Essay, Research Paper
Supply and Demand in the Gasoline Market
The substance known, as gasoline is a mixture of lighter liquid hydrocarbons
used chiefly as a fuel for internal-combustion engines. It is produced by the
fractional distillation of petroleum; by condensation or adsorption from natural
gas; by thermal or catalytic decomposition of petroleum or its fractions; by the
hydrogenation of producer gas or coal; or by the polymerization of hydrocarbons
of lower molecular weight. Gasoline produced by the direct distillation of crude
petroleum is known as straight-run gasoline. This is the type of gasoline, which
we use in our automobiles. It is this which makes gasoline a product that is
indispensable and also makes it highly demandable from the driving public. Thus
the price of gasoline can also have a direct affect on what types of cars people
will buy.
One of the problems with gasoline is that it is, for now, the main fuel for
automobiles and because of that it has become a necessity for most of the many
Americans who own cars and have no choice but to drive to get to work, as well
as in many other parts of the world. It is this constant need for gasoline to
get us around which makes the demand part of it very high. On the supply side is
where OPEC comes in, because they are the main suppliers for the gasoline for
the world at large. The Organization of Petroleum Producing Countries (OPEC) is
a permanent, intergovernmental organization, created at the Baghdad Conference
of September 10-14, 1960, by Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. The
five Founding Members were later joined by eight other Members: Qatar (1961);
Indonesia (1962); Socialist Peoples Libyan Arab Jamahiriya (1962); United Arab
Emirates (1967); Algeria (1969); Nigeria (1971); Ecuador (1973-1992) and Gabon
(1975-1994). OPEC’s objective is to co-ordinate and unify petroleum policies
among it?s Member Countries, in order to secure fair and stable prices for the
petroleum producers; an efficient, economic and regular supply of petroleum to
consuming nations; and a fair return on capital to those investing in the
industry (OPEC Web site). OPEC?s decisions have a direct effect on the price
we pay for gas, both here in America and around the world. If they decide that
they want to raise the price of petroleum to $30 per barrel, then the price per
gallon at the gas station will go up accordingly. Likewise, if OPEC decides to
lower the price per barrel of gasoline, then OPEC?s decision would have a
direct effect on the market price of the gas at the gas station.
The supply-demand issues in the domestic gasoline market affect all different
parts of the economy. For example, when the price for gas was extremely low
about a year or so ago, people started to purchase more cars and many of the
vehicles purchased were Sport Utility Vehicles (SUV?s). These vehicles have
larger engines and tend to consume much more gasoline than the smaller, more
fuel-efficient cars. (I know this to be true, because during that time I
purchased a Jeep Wrangler, which holds and uses more gas than the smaller car
that I used to own.) Now the price per gallon is at least 60 cents higher then
it was a year ago, which, if you do the numbers as to how much gas people use,
makes it an incredible increase. Since the use of gasoline is an absolute
necessity if you own a car, then you have no choice but to pay the higher price,
since at this point in time alternative fueled vehicles aren?t that cost
efficient.
In this paper I have tried to explain how the supply and demand of gasoline
and its use in automobiles can affect the economy. In conclusion, until such
time that gasoline is no longer needed to run automobiles there will be a
constant demand for the product, and there will always be organizations such as
OPEC around to supply it.
Brue, Stanley L. and McConnell, Campbell R. . Economics: Principles,
Problems, and Policies. Fourteenth Edition. McGraw-Hill Irwin
Gasoline," Microsoft? Encarta? Online Encyclopedia 2000
encarta.msn/ ? 1997-2000 Microsoft Corporation. All rights
reserved.
The Organization of Petroleum Producing Countries Web Site. opec/193.81.181.14/xxx1/welcome.htm.
2000 OPEC. All rights reserved.
Другие работы по теме:
Market and its Functioning
Law of demand and law of Supply. Elasticity of supply and demand. Models of market and its impact on productivity. Kinds of market competition, methods of regulation of market. Indirect method of market regulation, tax, the governmental price control.
Housing Problem Essay Research Paper Many economists
Housing Problem Essay, Research Paper Many economists argue that market solutions are more efficient than government agencies in providing services even when it comes to ?merit goods?. In the discussion of housing problem, I would disagree with the economist?s view. Housing is a very complicate issue that I believe it will work the best by the cooperation of market and government agencies.
Supply And Demand 2 Essay Research Paper
Recent medical advances have greatly enhanced the ability to successfully transplant organs and tissue. Forty-five years ago the first successful kidney transplant was performed in the United States, followed twenty years later by the first heart transplant. Statistics from the United Network for Organ Sharing (ONOS) indicate that in 1998 a total of 20,961 transplants were performed in the United States.
Oil In April 2000 Essay Research Paper
W A S H I N G T O N, April 6 ? The good news for consumers is gas prices are anticipated to drop this summer. But the bad news is the decline will be slow. With an increase in international oil production as a backdrop, the Energy Department today dramatically revised its forecast for summer gasoline prices. The agency said prices should peak later this month and begin dropping sometime in May, averaging about $1.46 a gallon throughout the summer.
Untitled Essay Research Paper In today
Untitled Essay, Research Paper In today’s modernized world, there seem to be several luxuries that we can not live without. In a large metropolitan area such as Los Angeles, cars and the gas that fuels the cars are a must. So what would happen when the number one and number two oil companies in the United States decided to merge together?The deal itself would be worth 75.3 billion dollars, making the new Exxon Mobil one of only two major fuel providers along with Royal Dutch/Shell until the merger between British Petroleum and Amoco Corp. is approved.
Anaylsis Paper Essay Research Paper Analysis Paper
Anaylsis Paper Essay, Research Paper Analysis Paper 1 The EIA predicted Midwestern Illinois families to be spending as much as 40% more on heating this year compared to last year because of higher natural gas prices. The increase in price is largely due to the reduction of natural gas supplied.
Ripple Effects Upon Economy Essay Research Paper
There are several things that can cause a ripple effect in our economy. There are economic facts, or things that will happen no matter what, that start to affect more and more people, until they sooner or later effect everybody. The
SupplyDemand And The Theories Of Location Essay
, Research Paper Economic theories of supply and demand provide a clear indication of the effectiveness of free markets in the allocation of land resources. Changes in the costs associated with accessibility have resulted in a free market move of population away from traditional city centres.
Economic Recession In Venezuela Essay Research Paper
Extract The Venezuelan economy is experiencing a recession. The recession has hit the industries the hardest. One company named Construcentro, similar to our Home Depot, was planning on opening thirteen new stores by the year 2000. They will certainly not achieve that goal and they may have to also close down other existing stores because of a forty- percent drop in sales.
AdAs Model Of A Boom Essay Research
Paper Explaining a ?BOOM? using the AD-AS model The Business Cycle or Trade Cycle is characterised by a regular cyclical pattern with four distinctive phases: the expansion, the peak, the contraction, and the trough.
Summary Of Pure Competition Essay Research Paper
There are four major types of markets. They are: Pure Competition: Large number of buyers and sellers trading a standardized product (corn, wheat); Pure Monopoly: One seller, firm is the industry; Monopolistic Competition: Large number of buyers, large number of sellers each selling a similar but slightly differentiated product (cigarettes); Oligopoly: Very few sellers that acknowledge that decision of one firm affects the others and takes this fact into account when making production or pricing decisions.
Untitled Essay Research Paper Jennifer Loughery
Untitled Essay, Research Paper Jennifer Loughery Back in the middle of October, the price of natural-gas had risen because a gas company was forced to shut down a pipeline due to the need for repairs. This
The Internet Market In Kuwait Essay Research
Paper Many competitive markets have been appeared in Middle East lately, and specially in Kuwait. The One which I will discuss is the Internet competitive market in Kuwait . Internet has been a great demand in all over the world. In 1992, The ministry of communication in Kuwait provided the internet service.
Explain What Is Meant By The Term
An Economic Model Essay, Research Paper Explain what is meant by the term an economic model and outline a model of price and output determination in a free market. Examine the effect of a change in real disposable income on equilibrium price and output.
Gas Prices Essay Research Paper How does
Gas Prices Essay, Research Paper How does that happen? I stopped in the morning on the way in to work and filled up my gas tank for $1.15/gallon or roughly $13 a tank and then just ten hours later, the same gas station, the same grade of gas is $1.10/gallon! If I had only waited, I could have saved enough money to buy a candy bar or a can of pop for my much-needed afternoon sugar break! But, of course, it has worked the other way in the past.
Perfect Competition Vs Monopoly Essay Research Paper
1. Analyze the fast food industry from the point of view of perfect competition. Include the concepts of elasticity, utility, costs, and market structure to explain the prices charged by fast food retailers.
Mankind Essay Research Paper The oil industries
Mankind Essay, Research Paper The oil industries have been a major issue in the world market economy; it has been a distressing factor for many years. In the 1970 s members of the Organization of Petroleum Exporting Countries (OPEC) decided to raise the world price of oil in order to increase their incomes.
Ethanol Essay Research Paper Proposal Essay42101Do the
Ethanol Essay, Research Paper Proposal Essay 4/21/01 Do the gas prices frustrate you every time you pull up to the pump? Gas companies are charging too much for the natural resource that is turned into what we know as gasoline. Gas companies discourage research and new ideas every year. Afraid of losing the market that they have cornered they buy patents.
Gasoline Essay Research Paper The price of
Gasoline Essay, Research Paper The price of gasoline is a major interest to almost everyone in the country and almost everywhere in the world. It seems that every month or even more frequently, gas prices are either rising or dropping but never staying stable. Gasoline prices are affected by many factors, including the price of crude oil in the world market, supply and demand for gasoline, local market competition, temporary supply interruptions, government regulations, or taxes.Gasoline is produced by a distillation process where crude oil is heated and fumes are captured and converted into many products such as kerosene, jet fuel, and gasoline to name a few.
Gasoline Essay Research Paper Why are we
Gasoline Essay, Research Paper Why are we paying so much for gasoline? If you haven?t noticed you must not drive, but there has been a drastic increase in gas prices in the past year and a half. It seemed like just the other day when I was at the gas station and I said ?Can I get 20 dollars on pump 3 please?? and that would guarantee a full tank of gas.
Rise Of Gasoline Prices Essay Research Paper
Jeff WoldhuisPeriod 25-22-00 Gasoline prices in the United States have been drastically rising since the beginning of the twenty-first century. These gasoline prices will continue to rise particullarly in the United States until the end of summer. But they will remain at a certain high from now on. The concept of supply and demand is also being used to explain the increase of these prices, where the demand of gasoline is rising faster than the supply for this United States gasoline.
None Essay Research Paper There are hundreds
None Essay, Research Paper There are hundreds of natural resources that the world relies on for everyday tasks. We use natural gas to heat our homes and office buildings. We use oil to lubricate the motors in automobiles and heavy machinery. We even use coal as a source of heat and energy in many circumstances.
3 Questions In Economics Essay Research Paper
1. Would the US economy be better off without government intervention in agriculture? Who would benefit? Who would lose? 2. Are large price movements inevitable in agricultural markets? What other mechanisms might be used to limit such movements?
Are Alternative Fuels The Best Alternative Essay
, Research Paper Are Alternative Fuels The Best Alternative? With the millennium just around the corner, new energy conserving ideas are being brought to the market. Among the most prominent are cars powered by electricity, as opposed to gasoline. Electric vehicles seem practical, and they protect the environment by reducing pollution.
Economic Report Essay Research Paper Demand In
Economic Report Essay, Research Paper Demand In economics, we need to use terms a little more carefully than they are sometimes used in ordinary discussions. In general use, “Demand” is a word that can have more than one meaning, but in microeconomics we define it more carefully so that it has only one meaning.
OPEC
– Supply And Demand Essay, Research Paper Lora Tomasello 7 / 17 / 00 Essay 1 The supply and demand issues dealing with the OPEC are that we are in great need of gasoline in the United States, since gas prices have soared in the past year. Saudi Arabia has a vast supply of stored oil. However, in the article it states that the Saudis cannot afford to appear as America?s lackeys.
SupplySide Economics Essay Research Paper SupplySide EconomicsEssay
Supply-Side Economics Essay, Research Paper Supply-Side Economics Essay Question Supply-Side economics and policies would best benefit the economy in the case of a recession in the year 2000. Supply-side policies are made of several important points to regulate the economy. Supply-side policies consist of stimulating the economy by production, cutting taxes, and limiting government regulations to increase incentives for businesses and individuals.
Heilbroner
’s Worldly Philosphers Essay, Research Paper 1. People looking to trade in their old car for money off of their new car become discouraged with the low trade in value, and decide either not to buy a new car at all or to buy a cheaper model. The lower car sales is a reduction in demand, because the decrease in resale value of used cars is not changing the prices of the new cars, as a change in quantity demanded would suggest, it is changing what people are willing to pay for the cars.
Monetary And Fiscal Policy Essay Research Paper
Monetary and Fiscal Policy The Monetary and Fiscal Policies, although controlled by two different organizations, are the ways that our economy is kept under control. Both policies have their strengths and weaknesses, some situations favoring use of both policies, but most of the time, only one is necessary.
Econ Essay Research Paper Moneycommodity money Fiat
Econ Essay, Research Paper Money-commodity money, Fiat. Money supply=currency in hands of public+other assetsas means of payment (demand deposits, traverler’s checks, savings accounts, time deposits, mutual funds)
Supply And Demand Essay Research Paper Market
Supply And Demand Essay, Research Paper Market demand is best defined as each consumer s demand for a particular product, or each firm s demand for a particular factor. The law of demand specifies that the amount demanded varies inversely with price . The following diagram can best demonstrate this. The table shows the maximum rate of purchase.
Fuel System Essay Research Paper David A
Fuel System Essay, Research Paper David A. & Jason A. Block 1 ? A Jan. 19, 2000 The Fuel System Automobiles, like all other mechanical devices must utilize a fuel to work. All cars, therefore have a fuel system. This system is responsible for storing gasoline and mixing it with air to be ignited in the engine to supply energy to the car.