Monday, May 22, 2006
Costs
In case you haven't noticed, gas prices have gone up and down, but mostly up lately. And there's all kinds of folks raising holy hell about that. I can't help but wonder however, why is it that gas in particular gives such heartburn.
Look at water for example. For a month's worth of water that I use to clean, cook and bathe in, I - and most others around here - pay roughly $5-10 a month to the city government. And while I honestly have no idea how it's billed, that seems to be for roughly 1000-2000 gallons of clean, clear and cold water. Every so often, when I'm driving, I'll stop and get some bottle water to drink. It costs about $1.20 for a bottle -- a bottle that contains about 1/2 litre. That works out roughly to $7 for a gallon of water - basically the same water that we pay $5 for a thousand gallons. I know there's some overhead for the bottle and other packaging but you have to admit, that's a pretty steep markup.
Crude oil is going for about $70 a barrel (as of writing this) or around $1.70 a gallon. By the way, if you don't know, a barrel of crude is 42 gallons. Not that most crude ever sees the inside of a barrel, but that's how it's measured. That standard is based on blue-colored barrels (hence the bbl abbreviation for barrel - blue barrel) once used by Standard Oil way back when.
So, seeing that oil is marked up from $1.70 to $3 and raises the ire of all those people driving 4x4 SUVs and pickups and hemi-powered station wagons, why don't they blink when paying $1.20 for a 1/6 gallon bottle of water that they can get for 1/2 a cent a gallon?
