If you have gotten gas recently, you might have noticed that the price of fuel is a little bit on the high side. Reaching prices over $3.50 in some places, it is only natural to wonder how much higher they will rise.
Many people wonder how gas prices can be so high and the oil companies can make such exorbitant profits at the same time. Part of that answer revolves around the fact that gasoline is an inelastic product, meaning that no matter how high prices get, the demand will not usually decrease as a result. It’s a lot like cigarettes… or crack.
The Organization of Petroleum Exporting Countries is a group of countries that produce oil. The organization basically controls everything to do with oil in those countries, including price. Now, this group is not a monopoly, but it does control two-thirds of the world’s oil, so it does have some monopoly like powers, and their job is to make sure that investors in oil get the best return on their money.
For the summer holidays, especially Memorial Day and the 4th of July, prices will most likely increase. This is a long standing trend. The good new is that they are supposed to level off to somewhere under $3.50 a gallon afterwards. You never thought you would be so excited about $3.40 a gallon, did you?
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