Free Essays,College Free Essays,Free College Essays at Anti Essays

Essay:

“Gas Prices: What has caused them to soar?”


















Business 350
1 October 2008
“Gas Prices: What has caused them to soar?”
This sudden surge in extreme gas prices has put the United States in a state of panic. Our once roaring economy has screeched to a halt. Millions of homes have gone into foreclosure. Credit cards are maxed out. Thousands of Business’s, large and small, are downsizing or closing their doors for good. The unemployment rate is at an all time high and does not seem to be slowing down anytime soon. The financial market is in shambles. Almost every major bank has either gone belly up, or is in merger talks. The sudden spike in gas prices seems to have been the tipping point that has caused all this turmoil. So where did these gas prices come from? There seems to be several factors contributing to the soaring gas prices: the fading U.S. production, the Iraq War, the OPEC stranglehold, an increase in world demand, and newly emerging technologies.
I. Fading U.S. Production
Over the past few decades, United States based oil companies have seen their production cost greatly increase. Not so much in maintaining oil fields that are already in production. But in finding and establishing new resources. It has become very expensive to find these new resources, and it is hit or miss. Many times when they decide on a location and drill for the oil, there is nothing there. They lose ever penny invested in that location. Not only is it expensive to produce the oil in the United States, it is expensive to refine it as well. The last U.S. based oil refinery was built in 1976. Big oil companies have attempted to build several more, but environmental groups and local residents have tied the process up in court spanning a decade or more. So not only is it very...