. We need the transnational pirates to give themselves billions of dollars of bonuses each year from the treasury to keep the world running.

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- CALLMEMSGT
  Posted on December 4, 2012 at 1:25pm
  Oil is bought and sold on the world market in dollars. U.S. prints more dollars, dollars are woth less-takes more of them to buy same amount of oil. An ounce of silver will pretty much buy the same amount of oil today as it would 40 years ago. It’s the dollar stupid.
  
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- longknifed
  Posted on December 4, 2012 at 1:32pm
  Oil companies help legislate laws that any small business competition is crushed, stupid. Ever heard of anti-fracking? It’s called a cartel for a reason. keep watching faux news, its good for you.
  
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- deeberj
  Posted on December 4, 2012 at 2:06pm
  I can tell you don’t really listen because what you are saying is not what they way. Either contribute something intelligent or just please go away troll.
  
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- CALLMEMSGT
  Posted on December 4, 2012 at 2:17pm
  Any proof?
  
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- longknifed
  Posted on December 4, 2012 at 7:57pm
  dbag,
  
  i notice you like to follow. How does my furniture look from the front yard? my links don’t get clicked on anyway because you neocons leave all your “proof” to “god” anyway.
  
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ResistSocialism
Posted on December 4, 2012 at 1:15pm
Chart shows gas generally costing more that’s about it.

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- Shamrock241
  Posted on December 4, 2012 at 1:37pm
  Look at the chart again oil/gas in 08 are about the same, in 2011 thru 2012 is when the oil drops and gas stays high.
  
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- SimpleTruths
  Posted on December 4, 2012 at 1:58pm
  SHAMROCK241
  It’s called supply and demand… you know free markets? As long as demand exceeds supply prices will remain high.
  
  Houses in my neighborhood are generally 15 – 20% higher than the next block. Why? because demand is there and sellers can get the higher price.
  
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- DarthMims
  Posted on December 4, 2012 at 2:43pm
  To be fair, SHAMROCK, the same gap occurs in 2005, 2006, and 2007 where there is a large spike in gas prices without a corresponding spike in oil prices. This is usually due to some supply problem, such as Hurricane Katrina in 2005.
  
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