Why Fuel Prices Should Be Lower
If you've been wondering why energy prices are surging upward for no apparent reason, you're not alone.
Something's not adding up, and it's important you understand what's happening in the market.
Dear Customer,
Like you, we are very concerned about rising fuel prices. When prices go up, some customers think we make more money. In fact, it just increases our costs and makes it harder for our customers to pay their bills.
The fundamentals of supply and demand normally drive prices. But there are forces at work keeping prices higher than they should be. It's important that you know what's happening and what we can do about it together.
Because nothing would make us happier than to see fuel prices drop.
What is driving fuel prices up?
Gas prices have gone up about 44 cents per gallon over the last 3 months of 2010 and are about 46 cents higher than in early February 2010.*
The typical factors leading to a rise in fuel prices -- supply shortage, high demand, and/or a weak dollar -- are not present. Oil inventories are above average, demand is up just 1% from last year, and the US dollar has strengthened. Conventional wisdom would have fuel prices dropping but they're not.
Speculation is causing fuel prices to rise.
Huge banks and hedge funds speculate on the cost of fuel.
They do this by exploiting loopholes in the way that the crude oil trades are regulated. A rise in oil prices leads to big profits for these investors. But, for the average homeowner the result is higher oil prices.**
What can you do?
- Contact your state and federal representatives:
Click here to contact / email Gov. Duval Patrick
Click here to contact / email Senator Scott Brown
Click here to contact / email Senator John Kerry
Click here and enter your state and zip code to find your State Representative
- Then, click here to contact the Commodities Futures Trading Commission or you may call 202-418-5000.
Urge your representatives to enforce regulations and close loopholes in the current regulations that make excessive speculation possible. Together, we can send a strong message to Wall Street. Let them know it is not acceptable to pad their pockets at the expense of the America public.
Over the long run, energy prices will also be helped by increasing domestic production, improving conservation and strengthening the U.S. dollar. But, together, we can attack the problem of speculation right now.
Information provided by Kerivan-Lane, Inc. Kerivan-Lane offers fuel oil delivery, oil heating, gas heating and plumbing services to the Greater Boston area.
Source: Why Fuel Prices Should Be Lower, copyright Warm Thoughts Communications, Inc.
* Source CNN.com ** Source TheBostonChannel.com
