is gas more costly than gold now?

I had absolutely no gas this morning so I drove over to the nearest gas Stations, "Spartan Gas" to fill up. I thought, without even looking at the price, that this would be cheaper then any Shell or Chevron. So I slid my card in, pushed 89 unleaded and started PUMPIN'. That's when I saw a 3 out of the corner of my eye... then following the 3 was a 2. Then my heart stopped for a mere second. WHAT?

$3.20 for a GALLON OF GAS? Are these people out of their freaking god damn minds?

It cost me $50 to fill up a BMW, not an Escalade, not a semi-truck... a BEEMER! I can't believe the cost of gas. What the hell happened that caused this spike? Rememeber the good ole days when you would budget $50 a month for gas? Now I have to save at least $150 a month to DRIVE. That is outrageous!Is there anything I can do to help stop this? How do Gas Prices even work?

Apparently, Gasoline is the bloodline that keeps America moving. Our personal vehicles alone guzzle 65 billion gallons of gasoline and diesel fuel each year, and that number is projected to increase by 2.6 percent each year. Gas prices go up, down and sideways constantly and they change from location to location. Other countries, and even other states and cities, can have very different gas prices from your local Gas-N-Go. To the average person, it probably seems as though there's little rhyme or reason to how gas prices are determined.

The bottom line is that Americans love gas. Our love for gas is growing rapidly with the popularity of SUV's etc... (and yes I'm guilty of that). Would you believe that Americans drive more than 2.5 trillion miles per year in automobiles? That is a hard fact to swallow. If you want to put that into perspective, that's about 14,000 round-trips to the sun.

We consume about an average of 20 million barrels of oil per day. The rest is used for distillate fuel oil, jet fuel, residual fuel and other oils. The reason we're seeing a spike right now is that typically, the demand for gas spikes during the summer. That's when lots of people go on vacation. Holidays like Memorial Day and the Fourth of July create logjams of tourist traffic during the summer.

This high demand usually translates into higher gasoline prices, although that's not always the case. For instance, while gas prices soared 31 cents in April and early May of 2001, reaching $1.71 per gallon (which now seems CHEAP AS HELL compared to today's prices), prices actually declined during the 2001 summer.

In 2004, prices continued to rise past the end of the summer travel season for a variety of reasons, including several hurricanes and an increase in the price of crude oil. And in 2005, Hurricane Katrina (along with a sizeable increase in crude oil prices) pushed prices to $3.07 per gallon on September 5, 2005.

Price increases generally occur when the world crude-oil market tightens and lowers inventories.

Who gets all that gas money?
When you pump $20 dollars into your tank, that money is broken up into little pieces that get distributed among several entities. Gas is just like any other consumer product: There's a supply chain and several groups who are responsible for setting the price of the product. The diagram below (from HowStuffworks.com) shows you the break down of your pump money...

Here's the breakdown of the areas listed above:

• Crude oil - The biggest portion of the cost of gas -- as of February 2006, that's about 59 percent -- goes to the crude-oil suppliers.
• Refining costs - The refining of crude oil makes up about 10 percent of the price of gasoline.
• Distribution and marketing - Crude oil is transported to refineries, and gasoline is shipped from the refineries to distribution points and then to gas stations. The price of transportation is passed along to the consumer. Marketing the brand of the oil company is also added into the cost of the gasoline you buy. Together, these two factors account for about 11 percent of the price of gasoline.
• Taxes - Taxes, including federal and local, account for about 20 percent of the total price of gas in the United States. Federal excise taxes are 18.4 cents per gallon, and state excise taxes average 20 cents per gallon. There may also be some additional state sales taxes, as well as local and city taxes. In Europe, gas prices are far higher than in America because taxes on gas are much higher. For example, gas prices in England have risen as high as $6 per gallon, with 78 percent of that going to taxes.
• Station markup - In order to stay in business, service stations have to add on a few more cents to make a profit. There's no set standard for how much gas stations add on to the price. Some may add just a couple of cents, while others may add as much as a dime or more. However, some states have markup laws prohibiting stations from charging less than a certain percentage over invoice from the wholesaler. These laws are designed to protect small, individually-owned gas stations from being driven out of business by large chains who can afford to slash prices at select locations.

Here are the national gas prices in the U.S.. Caution, view at your own risk:

Click for larger viewing....

There may be a few things you can try to do but nothing is gauranteed to work... its worth it though so read on...

1. Try to pump gas at the cheapest places around... There are lots of websites designated to help commuters find cheap gas stations. In San Jose, go visit: http://www.sanjosegasprices.com/
If you don't live in san jose, use sites like http://www.gasbuddy.com/ to find the cheapest spots in your home town.

2. Try to fight the gas war. For the next year, don't purchase any gas from Exxon, Mobil, Chevron or Shell. Try to get your gas from small retailers like Arco and Rotten Robbie. If the big gas companies aren't selling, the will be inclined to reduce their gas prices.. But honestly, to make this happen there would havebe millions of people who stop getting gas at those places.. so spread the word like butter.

3, Consider purchasing a hybrid like a Toyota Prius gets up to 60 miles per gallon. That could cut your gas costs in half! Its on 20K too!! Hmm.. honey, we gotta go car shopping..

Honestly, I don't know what to do. I'm going to try and go to the websites that have cheap gas stations but at the same time, I'm going to walk more and try to drive around to spots during light traffic hours etc. I may even increase my work at home days. who knows. We, the people, need to stop this price spike from going any higher. Theres no reaction when there's no action.

By the way, how long would it take to ride a bike from San Jose to Mountain View... hmmm....

LaaliOUT.