Gas price-gouging is just economics. Addiction to oil is the problem

Reports of price-gouging for essential goods and services that came before, during and after the arrival of Hurricanes Harvey and Irma provoked widespread outrage.

The anger was justified: $20 for a gallon of gasoline? Businesses that prey on people running for their lives by squeezing them for their last dollar deserve public scorn, and some representatives in Congress are calling for an investigation.

But Americans should consider this: That’s just economics. How is price gouging different than what Uber or Ticketmaster engage in as part of their core business model? It’s simple supply and demand: On an ordinary day, gasoline and diesel are priced according to many factors, largely the price of oil, which is set internationally. Under extraordinary circumstances, such as during a catastrophic storm, supplies are constricted, so demand goes up, and prices to match.

Anyone who doesn’t like this basic math should try to change the equation by thinking about the real underlying problem: It’s the fact that oil has a monopoly on our transportation fuels market. With the exception of people who drive plug-in electric vehicles, hydrogen fuel-cell vehicles or CNG-powered cars (which, combined, account for a fraction of total light-duty vehicles on the road), we have just one choice in “feedstock” for our vehicle fuel: oil.

That leaves us vulnerable when things go haywire: After Harvey made landfall in Texas, it temporarily took multiple oil refineries offline. With Irma, the problem was the supply chain that delivers gasoline to retail outlets: With freeways clogged from people evacuating South Florida and the state’s Gulf coast, and with the storm bringing flooding and debris, tanker trucks couldn’t get through. Many stations were empty, worsening the plight for exhausted evacuees who tried to get back home.

(Most recently, most of Puerto Rico remains without electricity after Hurricane Maria, and gasoline shortages are causing lines that stretch for blocks.)

People tend to get upset when they feel a company or business is making too much profit. (See Martin Shkreli as Exhibit A). We all operate under the rules of a capitalist economy, and we bristle at the thought of anyone putting a limit on how much we can earn. But jack up the price of a needed product, and the blowback is instant, particularly if the victims are children or working families living paycheck to paycheck. Americans hate monopolies.

And yet when the storms subside, consumers are likely to return to just living with the unpredictable cost of one commodity we need every day: gasoline or diesel for our vehicles. Deep down, we know we’re submitting to monopolistic prices, but too often our annoyance ebbs, because we feel we have no control.

It’s not true. We do have the power to fight against this one-sided system, and the power comes through unified voices calling for change. Join us in demanding that the U.S. increase the availability of alternatives to oil for transportation. Competition at the pump benefits the economy, our health, and national security.

When Mother Nature calms down, and prices return to “normal,” that’s exactly the time to demand fuel choice. We can’t predict when the next crisis will come along (whether man-made or natural), disrupting the fragile worldwide system of oil delivery. But it will come, and then another after that.

The only certain way to keep oil prices low, and stable, for the long term is to scale up the use of alternative fuels for transportation. Visit or sign up for our list to learn more about how you can help.


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