High *oil* prices keep O&G humming. Not gas prices. High oil prices are actually an enemy of the refining industry. Which is more profitable when input costs like oil are low.
Originally Posted by Stromprophet
You’re splitting hairs here.
Yes, high *oil* prices keep O&G humming, and higher *oil* prices reduce profits for refiners. But, as good capitalists, they have a remedy for that - they raise the price of their product - you know - *gas* (fuel oil, diesel, whatever). It’s a pretty direct correlation.
You simply can’t sustain high oil prices and low fuel prices, and as much as people may think they want low *oil* prices, they really don’t. They want the mid-point of the upward slope of the boom-bust cycle. Coming out of the bust hurts their wallets a bit at the pump though, so they piss and moan without realizing how good other things around them are.
My original point in calling out people complaining about the price of gas right now was to highlight that a significant portion of the Houston economy is driven by the price of oil. When oil prices drop, Houston suffers. If you need evidence of this, look at how 1986 affected the entire Houston financial landscape. Ask anyone who lived through that if they would go back to it just to save money on fuel. I wouldn’t.