bogart said:Hi, Kay -- oligopoly is only one aspect of the situation. Maybe the beer market is an oligopoly, too. Let's suppose so. However, others aspects of the situation mentioned in my post include "essential commodity" and "near-zero elasticity of demand wrt price." Let me propose a thought experiment: case (1) -- all gasoline is cut off in the USA for one year, vs (2) all beer is cut off for one year. Case (1) probably results in significant breakdown of the society, whereas case (2) is an inconvenience for some people. Beer drinkers switch to bourbon, or stop drinking, or brew their own beer (I've done it myself -- low barrier to entry in the beer market). Same kind of thing with bottled water. Use municipal water or well water instead (I've done both myself). My conclusion is that a rational society will be more likely to intervene in the gasoline market than in the beer market. That's why some people complain to the gummit about gasoline prices, but hardly anyone goes this route with beer or bottled water prices.
I think you're ignoring Econ 101. High profit margin induces new market entrants to seek high profits. Supply increases, market equilibrium prices go down. I concede there is a huge barrier to entry for the fuel refinery market. However, if your allegation of oligopolistic price fixing is true and there is a sufficiently high profit margin in the refinery industry, we'll eventually have new market participants. Or existing market participants who are allegedly part of your alleged oligopoly will seek to increase their production to capture slightly lower profits on a higher volume of product sales.