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Supply & Demand Article Essay

825 words - 4 pages

Supply and demand is defined as, how prices vary because of a balance between product availability at each price (supply), and the desires of those with purchasing power at each price (demand). Do not confuse the two elements just because there is an increase in supply does not mean that there is an actually demand for a product.The article on Gasoline Supply and Demand, Reuters, August 28, 2006 discusses the current price increase along with supply and demand of gasoline in the United States. Gasoline/oil is one product which is in high demand, and based on the United States inabilty to produce/refine gasoline within the Untied States the populations demand must be sourced from those ...view middle of the document...

Can Americans wait (last year my commute was 62 miles per day, I have since changed employers reducing my daily commute to 30 miles per day). Will the United States invest money in existing refineries half of the gasoline consumed in the U.S. is produced along the Gulf coast from Corpus Christi, Texas to New Orleans along with exports received from Canada?Product Supply:The United States has refineries and ports in the Gulf of Mexico, Texas, New Orleans, yet due to Hurricane Katrina, the refineries in the Gulf of Mexico stopped/limited production capabilities due to said hurricane leaving the United States dependant upon foreign oil resources. Canada is an exporter of oil to the United States, yet the questions how much more can U.S. refineries produce if the current rate of production is 160,000 barrels per day can the refineries increase production without upgrading their facilities.A secondary article found on stated, "There hasn't been a new oil refinery built in the US since 1976" and existing United States refineries are trying to get all they can out of their current production capabilities. Will these efforts be enough to meet the growing strain? Will the...

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