Gas Prices Are GUTTING American Wallets

(by Marie Hawthorne | The Organic Prepper) – As of June 16, the national average price for a gallon of gas was $5.009. The national average price for a gallon of diesel was $5.718. Unless we’ve lived in Europe, we haven’t seen gas prices like this before. What’s going on? Will it stay this way?

Pointing the finger

Biden keeps referring to the “Putin Price Hike.” After Russia invaded Ukraine in February, the White House banned Russian imports of coal, oil, and natural gas. Biden cut off trade, but he’s trying to blame Putin for the mess.

Sen. Elizabeth Warren blames corporate greed. While it’s true that ExxonMobil, for example, posted a record profit for the second quarter of 2022 at $25.79 billion, this comes on top of losing $20 billion back in 2020. “Corporate greed” doesn’t explain that.

Truthfully, a variety of poor policies have led to the current gasoline prices. To try and make sense of what’s going on, we can look at the four most significant factors that go into determining the price of a gallon of gasoline.

The four factors that impact gas prices

The first is the price of crude oil itself, which is an internationally traded commodity. That’s the biggest reason Americans have to pay attention to what happens in far corners of the world. The Organization of Petroleum Exporting Countries (OPEC), led by Saudi Arabia, controls roughly 60% of the world’s internationally traded petroleum.

Taxes play the second-biggest role, and that’s part of why prices vary so widely from state to state. Today, for example, a gallon of gas costs $6.428 in California and $4.497 in Georgia.

Distribution and marketing costs and profits also affect price. Think about oil refineries. Are there any down the street from you? No? Then that means oil needs to be transported by truck to the gas stations in your neighborhood, and obviously, the farther you are from oil refineries, the more this will contribute to gas prices in your area. This, along with lower taxes, is the main reason gas is so much cheaper in the southern states. The United States’ oil refineries are overwhelmingly located along the Gulf Coast.

And finally comes the cost of refining itself. Refining is incredibly complex, requiring many layers of highly skilled, highly trained engineers and technicians. Have you ever driven past a refinery? I have spent my adult life close to refineries for one reason or another. They look like little cities.

Refineries are complicated

You cannot turn a couple of switches off when you feel like using solar power and throw a couple switches back on when you get an unusually cold snap, and you decide you need petroleum products again. The same goes for the actual rigs. If you cap a well because a particular politician wants to end fossil fuel usage, you can’t necessarily reopen it once it gets cold and people decide they’d really prefer not to freeze.

Refineries take a long time to build. The permitting process is expensive, and if you have an administration like our current one, which canceled Keystone after it had been approved, it represents a gamble of many millions of dollars. These reasons, along with a NIMBY culture, are why no new refineries have been built in the U.S. in nearly 50 years.

(Worried about how rising gas prices will increase food prices? Check out our free QUICKSTART Guide to home canning.)

Energy drives civilization.

Since the end of World War II, the U.S. has been pushing its doctrine of happiness through fast cars, big homes, and eating whatever you want whenever you want across the globe. The rest of the world wants in on it, and they need energy. Energy to build and run the cars, energy to build and heat the homes, and energy to grow and transport the food. It all takes energy, and cheap energy is the reason so many of us work in offices rather than breaking our backs digging wells or harvesting by hand.

For something so vital to not only our lifestyle but our very survival, you’d think various governments would have coherent energy policies, but they don’t. In Biden’s Executive Order Protecting Public Health and Environment, issued Jan. 21, 2021, his first day in office, Biden made it clear that he intended to make oil and gas production more difficult and therefore more expensive. In Section 6c, he explicitly states that weather events have “increased the urgency for combatting climate change and accelerating the transition toward a clean energy economy.” In Section 6d, he states, “Leaving the Keystone XL Pipeline permit in place would not be consistent with my Administration’s economic and climate imperatives.”

Biden made it clear from his first day in office that he would not favor fossil fuel extraction. He’s not alone; the global finance community has further complicated the situation in its implementation of Environmental, Social, and Governance (ESG) scores.

ESG scores function like a social credit system for corporations.

The higher your ESG score, the easier it is to obtain funding for various business ventures. And ESG scores weigh heavily toward renewable energy sources such as wind and solar.

This should shock no one. The World Economic Forum (WEF) has been issuing guidance on developing ESG guidelines. The WEF is also passionate about ending fossil fuel usage.

The WEF’s reasons for ending fossil fuel extraction are outside the scope of this article. I simply want to state that many powerful global players want to end fossil fuel usage, and from his first day in office, Biden has made it clear that he shares those priorities. Read Full Article >