GAS PRICES II- Unspoken Miracle
While there is much attention given to 'price gouging' and 'windfall profits', no one in the media seems to be talking about how well the markets have functioned. In a time of tight inventories, reduced crude oil supplies, peak driving, damaged refining capacity, and great uncertainty increased prices and profit incentives allowed us a peaceful and effective transition through a time of crisis. The increased profits provided the incentive for increased imports, while the high prices prevented hoarding and shortages.
The miracle is that despite the devastation from hurricane Katrina and Rita, we did not run out of fuel and we did not have to stand in long lines with violent mobs. I would much rather pay more at the pump than take on an angry driver in a long line or get stranded because I'm out of gas and the nearest gas station had to shut down.