Prices of gasoline Essay Example for Free

Prices of gasoline Essay With the prices of gasoline fast approaching $3 per gallon, the effect is already causing deep pocket holes in most American homes. A survey carried out by Reuters in Washington discovers that Americans are already planning to reduce their driving. This is causing pains and hardship for most of homes, factories and, manufacturing companies that must use gasoline in larger quality. The reason of this increase in the price of gasoline is linked majorly to the high rising cost of crude oil. There are several costs that go into producing and delivering of gasoline. These include the cost of the crude oil to refiners, refining costs and profits, distribution and marketing costs, and federal and state taxes. The cost of the crude oil hovers close to 50 per cent of the cost of a gallon of gas, taxes comprise about 25 per cent, and the remaining costs average almost 30 per cent. An explosion at a refinery in Big Spring, Texas was cited as one of the reasons for a rapid increase of crude oil prices to a record high over $100 a barrel. Also the unsettled nature of the oil producing regions of the world is one main cause of increase in the prices of gasoline. The Niger Delta problems and political instability in Nigeria, war in Iraq as well the supply problems in Iran. Most importantly, the increase in gasoline has affected the cost of living. A survey carried out by Reuters has indicated that 58% of Americans now go with public transport. We can not also overlook the fast raising price in food. This is as a result of the high cost of production which the companies are paying. The sensitive role played by gasoline in the American economy and the subsequent increase in prices has affected every aspect of an average American and this will continue if the Federal Government does halt stockpiling for the time being. In conclusion, the rising increase in the demand of gasoline by the global market having contribute to this present state, the Government should be working on developing other sources of enery. this will help resolve the continues increase in the price of gasoline in America now and in the future. Thanks Reference: †¢ Food and fuel America. (Thursday, February 21, 2008) Gasoline Price Soar Higher.