SIMPLY PUTThere’s no reason to question lower gas prices
December 6, 2001
Hang on for a minute...we're trying to find some more stories you might like.
Email This Story
Have you noticed the low gas prices? I sure have. It hasn’t been since I first got my license, at 16, that I’ve seen the prices this low.
It’s a welcome change for students, especially those on a budget.
Some of the things that I’ve done since the prices dropped below a dollar: Drove to Irvine to visit my friend Craig and I drove to San Diego to visit my friend Bryan; I made no complaints about driving people around and drove aimlessly to points around Bakersfield.
You may be asking yourself, “Why are the gas prices so low?”
According to Stephen Smith, a BC economics professor, two reason have contributed to the low gas prices.
Simple supply and demand. Since the end of the summer driving months, people — especially those afraid to travel since Sept. 11 — have used a lot less fuel than in years past and the oil producers have a large inventory of fuel.
Adding to that, many economic experts believe that the United States has been in a recession since March.
Supply goes up, demand goes down. Demand goes up, supply goes down. Smith explained that when people clamor for gas, the oil companies will raise prices. Those companies must lower prices for the moment because of limited demand.
As prices continue to fall across the nation, people will be more apt to drive aimlessly, like myself.
Smith believes prices will fall even more when non-OPEC nations increase their production.
Non-OPEC countries — like Russia, Canada and Mexico — may be tempted to keep the oil coming in order to make money and knock the OPEC countries out of the ring.
A battle at the pump? Now that’s the sort of war I’d like to see. So what do we do now?
Simply put, there’s nothing that we can do. Smith said he believes that recessions and lower gas prices are cyclical. Whether we drive or not, eventually the high prices will catch up to us. Americans will find a way to screw the cheap times up and we’ll go back to the good old prices of close to $2 a gallon.
So, enjoy it while you can. I will.