Due to the high gas prices, it’s time for a repeat of my view of “monopolies” or “trusts”. My view: there is no such creature. I may explain with a contemporary example. Some may attempt to blame high gas prices on price fixing. People also tend to think there is no alternative to using gasoline. But of course, think a little more and you’ll realize there are alternatives — but they cost more. Example: the horse and buggy, the electric car, walking, car-pooling.
So if gas prices got up to a certain level you’d start looking more seriously at those alternatives. Maybe at $2 a gallon, you’ll start car-pooling more, at $5 a gallon you’ll buy an electric car. When electricity gets too expensive, you’ll buy a horse. When you can’t buy oats at a reasonable price you’ll start walking.
In reality, petroleum vendors have plenty of competition and that competition keeps prices below a certain level. Consumers just haven’t felt the need to switch to the alternatives yet.