Sunday, September 10, 2006

How Much Would You Pay for US Gasoline?

I just read that we recently discovered an HUGE oil field in the US Gulf of Mexico. The oil contained therein are supposed to boost our available reserves by 50%. That's pretty amazing if you think about it.

But we still import a lot of oil from the Middle East because we use so much and because we can get it there pretty cheap.

Now, this isn't a political blog and I'm not going to turn it into one, but I was curious how much, if any, a person would be willing to pay as a premium to know that their gasoline was refined only from US oil. It would be more expensive, but the cheapest price isn't always the only factor when determing purchases. Most often other factors like reliability, quality, and cost of ownership come into play at least as much or more than price. This is why people pay much more for a BMW than they do for a VW.

But lately people have been willing to buy everything from salad dressing and ice cream all the way to electricity based on how those products were created and what the profits were spent on.

So I asked myself if I would pay a 20% premium on fuel costs if it came only from US reserves or from close allies.

Any thoughts?

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