Why is our gas so expensive?

Ridgerat · Dec 4, 2008

I just got back from S. California where I paid $1.73/gal for gas, and I don't understand why its still so much more expensive here at home.

Last time I checked we drill oil, and refine fuel here in Alaska right?

What the heck?!?

900RMK_AK · Dec 4, 2008

Simple

You North Slopers aren't producing enough to meet the snowmachiners needs!

It's all about supply and demand. Maybe it will come down next spring, oh yeah, then the wheelers will need more. See, it's a vicious cycle here in AK. Drink more beer! :beer;

I'm going outside until the 29th, if your around when I get back let's hit it up.

Ridgerat · Dec 4, 2008

900RMK_AK said:
You North Slopers aren't producing enough to meet the snowmachiners needs! It's all about supply and demand. Maybe it will come down next spring, oh yeah, then the wheelers will need more. See, it's a vicious cycle here in AK. Drink more beer! :beer;

I'm going outside until the 29th, if your around when I get back let's hit it up.

I think your explanation sucks, but I like your solution, I'll drink to that!:beer;

Hit me up when ya get back into town, I'll try to be ready to keep up with ya!

MADinAK · Dec 4, 2008

The refiners here in AK have stated at least twice that they are hosing us because they can. Really. They were very upfront about it and said they charge what they do because they can.

I don't agree with that business practice but what else are you going to do. I checked the price of oil today and it is down in the low 40's per barrel. Lube up and bend over.

wwracer · Dec 4, 2008

The Flint Hils refinery has been claiming to have "production challenges" for some time now, which is supposedly contributing to the increased cost of fuel at the pump, however, stated above it's mostly because they can. At 2.59 a gallon we are .81 above the nat. average and don't forget , that's with no state tax. Maybe the gov ought to quit jettin around and get a handle on things here on the home front

cjgodden · Dec 4, 2008

according to a guy I know that works at the RCA, They are charging pennys under what it would cost to ship fuel from portland. So they are just under cutting to make sure the depo does not barge up fuel but are charging as much as they can.

Ridgerat · Dec 4, 2008

They've got us by the short-hairs and they know it. I wish there was something we could do about it other than just cry!

I thought price gouging was illegal.

Ak nitro · Dec 5, 2008

Its their (the Oil companys) way of getting everyones dividends back. During the spring I can spend well over a thousand a month on fuel.

rev440alaska · Dec 5, 2008

yea but for those of us working for the oil companies and getting a company vehicle and free gas, we dont care. haha

MARV1 · Dec 5, 2008

Heck, oil closed yesterday at $38/barrel. And supposedly our lawmakers are working on a price gouging law as we speak.

rkymtnrider · Dec 5, 2008

ak nitro said:
its their (the oil companys) way of getting everyones dividends back. During the spring i can spend well over a thousand a month on fuel.

bingo

Puff_N_AK · Dec 5, 2008

?

I thought this was one of Mr Begich's election promises, to make sure AK refineries and oil industry was in line with lower 48 prices. Does anyone know if the refineries are taxed by the state? If so, maybe the legislature should adopt a 1% weekly tax increase until the refineries come in line with lower 48 prices. Just my .o2 :beer;

D8 · Dec 5, 2008

The economists working for the refiners claim that the higher prices are due to shipping costs. They figure in what it would cost for a competitor to ship gas/fuel from the lower 48. Of course, they probably calculate their shipping costs using a tanker truck driven all the way up from Texas. Even at $4000 for a truck to haul 10,000 gallons of fuel up the ALCAN from washington would only add $0.40 to the price per gallon, so we should really see prices about 50 cents higher than the lower 48. Another blunder by our state was to eliminate the 8 cents per gallon gas tax. The stations all dropped 8 cents the day the law was enacted, but after that point it is impossible to tell if it's actually still taken off the top. I highly doubt our gas prices should be $0.08 higher than they are now, when they are already high. I'm sure the refiner's are laughing all the way to the bank on that one.

From an inside source at Tesoro, Flint Hills produces Tesoro Gas for the Interioir and Tesoro produces Flint Hills fuel for South Central. I'm sure both of them tack on a shipping price based on the cost to ship fuel across the state, even though that doesn't occur. In other words all the Southcentral gas at Tesoro and Holiday stations is actually Tesoro fuel and the opposite for the interior. It's all a game and we're getting screwed right now.

D8 · Dec 5, 2008

Ak nitro said:
Its their (the Oil companys) way of getting everyones dividends back. During the spring I can spend well over a thousand a month on fuel.

That's a pretty ignorant statement.

The oil companies, which had their taxes increased still sell the oil to the refiners based on market prices. The refiner's are their own companies and are not included in the producers tax, therfore the refiner's could care less how much big oil is taxed, they still pay the market price for the product.

I hear people say the high fuel prices are just the oil companies getting back at us, but that could only be true if Tesoro or Flint Hills was owned by one of the producers.

Ridgerat · Dec 5, 2008

I think everyone in the state should be fired up about this issue!

Maybe there's nothing we can do about it, but then again a few thousand well placed phone calls might get the ball rolling in our favor.

Does anyone know what state government office/department/official is appropriate to call to voice our opinions?

homeslice · Dec 5, 2008

supply and demand people...

Ridgerat · Dec 5, 2008

homeslice said:
supply and demand people...

If its really that simple, then tell me why gas is ~2x the price is was last time oil was $45/barrel, but supply and demand havn't changed anywhere near the same rate.

Puff_N_AK · Dec 5, 2008

homeslice said:
supply and demand people...

I guess after that bag has been poked full of holes, we will be told that its the cost of shipping the additives in. These are the two most common excuses that have been used to justify higher pump prices.

homeslice · Dec 5, 2008

Ridgerat said:
If its really that simple, then tell me why gas is ~2x the price is was last time oil was $45/barrel, but supply and demand havn't changed anywhere near the same rate.

You guys have a valid point, I'm not trying to argue for higher gas prices. We are an energy dependent nation... and some of the issue boils down to simple economics (with demand so high) Obviously it's more complicated than that but you can't ignore the demand factor.

Either way $4.50 a gallon isn't going to stop me from riding all the time. Buy some Energy stocks/funds and start reaping the benefits... oil WILL go back up

pura vida · Dec 5, 2008

but there is absolutely zero reason we should be paying more than the national average. we shouldn't even be paying that. we are getting screwed and we all know it. the question is by who. everyone wants to blame the oil companies but i'm not convinced they are the sole issue. everyone needs to keep in mind we are pretty much 100% dependent on the oil companies in this state. without them we die, no one has jobs, period. they are not the enemy and the anti-oil company attitude we have started to develop in this state, lead by some of our oh-so-wonderful representatives, bothers/scares me a bit. but with that said, there is no reason we should stand around and take it up the a-hole for them. oh wait, there really isn't a dam thing we can do about it and they know it. so.... pass the lube baby, maybe it won't hurt so bad.

pv

(at least people are still complaining about and not JUST looking at pump price)

Why is our gas so expensive?

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