Everything's like that... I paid a traffic ticket yesterday and it was posted that a speeding ticket's actual price was $35....but after all the taxes or fees....$234....
If we all stopped driving for a few days watch the price drop.
Kind of like distilled spirits (liquor). It's dirt cheap to make, the man has to have his tax money.
The actual production cost is an Average of 0.53 a gallon. The infastructure cost is not added into that equation and neither are wages. Oh, and don't forget 18% to 22% State and Federal tax per gallon.
The cost is closer to $1.00 - in the real world. The commodities brokers get their hands on the crude oil, then inflate the price by sitting on it before releasing it to the open market for sale. Then after gasoline is sold, those same brokers buy it and again hold it to run up the price. The people actually selling it are getting very little as compared to everyone else.
The majority of price will be taxes, with a chunk to the oil companies
I paid $3.83 last night.
The actual manufacturing or production cost of a commodity is usually very low compared to the middle wholesale and certainly final retail price.<br />
But when you take into consideration the massive infrastructure costs, investment, machinary, logistics, IT, etc, usually involving long term debt repayments, of producing a product, then the actual overall production cost is more.
Holy ****...5.59 a gallon? And I was pissed that it costs me 3.69 a gallon here in Arizona.
Thank you dirty billionaires!