[lmm]

If the price you pay doesn't cover the externalities (i.e. tax that includes the cost of cleaning up an equivalent amount of CO2 etc. emissions) then yes you're doing it wrong. If you're covering all that then sure, enjoy.

In the more general case, rapid price swings cause trouble all round (they make it hard for everyone to plan) even when the price adjustment is "correct". For the economy as a whole, low prices are better than high prices, but a stable price would be better than a volatile price even if the volatile average price was lower.