Monday, May 7, 2007

Gas Prices

I recently read an article, which stated that gasoline only cost 45 cents a gallon in Saudi Arabia, 33 cents a gallon in Iran and less than a quarter in Venezuela. These prices are extremely low compared to what we pay here in America partly because of the cost of living, but mainly because of the government subsidies. Many countries around the world have some government subsidy; and this is why they par far less than we pay. In America gasoline prices are over three dollars and are expected to reach four dollars by summer time. As gas prices continue to skyrocket the demand stays the same. People need gas to commute to work everyday, so of course the demand is going to always stay the same. In the article they said that the cost per barrel of oil went from sixty to eighty dollars and there was no change in demand. The only way that prices will go down is when the demand goes down. I suspect that this wont happen for a long time and prices will continue to rise, and people will continue paying high prices, including me.