Gasoline Price Gouging
The 1973 Oil Embargo
1974 Gas Rationing In The U.S.
The 1973 Oil Crises Unfolds
2007 Gasoline Fuel Banks
On October 16, 1973 , the Organization of Arab Petroleum Exporting Countries (OAPEC) formed after the Six Day War, in 1967, decided to penalize nations that had supported Israel in The Yom Kippur War and announced they were going to cease shipments of oil to those countries who had supported Israel. Those nations were primarily the United States, Japan, and Western Europe.
At the same time OAPEC cut back production, in an effort to drive up prices.
Many states have legislation that defines and penalizes gouging right before, during, or after an emergency, but no state has defined gouging related to gasoline, without another disaster involved. The laws allow for price increase during an emergency of not more than 10% in California, unless the wholesale price has been increased beyond that. Laws on the books allow for an investigation of the retailer such as the gas station, but not at the wholesale level, such as the refinery. This means gas prices can skyrocket at the wholesale level, unimpeded.
A growing popular trend is the Gasoline Fuel Banks. Patron purchase gasoline at today's price and decide how many gallons they want. Their card is credited with the number of gallons, not a dollar amount. This has encouraged driver's to stock up on gasoline, and then when prices come down, they don't use the card, they save it for when prices go up. With the up and down market, it has saved as much as $1 per gallon. More
October 17 to 19, 1973 Saudi Arabia, Iran, Iraq, Abu Dhabi, Kuwait, and Qatar raised their price for oil 17%, overnight. Saudi Arabia, Libya and other Arab states proclaim an embargo on oil exports to the United States.
November 5, 1973, an announcement was made that production would be cut back 25%, and the embargo is extended to some South American and African nations.
By 1974 the price of oil had increased to four times the pre-embargo level from $3 a barrel to $12 a barrel. Gas had risen 17 cents a gallon, and the New York Stock Exchange seen a reduction the value of the exchange by $97 Billion in only six weeks. More
U.S. Government, limited the price of old oil, that oil already discovered, while allowing newly discovered oil to be sold at a higher price. This was suppose to encouage new oil exploration in the U.S. It resulted in a withdrawal of old oil from the market and created an articifical shortage, that resulted in gas rationing. The rationing plan was based on the last digit in the car license plate, odd numbers fueled up on odd number days, even numbers on even number days.
January 2, 1974 the national interstate speed limit was rolled back to 55mph. January 6, 1974 the U.S. began daylight savings time, as another move to reduce consumption. In 1977, a cabinet-level Department of Energy was created, and the United States's Strategic Petroleum Reserve received the first oil shipment July 21 1977.
Gasoline Rationing - Gasoline Wars - Gasoline Alternatives
Gasoline Hoarding - Gasoline Gouging
The Dark Side Of Gasoline Is Oil
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Still driving that gas guzzler? You may want to rethink the wisdom
Everyone keeps comparing things based on inflation, to say things are not really all that high now. Let's compare gasoline.
The California price of gas in 1936 was 11¢ a gallon. The minimum wage was 25¢ an hour. So, it cost 44% of an hour's wage, to buy a gallon of gasoline.
If we adjust the cost of gasoline back then to today's equivalent adjusted for inflation it would be $1,48 a gallon.
The price of gasoline in California in June 2008 is about $4.50 a gallon. The minimum wage is $8.00 an hour. The cost of gasoline is 56% of one hour's wage. Unfortunately, the minimum wage is much lower in many states, yet the cost of gasoline is about $4 a gallon.
In many states the minimum wageis $5,85-6.15 an hour, making their gas 65-68% of an hour's wage. Gas prices in those cities
