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how do we get our gasoline, and why does it cost so much?...

<< Back to: Gasoline FAQ - Part 4 of 4

Question by kris
Submitted on 4/15/2004
Related FAQ: Gasoline FAQ - Part 4 of 4
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how do we get our gasoline, and why does it cost so much? Will the price ever go down?

Answer by Hush
Submitted on 7/11/2004
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Gasoline is derived from processing oil.  Diesel fuel also is from processing oil.  As it happens gasoline is actually a bi-product, and as such really is waste - so it is a little annoying that it is so expensive.  However, consider yourself lucky not to be in England - here fuel prices are exceptionally high because of the ridiculous 70+% fuel taxes!

Prices before tax are created based on the price of oil (priced per barrel) by the oil companies, and then obviously allowances are made for processing by the refinery and transport - together with a profit margin to fund the gas station and staffing throughout the company.


Answer by Chels
Submitted on 9/24/2004
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where do we get our gas from?


Answer by Jan in Texas
Submitted on 2/11/2005
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We import most of our oil from Iraq and with the war going on, it only makes sense that they would up the price in an effort to screw our economy and try and take over the world, in vain of course.


Answer by dad
Submitted on 5/13/2005
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how munch does gas cost


Answer by Kines
Submitted on 10/14/2005
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A complex question deserves a thorough answer!

Oil is, basically, a sticky viscous soup of hydrogen, carbon, chlorine, sulfur and other elements, all combined together with heat and pressure.

Everything we make, buy, use, or desire today contains some petrochemicals.

When oil is sent into a refinery it is a toxic sludge, when it comes out the other end, it can be anything, from aspirin, to car tires.

Most pharmaceuticals today are synthesized from petrochemicals, as are textile dyes, food preservatives, pesticides, plastics, polyester, vinyl, nylon, synthetic rubber, etc.

When you get a headache from this answer, and reach for an aspirin, that pill isnt made from powdered willow bark like it was back in the day, its made from oil.

Every barrel of oil the goes into a refinery comes out as a series of different chemicals, which can be molded, melted, modified, and changed into an almost infinite number of other chemical compounds, but theres also the downside.

Petrochemical waste includes  sulphur, volatile compounds, solvents, corrosives, toxic minerals, and other such unpleasantness. Fortunately, your car burns volatile organic compounds for fuel, and needs many of the toxic mineral salts to run efficiently. Petrochemical companies mix up these waste products into an efficient, affordable fuel, and sell it for a profit, so everybody wins.

Well... thats how it used to be.

Government regulations, market forces, and environmental laws have restricted oil companies in many ways, and have put price constraints on many of their operations. Currently oil companies are facing higher crude oil prices, and have few avenues to pass on these higher costs to the end user (thats us). Higher costs mean higher prices somewhere, and the most palatable choice was an increase in fuel prices. Unless we are willing to pay a LOT more for pharmaceuticals, plastics, textiles, dyes, medical equipment or food, fuel prices will be the preferred area where petrochemical companies offset higher oil prices.

But its not just oil companies, there are also the speculators, guys who produce nothing, and make their money by buying when something is cheap, and holding it until prices rise. Fuel speculators are the main cause of the current price spikes, and the trend towards higher fuel costs. Thats why if an oil tanker hits a rock off Puget Sound at 9 am you're paying an extra $1.50 a gallon in San Pedro by lunch. Speculators feed off the anticipated price increases from any perceived crisis, they could be called vultures, except vultures fill a role in the ecology.

So, next time somebody says "Big Oil is ripping us off", you can rest assured that it's not "Big Oil",the companies that make our lives better, easier, and healthier through innovation and science.

You're actually getting ripped off by a commodity broker who never produced anything himself, except hemorroids, and an ulcer.


Answer by Saeah
Submitted on 4/19/2006
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oil comes from dinosuor remains


Answer by rez
Submitted on 5/14/2006
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why is gasoline so high,and why isnt there alot?


Answer by james
Submitted on 8/16/2006
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That is a rediculous tax.  I wouldn't want to pay that


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