Demand and supply #5420

A decrease in supply leads to an increase in price (The priciest gas ...):

Nation, you’d have to drive a long way today — to Alaska or (glub, glub) Hawaii — to find gas more expensive than it is right here in North Carolina.

We have the priciest gas in the lower 48 states.

The average price for self-service regular today is $3.794 statewide (and even higher in the Triangle, $3.841), according to fuelgaugereport.com.

That’s 31.4 cents more than the national average.  A month ago, North Carolinians were buying gas for $3.659 (and then we were about a penny BELOW the national average).

Why so high? With world oil prices falling sharply, why are our gas prices falling only slowly?

Hurricane Ike is still hurting us, and our southeastern neighbors in South Carolina and Georgia. The two Gulf refinery pipelines that deliver most of our gas have returned to full production, but a lot of retailers still aren’t getting their full supplies.

Comments

[Don Lloyd]

John,

I have no data to bear on the question, but suspect that states that have seen actual shortages in the last couple of months, possibly exacerbated by politicians seeking political gain by talking up anti-price-gouging measures, will tend to have motorists that are slower to resume allowing their gas tanks to empty to more normal levels and reducing demand. Only consumers can allow prices to fall after station operators can see more normal supply and their predicted replacement costs returning to lower levels.

Regards, Don

[odograph]

Didn't the "Nation, ..." thing start with Colbert? Now everybody is doing it (even Obama).

[Tim Haab]

Nation, I paid $3.12 for gas this morning.

[John Whitehead]

Nation, I've located the exact location of the highest gas prices in the country:

On Tuesday, gas in the Charlotte area sold for an average of $3.90 for a gallon of regular. Elsewhere in the state, the average was $3.88 in Asheville and $3.84 in Raleigh. The national average was $3.48.

http://www.charlotteobserver.com/100/story/239204.html

[Don Lloyd]

http://mises.org/story/3136

Regards, Don

[LFLIATWP]

John,

Why don't you make a road trip to Lexington, KY, this weekend. Gas is cheap here.

Living in KY, I was surprised to see that the Southeast had problems with their supply of gas. We saw gas prices spike pre-Ike at $3.96. Since Ike, our prices have continued to fall while TN, SC, NC, and GA were reporting problems getting gas. I was certain their gas prices would rise leading to that magical invisible hand taking gas from us in KY to give to those without(that almost sounds socialistic). That should have eased the supply problems with our neighbors. Of course we would have seen higher prices not lower prices here in KY as a result.

Darn the invisible hand. It is starting to make me look bad.

[John Whitehead]

For cheap gas I'll make the trip!