We hear Biden and others continually say oil companies are gouging because gasoline prices at the pump don't react immediately to changes in crude oil prices.  As with most Democrat talking points, facts don't matter.

The facts are easy to find, but somehow journalists rarely, if ever, do research before they repeat the talking points.  After all, their basic function seems to be to campaign for Democrats and their leftist policies to destroy America and disparage capitalism.

Here are some facts:

The price of crude oil on election day 2020 was around $40 per barrel.

The price of crude today is around $106 per barrel, or up over 150%.

The average retail price of gas on Election Day 2020 was around $2.11 per gallon.  The average price today is $4.09, or up less than 100%.

Gasoline prices in California, 4/12/22.

If the price of the raw product is up over 150%, and the price of the finished product is up less than 100%, how could that possibly be considered gouging?  If the retail price of gas today corresponded with crude oil prices, it would be over $5 instead of $4.

People should also recognize that retail stores face a lot of other cost increases, just like all businesses, because inflation has ramped up due to Biden's policies.  Labor costs, utility costs, and everything else are increasing substantially.  As the price of gas has doubled, the credit card interchange fee has also doubled from over 4 cents per gallon to over 8 cents per gallon.

Democrats should also recognize that crude oil doesn't magically go directly to the pump from the well.

The producer at the well, the transporter from the well to the refiner, the refiner, the transporter to the terminal, and the transporter from the terminal to the retailer all face substantial inflation costs before the product gets to the retail station, so those costs are absorbed in the retailers' cost.

People should also remember that, in Illinois and a few other states, sales taxes rise with the price of gasoline, which reduces the margin at the pump even lower than the 100%.  If gouging is underway, isn't Illinois gouging?  Its markup for sales tax has almost doubled from around 10 cents to around 20 cents per gallon even though its raw costs haven't gone up at all.

The raw cost to the government is zero, yet in Illinois, the price of gas includes:

 Federal excise tax —18.3 cents

State Motor Fuel tax — 39.2 cents

Sales tax is 6.25%, or around 20 cents.

The taxes on gasoline in Illinois total around 77 cents per gallon, which dwarfs the profit per gallon of the oil companies, and the state and the federal governments have zero capital investment in the store and zero operational costs.  So who is gouging?  Isn't it the politicians who are the greedy ones, instead of the private sector?

President Biden repeatedly says he is doing every dictatorial edict (executive action) that he can to lower inflation.  His latest action is especially idiotic and will do nothing to save people money.  He is allowing gas stations to sell more E85 this year during the summer.  Basically, he is converting more high-priced corn into fuel.  He says that will save drivers 10 cents per gallon.  Does it really save drivers money when E85 gets drivers significantly worse miles per gallon?

MPG: Due to ethanol's lower energy content, FFV's operating on E85 get roughly 15% to 27% fewer miles per gallon than when operating on regular gasoline, depending on the ethanol content.

Isn't that intentionally misleading the consumers, or false advertising, when you tell them they will save money?

Is it smart to divert food to fuel when we have plenty of fuel in the ground, when food prices are soaring, and when we are already worried about a shortage of food?  Is it smart to continually divert corn to fuel when it isn't good for the environment?

U.S. corn-based ethanol worse for the climate than gasoline, study finds

Corn-based ethanol, which for years has been mixed in huge quantities into gasoline sold at U.S. pumps, is likely a much bigger contributor to global warming than straight gasoline, according to a study published Monday.

The study, published in the Proceedings of the National Academy of Sciences, contradicts previous research commissioned by the U.S. Department of Agriculture (USDA) showing ethanol and other biofuels to be relatively green.

It has been known for a long time that ethanol is not that good for the environment, so why don't the media constantly point it out?  Because they don't really care.

This article is from 2012. 

Study: E85 Hurts Environment Up To 33 Percent Worse Than Conventional Gasoline

So what factors have caused inflation to soar since Biden took office?

The war on fossil fuels sent a message to the world that the U.S would no longer be a major oil producer, and higher energy prices affect almost everything we buy and use.

Regulations limiting supply are very inflationary.

Paying people more to stay home than work caused major inflationary pressures.

Lockdowns and capacity limitations are inflationary.

Moratoriums on rent are inflationary.  What are landlords supposed to do when power-hungry politicians can stop their cash flow with the stroke of a pen?  People who didn't pay rent had more money to spend on other stuff. 

Continually stopping student loan payments gives people more money to spend on other stuff.  Who the heck believes that people that borrow shouldn't have to pay it back?  Why should other people have to pay loans that they didn't benefit from?

The Federal Reserve printing massive amounts of money and keeping interest rates artificially low is also very inflationary. 

California is considering a law that will goose inflation higher.  Businesses are having trouble hiring people and keeping up with orders, so what should be a good policy?  It surely wouldn't be a good policy to cut the workweek to 32 hours and make businesses pay overtime for anything over 32 hours, would it?

California considers a shortened, 32-hour workweek for larger companies

The law would supposedly affect only larger businesses, but like most regulations, small businesses would be decimated, because they would have to compete harder for workers.

Economics is not rocket science.  It is mostly common sense, and most journalists and other Democrats don't have a lick of that.

Here is what our brilliant V.P. said about inflation: "I acknowledge one must acknowledge that prices are going up."

Incidentally, I am a CPA with 45 years of experience.  I was the controller of an oil company from 1981 to 1990, where the company was a wholesaler, trader, and retailer.  Retailing is a very capital-intensive, low-margin business.  Our average markup on wholesaling and trading was around one quarter of a cent per gallon, and, on retail, we were lucky if we averaged 10 cents per gallon.  The key was volume.  I would challenge any politician to explain why that retail margin is too high.

If Biden and others want to go after high-margin businesses, they should go after companies like Microsoft, Facebook, Twitter, and Google.  Of course, they won't go after them because they are also leftists who support the left's destructive agenda.  Those companies did well with the lockdowns as small businesses were destroyed.

Will journalists ever do their job and research and report facts instead of talking points?  Sadly, it doesn't appear that they will, because all they appear to care about is power for leftists.

Image credit: YouTube screen grab (cropped).