Gas Prices

[freeztar]

It seems to be on everyone's mind (and wallet) these days, so I thought it would make for a good discussion here.

 

What is causing the higher prices? When and how will we see relief? What are the social implications of higher fuel costs? What are you doing to soften the financial blow? etc...

 

[Moontanman]

It seems to be on everyone's mind (and wallet) these days, so I thought it would make for a good discussion here.

 

What is causing the higher prices? When and how will we see relief? What are the social implications of higher fuel costs? What are you doing to soften the financial blow? etc...

 

 

There lots of reasons for high gas prices, speculators, lack of refineries, high demand, less than optimum oil production, all these things contribute to a synergy that pushes prices higher than they could be. One thing about the prices in other countries, most of the countries that have extremely high prices are small countries. You could take a tank of gas and drive almost anywhere in Germany but a tank of gas wouldn't take completely across my state of NC. this might not be fair but it's true. Add to that the fact that small countries do not have as much room for refineries as big countries and you get very high prices. It's sad we (the US) doesn't have enough refinery capacity to prevent the need to import refined gasoline. This is driving prices up as much or more than any other reason. But it is our own fault, no one want a stinky gasoline refinery near them "NIMBY" so they are not being built to meet demand.

[freeztar]

Yes, the NIMBY factor is a big one, but there are plenty of places that are not anyone's "backyard". I found an interesting article that discusses the issues with US refineries. I found it well worth the read.

 

U.S. refiners stretch to meet demand - Oil & energy - MSNBC.com

 

There hasn’t been a new refinery built in the U.S. since 1976, the result of extremely tight environmental restrictions, not-in-my-back-yard community opposition, and the high cost of new construction. Used refineries currently sell for about 30 to 50 percent of the cost of building a new one, so it’s cheaper to buy an old refinery and upgrade it. Or squeeze a little more gasoline out of the refineries you already own.

 

Expansion of refining capacity is also made more difficult because oil refineries are a lot more complicated to build and operate than your average widget factory. For starters the raw material — crude oil — has many different properties, from thickness to sulfur content, so not all refineries can blend just any barrel of crude.

 

[Thunderbird]

It has to do with supply and demand. The demand in newly industrialized countries has sky rocketed while production has stayed about the same. The oil companies are making huge profits but this only to off set the future and current cost of exploration of new oil reserves.

 

The problem of high fuel cost is not going away. What we need to decide in the US is to elect a president that thinks that drilling new wells and continuing and expanding a war in the middle east is the solution {McCain } or push for alternative sources of energy { Obama } This is going to be the issue that Americans need to decide on in the next election.

[Turtle]

Falling US dollar, no increase in oil production by OPEC, and increased demand for petroleum products. That's what I hear anyway. ;)

 

What are you doing to soften the financial blow?

 

Fewer trips to Lechtenberg. :eek: .........:phones:

[Moontanman]

What am I doing to off set the price of gas? I don't go anywhere for fun anymore, the store, the doctor, my wife to job interviews, no driving for fun at all. All my fun is here, kinda sad aint it!

[freeztar]

There's also the X-factor, namely China.

 

U.S. agencies, think tanks and market researchers rely on Chinese government statistics and GDP-related estimates to gauge oil demand. This year, China's freak winter storms, the May 12 earthquake and the Summer Olympics have further clouded forecasts.

 

China's strong diesel demand spiked after the quake as the government fired up backup power generators. Beijing plans to substitute diesel for coal in power plants near the capital some 45 days before the Olympics to reduce pollution, says a Lehman Bros. report.

 

And, China has stockpiled oil products for transportation needs during the Olympics, analysts say.

 

Some argue the Olympics impact on demand has been overhyped.

China's Oil Needs Keep Rising For Trucks, Industry, Stockpiles - Yahoo! News

[Thunderbird]

What is causing the higher prices? When and how will we see relief? What are the social implications of higher fuel costs? What are you doing to soften the financial blow? etc...

 

both of my jobs,bank,store, gas station, insurance company,Church, recreational facilities are all within a 2-5 blocks of my house. :phones: I'm fortunate. ;)

[freeztar]

What am I doing to off set the price of gas? I don't go anywhere for fun anymore, the store, the doctor, my wife to job interviews, no driving for fun at all. All my fun is here, kinda sad aint it!

Pretty much the same thing here. I also combine trips as much as possible. For example, if I need to go to the grocery store, I go on my way home from work.

[Zythryn]

Supply is not keeping up with demand. That is the basic reason. While demand in the US took a small dip, increases in worldwide demand make that a very minor point.

While Mexico's production is in decline, it is also consuming more each year. Estimates are that Mexico will no longer be exporting any oil around 2012 as their demand reaches the level of their production.

What I am doing to alleviate the pump prices? Nothing I haven't already done. Bought a Prius (2 actually if you count my wife's car) last year. This cut my gasoline bill in half. So until gasoline goes north of $5 - $6 I am spending less than I did prior to my Prius purchase.

I do limit my driving and combine errands when I can. However, that is not due to pump prices. That is just because I wish to use less oil.

[Moontanman]

Supply is not keeping up with demand. That is the basic reason. While demand in the US took a small dip, increases in worldwide demand make that a very minor point.

While Mexico's production is in decline, it is also consuming more each year. Estimates are that Mexico will no longer be exporting any oil around 2012 as their demand reaches the level of their production.

What I am doing to alleviate the pump prices? Nothing I haven't already done. Bought a Prius (2 actually if you count my wife's car) last year. This cut my gasoline bill in half. So until gasoline goes north of $5 - $6 I am spending less than I did prior to my Prius purchase.

I do limit my driving and combine errands when I can. However, that is not due to pump prices. That is just because I wish to use less oil.

 

Lucky you Zythryn, If all of us could buy a hybrid or an electric the world would be a much better place. At this point there is no shortage of oil that is not man made. OPEC keeps it production low enough to keep the prices very high. Theoretically that would be illegal in the US but of course we don't control the world. It's a shitty idea but think about how the world would react if there was a consortium of FPEC (food producing exporting countries) that keep the supply of food low to jack up prices. Yes we need to move away from oil as an energy source, we need nuclear power, solar power, geothermal power as energy sources. but crippling the economy by keep everyone from being able to live isn't going to help the world get there. We live in a large country, it take lots of energy to transport people, raw materials, and finished goods over this and any other country for that matter. I think we are already engaged in the third world war and it doesn't have a thing to do with shooting people or dropping bombs no matter how hard some try to convince the world it is. It's called economic warfare and in the long run it is as damning as any other type of war can be. to win it we need to be flexible and self sustaining in our energy needs and uses but the whole idea of controlling energy prices and keeping them high prevent us from doing the very things we need to do to win or even bring about a stalemate.

[modest]

Brazil is a model we should all look to :phones:

 

Brazil's Biofuel Strategy Pays Off as Gas Prices Soar

 

Such bumper sugar crops have often meant worldwide gluts, low prices and headaches for politicians in the more than 100 countries where sugar cane is grown, but not this year in Brazil. About half the cane brought here will be made into ethanol as part of a 30-year gamble to substitute fuels made from crops for imported oil...

 

As international oil prices soar, that bet has put Brazil at the forefront of a "biofuels"...

[Zythryn]

Lucky you Zythryn, If all of us could buy a hybrid or an electric the world would be a much better place.

 

Luck has nothing to do with it.

I realized years ago that oil is a finite reasource and that the price of gasoline is, year over year, going to continue to rise.

Hybrids are not the only solution, any high effiency car will improve your situation. 34 mpg is far better than the average 20mpg.

And yes, I agree that if hybrid or preferable all electric cars were available to everyone the world would be a better place;)

 

OPEC keeps it production low enough to keep the prices very high. ...

 

Do you realize how little of the US oil imports are from OPEC nations??

The price is determined by the free market. The price is spiking due to the fact that we no longer can produce enough to handle any major supply disruptions. So any fear of a geologic, weather or political disruption sends prices soaring.

[Moontanman]

Luck has nothing to do with it.

I realized years ago that oil is a finite reasource and that the price of gasoline is, year over year, going to continue to rise.

 

Any one who didn't see this coming is quite a bit less than unlucky, not everyone is in the financial situation to buy the way they should and then you have a large proportion of the population that is simply locked into cars that are old and cannot be replaced due to lack of money or credit or some other reason. to suggest that anyone or everyone should have bought certain cars ignores reality. as much as I enjoy ignoring reality it never goes away.

 

Hybrids are not the only solution, any high effiency car will improve your situation. 34 mpg is far better than the average 20mpg.

 

You are of course completely correct but I have found that the people most guilty of buying gas hogs are the people who thought they could ignore gas prices because they made so much money filling a hummer tank with 50 gallons of fuel was no big deal. I do not have any sympathy for these people. I remember choking when gas hit $1 a gallon and I was a big proponent of methane powered cars but no one seemed to be listening. Gasoline was too entrenched to even think about a alternative so all the money was spent on making gas engines less polluting and this is where we ended up.

 

And yes, I agree that if hybrid or preferable all electric cars were available to everyone the world would be a better place;)

Do you realize how little of the US oil imports are from OPEC nations??

The price is determined by the free market. The price is spiking due to the fact that we no longer can produce enough to handle any major supply disruptions. So any fear of a geologic, weather or political disruption sends prices soaring.

 

OPEC still sets the prices, even the prices of non OPEC producers. No one is going to sell their oil at a rate less than the set price, it would be crazy to do that.

[freeztar]

Do you realize how little of the US oil imports are from OPEC nations??

 

According to this nifty chart, we get most of our refined oil from the UK and only 3% comes from OPEC. We do get most of our crude oil from OPEC though, almost 54% in 2007.

[modest]

According to this nifty chart, we get most of our refined oil from the UK and only 3% comes from OPEC. We do get most of our crude oil from OPEC though, almost 54%.

 

Seems like an economic disaster we don't refine all our own oil.

 

According to: Refinery shortages, gasoline prices, and what's to come - Apr. 17, 2007

 

The US used 17 million more gallons of gasoline than it could refine in 1995. In 2005 it was up to 36 million. And, we haven't built a new refinery since 1976.

 

Plans to build one in South Dakota are meeting resistance, but it will apparently happen.

 

New South Dakota Oil Refinery One Step Closer to Reality : Gas 2.0

 

I'm not too versed in economics, but hopefully getting that built will provide some relief. I can't take these prices much longer.

 

-modest

EDIT:

 

Also, nice link freeztar ;)

[Moontanman]

I hate to say it, but I don't see gas prices going anywhere but up. I see people on TV talking about how the gas prices aren't impacting their lives very much but I do know people who are doing more than just staying home from fun, they are having to make very hard decisions about food, medicine and energy. for me it isn't easy but i do manage to go where i need to. i miss driving around in the country pursuing my native fish collecting hobby but i can do with out that. I see people who are walking great distances instead of driving. More and more people are walking several miles to go where they need to go and some of them are not fit enough to do that. Not sure what is going to happen but to a great extent the public has brought some of this about by stopping the building of refineries, opposing the building of new nuclear power plants, and by not insisting on high mileage cars instead of low pollution cars. We had a Chance to start to move away from gasoline in the 70's and we choose not to. Now is the time to look ahead and insist on the correct choices this time because next time might not come in time to save us from our selves.