Now that the price of gasoline is at the $4/gallon+ level, the pain is at the acute level for just about every driver. The question asked is how did it get to be this high? Lots of theories abound. One lady, in a letter to the editor of the Journal Sentinel, blamed it all on the compensation level of the top executives of the oil companies. Other theories proliferate which are equally ludicrous.
One real reason is the weakening dollar on the world market. The US dollar has been the standard set for selling and buying oil by the barrel, so when the oil sellers can only purchase say $80 worth of American goods instead of the past $100 of American goods, up goes the price of a barrel of oil to make up this shortfall – and up goes a gallon of gasoline. If and when the dollar strengthens as the American economy strengthens, the price of gasoline at the pump will reduce.