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1. Everyone’s Gasoline Problem. We are all familiar with fluctuating prices of gasoline at the pump. Why does this happen? Research the recent history of gasoline pricing in your area, and attempt to relate any fluctuations you observe to documented supply and demand factors outlined in our book. Be sure to cite any references used. * Gasoline prices rise and fall depending on supply and Demand. Gas prices are impacted by a number of factors, each individually placing its own pressure on our overall energy system. Some affect the price of crude oil and others affect the cost of producing and marketing gasoline, but combined, these factors greatly impact the fluctuation of gas prices that we experience on a daily basis. Changes in crude oil prices - Crude oil prices are determined by worldwide supply and demand, with significant influence by the Oil Producing and Exporting Countries (OPEC) as they determine how much oil to produce and sell to other countries. The more crude oil OPEC chooses to produce and release, the lower the price. Additionally, because oil is traded in a world market, events in remote areas affect the price of crude oil for almost everyone. In recent years, worldwide events that have impacted gas prices include: Decisions by the OPEC cartel to raise production quotas slowly and reluctantly after having reduced them in 2002. * An increase in worldwide demand for oil, including unexpected demand growth in China, India, and other quickly developing nations. These nations have experienced a tremendous growth in the number of citizens who have access to automobiles, and their billion-person populations have a strong impact on the amount of crude oil needed in those parts of the world. * Disruptions in oil production in countries that are major exporters, including Venezuela, Iraq and Nigeria. * A decline in the value of the U.S....

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