When oil-producing nations cut production, or there is some other scarcity condition, gasoline prices rise in the U.S. It would stand to reason, therefore, that when oil-producing nations commit to increasing production, gas prices should back off. Doesn't this make sense? Apparently it doesn't, and the Bush administration is claiming that although Saudi Arabia and other nations have committed to increased production, its the lack of oil refineries that is standing in the way of decreased gasoline prices.
Am I paranoid to suspect that there's another agenda at work here, like hooking up Bush's oil buddies by keeping gasoline prices high while calling for incentives for those who would add to the number of oil refineries? Do I smell another tax break for oil companies coming?