For example, the groceries we buy — which arrive in gasoline-powered trucks — go up as well. Although it not only causes consumers to stay home, it causes everyone to have to cut their budget to accommodate other important areas.
It turns out domestic oil demand is near record lows at the very same time U.S. oil supplies remain at high levels, according to the U.S. Department of Energy.
I spoke to one Miami driver who blames speculators for hiking the price of wholesale oil. He said that is who is behind the recent spikes in local gas prices.
In fact, some stations by Miami International Airport already are selling Regular-Unleaded for $4.39 a gallon!
“The politicians better watch out what they are doing to the investors who are driving up prices?” this driver insisted.
According to a report by the House Natural Resources Committee, between 1999 and 2007 the number of drilling permits on public lands has increased by more than 361 percent, yet gasoline prices continued to skyrocket. However, increased leases have not reduced the price of gas.
With consumer prices up about 3 percent since last year, overall food and energy costs have risen at their fastest annual rate since 2008. They’re up more than 6 percent for energy-related costs, and almost 4.5 percent for food prices.
So do oil companies need new leases along the OCS (Outer Continental Shelf)? According to the U.S. Minerals Management Service, only 20 percent of the 38.5 million acres of existing leases along the OCS are being used for production. The vast majority of oil and gas deposits along the OCS already are open to drilling. What’s more, 82 percent of the gas in the OCS and 79 percent of the oil in the OCS is available for leasing.
Local produce buyers say if gas prices keep rising, food costs will keep climbing too following the expected extra fuel surcharges from shippers.
One Norman Brothers produce manager told me, “We’re not seeing it just yet, but it’s coming. It’s still early.”
Consequently, a Kendall consumer complained, “I think that’s terrible having to pay extra for fuel products.”
Her sentiments are commonplace. The price of oil on world markets climbed again recently, closing above $106 a barrel. Tension in the Middle East is partly to blame, but the rising price of gas at the pump provided political fuel for Republican presidential hopefuls.
The surprisingly swift rise in oil prices recently has sent the average price of gasoline up and it’s hurting many families that were already fighting to survive tough economic conditions.
The Obama administration says it’s not responsible for this rise in gas prices and insists that the solution to the problem is difficult. According to the administration, there is no easy answer to this problem.