No cartel in petrol industry!

We have all the time believed that there is an unofficial oil cartel regulating the pump prices. When one petrol company raises its price, the rest will follow suit for the same amount. This has been going on for the last round of increases when oil price shot to US$145. Then the prices started to come down in unison, same day same amount. Today, surprise, and surprises, the petrol companies are bring down their prices in drips and pieces, at 3 or 4 cents, 2 cents, 6 cents and 1 cents, all at random over a few hours. Now, this kind of pattern indicates that there is no cartel and they are all acting independently. And possibly a price war in the making! So, will all the pump prices steady in a few days and all settle at the same price again? My guess is that it will be the case. Those school bus operators should do the same if they want to raise their fares. One at a time at different amounts. Some by $10, some $12, some $15 etc, and do it at different times, then all will be ok. No price fixing.

1 comment:

Anonymous said...

No monopoly means there will be a cartel. No cartel means it will just be decided behind 'closed doors'. And who are those behind the 'closed doors'?