gas prices, take 2 Options

[dmenche914]

Oil prices being high are due to the raise in demand (more folks with bigger cars, SUV's, in many nations, huge and rapid increase in demand in china and india), Other factors effect price: Political stuff like that dictator Chevez in Venezuala, he sells below market to his marxist buddies like castro's cuba, and threatens to turn off American supply (while at the same time signing big long term oil deals with commie china) Venezuala supplies up to 1/4 of American oil use. We know the mad mullahs in Iran don't like us, and they control their supply, and how they sell it too. These mad mullahs that run Iran are really rotten folks, no womens rights, beatings for minor infractions to islam, etc..

So you see the USA has undependable sources that can effect our oil prices, unfortunately we in the USA like many industrial nations depend on too much oil, so much so that we end up needing oil from or enemies or hostail nations. We are with are demand puttting the fate of oil oil in the hands of bad guys. We are building up nations with oil money that are vary evil.

There is a limited supply, suppose we could pump faster, but we are told the wells will run dry eventually, then what, prices will really skyrocket.

We do have reserves here, but not enough to keep us going for long at our rate of consumption. every bit we save will reduce the price. consumption will reduce as folks drive better more mpg cars. Soon oneday our 25 - 30 mpg 914's will be considered gas guzzlers, when new cars will hit 50 -60 mpg rutinely. If price stay high or go up, this will happen.

other factors are tax on gas and oil. (bet the saudi royal family, the mad mullahs in iran, and chavez all get a nice cut from every bit sold.

local regulations increase gasoline proces with all the specialty gas required in differnt areas or time of year.
we have not built new refineres for years in the USA, so we even have to import gasoline from other nations.


lots of things effect the price of gas and oil. the muslim terrorists sent by iran syria saudi, etc.. in Iraq are blowing up oil production making less than when saddam was in charge, but back in saddams day, some UN guys were skimming off the oil sales, as did saddam himself.

bottom line is we need to reduce our consumption, maybe in a few years as the auto fleet changes we will average 60 mpg and $5 per gallon gas will not bug us cause the price per mile would be better.

probalby need to look at our coal reserves, make deals with canada, as i beleive they have lots of coal, and they are friendly democratic folks, (rather see my money go too them rather than a dictator, or mullah) We have plenty of coal. nuclear should be considered if very safe designs can be mass produced. safe nuclear power on a large scale would really help, but ther are issues, technical ones like waste can be handled,
Yes we need to reduce use of oil, or just take it all over, but then we have a china that wouldn't like its supply take by us, so they would put up a fight, they are building up their military with the money they get using cheap labor to make products the USA buys, the evil chinese marxist's are building a big military to counter any US use of force to take the oil from the other bad dictator / mullah bad guys, china is getting to be more powerful, and has bad intent.

againt the solution is to stop using their oil, make the oil worthless by stopping demand.

oil should only be used to make chemicals, and plastics, not burned, if we didn't burn it, we would have more than enough.

that was a very neat chart I like it showing both actual and adjusted prices of gas. Those of us that are old enough recall when prices jumped in the first arab oil imbargo. This big increase is relitivily like the arab imbargo, I get the same milage today (I am even driving the same car) It hurts, but maybe a 60 mpg engine conversion for the 914 should be considered???? that woudl help ease the pain of the price increases

[Mrs. K]

QUOTE (MattR @ Aug 29 2005, 04:10 PM)

i'd like to put out a public apology. My recent oil leak has caused gas prices to surge.  OPEC and W couldnt have anticipated the spike in oil use from my house and it caused a nationwide panic.  My oil leak is fixed though, so the prices will get back down to normal.  Again, Im sorry for the inconvenience and I will alert all the credible media (fox). (IMG:http://www.914world.com/bbs2/html/emoticons/biggrin.gif)

(IMG:http://www.914world.com/bbs2/html/emoticons/chairfall.gif) Still need more shop towels from the hospital Matt??

Lisa (IMG:http://www.914world.com/bbs2/html/emoticons/cool_shades.gif)

[lapuwali]

The main point of that graph was to show that, until very recently, the thing driving the oil prices up for the past several years has simply been the price of oil catching up with normal inflation. If the price of oil exactly matched the rate of inflation, the red and black lines on that graph would be the same. Where the black line is below the red line, oil is unsually cheap, and one should expect the price to rise eventually. Where the two lines are close together, the price of oil can simply be explained by the same macroeconomic factors that drive ALL prices up. This has been true for several years now. Very recently (the past couple of months), the price of oil has risen faster than inflation, which suggests it will either fall again, or inflation will rise and overall prices of everything will rise to meet the oil price. Since the price of oil is, to some degree, factored into the price of most everything else, the latter case is most likely.

We're basically just paying the price now for years of having excessively cheap oil, and prices have caught up with what they should have been all along. The only thing that would keep oil cheap relative to inflation long-term would be the cost of production falling for factors like technological innovation, or an increasing supply, or a decreasing demand. If you look at actual histories of proven reserves, they've actually INCREASED over the past 20-30 years (I wish I had a graph for this). Despite rapid increases in demand, we keep finding more oil OR we discover newer cheaper ways to extract oil we knew about, but couldn't reach (or couldn't reach economically). Also, as the price of oil goes up, we paradoxically increase the proven reserves, as it suddenly becomes "economic" to extract oil that was uneconomic yesterday at lower prices. Many Texas oil fields shut down in the early 80s as the price of oil fell back off the artificial peaks created by OPEC in the early 70s. This crippled the Texas economy for years. The oil is still there, it's just too expensive to pull out. Oil prices have to rise substantially above inflation for awhile before Texas becomes a major oil producer again, or we have to dream up some newer, cheaper way to get it out. It hasn't, so Texas is still sitting on a lot of oil no one is willing to pull out of the ground.

This is a fact lost on the guy that keeps trying to "prove" that we're near or just past the "peak" for oil. This same guy first predicted the peak would be in the 1970s, and has been slowly pushing his peak forward every few years. I'm sure I'll be in the ground for a long time before we actually reach this peak.

[redshift]

QUOTE (MattR @ Aug 29 2005, 07:10 PM)

i'd like to put out a public apology. My recent oil leak has caused gas prices to surge. OPEC and W couldnt have anticipated the spike in oil use from my house and it caused a nationwide panic. My oil leak is fixed though, so the prices will get back down to normal. Again, Im sorry for the inconvenience and I will alert all the credible media (fox). (IMG:http://www.914world.com/bbs2/html/emoticons/biggrin.gif)

(IMG:http://www.914world.com/bbs2/html/emoticons/laugh.gif) I needed a funny!


M

[scotty914]

okay, i dont see some of the crap over seas as being the problem, opec sells the gas to who ever can buy it for 12 a barrel, so opec does not make that much, compaired to the price here. so who marks it up, not opec.

also i have read a bunch of stuff about the wells filling back up after 10 to 20 years, so it might not be a finite of a resource as we have been told.

now lets take texas, go drive thru that state and you will see a lot of wells shut off, they say it is because it costs more to get the oil out of the ground than its worth (IMG:http://www.914world.com/bbs2/html/emoticons/bs.gif) , if they can pump it and sell it for 12 a barrel in the middle east, why not here, lets say the labor costs twice as much, that still does not make it cost 67 a barrel. i would bet the texas pumps are shut off so they can get more for the ones they have running. and why use up thier oil if they dont have to.

as for demand i believe that is bull too, if that was true then thier would be shortages.

its is as simple as they will just keep inflating prices and blaming it on other stuff ( hurricans, terroists ) until they see a drop in use, which they wont.

the news today said that a lot of people in the country now are starting to cut back on other stuff so they can afford to go to work. they are finding a lot of single parent families are not doing vactions and not buying thier kids new cloths for the school year because they spent the extra money on gas over the last year.

i would be a fan on a wider sweeping gas guzzler tax and to lower the tax for normal cars, i mean the hummer 2 gets 8 mpg, and they lied about it and said it 12 so it would not have a guzzler tax, make it so real world testing determins it.

i pay about 50 cents per gallon tax on gas in maryland, and thats just to the state

[redshift]

Our biggest problem is refining.

We have a daily refining deficit.. that's compounding intrest... backwards.

Oil continues to go up over the long haul. Short term, supply will catch up a small amount, the price will come down around... somewhere in the mid/upper 20% range, then the slightest tic in demand, will set off racing gains in prices, again.

It's not the oil I worry about.


M

[JB 914]

QUOTE (MattR @ Aug 29 2005, 03:10 PM)

i'd like to put out a public apology. My recent oil leak has caused gas prices to surge. OPEC and W couldnt have anticipated the spike in oil use from my house and it caused a nationwide panic. My oil leak is fixed though, so the prices will get back down to normal. Again, Im sorry for the inconvenience and I will alert all the credible media (fox). (IMG:http://www.914world.com/bbs2/html/emoticons/biggrin.gif)

your new 914club name is: Valdez

[Aaron Cox]

QUOTE (PKRMONY @ Aug 29 2005, 08:17 PM)

QUOTE (MattR @ Aug 29 2005, 03:10 PM) i'd like to put out a public apology. My recent oil leak has caused gas prices to surge.  OPEC and W couldnt have anticipated the spike in oil use from my house and it caused a nationwide panic.  My oil leak is fixed though, so the prices will get back down to normal.  Again, Im sorry for the inconvenience and I will alert all the credible media (fox). (IMG:http://www.914world.com/bbs2/html/emoticons/biggrin.gif) your new 914club name is: Valdez

ask matt about the exxon valdez incident on my driveway....

[JB 914]

QUOTE (scott thacher @ Aug 29 2005, 06:40 PM)

okay, i dont see some of the crap over seas as being the problem, opec sells the gas to who ever can buy it for 12 a barrel, so opec does not make that much, compaired to the price here. so who marks it up, not opec. also i have read a bunch of stuff about the wells filling back up after 10 to 20 years, so it might not be a finite of a resource as we have been told. now lets take texas, go drive thru that state and you will see a lot of wells shut off, they say it is because it costs more to get the oil out of the ground than its worth (IMG:http://www.914world.com/bbs2/html/emoticons/bs.gif) , if they can pump it and sell it for 12 a barrel in the middle east, why not here, lets say the labor costs twice as much, that still does not make it cost 67 a barrel. i would bet the texas pumps are shut off so they can get more for the ones they have running. and why use up thier oil if they dont have to. as for demand i believe that is bull too, if that was true then thier would be shortages. its is as simple as they will just keep inflating prices and blaming it on other stuff ( hurricans, terroists ) until they see a drop in use, which they wont. the news today said that a lot of people in the country now are starting to cut back on other stuff so they can afford to go to work. they are finding a lot of single parent families are not doing vactions and not buying thier kids new cloths for the school year because they spent the extra money on gas over the last year. i would be a fan on a wider sweeping gas guzzler tax and to lower the tax for normal cars, i mean the hummer 2 gets 8 mpg, and they lied about it and said it 12 so it would not have a guzzler tax, make it so real world testing determins it. i pay about 50 cents per gallon tax on gas in maryland, and thats just to the state

It's really a combination of things. Artificially low oil prices for a long time due to available cheap reserves. Reduced refining capacity and increased demand from new markets (i.e. China, Far East). These are the major factors that have increased the cost of oil. Plus, those big fat reserves we have been pumping since the 70's are not producing as much as they were 30 years ago.

The Arab oil has always been cheaper to extract than the U.S. reserves.

Scott, i grew up in Texas. If those wells are not operating they are either 1. Dry 2. unprofitable to operate in the current market 3. unprofitable to operate in any market.

The cost of drilling is very different depending on where you drill, how deep you need to go and what type of geological formation you are drilling into. also, what type of equipment is needed to extract. If that were true that the same would apply to electrical contracting. It doesn't. Because each job has it's particular level of difficulty.

When the prices of oil rise wells that were once unprofitable to operate can be 'uncapped' many of these wells are categorized as "reserves" If oil companies are sitting on 55B gallons or 1 years supply of oil they would get eaten up with storage costs. Most of the oil in storage is simply short term waiting for refining.

I'm as unhappy with the higher prices as anyone. i just don't like to see people getting misled about the "big picture" by the inept US Media

[Joe Bob]

Ah bullshit.....we're just getting DICKED

Record profits, record prices and we're rolling over and taking it with a tiny inaudible whimper and tear in our eye....

Plain out and out greed....

[Joe Bob]

BTW....there are wells here in the local area that have been shut in for years.....oil hit 60 bucks....cachunk, cachunk.....puppies are up and running, pumping and a burning.....it's low grade sulfer rich thick nasty crap, best suitable as asphalt, but it's workable and will yield some high end light oil....

[wheelo]

Oil Schmoil ......

Stinky Greedy Fuchs ....

Start Shipping Iraq Crude... Now !

It's pay-back Time!

- M

(IMG:http://www.914world.com/bbs2/html/emoticons/cool_shades.gif)

[lapuwali]

I completely agree that the oil companies are seeing record profits lately, and entirely due to increase revenues with no increased costs. The only reason I can see for the prices to rise NOW has been panic on the part of oil traders, and easy excuses from world events that only MIGHT cause shortages that have yet to appear. However, long-term, it's been inevitable that prices would rise. The oil companies are simply doing what any public company with shareholders would (and MUST) do: make money while the sun shines.

Scott, I don't believe old wells are "filling up again", only that oil that's been there all along has become more economic in some cases to extract, simply because prices have risen sufficiently to allow it. The oil in TX costs a LOT more than in does in Arabia to extract. It's much deeper down, and it fills lots of small crevices in large rock formations. This requires a lot more wells, which not only cost money to drill, but lots of money to maintain. Labor costs are also a lot more than double what they are in the Middle East for basic labor. The Saudis import large amounts of cheap labor from Southeast Asia and India, paying them 10% or less what they pay US-trained specialists there. The $70 prices you see are also not the price as it comes out of the ground, but the price as it reaches US ports. Transport costs are hardly free. I also haven't found any data to support the $12/barrel number you're quoting.

I lived in TX in the early 80s. I saw the economic devestation wrought by the collapse of oil prices. People in Houston were abandoning houses because they could find no buyers, and moving out of state to find work. The news at the time was full of people trying to explain that there was plenty of oil there, it just cost more to pull it out than it did to ship Arabian oil halfway around the world. If prices continue to rise, TX oil might become price competitive again, and we'll be that much less dependent on "foreign" oil.

[MattR]

QUOTE (Mrs. K @ Aug 29 2005, 05:57 PM)

QUOTE (MattR @ Aug 29 2005, 04:10 PM) i'd like to put out a public apology. My recent oil leak has caused gas prices to surge.  OPEC and W couldnt have anticipated the spike in oil use from my house and it caused a nationwide panic.  My oil leak is fixed though, so the prices will get back down to normal.  Again, Im sorry for the inconvenience and I will alert all the credible media (fox). (IMG:http://www.914world.com/bbs2/html/emoticons/biggrin.gif) (IMG:http://www.914world.com/bbs2/html/emoticons/chairfall.gif) Still need more shop towels from the hospital Matt?? Lisa (IMG:http://www.914world.com/bbs2/html/emoticons/cool_shades.gif)

Always (IMG:http://www.914world.com/bbs2/html/emoticons/smile.gif)

My brother and I did a top end rebuild on his '65 mustang this past weekend. Those things hold more oil then a 914!

[Speedster07]

I lived in the big D and sold oil for Sunset Energy in the 80's. The problem with starting up the Texas and Oklahoma oil wells is: where do you get experienced help, where do you get equipment, all of the suppliers to the Oil industry are out of business as of the Late 80’s, There are no more drill bits makers here no more casing makers here no more rig makers, they all went Bankrupt. If GM went BK do you have any idea how many venders and suppliers make parts for that company, it could bankrupt the whole country. Most auto manufactures don't manufacture vehicles they assemble parts (from suppliers) to make a vehicle. Thousands and thousands of parts suppliers sell parts to GM, Ford, Honda ect....
Same thing happened to suppliers of the oil producing industry. I know I delta with a lot of them.
One day making millions the next looking for a job and selling everything to stay alive. Do any of you remember being able to buy exotic cars rarely seen out, now in the front yard of some Texas mansion, pick up a $12,000 Pres Rolex for 3Grand. Million dollar homes for a few Hundred Grand. I was there saw it, did it, lived thru it.
You can't just turn on a switch to pump an Oil rig. Man I wish it was that simple!

Sorry for the ramble.
(IMG:http://www.914world.com/bbs2/html/emoticons/beerchug.gif) Now I sit and play with Toy Cars (914's) (IMG:http://www.914world.com/bbs2/html/emoticons/driving-girl.gif) (IMG:http://www.914world.com/bbs2/html/emoticons/headbang.gif)

[scotty914]

QUOTE (lapuwali @ Aug 29 2005, 11:18 PM)

Scott, I don't believe old wells are "filling up again",... It's much deeper down, and it fills lots of small crevices in large rock formations. This requires a lot more wells, which not only cost money to drill, but lots of money to maintain. ... I also haven't found any data to support the $12/barrel number you're quoting.

just do a google search on, oil wells filling, and you will see a lot of stuff showing it.

i found out that 70 % of the running wells in texas only produce 9 barrels per day, or $ 630 a day at 70 per gallon, not a bad days income if you ask me. when i went to the WCC i saw them drilling new wells near my cousins, then i talked to some oil guys, they said you can buy an pump for about 250 bucks, that cost about 20 a day to run including maintance.

i also found that 10 % of the final cost we see is advertising, 21 % is taxes, and roughly 50 % is crude costs. the final number i found was opec sells oil at 22 to 28 per barrel, so the 12 must be their cost.

currently a decent refinery get about 60 % of the oil made in to gas so at the numbers i just used

70 a barrel they get 42 dollars worth of gas, or about 30 gallons, so cost per gallon is is about 1.4 per gallon, then we add 21 5 in tax, or 1.7 a gallon, then the ad stuff at 10 %, we are up to 1.81 or so, that leaves about a dollar profit, for some thing they sell millions of every day. the article i read says the delivery of the gas in considered in the 10 % for distribution. the cost to refine was not much either.

and all this math does not include what they do with the other 40 % of the barrel

[JB 914]

QUOTE (Speedster07 @ Aug 29 2005, 08:38 PM)

I was there saw it, did it, lived thru it. You can't just turn on a switch to pump an Oil rig. Man I wish it was that simple! Sorry for the ramble. (IMG:http://www.914world.com/bbs2/html/emoticons/beerchug.gif) Now I sit and play with Toy Cars (914's) (IMG:http://www.914world.com/bbs2/html/emoticons/driving-girl.gif) (IMG:http://www.914world.com/bbs2/html/emoticons/headbang.gif)

Me too. i grew up in Texas and lived in Houston during the boom and bust. i remember the bumper stickers during the boom. "last one out of Michigan, turn out the lights"

during the bust it was: " Please lord, give us $40 a barrel oil and we promise not to piss it all away this time"

I started college as a Geology major. I switched majors when one of my Frat brothers with a masters degree in Geology took a job at 7-11. It was that bad in the 80's.

oil wells are filling up. (IMG:http://www.914world.com/bbs2/html/emoticons/rolleyes.gif) (IMG:http://www.914world.com/bbs2/html/emoticons/wacko.gif)

wanna buy some land? Because you read it on the web it must be true?

[skline]

So true Joe, so true, dont believe half of what you read on the web or see on TV, they only show you what they want you to see and tell you what they want you to hear. Most of it is propoganda BS. If you only knew the truth, this country would experience another revolution.

[Brent]

QUOTE (lapuwali @ Aug 29 2005, 07:23 PM)

the thing driving the oil prices up for the past several years has simply been the price of oil catching up with normal inflation.

Was oil catching up with inflation or driving it? Since all companies have to pass the increase in expenditure without being in the budget, the increase is inevitably passed to the consumer. If I read the chart right, the black line influenced the red one.

As seen on many threads the cost of shipping is growing with the cost of fuel.

[Brent]

QUOTE (lapuwali @ Aug 29 2005, 09:18 PM)

I completely agree that the oil companies are seeing record profits lately

Its fact...not hard to agree with. Exxon cleared 7 Billion in Profit...not revenue, profit in the last quarter (thats Three months), then oil companies were awarded a GRANT of 2 Billion from the White House for exploration. NICE.

I'm not deppleting resources since I don't leave the house looking for jobs, and wife working from home, so really arm chair quaterbacking on this one.