Ga$ Price How high will they go?

[jlthunder]

Originally Posted by jeff denton I wonder how many laps I could get out of a set of shoes and a bale of hay? edit: Disclaimer- Just kidding. Don't need hate mail from the animal rights activists. I actually like horses. Just have a little problem with the expense of a certain pair of them from time to time. Stock car racing is a LOT cheaper!

I love working with horses too, but the only problem is you can put your race car away and it won't cost you anything. Putting a horse away still costs $$$.

[RallyBob]

Friday Jun 6th ih Avon, CT.

87 octane: $4.35
89 octane: $4.45
93 octane: $4.55 per gallon!

Oh, and earlier this week it went over $5 per gallon in Nantucket for 87 octane!

Just plain nuts.

Bob

[PROPEL]

Originally Posted by RallyBob Friday Jun 6th ih Avon, CT. Just plain nuts. Bob

No kidding. As the secret & private Bilderberg group is meeting as we speak, I am very troubled, as I'm sure everybody already saw this...

Reuters: Oil surges more than $9 to record $137

Also...

Globalists Take a Step Closer To $200 Dollar Oil
JPMorgan Chase & Co announce plan to trade oil by end of 2008

[ungermm]

Yes, I'm watching it. Watching the gas station attendant running out of 4's. Watching air fares triple. Watching an increase of gas theft. Watching an increase in food prices at the grocery store. Watching the report of an angry woman setting fires at gas stations and while she's at it a Starbucks too. Last week was the first time I've ever bought gas for over $4/ga. I think that now might end up being the good old days soon.
Jerry

[sbarc]

Originally Posted by ungermm Last week was the first time I've ever bought gas for over $4/ga.

I just filled up with high Octane the other day for US$5.60/USGal here on the west coast of Canada.....and that was in a Sunday driver car of mine that gets 11mpg.


I expect gas prices to remain very high until the bulk of the civilian fleet has switched to electric cars over the coming 10 to 15 years. The bulk of the cars on the road are less than 15 years old. It's a simple case of supply and demand and as the average person builds up a burning hatred for the oil compnaies, they will switch their vehicles to non-gas burning cars.

Cars such as the Chevy Volt will meet the needs of the bulk of the average driver and I'm sure Honda and Toyota are busy developing their own electric cars.

One day the only cars burning fossil based fuels will be vintagre cars at car shows.

[plazaauto]

I was going to complain but I guess I have nothing to complain about.

We have a station on either side of the garage,

Gulf $3.91 (cheap stuff) $4.81 for diesel
Xtra-mart $3.89 (cash) $4.83 for diesel.

I'll complain anyway filled the car carrier this morning @ $4.89 per.....lets just say it wasn't pretty.

[grslightng02]

With gas prices already high at $4.19 a gallon, I went on a brief trip from California to Arizona. The gas in Arizona is still more reasonably priced at $3.69 a gallon. I was away for 9 days and to my surprise when I returned home gas was $4.41 a gallon for regular!

Today news says that crude oil has jumped $11 a barrel in one day! I'm certain we will be paying $5.00 a gallon by the time summer is in full swing. With all the election whoopla going on why don't any of the candidates address this scandal for what it really is... another form of terrorism from oil companies! America has relied too long on foreign fuel and now we're at their mercy!

My roomate has a Dodge Dakota V8 that gets about 15-20 miles per gallon. I told him my car should get around 30-34 miles per gallon, one more reason why I need to get my car up and running soon!

Neil

[grslightng02]

Here's something funny I forgot to mention. As I was detailing the interior of my newly bought GT a few weeks back, I found a credit card receipt for gas from one of the previous owners in the mid 1990's. The gas was purchased at a Chevron Station in the San Francisco area for $1.29 a gallon!

Fuel costs have quadrupled in just over a decade, has the average income?

[Sparky73]

If I go out anywhere, and drive for say 45 minutes or an hour.. $20 gone. Me and my girlfriend went to see a movie a couple nights ago. Her house is about 15 minutes from mine, and the theater is like 10 minutes from her house. This is the first time I think I've paid more for gas to get there, then the actual movie cost. It cost me just under $20 for gas that evening, and the tickets were only $6 a piece.

Pretty soon here the truck is getting sold and I'm getting something with 25 MPG+. I don't think the gas gauge has seen over 1/2 in about 6 months, and 1/4 in the last 3 LOL.

[Sparky73]

Originally Posted by benncojr I filled up this morning when gas was $2.47/gal.

This is not the type of thread to read from beginning to end LOL. It's so depressing..

[Gumby]

O-o I filled up today with mid-grade (or plus depending on the station) for $4.13 today. Even $45 dollars to fill my Honda Civic.

Originally Posted by grslightng02 Today news says that crude oil has jumped $11 a barrel in one day! I'm certain we will be paying $5.00 a gallon by the time summer is in full swing. With all the election whoopla going on why don't any of the candidates address this scandal for what it really is... another form of terrorism from oil companies! America has relied too long on foreign fuel and now we're at their mercy!

It has very little to do with "oil terrorism" and a lot more to do with the futures market and our refinery capacity. We are more than capable of pumping enough oil to meet our own needs but it does you no good if you can't refine it. Besides then the government doesn't get an import/export "fee". :/

Just keep in mind that negative economic situations are fueled in part by market "negativity". Cheer up and hope Obama doesn't get elected. Things will eventually get better.

[traytodd]

I have seen some positive news in the oil industry lately. Construction is planned for about about 500,00 bbl/d increase in US distillation capacity. This is mostly expansion and debottlenecking of existing refineries. It will take about 5 years to bring all of this online. It is not enough. Also, the voters in one SE South Dakota county approved siting a new refinery. Of course the NIMBYs promise to block it by all available means. Most of the new capacity is for heavy crude such as that coming from the Canadian Tar Sands. Canada is ramping up production of the tar sands so refineries in the northern tier states could be built to accept it.

Applications for drilling permits and to reopen capped wells in the LA basin have increased. Some of the drilling applications are for slant drilling into the off shore deposits.

The recent run up of crude price from $120 to near $140 is purely speculation. The announcements from the brokarage houses of $150 to $200 oil is to sucker people into oil futures. When the price is high enough, then the bubble will burst leaving the suckers with the losses. Its the .com, telecom, housing scenerio all over again.

If the Warner-Lieberman cap and trade bill passes, it will put a strong damper in oil refining and production and will increase the cost of fuel over the next few years.

Increased revenues by the majors, can result in increased domestic production if the courts and Congress permit it. Congress needs to immediately open up more drilling sites so we can become more self reliant. They could also permit closed but contaminated military bases to become refineries. I am afraid that nothing will happen this year because of the election cycle, and then we have a 50-50 or greater chance of the wrong things being done.

Terry

[West Coast GT]

I filled my Chrysler the other day, then saw prices go up 13 cents the next.

On another front, I need to drive about the Bay Area one week this month collecting seismic info. My personal car will not be used as the company's reimbursement rate has not risen in the last year. I will be renting a car and allowing the company to absorb the increased fuel charges, as well as the increased bridge tolls.

[tomking]

Originally Posted by traytodd I have seen some positive news in the oil industry lately. Construction is planned for about about 500,00 bbl/d increase in US distillation capacity. This is mostly expansion and debottlenecking of existing refineries. It will take about 5 years to bring all of this online. It is not enough. Also, the voters in one SE South Dakota county approved siting a new refinery. Of course the NIMBYs promise to block it by all available means. Most of the new capacity is for heavy crude such as that coming from the Canadian Tar Sands. Canada is ramping up production of the tar sands so refineries in the northern tier states could be built to accept it. Applications for drilling permits and to reopen capped wells in the LA basin have increased. Some of the drilling applications are for slant drilling into the off shore deposits. The recent run up of crude price from $120 to near $140 is purely speculation. The announcements from the brokarage houses of $150 to $200 oil is to sucker people into oil futures. When the price is high enough, then the bubble will burst leaving the suckers with the losses. Its the .com, telecom, housing scenerio all over again. If the Warner-Lieberman cap and trade bill passes, it will put a strong damper in oil refining and production and will increase the cost of fuel over the next few years. Increased revenues by the majors, can result in increased domestic production if the courts and Congress permit it. Congress needs to immediately open up more drilling sites so we can become more self reliant. They could also permit closed but contaminated military bases to become refineries. I am afraid that nothing will happen this year because of the election cycle, and then we have a 50-50 or greater chance of the wrong things being done. Terry

Well said and Right On.

[PROPEL]

Originally Posted by traytodd The recent run up of crude price from $120 to near $140 is purely speculation...When the price is high enough, then the bubble will burst leaving the suckers with the losses. Its the .com, telecom, housing scenerio all over again. \

Unfortunately, the run-up will not reverse until we do something about the sinking U.S. dollar, which is also fueling the speculative market. All these bubbles are initially caused by the lending of easy credit. The Fed prints excess money to fund government expansion, then people believe that the good times are rolling, and borrowing expands exponentially. Then there is the inevitable market correction as business catches on that the lending money supply has been inflated (depreciated). The speculation in oil and commodities is due to investors abandoning worthless paper. The dollar was once backed by gold, but it is now unofficially denominated through credit backed by oil. So unfortunately, there's going to be a problem solving the current "bubble".


"It is to be supposed that this year’s meeting will include discussion of current international emergencies, such as Afghanistan, the high cost of oil, and the world economic crisis. Concerning oil: after the Ottawa meeting, indiscreet leaks reported that a decision had been announced by oil producers to raise the cost of oil to over $100 a barrel over the course of two years."

[Hiro]

starting to mix some ethanol in gas to lower the cost here in France:
gas is about 1.50-1.60 euro per liter whereas ethanol (E85) is around 0.80 euro per liter,
our old CIH work OK with E85 30% up to 50% so money saving is substancial.
more demos & strikes here this week: taxi drivers, truckers, fisherman.
inflation is also starting to show up in daily life: movie ticket price is close to 10 euros in Paris now,
a Tequila in my favorite music bar is 11 euros, a casual coffe or Coke can be up to 6 euros etc,
just unsane specially for the kids...
Hiro

[wattiefan]

Some advice for you guys. Before gas jumped to $3.89 in MN, i filled up the tank in my chevy hhr(14 gallons), but i used the pay at the pump feature. I am glad i kept my reciept as i got a call from my local sheriff. Apparently the gas station thought i drove off without paying for the gas. The sheriff was cool about it. I had to stop at the station on my way home from work to verify that i paid for it. Which always made me wonder if a machine can malfuntion like this how do we know gas isnt 3 cents higher on the dial, than what it says on the sign? I have been keeping the reciepts to moniter how much fuel i use and this time it paid off.

List of things i have slowed down on buying since gas rose:
Beer(prices have gone up as well)
fast food/restuarants(prices have gone up as well)
energy drinks
movie theatre

I now just do all my errands either all at once or ill stop if its on the way home from work.
I also purchased a locking gas cap so hopefully no problems there. People have talked about upwards of 8.00 a gallon in the future, and only now am i glad that i got rid of my f150.

[kwilford]

For those that haven't met me, I am a Petroleum Engineer and have been for the past 25 years. As such, my livelihood depends very much on the price of oil and natural gas, or more importantly, on the DIFFERENCE between the cost of finding and producing it versus the price we get for it. In fact, five of my colleagues and I are just starting up our own (with thirty or so investors) private exploration and production oil company. That's not unique, as I have helped run four of these over the past ten years, and there are probably 100 or more similar companies operating in the Canadian oil "patch" at any given time. My reason for stating this is that it makes me a bit of an expert on the subject. Not THE expert, just smarter than the average bear...

For those seeming to forget history, for every time the price has jumped dramatically, there was an eventual drop. And for every collapse in the price, there has been a revival. The law of supply and demand eventually takes force, although politics, speculation and simple myopic thinking often modifies the rules for a time. While I understand the technical aspects of my industry extremely well, and that includes the fundamental economics of same, the reason behind the historic price fluctuations are simply too complex to be reasonably explained in this Forum, let alone by the most so-called experts. I don't think they CAN be fully explained, just rationalized after the fact. One thing I have learned after two and a half decades is that EVERY price forecast in history has proven to be WRONG, and I have seen THOUSANDS of price forecasts. In my business, there is a new Industry price forecast every month or two, from probably a hundred different sources, which we use to try to make decisions on investments. GENERALLY a given price forecast may be close at least in the near term, but is NEVER exactly accurate for all time. And they can be remarkably inaccurate, especially when world events unfold that affect the market in an unforeseen manner.

Anyway, there are several posts here that are worth responding to, for both accurate and inaccurate conclusions:

Originally Posted by sbarc I expect gas prices to remain very high until the bulk of the civilian fleet has switched to electric cars over the coming 10 to 15 years. The bulk of the cars on the road are less than 15 years old. It's a simple case of supply and demand and as the average person builds up a burning hatred for the oil companies, they will switch their vehicles to non-gas burning cars.

I simply don't see this, nor do most of the energy experts. Electric cars still require power, and there isn't enough power generation as it is on the continent, let alone to supply the required demand for 100 million electric cars. More importantly, until there has been a fundamental discovery in electricity storage (batteries), this dog isn't going to hunt.

Originally Posted by traytodd ... Most of the new capacity is for heavy crude such as that coming from the Canadian Tar Sands. Canada is ramping up production of the tar sands so refineries in the northern tier states could be built to accept it.

Canada has two forms of "tar sands", although one is usually called "oil sands". The first (and true tar) is the shallow stuff that is mined, such as around Fort McMurray. This heavy bitumen is extracted from the mined sand by washing it with hot water, and then the bitumen is usually "upgraded" (through a refining process) into so-called "synthetic crude". The "tar" is too viscous to economically transport by pipeline any great distance, so it is usually upgraded nearby the mine. But there are some examples where bitumen is transported in a water-emulsion via pipelines to refineries that are purpose-designed to upgrade the thick goop. The resulting synthetic crude is of high quality (about 40 degrees API, so similar to West Texas Intermediate or other "light" oil) and can be refined into gasoline and other petrochemicals in most conventional refineries. The mining and extraction process is pretty ugly, with large open pits and extensive tailings ponds, which is what the media has been playing up on recently. But they aren't a lot different than any open pit mine, whether oil sands, bauxite (aluminum), iron, copper or any other such resource.

The other form of heavy oil is usually deeper (at least not typically minable), usually not as "heavy" (a term that defines oil in relation to it's weight as compared to water; 10 degree API oil weighs the same as water, while 40 degree API is about 82.5% the weight of water, and heavier usually means more viscous), and is usually extracted by drilling a well. The common term is "in situ", as in the sand stays where it is, while the bitumen (or heavy oil) is removed. Some of these wells produce through "cold" production (as in no heat is added to lower the viscosity) through pretty conventional wells, but the hot industry technique these days is by using "SAGD (Steam Assisted Gravity Drainage) and pairs or trios of parallel horizontal wells, or other such exotic means.

Anyway, my point is that much of the oil that Canada exports to the USA (and we're the largest, BY FAR, supplier of oil to America) is not "heavy", although much of it started that way. And for interest, Canada exports more energy in the form of natural gas to the USA than as oil.

Originally Posted by traytodd The recent run up of crude price from $120 to near $140 is purely speculation. The announcements from the brokerage houses of $150 to $200 oil is to sucker people into oil futures.

Speculation? Probably to some extent, but the general wisdom is that this oil price run-up is different than most in the past. This increase has been due more to "DEMAND" (as in more people, especially the Chinese, using more oil) versus historical jumps caused by a sudden reduction in "SUPPLY" (such as during the 1978 Middle East oil embargo or fears of supply disruptions such as during the Kuwaiti war). But the reason for the greater increase in the USA is that oil is priced in $USD, and the depreciating value of the Greenback is exacerbating the rise to American consumers. Why? Many answers, including the trillions spent in Iran, the collapse of the sub-prime mortgage market, and the current and impending collapse of the American housing market.

I am getting to know brokerage houses very well. They raise money, mostly for a fee to their own benefit, for various reasons. Are they trying to "sucker" people? Sure, but don't be thinking that smart people can be suckered. But yet there are still LOTS of people getting suckered by brokers. Maybe too few smart people?

Originally Posted by grslightng02 With all the election whoopla going on why don't any of the candidates address this scandal for what it really is... another form of terrorism from oil companies! America has relied too long on foreign fuel and now we're at their mercy!

OK, this is laughable. Oil company terrorism? AS IF! Oil companies are simply not that coordinated. America uses more oil than it makes. Simple as that. Do other countries get hurt by high oil prices? Sure, but for the reasons above, the Yanks are getting hurt more these days.

Originally Posted by Gumby It has very little to do with "oil terrorism" and a lot more to do with the futures market and our refinery capacity. We are more than capable of pumping enough oil to meet our own needs but it does you no good if you can't refine it. Besides then the government doesn't get an import/export "fee"

I agree with the first statement about oil terrorism. The second statement is untrue, at least for American supply versus demand. Also, governments make a LOT of money when oil is produced locally, through indirect taxes, and even more so when direct taxes (royalties) are payable to the government. On a world basis, supply and demand are typically matched, at least eventually. More supply causes lower prices causes more consumption AND lower production which causes higher prices which causes more production and more supply. Not simple, but eventually true.

And while some "imported" oil may get charged a "fee" (duty or tariff), that is NOT the case for oil or natural gas that is imported into the USA from Canada and Mexico (NAFTA). So count your blessings about NAFTA, and remind Obama that if he screws with NAFTA, we're going to screw back. Canada lost a LOT of manufacturing when NAFTA first came in, which was somewhat reversed by the weak Canadian Peso (I mean dollar), which created more manufacturing. The current weak Yankee dollar is causing the loss of Canadian jobs due to reduced exports, so don't be thinking for a minute that we'll put up with that AND some some kind of selective tariffs on oil or such.

</

Originally Posted by PROPEL Unfortunately, the run-up will not reverse until we do something about the sinking U.S. dollar, which is also fuelling the speculative market. All these bubbles are initially caused by the lending of easy credit. The Fed prints excess money to fund government expansion, then people believe that the good times are rolling, and borrowing expands exponentially. Then there is the inevitable market correction as business catches on that the lending money supply has been inflated (depreciated). The speculation in oil and commodities is due to investors abandoning worthless paper. The dollar was once backed by gold, but it is now unofficially denominated through credit backed by oil. So unfortunately, there's going to be a problem solving the current "bubble".