Gas prices are a wonderful thing.  One week you drive by the pump, it’s $2 a gallon and the next week it’s $1.80/gallon.  That’s great but why do these rates change on a daily basis and how can we tell when the prices are going to go up and down?

Well we used to be able to track the price of the barrel but until recently people were confused that when the barrel went down, the prices would go up when they would usually go down.  It just didn’t make any sense.  Let’s look at some ways on why the gas prices go up.

The price of the barrel:  As I mentioned already, usually when the price of the barrel goes up on Wall Street, you can bet that the prices are going to go up in the next couple of days.  By keeping your eye on these prices, you can get a good idea on when it’ll go up and down.  You can always view the current price at Bloomberg.com.

Higher demand:  Like anything, when something is in demand, the price is going to rise.  When the economy isn’t doing so hot, you may find that people are cutting back on spending which can draw the prices to go down.

Disasters or leaks:  If a refinery is effected in any way, you’re going to hear about it in the news.  Whether it’s a hurricane, a gas pipe leakage or anything related to that, you’re going to hear how it’s going to draw the prices up.  Why would this happen?  Well, this means that less gas is being pumped to your local gas station, making the supply lower.

Refining costs:If the refining costs goes up, it’s going to be passed onto the consumer.  Some of these expenses included are going to be marketing, transportation and more.  When these expenses go up, guess who gets to pay for it?

These are a just a few factors when it comes to gas prices.  One thing that you do have to realize is that you can’t blame the gas station itself because they have to mark the prices up a little to make a profit themselves.  They have to stay in business, right?  While gas prices go up, there’s not much we can do unless we cut back on driving but as the years go on, alternative energy shall come and we won’t have to worry about these gas prices anymore.