Current Topics
Help me understand
by Ardy
10:17 PM
Passing out weapons as a foreign policy
by california rick
09:27 PM
Round Table for July 27-August 2, 2014
by Scoutgal
08:50 PM
Libya a failure of foreign policy
by jgw
04:09 PM
Israel. Specious arguments wearing thin
by california rick
10:56 PM
Big brother is watching
by Joe Keegan
10:55 PM
Zionism and ethnic cleansing.
by Schlack
07/29/14 04:38 PM
Palestine after Rome and before wwi
by Ardy
07/29/14 11:40 AM
palestinian responsibility for the Jewish Diaspora?
by Phil Hoskins
07/29/14 11:37 AM
Spiritual But Not Religious
by Spag-hetti
07/28/14 06:08 PM
State sees surge in high-paying white-collar jobs
by NW Ponderer
07/28/14 08:39 AM
Time Travel Question: Kill Hitler or educate voters on the 2000 FL ballot
by california rick
07/27/14 12:39 PM
Round Table Foe Week Of July 20th-July 26th, 2014
by Scoutgal
07/27/14 10:08 AM
Impeachment Circus Rides Again
by california rick
07/26/14 12:12 PM
Illegal immigration rates
by NW Ponderer
07/24/14 07:56 PM
Forum Stats
6003 Members
55 Forums
14221 Topics
246554 Posts

Max Online: 282 @ 05/29/08 01:08 AM
Google Adsense
Page 1 of 12 1 2 3 ... 11 12 >
Topic Options
#212074 - 02/07/12 08:47 AM Gas Prices... Again
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
As wholesale prices for unleaded regular near $3.00/gal (currently hovering around $2.93), our local NBC affiliate had a short squib from an unnamed "expert" who projected retail prices of over $5.00/gal within a year.
With what should be a differential of $.60 to $.70 (taxes, transportation, station owner profit) the neartime (National) price should be expected to be about $3.70.

Our local pump price has gone from $3.15 about a month ago, to $3.50.

Not much in the news, and nothing from congress. All is blamed on the Iran blockade threat. It appears that no one follows or cares about the futures/derivative trading behind the fluctuations.

The simple minded "supply/demand" answer seems to have satisfied everyone, in the same manner that the housing bubble was characterized between 2000 and 2007.

Of course the thirst for energy will drive the price... (China, India,and the rest of the emerging nations), but the price differential is now, and the obscene profits based on oil that is 3-4 months away from the gas tank of your car.

Three years ago, the OPEC nations declared that they could and would be profitable with oil prices at $65/bbl. World inflation is nowhere near the 50% increase that now is the new "norm". ($100/bbl WTI).

You may pick your own statistics, and quibble the numbers, but the fact remains that speculation in gas/oil, is one of the major factors that continues to slow the economy, and disproportionately affect gas prices, airline, shipping and fuel oil prices. This coincidentally places more money in the pockets of producing countries, oil companies, and bankers and brokers...


The extra fuel cost to operate an auto for 12,000mi. @22mpg and gas @ $3.50 vs $2.00 three years ago... is nearly $900. a 75% increase.

The most amazing thing is that very, very few people know how prices are set, including most of Congress, but you can find out, from this "HOW" piece.
Note: multi page
There is also a link on that page to "peak oil"...IMO, one of the most balanced articles that I've read.

FYI... some other basic info hereand here.

and here is a recent news article

(awaiting the outrage and criticism smile
tonbricks



Edited by itstarted (02/07/12 10:56 AM)

Top
#212082 - 02/07/12 10:44 AM Re: Gas Prices... Again [Re: itstarted]
AustinRanter Offline
enthusiast

Registered: 10/29/06
Posts: 3643
Loc: Austin, Texas
If the "supply/demand" answer was the answer...

I hear people get really angry at oil companies about their profit margins. Oil companies, like all other public companies, have a responsibility to stockholders. A lot of retirement funds are hinged to such investments. But in the end, they work within the parameters of spot prices.

I don't think it's possible for a person or even a group to control spot prices.

I don't know...

As long as people are trading in oil spots...they're gonna want to try to earn off of their investment. That's what makes risk/reward opportunities exciting.
_________________________
Turn on ANY brand of political machine - and it automatically goes to the "SPIN and LIE CYCLE" wink

Yours Truly - Gregg



Top
#212193 - 02/07/12 11:22 PM Re: Gas Prices... Again [Re: itstarted]
Mechanic Offline
journeyman

Registered: 04/19/11
Posts: 802
Originally Posted By: itstarted
As wholesale prices for unleaded regular near $3.00/gal (currently hovering around $2.93), our local NBC affiliate had a short squib from an unnamed "expert" who projected retail prices of over $5.00/gal within a year.
With what should be a differential of $.60 to $.70 (taxes, transportation, station owner profit) the neartime (National) price should be expected to be about $3.70.

Our local pump price has gone from $3.15 about a month ago, to $3.50.

Not much in the news, and nothing from congress. All is blamed on the Iran blockade threat. It appears that no one follows or cares about the futures/derivative trading behind the fluctuations.

The simple minded "supply/demand" answer seems to have satisfied everyone, in the same manner that the housing bubble was characterized between 2000 and 2007.

Of course the thirst for energy will drive the price... (China, India,and the rest of the emerging nations), but the price differential is now, and the obscene profits based on oil that is 3-4 months away from the gas tank of your car.

Three years ago, the OPEC nations declared that they could and would be profitable with oil prices at $65/bbl. World inflation is nowhere near the 50% increase that now is the new "norm". ($100/bbl WTI).

You may pick your own statistics, and quibble the numbers, but the fact remains that speculation in gas/oil, is one of the major factors that continues to slow the economy, and disproportionately affect gas prices, airline, shipping and fuel oil prices. This coincidentally places more money in the pockets of producing countries, oil companies, and bankers and brokers...
The extra fuel cost to operate an auto for 12,000mi. @22mpg and gas @ $3.50 vs $2.00 three years ago... is nearly $900. a 75% increase.

The most amazing thing is that very, very few people know how prices are set, including most of Congress, but you can find out, from this "HOW" piece.
Note: multi page
There is also a link on that page to "peak oil"...IMO, one of the most balanced articles that I've read.

FYI... some other basic info hereand here.


and here is a recent news article

(awaiting the outrage and criticism smile
tonbricks



A most entertaining post IS !! Why should I be "outraged" by real world facts ? OTOH I am "outraged" by an OA energy policy designed to increase energy costs to its political opposition while remaining transparaent to its gv'mt-funded supporters ! IOW, just another "step" in its pogrom of racial division !

On a more technical note, none of my experience in the refineries or the "energy business" seems adequate to "splain" why my mileage, ( in the same car driven by the same person over the same route under similar environmental conditions ) declines even as the pump price rises ! (I'd like to perform a "knock test" on the pump gas I'm buying, but haven't the facillities; and it wouldn't mean DS as the posted octane is a "research number", not a demonstrated "knock number" one !

I do know pump gasoline is a complex blend of a lot of refinery and imported fractions, per the dictums of market forces and the USG ! I'm sure its possible to create an "standard" knock-test engine equally capable of documenting the energy content of its fuel on a /lit4r basis ! Now wouldn't that be a nice number to see at the pump ?

But then, both state and federal governments have a "vested interest" in increased fuel consumption - thereby gaining more tax revenue - don't they ? And why wouldn't a federal administration use its executive and regulatory powers to enhance these "beneficial" consequences ? >Mech

Top
#212203 - 02/08/12 07:38 AM Re: Gas Prices... Again [Re: Mechanic]
Ted Remington Offline
old hand

Registered: 07/09/08
Posts: 4890
Originally Posted By: Mechanic
I am "outraged" by an OA energy policy designed to increase energy costs to its political opposition while remaining transparaent to its gv'mt-funded supporters ! IOW, just another "step" in its pogrom of racial division !


That makes absolutely no sense at all. Why and how could the Obama Administration increase energy costs for just one segment of the consumer base?

Pogrom of racial division? What could possibly lead to such a conclusion that anything like that even exists?

Do you have anything to show us that your statements are correct in the above quote?

Originally Posted By: Mechanic
But then, both state and federal governments have a "vested interest" in increased fuel consumption - thereby gaining more tax revenue - don't they ? And why wouldn't a federal administration use its executive and regulatory powers to enhance these "beneficial" consequences ?


How can you make an allegation like this in the face of all the facts that the Obama administration is trying to increase fleet economy?

Quote:
That thud you just heard was the “other shoe” dropping in Washington, D.C.: the Obama administration has used the turmoil in the auto industry as an opportunity to nudge—okay, force—the industry into a new, more environmentally sensitive direction, thus making good on its promise to impose stricter Corporate Average Fuel Economy (CAFE) and tailpipe emissions standards across the automobile industry.

The proposed mandate raises CAFE standards about five percent annually from today’s level of 23 mpg for trucks and 27.5 mpg for cars to 30 mpg for trucks and 39 mpg for passenger cars by 2016, for an average of 35.5 mpg overall. This is roughly four years earlier than the already aggressive 35-mpg goalpost established by Congress in 2007.


source

And more recently:

Quote:
On July 29 (2011), President Barack Obama announced increased miles per gallon (MPG) standards for cars and light-fleet vehicles. The National Highway Traffic Safety Administration (NHTSA) is raising the average MPG standard for model years 2017-2025, requiring a 54.5 mpg fuel efficiency by 2025 for cars and light -fleet vehicles. This latest phase of fuel economy standards will result in a total savings of 3.5 million barrels of oil a day by 2030.


source
_________________________
Take the nacilbupeR pledge: I solemnly swear that I will help back out all Republicans at the next election.

Top
#212281 - 02/08/12 06:30 PM Re: Gas Prices... Again [Re: itstarted]
keysersoze Offline
journeyman

Registered: 12/01/11
Posts: 880
ECAT will eventually solve this. Go...Rossi....go!
_________________________
Only racists oppose my dictatorship.

Top
#212286 - 02/08/12 07:07 PM Re: Gas Prices... Again [Re: keysersoze]
Ted Remington Offline
old hand

Registered: 07/09/08
Posts: 4890
From your mouth to God's ear.
_________________________
Take the nacilbupeR pledge: I solemnly swear that I will help back out all Republicans at the next election.

Top
#212340 - 02/09/12 07:17 AM Re: Gas Prices... Again [Re: itstarted]
Ma_Republican Offline
old hand

Registered: 02/12/04
Posts: 6325
Loc: USA
A country cannot create trillions of dolars out of thin air and not expect inflation to creep into the equation. The price of fuel and food have increased dramatically over the past 6 months, and will continue to increase until the amount of dollars floating around in the economy is reduced.

Yeah, 3.25% mortgages are great, but easing has created another danger. If it were GW in offce instead of the great teleprompter, the news would be all over the added costs for the poor and, more importantly, the children of the poor. Fuel prices will continue to increase, as will the cost of food and major appliances. The US dollar isn't worth nearly what it was when this administration took office.


Edited by Ma_Republican (02/09/12 07:18 AM)
_________________________
A proud member of the Vast Right-wing Conspiracy, Massachusetts Chapter

“The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.”
Thomas Jefferson

Top
#212343 - 02/09/12 08:01 AM Re: Gas Prices... Again [Re: Ma_Republican]
Chuck Howard Offline
old hand

Registered: 09/17/01
Posts: 6723
Loc: Philly 'burbs
From that bastion of liberal, socialist thought, the Cato Institute:

Quote:

So what is driving the gasoline price spike? It seems far more likely that it is the result of a combination of the following:

Uprisings in the Middle East could spread to mega-exporters Saudi Arabia and Iran, which has resulted in an implicit risk premium on oil and oil products.
Japanese recovery efforts from the March 11 earthquake and tsunami are drawing heavily on petroleum.
China and India are using more energy as their economies recover from the global recession.


Link to source

But it's so much easier to find simple reasons for complex problems, isn't it. Just blame it on that Kenyan guy.


Edited by Chuck Howard (02/09/12 08:02 AM)

Top
#212346 - 02/09/12 08:35 AM Re: Gas Prices... Again [Re: Ma_Republican]
logtroll Offline
old hand

Registered: 04/25/10
Posts: 6142
Loc: New Mexico (not old Mexico)
Originally Posted By: Ma_Republican
A country cannot create trillions of dolars out of thin air and not expect inflation to creep into the equation.

No argument there. Good thing that inflation isn't a killer disease, just a reflection of the constant adjustment of an economy to unregulated "growth" (things like vulture capitalism - thanks Mitt!).
Originally Posted By: Ma_Republican
The price of fuel and food have increased dramatically over the past 6 months...

How are food prices kept low? Oh, right, farm subsidies. Where shall we cut the budget, farm subsidies? Lower taxes, raise prices. Nice way to shift more of the economic burden to the poor.
Originally Posted By: Ma_Republican
and will continue to increase until the amount of dollars floating around in the economy is reduced.

??? Can you provide a bit of the logic supporting this statement? Thanks.
Originally Posted By: Ma_Republican
Fuel prices will continue to increase, as will the cost of food and major appliances. The US dollar isn't worth nearly what it was when this administration took office.

Yes. How long has this trend been occurring and have there been steeper and flatter parts to the curve? That would be interesting to have an unbiased look at.
_________________________
"If you would make a person happy, add not to their possessions but take from their desires"
Unknown

Top
#212347 - 02/09/12 08:36 AM Re: Gas Prices... Again [Re: Ma_Republican]
AustinRanter Offline
enthusiast

Registered: 10/29/06
Posts: 3643
Loc: Austin, Texas
Originally Posted By: Ma_Republican
A country cannot create trillions of dolars out of thin air and not expect inflation to creep into the equation. The price of fuel and food have increased dramatically over the past 6 months, and will continue to increase until the amount of dollars floating around in the economy is reduced.

Yeah, 3.25% mortgages are great, but easing has created another danger. If it were GW in offce instead of the great teleprompter, the news would be all over the added costs for the poor and, more importantly, the children of the poor. Fuel prices will continue to increase, as will the cost of food and major appliances. The US dollar isn't worth nearly what it was when this administration took office.


Creating money out of thin air doesn't summons inflation. It is inflation. That's how government loves paying its bills.
_________________________
Turn on ANY brand of political machine - and it automatically goes to the "SPIN and LIE CYCLE" wink

Yours Truly - Gregg



Top
#212348 - 02/09/12 08:44 AM Re: Gas Prices... Again [Re: Chuck Howard]
Ma_Republican Offline
old hand

Registered: 02/12/04
Posts: 6325
Loc: USA
Originally Posted By: Chuck Howard
From that bastion of liberal, socialist thought, the Cato Institute:

Quote:

So what is driving the gasoline price spike? It seems far more likely that it is the result of a combination of the following:

Uprisings in the Middle East could spread to mega-exporters Saudi Arabia and Iran, which has resulted in an implicit risk premium on oil and oil products.
Japanese recovery efforts from the March 11 earthquake and tsunami are drawing heavily on petroleum.
China and India are using more energy as their economies recover from the global recession.


Link to source

But it's so much easier to find simple reasons for complex problems, isn't it. Just blame it on that Kenyan guy.


OK, I will. The Kenyan Guy's policy (lack of policy) on the Arab Spring uprisings have created uncertainty throughout the ME and the world. His inability to create US leverage has not helped and his pandering toward Iran has created a situation where Iran has become a power player in the ME, instead of just another petty dictatorship that only Jimmy Carter could like. Then again, Jimny Carter created today's Iran, encouraged her current theocracic policies and failed in his responsibility to protect the United States at the same time. A perfect Democratic trifector.

Then there is the earthquake in Japan? How much oil does Japan export into the world's market, oh yeah, that would be 0.0%. Makes perfect sense that the earthquake that hit a non-exporting nation would have such an effect on US oil prices.

But, then again, creating money out of thin air, diluting the world's dollar supply and causing the world's standard purchaing instrument to be worth less by a considerable percentage had nothing to do with fuel prices to increase. Is there anything that your Kenyan lord would do that would force you to take the rose colored glasses off and stop licking his cornhole?

I know a hooker, she would be perfect for you. She is a skank, has many STD's and looks like the back of your ass. But every person she contaminates drives up the demand for Obamacare, er Kenyanguycare. Forget that she is a drain on society, she deflects reality and causes people to look elsewhere. She is obviously a Kenyan Guy supporter, she is on food stamps. That means she is a job creator also, since foodstamps and unemployment create jobs.


Edited by Ma_Republican (02/09/12 08:49 AM)
_________________________
A proud member of the Vast Right-wing Conspiracy, Massachusetts Chapter

“The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.”
Thomas Jefferson

Top
#212349 - 02/09/12 08:53 AM Re: Gas Prices... Again [Re: AustinRanter]
Greger Offline
veteran

Registered: 11/24/06
Posts: 11848
Loc: Florida
Speaking of gas prices, I just had Propane delivered.
Holy Jegus Effing Christ!

$5.98 a gallon!

While I'm doing without food later this month I'll be able to enjoy nice hot showers.
_________________________
"Be yourself; everyone else is already taken."— Oscar Wilde

Top
#212352 - 02/09/12 09:02 AM Re: Gas Prices... Again [Re: Ma_Republican]
Chuck Howard Offline
old hand

Registered: 09/17/01
Posts: 6723
Loc: Philly 'burbs
Originally Posted By: Ma_Republican


OK, I will. The Kenyan Guy's policy (lack of policy) on the Arab Spring uprisings have created uncertainty throughout the ME and the world.


Yeah, I know. And prior to January 20, 2009, the Middle East was such a quiet, stable, conflict-free region of the world. rolleyes

Quote:

Then there is the earthquake in Japan? How much oil does Japan export into the world's market, oh yeah, that would be 0.0%. Makes perfect sense that the earthquake that hit a non-exporting nation would have such an effect on US oil prices.


I really don't know which impacts your thought more; your blind hatred of the President or just poor reading comprehension skills. If you had read and understood the linked-to article, you would would have known that there was no reference there to Japan as an oil-exporting nation.


Quote:

I know a hooker, she would be perfect for you. She is a skank, has many STD's and looks like the back of your ass. But every person she contaminates drives up the demand for Obamacare, er Kenyanguycare. Forget that she is a drain on society, she deflects reality and causes people to look elsewhere. She is obviously a Kenyan Guy supporter, she is on food stamps. That means she is a job creator also, since foodstamps and unemployment create jobs.


Your problems obviously run much deeper than just blind partisanship. Please get some help.

Top
#212353 - 02/09/12 09:03 AM Re: Gas Prices... Again [Re: Ma_Republican]
logtroll Offline
old hand

Registered: 04/25/10
Posts: 6142
Loc: New Mexico (not old Mexico)
Originally Posted By: Ma_Republican

OK, I will. The Kenyan Guy's policy (lack of policy) on the Arab Spring uprisings have created uncertainty throughout the ME and the world. His inability to create US leverage has not helped and his pandering toward Iran has created a situation where Iran has become a power player in the ME, instead of just another petty dictatorship that only Jimmy Carter could like. Then again, Jimny Carter created today's Iran, encouraged her current theocracic policies and failed in his responsibility to protect the United States at the same time. A perfect Democratic trifector.

Then there is the earthquake in Japan? How much oil does Japan export into the world's market, oh yeah, that would be 0.0%. Makes perfect sense that the earthquake that hit a non-exporting nation would have such an effect on US oil prices.

But, then again, creating money out of thin air, diluting the world's dollar supply and causing the world's standard purchaing instrument to be worth less by a considerable percentage had nothing to do with fuel prices to increase. Is there anything that your Kenyan lord would do that would force you to take the rose colored glasses off and stop licking his cornhole?

I know a hooker, she would be perfect for you. She is a skank, has many STD's and looks like the back of your ass. But every person she contaminates drives up the demand for Obamacare, er Kenyanguycare. Forget that she is a drain on society, she deflects reality and causes people to look elsewhere. She is obviously a Kenyan Guy supporter, she is on food stamps. That means she is a job creator also, since foodstamps and unemployment create jobs.

Wow! A magnitude 12 Self-Smackdown! Irked couldn't do a better parody! (but I bet the master will try).
_________________________
"If you would make a person happy, add not to their possessions but take from their desires"
Unknown

Top
#212356 - 02/09/12 09:05 AM Re: Gas Prices... Again [Re: Ma_Republican]
Chuck Howard Offline
old hand

Registered: 09/17/01
Posts: 6723
Loc: Philly 'burbs
Originally Posted By: Ma_Republican
Then again, Jimny Carter created today's Iran,...


Your complete lack of any sense of history is mind-boggling. And "cause and effect" doesn't appear to be one of your strong points either.

Top
#212358 - 02/09/12 09:41 AM Re: Gas Prices... Again [Re: Ma_Republican]
logtroll Offline
old hand

Registered: 04/25/10
Posts: 6142
Loc: New Mexico (not old Mexico)
Originally Posted By: Ma_Republican

I know a hooker, she would be perfect for you. She is a skank, has many STD's and looks like the back of your ass.

Ma, how often do you know her?

BTW, who is Kenyan Guy? He's not on Facebook with any info.
Kenyan Guy
_________________________
"If you would make a person happy, add not to their possessions but take from their desires"
Unknown

Top
#212359 - 02/09/12 10:00 AM Re: Gas Prices... Again [Re: Greger]
Ken Condon Offline
enthusiast

Registered: 06/13/07
Posts: 2883
Loc: Eugene, OR
Quote:
While I'm doing without food later this month I'll be able to enjoy nice hot showers.

Now wait a minnit greger. You live in Florida-correct? Isn’t it pretty darn sunny and warm where you live? I ask because of this.

When I was young I lived on Oahu. On our roof we had a simple 55 gallon metal drum painted black. Inside was a toilet shut off valve mechanism. The drum would fill with cold tap water, then get heated quite hot during the day by the sun, and the cold water intake would shut off with the toilet mechanism when it got full. The hot water in the tank gravity flowed to an outside shower in the back yard. It worked great.

Couldn’t something like that work for you?
_________________________
The past is always tense, the future perfect.

Top
#212364 - 02/09/12 10:50 AM Re: Gas Prices... Again [Re: Ken Condon]
AustinRanter Offline
enthusiast

Registered: 10/29/06
Posts: 3643
Loc: Austin, Texas
Originally Posted By: Ma
I know a hooker, she would be perfect for you. She is a skank, has many STD's and looks like the back of your ass.


Wow, Ma...that sounds just like a girl I dated in high school. I bet she wished that she looked as good as the back of my ass (well, at the time). Wonder how she is? My guess is that she's married to an elected official in Washington.
_________________________
Turn on ANY brand of political machine - and it automatically goes to the "SPIN and LIE CYCLE" wink

Yours Truly - Gregg



Top
#212382 - 02/09/12 12:13 PM Re: Gas Prices... Again [Re: itstarted]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Replying to my original post.

"Sheesh Bob, you're the only one who read it."

ROTFMOL

Much easier to rant on something when ya haven't bothered to read the original piece... Freedom of expression.
One thing none of us can be accused of... "Humility".

Someday... when ya get a chance, you might want to read the first link in the thread... Here for your ease in navigation.
How does oil speculation drive up prices.
BTW... three pages... so maybe when ya get a week off, or like that.

BTW....I agree with Ma on this:
Quote:
A country cannot create trillions of dolars out of thin air and not expect inflation to creep into the equation. The price of fuel and food have increased dramatically over the past 6 months, and will continue to increase until the amount of dollars floating around in the economy is reduced.


The next big topic will be commodities... fuel, food, and rw materieals, where the the big money ignore supply demand... work together in collusion with other bankers and brokers, and bump rices out of sight... Because they can... and because we need food and energy to live. The owners of the commodities support the scheme, by holding back production, which they can boost back up, when the price is right.


Edited by itstarted (02/09/12 06:37 PM)
Edit Reason: spelling

Top
#212415 - 02/09/12 02:07 PM Re: Gas Prices... Again [Re: itstarted]
logtroll Offline
old hand

Registered: 04/25/10
Posts: 6142
Loc: New Mexico (not old Mexico)
From the article:

Quote:
Everything that can be bought or sold has what 18th-century political economist Adam Smith called a natural price. This price is the sum total of the values of everything that came together to create the product or service. Raw materials, labor, distribution -- all of these add to the natural price of a product. Any amount that the seller of a good or service can get above this natural price is profit.


I submit that profit, so described, is inflationary (or "making moneyvalue out of thin air").


Edited by logtroll (02/09/12 02:09 PM)
_________________________
"If you would make a person happy, add not to their possessions but take from their desires"
Unknown

Top
#212425 - 02/09/12 04:35 PM Re: Gas Prices... Again [Re: itstarted]
AustinRanter Offline
enthusiast

Registered: 10/29/06
Posts: 3643
Loc: Austin, Texas
Originally Posted By: itstarted

BTW....I agree with Ma on this:
Quote:
A country cannot create trillions of dolars out of thin air and not expect inflation to creep into the equation. The price of fuel and food have increased dramatically over the past 6 months, and will continue to increase until the amount of dollars floating around in the economy is reduced.


The next big topic will be commodities... fuel, food, and rw materieals, where the the big money ignore supply demand... work together in collusion with other bankers and brokers, and bump rices out of sight... Because they can... and because we need food and energy to live. The owners of the commodities support the scheme, by holding back production, which that can boosy back up, when the price is right.


The US Government stock piles commodities, it always has. Our already corrupt government (along with others I suppose) would have to be a major player working in collusion with investment bankers, brokers, and other capable corporate entities to consistently control overall global futures prices.

Life is really getting complicated for the little guy.
_________________________
Turn on ANY brand of political machine - and it automatically goes to the "SPIN and LIE CYCLE" wink

Yours Truly - Gregg



Top
#212434 - 02/09/12 06:31 PM Re: Gas Prices... Again [Re: AustinRanter]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Quote:
Life is really getting complicated for the little guy.

Especially when we don't know what they're doing...
I believe that in the case of Gas and OIL... when they allowed the trading of derivatives outside of the view of the SEC (and the CFTC) and into ICE, that they pulled the curtains around the glass room. Now, as the banks and brokers trade derivatives together, there is no way of knowing how many hundreds of billions of trades are taking place... in a matter of days. When the dealers can play with leverage of as much as 20 to 1, and make a trade on $3.00 gas that moves $.01 the profits can be in the multi millions. When the price went from $2.56 in October to $3.01 today....and the trading goes on a minute to minute basis, then it's easy to see how a single one man hedge fund can make $5 Billion in one year. That's five thousand million dollars.

Trading in computers, or clothing, or services, is a very different animal, not like commodities. We can live without MacDonalds, or Hewlett Packard, or even Google... we cannot live without energy... heat and light... or without food,
....so... when the price goes up, and the oil stays in the ground, or the farmer doesn't bring food to market... then the price goes up... the demand is there, the need is there... and with collusion to shut down refineries, or block pipelines, or just not pump the available oil... THEN... the consumer pays the price.

The "Free Market" isn't free, when people conspire behind closed doors to restrict supply of the absolute necessities.

The natural supply and demand, that rises and falls with the weather and the crop output and the public "wants"... like coffee... $6 to $12 in 6 months... is a different animal. Production will catch up and the Brazil growers will compete, and prices will fall.

Not so with gas and oil prices. Not so when monoliths like ADM collude with other food processors... And not so when Congress uses the services of the corporations to develop the laws that govern their actions... Read that: "Legal Departments and Lobbyists".

They say: "What you don't know can't hurt you". THEY are wrong.

Oil Speculation
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#212442 - 02/09/12 07:42 PM Re: Gas Prices... Again [Re: itstarted]
AustinRanter Offline
enthusiast

Registered: 10/29/06
Posts: 3643
Loc: Austin, Texas
Originally Posted By: itstarted
Quote:
Life is really getting complicated for the little guy.

Especially when we don't know what they're doing...
I believe that in the case of Gas and OIL... when they allowed the trading of derivatives outside of the view of the SEC (and the CFTC) and into ICE, that they pulled the curtains around the glass room. Now, as the banks and brokers trade derivatives together, there is no way of knowing how many hundreds of billions of trades are taking place... in a matter of days. When the dealers can play with leverage of as much as 20 to 1, and make a trade on $3.00 gas that moves $.01 the profits can be in the multi millions. When the price went from $2.56 in October to $3.01 today....and the trading goes on a minute to minute basis, then it's easy to see how a single one man hedge fund can make $5 Billion in one year. That's five thousand million dollars.

Trading in computers, or clothing, or services, is a very different animal, not like commodities. We can live without MacDonalds, or Hewlett Packard, or even Google... we cannot live without energy... heat and light... or without food,
....so... when the price goes up, and the oil stays in the ground, or the farmer doesn't bring food to market... then the price goes up... the demand is there, the need is there... and with collusion to shut down refineries, or block pipelines, or just not pump the available oil... THEN... the consumer pays the price.

The "Free Market" isn't free, when people conspire behind closed doors to restrict supply of the absolute necessities.

The natural supply and demand, that rises and falls with the weather and the crop output and the public "wants"... like coffee... $6 to $12 in 6 months... is a different animal. Production will catch up and the Brazil growers will compete, and prices will fall.

Not so with gas and oil prices. Not so when monoliths like ADM collude with other food processors... And not so when Congress uses the services of the corporations to develop the laws that govern their actions... Read that: "Legal Departments and Lobbyists".

They say: "What you don't know can't hurt you". THEY are wrong.

Oil Speculation


Touché, Bob...

Your really right on about the inside derivatives game. We both know that every statute possible, which allows the abusive use of derivatives are alive and well. I haven't heard any plan to overturn them.

Leveraging is used everywhere. And as we know, the amount is staggering on a global scale.
_________________________
Turn on ANY brand of political machine - and it automatically goes to the "SPIN and LIE CYCLE" wink

Yours Truly - Gregg



Top
#212453 - 02/09/12 08:39 PM Re: Gas Prices... Again [Re: AustinRanter]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Yeah...
And if you're still into to doing all this reading, Gregg... you might wanna take a look at this, to see who's doing all of this money juggling...
Charles Hugh Smith on self interest. Helps explain how and why people do things we wouldn't think of trying. crazy
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#212497 - 02/10/12 12:05 PM Re: Gas Prices... Again [Re: itstarted]
AustinRanter Offline
enthusiast

Registered: 10/29/06
Posts: 3643
Loc: Austin, Texas
Originally Posted By: itstarted
Yeah...
And if you're still into to doing all this reading, Gregg... you might wanna take a look at this, to see who's doing all of this money juggling...
Charles Hugh Smith on self interest. Helps explain how and why people do things we wouldn't think of trying. crazy


Thanks, Bob...I'll find some time to squeeze it in.
_________________________
Turn on ANY brand of political machine - and it automatically goes to the "SPIN and LIE CYCLE" wink

Yours Truly - Gregg



Top
#212515 - 02/10/12 03:19 PM Re: Gas Prices... Again [Re: AustinRanter]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
This gets complicated... the link in my last post was wrong, and now is corrected.
BUT
The link WAS to a new CHS post about the decline in Gas consumption in the US... and maybe even more applicable to the idea that the price is being manipulated.
Gasoline consumption drops in US

Just as in the case of derivatives, it gets so complicated that unless one digs in deep, none of these arguments make sense... thus so many people here on RR ignore the posts, and don't understand.

_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#212516 - 02/10/12 03:57 PM Re: Gas Prices... Again [Re: Chuck Howard]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Originally Posted By: Chuck Howard
From that bastion of liberal, socialist thought, the Cato Institute:

Quote:

So what is driving the gasoline price spike? It seems far more likely that it is the result of a combination of the following:

Uprisings in the Middle East could spread to mega-exporters Saudi Arabia and Iran, which has resulted in an implicit risk premium on oil and oil products.
Japanese recovery efforts from the March 11 earthquake and tsunami are drawing heavily on petroleum.
China and India are using more energy as their economies recover from the global recession.


Link to source

But it's so much easier to find simple reasons for complex problems, isn't it. Just blame it on that Kenyan guy.


First of all... about Cato being Liberal... Not so much... Not Conservative, but not liberal either... and like the conservative foundations, not always right either.
Now... as to the author's thesis...
He was correct in his last paragraph... He is not a wall street wizard. Nice theory but wrong.

Reviewing the article, his premise is that the price of oil/gas would have to eventually come down is totally wrong. I the 2004 hearings, the oil companies convinced the committee, that the spot prices would have to immediately translate to pump prices... and the senate and the country bought it.
Sheer nonsense. When through collusion, the speculators buy and sell and buy and sell, and drive the prices up... those increased prices are charged to the public. There is no "back-up" as the author speculates. There is no "oversupply". The regular pumping, transport, port storage, refinery acceptance, and redistribution, is carefully controlled at check points along the way... The most recent of these is the shutdown "for cleaning" of four of the major US refineries.
See this article, HERE which proves the point, with consumption/supply charts.
The speculation is good for the Arab suppliers... they get more per bbl, and keep more in the ground. In 2010 the head of OPEC spoke publicly about being able to supply at $60/bbl. and for 25 years. The speculation is good for the Oil Companies...and especially good for the private dealers, who no longer compete, and over the past year and a half, have increased their average per gallon profit from $.10 to about $.13.
The only loser, is the public who pay.

The idea that speculation is based on forward purchases by airlines or trucking companies is false. They DO buy that way, but the big dollars that drive the Commodity derivative markets in the ICE are Banks and Brokers. Unfortunately, except for leaks from the funds, no one knows how many or the amount of these leveraged trades.

I expect that no one on this board will ever be convinced that supply/demand does not exist in commodities, in the same way as it does in finished products or services. So be it...

Heck, at least half of the people here on RR think that the bubbles were caused by supply/demand. (a totally different animal).

_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#212520 - 02/10/12 04:32 PM Re: Gas Prices... Again [Re: itstarted]
Irked Offline
enthusiast

Registered: 12/14/05
Posts: 3319
Loc: Somewhere out in left field
With an ever increasing population, and ever increasing demand and an ever dwindling supply what, beyond government interference in the market, would stop prices from going up?
_________________________
How eager they are to be slaves - Tiberus Caesar

Coulda tripped out easy, but I've changed my ways - Donovan

I consider myself to be a laid back type and quite tolerant on most issues - AB Breivik

Top
#212527 - 02/10/12 05:15 PM Re: Gas Prices... Again [Re: itstarted]
numan Offline
veteran

Registered: 08/06/08
Posts: 10853
Loc: What! Me Worry?
'
Originally Posted By: itstarted
...you might wanna take a look at this, to see who's doing all of this money juggling...
Charles Hugh Smith on self interest. Helps explain how and why people do things we wouldn't think of trying.

Pretty good link, Cousin It. Very succinct.

Quote:
The Power Elites' time-honored strategy to protect their own wealth and grip on power has three components: one is to pursue a strategy of pervasive, ceaseless propaganda to persuade the productive classes that the system is sound, fair and working for them; the second is to fund diversionary "bread and circuses" for the potentially troublesome lower classes, and the third is to harden the fiefdoms of power and wealth into an aristocracy that is impervious to the protests of debt-serfs and laborers below.
_________________________
The ultimate result of shielding men from the effects of folly is to fill the world with fools -- Herbert Spencer

Top
#212531 - 02/10/12 05:44 PM Re: Gas Prices... Again [Re: Irked]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Quote:
With an ever increasing population, and ever increasing demand and an ever dwindling supply what, beyond government interference in the market, would stop prices from going up?

Did you read the link to gas demand? Here

Top
#212571 - 02/11/12 01:04 AM Re: Gas Prices... Again [Re: itstarted]
Irked Offline
enthusiast

Registered: 12/14/05
Posts: 3319
Loc: Somewhere out in left field
Yes, i suppose the recession is a permanent situation. World demand will continue fall as millions of Asian drivers are added every year.

Originally Posted By: From Link
Though I don't have data on hand to support this, ...
_________________________
How eager they are to be slaves - Tiberus Caesar

Coulda tripped out easy, but I've changed my ways - Donovan

I consider myself to be a laid back type and quite tolerant on most issues - AB Breivik

Top
#212577 - 02/11/12 10:05 AM Re: Gas Prices... Again [Re: Irked]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Oi Falls

Quote:
The IEA cut its 2012 global oil demand forecast for the sixth month, predicting worldwide crude consumption will increase by 800,000 barrels a day, or 300,000 less than previously estimated, to 89.9 million barrels a day, according to the Paris-based agency’s monthly oil market report today.

Consumption will drop in member nations of the Organization of Economic Cooperation and Development this year as Europe’s sovereign debt crisis slows growth, according to the IEA.

“It’s a pretty remorseless picture of decline for oil demand throughout the OECD,” David Fyfe, head of the agency’s market and industry division, said in a telephone interview from Paris. “These are mature markets, in which industry recovery is stuttering, and moving into recession in the case of Europe.”

The Organization of Petroleum Exporting Countries reduced its estimate of crude consumption for this year by 120,000 barrels a day to 88.76 million a day, the group’s Vienna-based secretariat said in its monthly market report yesterday. Supply from the 12 members increased to 30.9 million barrels a day last month, the most since October 2008, compared with estimated requirements of 29.55 million, the report showed.


Remember that we are talking about speculation driving prices. Note that Regular gas was selling (nationwide) at $3.22 on December 23. Currently the National price is $3.50,
and the industry and the financial projections are for $4.00+ in the near term (1 to 2 months). During the past 2 months... demand has fallen in the US and worldwide... There have been no major disruptions to oil supply (except as noted for the refinery shutdowns). So... what triggers the price increase, other than the traders on ICE?

The rest of the very selective part of the quote you seem to question:
Quote:
Retail gasoline deliveries, already well below 1980 levels, have absolutely fallen off a cliff. Is the plunge inventory-related, i.e. are storage facilities so full that retailers are simply putting off deliveries?

Though I don't have data on hand to support this, I know from one of my correspondents who is in the gasoline distribution/delivery business that gasoline is very much a "just in time" commodity: gas stations are often close to running out of fuel when they get a delivery. Stations aren't holding huge quantities of surplus gasoline; that's not how the business works.

Given the absence of "extra storage" in gas stations (and the fact that the number of gas stations has fallen dramatically since 1980), it is reasonable to conclude that retail delivery is largely a function of demand, i.e. gasoline consumption.


That was covered in earlier posts... yes.. of course it's "Just in Time Delivery" ... the stations don't have extra 100,000 gallon tanks hanging around. The managed shortages come (as i mentioned before) at the wellhead, on the tankers... often stacked up at the ports, and most egregiously, at the refineries... as in the current case, where the shortage was exacerbated by the deliberate well timed shout down for cleaning or formula changeover... as if one company didn't know what the other companies were doing.

No question that world energy requirements are increasing. Probably no question about peak oil... though the "Peak" date seems to change (up to 20 more years)...

But...None of this accounts for the incredible fluctuations in price... which IS caused by speculation. And the sad part is... that the risk... meaning the due date of the hedge or derivative... does not result in losses, because the price was passed on to the consumer at the point of the contract.

That is the part of the derivative scheme that no one seems to comprehend. Every buy is countered by an offset, guaranteeing that the counter parties don't lose. Second by second trading leaves the innocent public to bear the burden of the increase. Think of a Ponzi scheme... where at the end, the losing investor, is the public.
...............................................
I don't expect anyone to be convinced that derivative trading is at the heart of this, (as well as in the commodities market in general)... but the simple (supply/demand) theory just doesn't work when we get down to statistics.

BTW.. Irked... thank you for your input on a subject that almost everyone avoids. Bow Makes me think harder... and that's good. smile


Edited by itstarted (02/11/12 11:01 AM)

Top
#212583 - 02/11/12 12:00 PM Re: Gas Prices... Again [Re: itstarted]
Joe Keegan Offline
veteran

Registered: 12/25/05
Posts: 8707
Originally Posted By: itstarted
So... what triggers the price increase, other than the traders on ICE?
Thoughts of Iran?

Top
#212607 - 02/11/12 01:59 PM Re: Gas Prices... Again [Re: Joe Keegan]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Iran is an excuse
Oil line disruptions are excuses
Refinery shutdowns are an excuse
Fires
Storms
China cornering the market
Lawsuits
Peak oil
OPEC
etc,etc... and there are always worries. And yet, so far, we haven't suffered from any of these, since the pumps don't go dry.

Remember... we're tying the price of oil in the futures market to the price at the pump... Today! It isn't as if the pump price waited until the oil/gas arrives at the station...

The money flows the same way.

So think of it this way... Like buying a painting... I buy it from you for $5... You sell it back to me at $10, then I sell it back to you at $20... and you sell it to me for $40 Now I have a $40 painting. That is derivatives. I sell it to the museum for $40. The museum it the public. You and I made a good dollar on those trades.

What drives the price? The people who are trading in the international market of derivatives. What drives the price?
Profits. With 10 or 20 times leverage, and no actual money in the trades, trades of $100 million dollars are backed by 10 million dollars. A dimes' difference in a barrel of oil @ $100/bbl can mean a profit of 1 million dollars.



Top
#212608 - 02/11/12 02:02 PM Re: Gas Prices... Again [Re: itstarted]
Irked Offline
enthusiast

Registered: 12/14/05
Posts: 3319
Loc: Somewhere out in left field
Speculation is an integral part of supply and demand. As soon as anyone purchases more of a product or service than they can consume themselves, they are either:

1) Gluttons
2) Foolish
3) Speculating that they can sell the excess supply for a profit.

Whether an actual commodity, a classic future or a more complicated packaged derivative is purchased is immaterial, the speculation on future demand such purchases represent will impact the price of the commodity.
_________________________
How eager they are to be slaves - Tiberus Caesar

Coulda tripped out easy, but I've changed my ways - Donovan

I consider myself to be a laid back type and quite tolerant on most issues - AB Breivik

Top
#212634 - 02/11/12 05:41 PM Re: Gas Prices... Again [Re: Irked]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Quote:
Feb 9 (Reuters) - European Union diplomats and the European Parliament agreed on Thursday to overhaul regulation of the roughly $700 trillion derivatives market, a move that will make it easier to control one of the most opaque areas of finance.

WHAT IS A DERIVATIVE? more...

Reuters Link

700 Trillion... is NOT supply and demand. crazy


Top
#212646 - 02/11/12 07:50 PM Re: Gas Prices... Again [Re: itstarted]
AustinRanter Offline
enthusiast

Registered: 10/29/06
Posts: 3643
Loc: Austin, Texas
Originally Posted By: itstarted
Quote:
Feb 9 (Reuters) - European Union diplomats and the European Parliament agreed on Thursday to overhaul regulation of the roughly $700 trillion derivatives market, a move that will make it easier to control one of the most opaque areas of finance.

WHAT IS A DERIVATIVE? more...

Reuters Link

700 Trillion... is NOT supply and demand. crazy



Exactly, Bob...

But that number isn't real. I mean, I know it's a real number, and it probably reflects what it's stated to, but the number is too profound to grasp. Well, too profound for me.
_________________________
Turn on ANY brand of political machine - and it automatically goes to the "SPIN and LIE CYCLE" wink

Yours Truly - Gregg



Top
#212730 - 02/12/12 08:57 PM Re: Gas Prices... Again [Re: itstarted]
Irked Offline
enthusiast

Registered: 12/14/05
Posts: 3319
Loc: Somewhere out in left field
Quote:
700 Trillion... is NOT supply and demand.

Sure it is. It is part of the price the market, in toto, has placed on the commodity. Should one want to change tha price, one must change the market. Where should we start? Should it be illegal to pay someone today for delivery in 3 months? 6 months? A year? Should it be illegal to sell that promise to a 3rd party? Should it be illegal to sell a share in the promise? Should it be illegal to sell shares in more than 1 promise at the same time to the same buyer? Perhaps all trades in commodities should be restricted to transactions with immediate delivery?
_________________________
How eager they are to be slaves - Tiberus Caesar

Coulda tripped out easy, but I've changed my ways - Donovan

I consider myself to be a laid back type and quite tolerant on most issues - AB Breivik

Top
#212742 - 02/12/12 10:51 PM Re: Gas Prices... Again [Re: itstarted]
california rick Offline
Member
Carpal Tunnel

Registered: 05/09/05
Posts: 35961
Loc: Bay Area, California
Paid $3.87/gal today. Thanks Mossad, Israel, neo-cons, and other war hawks. ThumbsUp
_________________________
Contrarian, extraordinaire



Top
#212751 - 02/13/12 04:36 AM Re: Gas Prices... Again [Re: itstarted]
Jeffery J. Haas Offline
veteran

Registered: 08/03/04
Posts: 10485
Loc: Downey, California
Curses, foiled again, the Republicans just don't fight fair!
THEY get to use words like "uncertainty" as a catch all for everything and we don't!

THEY get to pretend that our history with Iran started in 1979 and we are forced to work with the annoying reality based 1953 model!

Dangit!
_________________________
"Our options for change range from basically what we have plus a little more Hayek,
to what we have plus a little more Keynes. Why?"

---Benjamin Bratton

Top
#212758 - 02/13/12 08:42 AM Re: Gas Prices... Again [Re: Irked]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Quote:
Sure it is. It is part of the price the market, in toto, has placed on the commodity. Should one want to change tha price, one must change the market. Where should we start? Should it be illegal to pay someone today for delivery in 3 months? 6 months? A year? Should it be illegal to sell that promise to a 3rd party? Should it be illegal to sell a share in the promise? Should it be illegal to sell shares in more than 1 promise at the same time to the same buyer? Perhaps all trades in commodities should be restricted to transactions with immediate delivery

rolleyes
You describe Bernie Madoff.

... and now ICE... It was not always thus. If Dodd-Frank is ever completed, we will revert to rules that kept this casino under control... What has happened since the rules changed opened the floodgates. Link


_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#212811 - 02/13/12 07:30 PM Re: Gas Prices... Again [Re: itstarted]
Mechanic Offline
journeyman

Registered: 04/19/11
Posts: 802
Didn't President Obama's "Energy Czar", S. Chu, announce he wanted $5/gal. gas not too long ago ? >Mech

Top
#213438 - 02/20/12 08:35 AM Re: Gas Prices... Again [Re: itstarted]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Today's wholesale Regular Price started at $3.05, making the probable retail price in March about $3.80

If you average 12,000 miles per year at 22MPG...then:
In March 2009, annual gas cost would have been $900. @$1.65gal.
Three years later... $2070. @$3.80gal.

Fortunate that we don't have inflation, eh? smile

Top
#213440 - 02/20/12 08:46 AM Re: Gas Prices... Again [Re: Mechanic]
Joe Keegan Offline
veteran

Registered: 12/25/05
Posts: 8707
Originally Posted By: Mechanic
Didn't President Obama's "Energy Czar", S. Chu, announce he wanted $5/gal. gas not too long ago ? >Mech
I believe that he's going to get his wish before too much longer.

Top
#213441 - 02/20/12 09:00 AM Re: Gas Prices... Again [Re: Mechanic]
rporter314 Offline
old hand

Registered: 03/18/03
Posts: 4790
Loc: Highlands, Tx
wow i wish you would at least get the facts right

he is SoE not a czar

he proposed using high gas prices as a way to wean Americans off their dependence of oil by using more efficient cars or alternative energy cars

the last time this was "news" was about a year ago

Top
#213442 - 02/20/12 09:06 AM Re: Gas Prices... Again [Re: Joe Keegan]
rporter314 Offline
old hand

Registered: 03/18/03
Posts: 4790
Loc: Highlands, Tx
Quote:
get his wish

had higher gas prices been the "plan" government could have tried to raise prices through more draconian tax measures ... since they did not do so we should be able to conclude raising the price of gas is not the goal

however by using high prices it may provide an incentive for Americans to reconsider their gluttonous thirst for oil and change their behaviour ... if however you are a rushbo adherent then your response would be frack them i want my gas at any price for my 2 mpg hummer

it appears to me that rushbo is far more concerned about his survival rather than our nation

Top
#213453 - 02/20/12 11:46 AM Re: Gas Prices... Again [Re: itstarted]
california rick Offline
Member
Carpal Tunnel

Registered: 05/09/05
Posts: 35961
Loc: Bay Area, California
Fricken $4.10/gal here in the Bay Area.
_________________________
Contrarian, extraordinaire



Top
#213620 - 02/22/12 12:09 PM Re: Gas Prices... Again [Re: california rick]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#213625 - 02/22/12 01:16 PM Re: Gas Prices... Again [Re: itstarted]
Joe Keegan Offline
veteran

Registered: 12/25/05
Posts: 8707
_________________________

Top
#213627 - 02/22/12 01:52 PM Re: Gas Prices... Again [Re: california rick]
Ma_Republican Offline
old hand

Registered: 02/12/04
Posts: 6325
Loc: USA
Originally Posted By: california rick
Fricken $4.10/gal here in the Bay Area.



Thank quantitative easing for that $4.00+ gas, and they are talking about doing another mass printing of more money, er quantitative easing, in the near future. Gas prices are exactly what Obama wanted, high fuel prices, forcing people to think green. The problem is it happened in 2011 and not 2009.
_________________________
A proud member of the Vast Right-wing Conspiracy, Massachusetts Chapter

“The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.”
Thomas Jefferson

Top
#213628 - 02/22/12 01:55 PM Re: Gas Prices... Again [Re: Ma_Republican]
Ted Remington Offline
old hand

Registered: 07/09/08
Posts: 4890
Originally Posted By: Ma_Republican
Originally Posted By: california rick
Fricken $4.10/gal here in the Bay Area.



Thank quantitative easing for that $4.00+ gas, and they are talking about doing another mass printing of more money, er quantitative easing, in the near future. Gas prices are exactly what Obama wanted, high fuel prices, forcing people to think green. The problem is it happened in 2011 and not 2009.


Could you please cite something to show the nexus between quantitative easing and gasoline at $4/gallon, particularly in light of the unquestionable fact that the price of oil has risen quite sharply recently because of the hoo-ha over Iran's recalcitrance and threats to close the Strait of Hormuz.
_________________________
Take the nacilbupeR pledge: I solemnly swear that I will help back out all Republicans at the next election.

Top
#213633 - 02/22/12 02:41 PM Re: Gas Prices... Again [Re: itstarted]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Question for everyone...

Since you feel that Oil Prices reflect supply and demand, there must be something in the articles about speculation that you disagree with. I constantly am asked for sources. The McClatchy article provides statements that absolutely attribute the current spike in Gas Prices to speculation. What part of the argument is wrong?

Speculation

Top
#213634 - 02/22/12 02:47 PM Re: Gas Prices... Again [Re: itstarted]
Ma_Republican Offline
old hand

Registered: 02/12/04
Posts: 6325
Loc: USA
Originally Posted By: itstarted
Question for everyone...

Since you feel that Oil Prices reflect supply and demand, there must be something in the articles about speculation that you disagree with. I constantly am asked for sources. The McClatchy article provides statements that absolutely attribute the current spike in Gas Prices to speculation. What part of the argument is wrong?

Speculation


Actually, the price represents the value of the dollar on the world market. Since that value has been diluted by somewhere above $1.5T in quantitative easing, ie printing money without actually printing money. It is called inflation in some of the more politically incorrect circles, it is called a mystery in the White House.
_________________________
A proud member of the Vast Right-wing Conspiracy, Massachusetts Chapter

“The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.”
Thomas Jefferson

Top
#213635 - 02/22/12 02:48 PM Re: Gas Prices... Again [Re: Ma_Republican]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
so, Ma.... I still have to ask you what part of the article is wrong. did you read it?
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#213639 - 02/22/12 03:01 PM Re: Gas Prices... Again [Re: Ma_Republican]
Greger Offline
veteran

Registered: 11/24/06
Posts: 11848
Loc: Florida
Actually, the price represents the value of the dollar on the world market.
Could you produce some verification that the price of gasoline tracks the value of the dollar?

When President Bush took office gasoline was pretty cheap.
Cheney met with the energy magnates and prices immediately began to rise. Eventually gasoline prices soared to unheard of highs.
Was this directly related to the value of the Dollar?

Or was there some different set of parameters at work then?
_________________________
"Be yourself; everyone else is already taken."— Oscar Wilde

Top
#213647 - 02/22/12 03:29 PM Re: Gas Prices... Again [Re: Greger]
Ma_Republican Offline
old hand

Registered: 02/12/04
Posts: 6325
Loc: USA
Originally Posted By: Greger
Actually, the price represents the value of the dollar on the world market.
Could you produce some verification that the price of gasoline tracks the value of the dollar?

When President Bush took office gasoline was pretty cheap.
Cheney met with the energy magnates and prices immediately began to rise. Eventually gasoline prices soared to unheard of highs.
Was this directly related to the value of the Dollar?

Or was there some different set of parameters at work then?



Take a tour of an alternative form of finance, one based upon the way data was reported in the 80's.

http://www.shadowstats.com/alternate_data/inflation-charts
_________________________
A proud member of the Vast Right-wing Conspiracy, Massachusetts Chapter

“The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.”
Thomas Jefferson

Top
#213649 - 02/22/12 03:34 PM Re: Gas Prices... Again [Re: Greger]
Chuck Howard Offline
old hand

Registered: 09/17/01
Posts: 6723
Loc: Philly 'burbs
Originally Posted By: Greger


When President Bush took office gasoline was pretty cheap.




Well, as you can clearly see from the graph which is part of this link, you are absolutely wrong. The price of gas was cheap until January 20, 2009, and then it skyrocketed. NOT!!!

Top
#213653 - 02/22/12 04:18 PM Re: Gas Prices... Again [Re: Chuck Howard]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Which part of this Speculation
is incorrect?
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#213706 - 02/22/12 09:22 PM Re: Gas Prices... Again [Re: Greger]
Mechanic Offline
journeyman

Registered: 04/19/11
Posts: 802
Greger,

The "critical number" for gas prices is not what's displayed on the pump ! Rather it is - as it always has been - how filling up the family bus impacts the budget. >Mech

Top
#213730 - 02/22/12 10:18 PM Re: Gas Prices... Again [Re: itstarted]
Irked Offline
enthusiast

Registered: 12/14/05
Posts: 3319
Loc: Somewhere out in left field
Whining is understandable and it's certainly a crime that So much of the price is taxes and that gas may soon cost as much as it did in 1959, but everyone is free to buy just as much gas as they want and deserve The Market allows everyone to buy just as much gas as they please. If one doesn't want to pay the price, then don't buy the gas.


Edited by Irked (02/22/12 10:33 PM)
_________________________
How eager they are to be slaves - Tiberus Caesar

Coulda tripped out easy, but I've changed my ways - Donovan

I consider myself to be a laid back type and quite tolerant on most issues - AB Breivik

Top
#213830 - 02/23/12 05:00 PM Re: Gas Prices... Again [Re: Irked]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Even though no one seems to have time to look at my links, here's another one.
readability link
regular link

oh yeah... and don't bother clicking on the links inside this article that you won't read anyway...they lead to the ones I posted that you didn't read before. crazy crazy

It's a known Republican trait to
"know what one knows"

Go guys... fer sure it's supply/demand. dunce

ROTFMOL

_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#213842 - 02/23/12 05:38 PM Re: Gas Prices... Again [Re: itstarted]
Greger Offline
veteran

Registered: 11/24/06
Posts: 11848
Loc: Florida
Quote:
fer sure it's supply/demand.

What we have here is an oversupply of assh0les demanding they get their way or the rest of us are going suffer. And it doesn't bother them to make a great deal of money while the rest of us suffer either.
And as usual it can be blamed on REPUBLICANS!
_________________________
"Be yourself; everyone else is already taken."— Oscar Wilde

Top
#213866 - 02/23/12 08:39 PM Re: Gas Prices... Again [Re: itstarted]
Irked Offline
enthusiast

Registered: 12/14/05
Posts: 3319
Loc: Somewhere out in left field
Why isn't speculation part of the supply and demand mechanism? No one should make investments on the future? Price fixing by government? Will we have an OPCI (Organization of Petroleum Consuming Individuals) determined worldwide retail price for oil? Is there a plan on removing speculation from the petroleum market? How would that happen? How will the negative consequences be ameliorated?


Edited by Irked (02/24/12 02:05 AM)
_________________________
How eager they are to be slaves - Tiberus Caesar

Coulda tripped out easy, but I've changed my ways - Donovan

I consider myself to be a laid back type and quite tolerant on most issues - AB Breivik

Top
#213890 - 02/24/12 08:32 AM Re: Gas Prices... Again [Re: Irked]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Quote:
Why isn't speculation part of the supply and demand mechanism? No one should make investments on the future? Price fixing by government? Will we have an OPCI (Organization of Petroleum Consuming Individuals) determined worldwide retail price for oil? Is there a plan on removing speculation from the petroleum market? How would that happen? How will the negative consequences be ameliorated?

The first part of this answer, has been explained often, even in this thread.
Basically, the change from regulated trading through the CFTC
to ICE.

As with all commodities, it is not necessary to have supply and demand, when there is collusion between the major players.

FWIW, I believe that with the intense public pressure on oil prices, that speculation will once again receive much more attention. It may be paranoid to suggest that the media is complicit in restricting discussion of the subject, but time will tell.

This goes back to 2001. The fact that the Oil Price Committee Hearings proved the findings of speculation, the mighty pushback from Big Oil on Congress, suppressed action.

Oil Hearings
Quote:
In 2001, Senator Levin directed the subcommittee to begin an investigation into recent gasoline and crude oil price spikes. Senator Levin chaired hearings in the spring of 2002 detailing how U.S. retail gasoline prices are set. The hearings and a 400-page staff report identified several factors responsible for rising prices and frequent price spikes, including oil industry mergers, refinery closings, tight gasoline supplies, and regional pipeline limitations. In March 2003, the subcommittee released a second staff report detailing the operation of crude oil markets that affect the price of not only gasoline, but also key commodities like home heating oil, jet fuel, and diesel fuel. The report warned that these markets are vulnerable to price manipulation. The report also warned that ongoing large deposits of oil into the Strategic Petroleum Reserve while oil prices are high and oil supplies are tight have increased prices but not overall U.S. energy security.

The Subcommittee's report, The Role of Market Speculation in Rising Oil and Gas Prices: A Need to Put a Cop on the Beat [PDF], released in June 2006, found that the traditional forces of supply and demand no longer fully account for sustained increases and price volatility in the oil and gasoline markets. The report determined that market speculation contributed to rising oil and gasoline prices, perhaps accounting for $20 out of a $70 barrel of oil, and that too many energy trades occurred without regulatory oversight. The report recommended new laws to increase market oversight and stop market manipulation.


This was written long before the transition to trading in ICE and away from US control. Instead of tightening controls, the pressure from the financial powers, in essence eliminated controls.

All in all, a tribute to the power of the oil companies, and the vested interest from the banks, as derivatives trading became more and more obscure.

I know none of this will change anyone's mind, but I'd suggest, at the least, that it should be considered. Remember, that the big problems begin when we believe we know what we know.
West Texas Crude on ICE For overview, look at Historical by Month.


Top
#213893 - 02/24/12 08:52 AM Re: Gas Prices... Again [Re: itstarted]
Greger Offline
veteran

Registered: 11/24/06
Posts: 11848
Loc: Florida
It's, I have never even suspected that oil prices, or the price of any commodity for that matter, was controlled by supply and demand. This is it in a nutshell, it has ever been thus:
Quote:
As with all commodities, it is not necessary to have supply and demand, when there is collusion between the major players.
_________________________
"Be yourself; everyone else is already taken."— Oscar Wilde

Top
#213895 - 02/24/12 09:13 AM Re: Gas Prices... Again [Re: Greger]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Here's why oil prices are important. Oil and the Economy
Quote:
That is precisely what has happened since the near $3 per gallon of gasoline this summer, which was an effective $60 billion tax break for consumers during the much anticipated retail shopping season, to near $3.50 a gallon today. That 16% rise in gasoline has now effectively wiped out the entire payroll tax cut being extended into 2012

and
Quote:
There have been quite a few theories as of late about rising oil prices whether it is a potential war with Iran or seasonal demand. While part of the issue is the supply and demand equation – that does not account for the recent price surge. As the world central banks have turned on the liquidity pumps to support the Eurozone and the U.S. economy; the most logical place for that excess liquidity to go is into highly liquid, highly leveraged, commodity contracts. The rising number, the second highest peak on record, of oil contracts outstanding continues to push prices higher. In turn those higher prices draw more speculation into the market – so forth and so on. That is – until it pops.


Top
#213899 - 02/24/12 09:35 AM Re: Gas Prices... Again [Re: itstarted]
logtroll Offline
old hand

Registered: 04/25/10
Posts: 6142
Loc: New Mexico (not old Mexico)
I guess there's no real disagreement that we have an oil based economy. You could also say that we have an oil based culture.

The LARGE solution is to not be so extremely dependent on oil.

That concept should be the touchstone for all thinking about what should be done.

We will adjust to being less dependent on oil. It would be so nice if we could be rational and intentional about making that adjustment (in that I am not optimistic.)

Use less oil. Make it a cultural thing to use less oil. You can do it now, or you can do it later (Mr. Goodwrench, is that you?).
_________________________
"If you would make a person happy, add not to their possessions but take from their desires"
Unknown

Top
#213900 - 02/24/12 10:01 AM Re: Gas Prices... Again [Re: logtroll]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Quote:
Use less oil. Make it a cultural thing to use less oil. You can do it now, or you can do it later


Just in case you missed it in the links, we are using less oil.

In the meantime, as the economy is destroyed... Every extra $10 fill up is a $10+ hit to the GDP. Unnecessary.

Today's NBC News on Speculation

Quote:
Chilton obtained an energy research report from Goldman Sachs spelling out how much the Wall Street firm estimated speculators had pushed up the real price of oil sold to make gas, due to large bets in the markets.
Using the numbers from in the Goldman Sachs report, combined with current information from the CFTC, Chilton calculated how much speculation is driving up the price at the pump for the average consumer.
He shared calculations with ABC News for the first time.
By Chilton’s calculation, if you drive a car like a Honda Civic, you’re paying $7.30 more than you should every time you fill up — to Wall Street speculators. If your car is a Ford Explorer you’re paying an extra $10.41.
For a Ford F150, he says owners pay an additional $14.56 per fill up -or more than $750 a year.


For anyone who doesn't want to go through the links, here's a quick and very simple explanation.
How Oil Speculation Works



Top
#213901 - 02/24/12 10:26 AM Re: Gas Prices... Again [Re: itstarted]
logtroll Offline
old hand

Registered: 04/25/10
Posts: 6142
Loc: New Mexico (not old Mexico)
Originally Posted By: itstarted
Quote:
Use less oil. Make it a cultural thing to use less oil. You can do it now, or you can do it later


Just in case you missed it in the links, we are using less oil.

In the meantime, as the economy is destroyed... Every extra $10 fill up is a $10+ hit to the GDP. Unnecessary.


I didn't miss the links. In my view, our culture of addiction is what is allowing the "dealers" to screw us so easily and royally. We are actually in the "pay me later" phase.

Changing away from an oil economy is going to seriously affect the economy and our culture tremendously. But it will happen. It's not a pleasant scenario. It will be increasingly unpleasant the more we put it off. I hate that expensive fuel costs me more and profits the bastids, but it is a dis-incentive to use oil, i.e. an incentive to change our ways.

Maybe we should nationalize the oil industry, keep the prices up, but use the profits to end our oil addiction?

It's good that we are using less oil. But we have to use less oil. Less oil... less oil... Withdrawal is not a pleasant process.
_________________________
"If you would make a person happy, add not to their possessions but take from their desires"
Unknown

Top
#213902 - 02/24/12 10:58 AM Re: Gas Prices... Again [Re: logtroll]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Quote:
I didn't miss the links. In my view, our culture of addiction is what is allowing the "dealers" to screw us so easily and royally. We are actually in the "pay me later" phase.


Dealers (of any kind) have nothing to do with it, and Oil Companies are not at the heart of the problems. Neither are the Saudi's (though they don't really complain).
It's speculators, and they are the Banks and Brokers, who are bettors, not "dealers".

As late as last year, the Saudis agreed that at $80bbl, the supply demand was sufficient to keep economies on a level playing field... the year before it was $60.

The article in my last post, suggests that $40 might be a reasonable figure, based on actual supply/demand.

As long as the selling price of gas at the pumps, is locked in to the speculation price for gas to come out of the ground three months hence... then the cost of the speculation is charged directly to the consumer.

An extremely scary part of this type of speculation, is that it is creeping into the cost of other commodities. Even though food derivatives are still controlled, the market price is rising based on speculation.. which then becomes a self fulfilling prophecy. Metals and building materials, not so much.

The propaganda machine is working overtime to hide this problem... The part of politics that deals with drilling, pipelines, and the stupidest current bullshot... that we are exporting too much energy... This is outrageous and designed to appeal to the lowest common denominator. The fact that candidates for the presidency can spout this nonsense, with no response from the supposedly "investigative" media... is a measure of the influence of politics on the belief of the Peeople of the US.

Second to the threat of a nuclear war, is the harm that the total hold that Banks, and Big Business has over the economic future.
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#213904 - 02/24/12 11:05 AM Re: Gas Prices... Again [Re: itstarted]
logtroll Offline
old hand

Registered: 04/25/10
Posts: 6142
Loc: New Mexico (not old Mexico)
I put "dealers" in quotes because I meant metaphorical drug dealers, aka anyone who controls the oil industry/markets. The same crowd you are identifying. Sorry for the confusion.

Let's try and use so much less oil that we reduce the size of the oil baby to the point where we can drown it in the bathtub!
_________________________
"If you would make a person happy, add not to their possessions but take from their desires"
Unknown

Top
#213942 - 02/24/12 05:33 PM Re: Gas Prices... Again [Re: itstarted]
Jeffery J. Haas Offline
veteran

Registered: 08/03/04
Posts: 10485
Loc: Downey, California
The last time the speculators went on a rampage (it was Summer 2008 was it not?) Americans STOPPED driving, did they not?
A lot of speculators got burned, did they not?
_________________________
"Our options for change range from basically what we have plus a little more Hayek,
to what we have plus a little more Keynes. Why?"

---Benjamin Bratton

Top
#213952 - 02/24/12 07:09 PM Re: Gas Prices... Again [Re: itstarted]
Mechanic Offline
journeyman

Registered: 04/19/11
Posts: 802
One thing I missing from the arguments offered is an evaluation of gas prices in terms of constant-value dollars. Most of the current "rise in pump price" is, I suspect, more reflective of dollar inflation, not a "cost rise", per se. But, then, politicians of every stripe/ilk have long had a love affair with inflation !

Of course the "bitter edge" of inflation isn't even perceivable from the perspective of politicians - or their crony capitalists - is it ? What may mean a shorter stay at some cushy resort for some means there won't be as many franks in the beans for a lot of folks !

Perhaps we ought to be demanding our pols answer how - in real world economic terms - obligating oneself for a 40K debt to save <$2/gallon at the pump is viable ? Or why government - in this era of its declared "fuel crisis" - isn't pursuing every means to explore/develop/deliver fuel we need now; not "pie in the sky' in some vague future ? Proposing "solutions" with no short-term viability or even long-term promise without major economic/environmental impact isn't "political grandstanding" ! It isn't even responsible - unless, of course, your objective is to create a "social revolution", pitting the the "losing "haves" against the "never hads" while the "ruling elite" gull both sides ! >Mech

Top
#213954 - 02/24/12 07:34 PM Re: Gas Prices... Again [Re: Mechanic]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Mech... you have great theories..

Top
#213959 - 02/24/12 08:03 PM Re: Gas Prices... Again [Re: Mechanic]
Ted Remington Offline
old hand

Registered: 07/09/08
Posts: 4890
Quote:
One thing I missing from the arguments offered is an evaluation of gas prices in terms of constant-value dollars.


Not any more, Mechanic.

Look at the green line on the chart. That line represents what gasoline would have cost in various years if bought in 2005 dollars.

Interestingly, it is only since 1969 that gas prices were LOWER than they were in 2005, after adjusting for inflation.

So far as I can recall, no one has mentioned on this thread that one of the reasons gasoline is higher right now is because none or almost none is produced when the changeover is made from winter production to summer production at the nation's refineries. They have to shut down the refineries, which means that the consumers of gasoline are drawing down the reserves at the refineries and elsewhere, which has the natural effect of driving the price of gas up temporarily.

I am NOT saying that this is the cause of the huge jump in prices, but it certainly is contributory. This volatility is one of the reasons gasoline was removed from the CPI.

The saber-rattling in the Mideast is almost undoubtedly the major driver of this increase in gasoline prices. Speculators come out of the woodwork in times like these, as noted in the excellent article posted up above.
_________________________
Take the nacilbupeR pledge: I solemnly swear that I will help back out all Republicans at the next election.

Top
#213979 - 02/25/12 09:11 AM Re: Gas Prices... Again [Re: Ted Remington]
logtroll Offline
old hand

Registered: 04/25/10
Posts: 6142
Loc: New Mexico (not old Mexico)
Originally Posted By: churlpat lives
Quote:
One thing I missing from the arguments offered is an evaluation of gas prices in terms of constant-value dollars.


Not any more, Mechanic.

Look at the green line on the chart. That line represents what gasoline would have cost in various years if bought in 2005 dollars.


Used to be I would freak out semi-irrationally every time gas prices jumped a bit, just like everyone else seems to do. You know when the rumor sez "it's going up 10 cents", and the lines are so long that it takes 30 minutes to get to a pump? Or, the word gets out that Nifty Gas 'N Go has gas for 12 cents off, and the street is clogged until midnight with folks saving money? Or it's 25 cents cheaper in a town 45 miles away, and Gabe sez he's going to go there to buy a tank of diesel?

Well, I'm a naturally calkilating in my head all the time kind of guy, and I would run the numbers on what it would cost me to take advantage of the price differentials. Let's assume a pretty empty tank that would take 15 gallons to fill up, and a price spread of 20 cents per gallon on $3 gas. The savings on making a special effort to get a good deal would be $3 bucks (a cup of Starbucks every week). Now consider the investment in getting that $3 bucks from a dead start - maybe drive 4 miles round trip from home and wait in line for 15 minutes. With a 20 mpg vehicle you'd burn .2 gallons, or 60 cents. Your drive time plus wait time would be 30 minutes, or $5 bucks if you make $10 bucks an hour. So, you would pay $5.60 to save $3.00.

Let's say you are down half a tank and see a price 20 cents cheaper and you take advantage of the windfall opportunity and stop to save some money. 8 gallons at 20 cents off, a buck sixty, hooray! - and it only cost an extra 15 minute stop at the pump! Again, if you are a $10 bucks an hour worker, you just spent $2.50 to save $1.60, good fer you!

My point here is that it's always a good idea to use scale and relativity when you really just want to panic. Sure, you can look through the telescope from the other end in order to make things scarier (how much will it cost in a year, what will it do the the economy, etc.) but if you don't understand the scale and associated relativity of those monster numbers, then what have you got? At my scale, those monster numbers mean a cup of coffee a week.

"Don't Panic!" The Hitchhiker's Guide to the Galaxy

(PS - Thanks for the chart, Churlpy)



Edited by logtroll (02/25/12 09:41 AM)
Edit Reason: nod
_________________________
"If you would make a person happy, add not to their possessions but take from their desires"
Unknown

Top
#214022 - 02/25/12 02:36 PM Re: Gas Prices... Again [Re: logtroll]
AustinRanter Offline
enthusiast

Registered: 10/29/06
Posts: 3643
Loc: Austin, Texas
Originally Posted By: Mechanic
One thing I missing from the arguments offered is an evaluation of gas prices in terms of constant-value dollars. Most of the current "rise in pump price" is, I suspect, more reflective of dollar inflation, not a "cost rise", per se. But, then, politicians of every stripe/ilk have long had a love affair with inflation !


One more perspective...

Quote:
The high and rising price of oil does, however, contribute to the decline of the dollar, because the increasing cost of oil imports widens the United States’ trade deficit.

In 2007, the US spent $331 billion on oil imports, which was 47% of the US trade deficit of $708 billion dollars. If the price of oil had remained at $65 a barrel, the cost of the same volume of imports would have been only $179 billion, and the trade deficit would have been one-fifth lower.

The dollar is declining because only a more competitive dollar can shrink the US trade deficit to a sustainable level. Thus, as rising global demand pushes oil prices higher in the years ahead, it will become more difficult to shrink America’s trade deficit, inducing more rapid dollar depreciation.

Martin Feldstein, a professor of economics at Harvard, was formerly Chairman of President Ronald Reagan’s Council of Economic Advisors and President of the National Bureau for Economic Research. Link

_________________________
Turn on ANY brand of political machine - and it automatically goes to the "SPIN and LIE CYCLE" wink

Yours Truly - Gregg



Top
#214038 - 02/25/12 04:52 PM Re: Gas Prices... Again [Re: AustinRanter]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Analysis
comments at the end very worthwhile

just one of dozens:
Quote:
But there's a strong profit incentive for people who buy or sell crude oil or crude oil futures contracts to try to get it right." Um, no there isn't. There is a strong incentive to make a profit, which means there is a strong incentive for the price of oil to be wrong.

The threat of Iran is, as you say, speculative. Furthermore, it has already been priced into oil many times before, for instance, with the invasion of Iraq, with the Arab Spring, etc. Each one of those occurrences brings with it an increase in price derived from the threat of a closure of the Strait of Hormuz.

"Does it make sense for consumers to suffer now just because of something that may or may not happen in the future?" No, it doesn't. The price of oil has risen because of the threat of Iran. However, in the event that oil supply is actually disrupted the price of oil will rise further. So what just happened there? One action, Iran, caused the price to rise twice. This makes sense since oil producers, including Iran, want the price of oil to be as high as possible -- that is their profit motive, not to get the price "right."
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#216147 - 03/13/12 02:46 PM Re: Gas Prices... Again [Re: itstarted]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Think of a casino...where the odds are very stongly with the "house"... Let's say from 30% to .5%. casino odds

Now think of a casino where the odds may be 70% to 85% with the "house". A casino where you only have a 30% chance of getting your money back.

That's where we are in the oil derivatives market.

Now, realize what happens when the casino shuts down... after being in business for a year. Do you get your money back? Of course not. The casino walks away with their profit.

That's what's happening in the derivatives market. A win-win proposition for the speculators, because they passed on the price increases to the public. The public pays for their unreasonable bets.

Here's the nub of the current situation. From a time when end users (Airlines, trucking firms, energy companies) accounted for 70% of the "hedging" in futures (derivatives)... to today, when they account for about 15% of these hedges. That means the "betting" is being done by the banks and brokers.
Further more, because the actual final price is laid at the door of the consumer, they are not at risk... even if the prices fall, later on.

As long as there are no regulations, and no oversight on collusion to drive up prices, the speculation will continue. No risk. Trading done in unregulated markets, or without CFTC oversight, means that supply demand will not result in losses for the speculators.

Like the casino that has not yet closed, speculation continues, even though the US surplus increases and worldwide demand levels off. The oil companies reduce refining, and the rumor market gears up to a panic pace. Like the way the Brazilian Coffee Planters conspired to drive up coffee prices, so will the speculation and betting continue. The public will continue to pay the higher prices... just the same way that coffee prices went up by 50% in the past two years.

As the supply/demand level reverses, the gas prices will eventually go down... the speculators will walk away with their profits, and we'll again wonder what happened, and why we're always on the short end.

Read about it here.
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#216220 - 03/13/12 09:22 PM Re: Gas Prices... Again [Re: itstarted]
Mechanic Offline
journeyman

Registered: 04/19/11
Posts: 802
Then Ill add another IS !

Had the U.S. not followed the beaded/bangled non-science anti-nuke luddites circa 1980 we'd have plenty of clean electrical power ! And, had we used this power to implement efficient public transportation the computer age afforded, we would have even cleaner air, far fewer traffic fatalities, and more efficient ground transport.

The hell of it is, with a true "leader" we can implement these benefits within a generation or less, while stimulating the economy, for far less cost than the Apollo Program ! But one early casualty is going to be the "green energy" fairy tale ! Which means a lot of politicians are going to have to be dragged free of their firm bite on the lobby tit ! Right now - under the Obama Administration - its "pay to play", with the Administration "kicking back" most of the costs from the taxpayers' pockets ! Disagree ?


Then by all means "splain" how every economic "bailout" the OA has promoted has tanked ! "Splain" how every "green energy" corp its subsidized has gone tits up even as its executives reap major bonuses ! >Mech

Top
#216222 - 03/13/12 09:32 PM Re: Gas Prices... Again [Re: Mechanic]
logtroll Offline
old hand

Registered: 04/25/10
Posts: 6142
Loc: New Mexico (not old Mexico)
Gee, Mech, I'd shore like ter git on the bandwagon, but ya fergot ta give any links!

Dude!!
_________________________
"If you would make a person happy, add not to their possessions but take from their desires"
Unknown

Top
#216301 - 03/14/12 02:13 PM Re: Gas Prices... Again [Re: itstarted]
Ken Condon Offline
enthusiast

Registered: 06/13/07
Posts: 2883
Loc: Eugene, OR
Its-ter:

Aren’t high gas prices entirely the fault of Obama? Nothing more needs to be said about the subject than that. All your graphs and charts only serve to confuse the “common” man.
_________________________
The past is always tense, the future perfect.

Top
#216327 - 03/14/12 04:44 PM Re: Gas Prices... Again [Re: Ken Condon]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
No one argues peak oil... or far east growth and the effect on world supplies. No one argues the ability to make more efficient use of energy, or the long term need to find other sources. We waste our time as we lecture each other on the obvious.

Bringing up these points is pandering to ignorance. It is the IF... Well... But... story of the oil companies, and of the politicians. It's misdirection. It's pure pandering to those who can't think or understand beyond hot button words. It's a childish "so's your old man" reply.

We all should be wise enough by now to understand the obvious. Continuing to bring up what we already know is something for the 5th grade debating team, and an insult to our intelligence.
...........................

So... back to the futures discussion, that somehow seems to be incomprehensible. The bits of information that are starting to come from congressmen, and the financial media and websites... speak to a $.50/gallon influence on the per gallon price, coming from the (Carl Levin) Futures/Derivative Market Hearings of 2002.. This is nonsense that comes from that dated information. I would contend that the actual influence, (now compounded) is more like $1.00 to $1.50 per gallon.

The day that the oil companies made the case that increased prices at the well head would be instantly reflected in the price at the pump, any thought of a supply/demand continuum disappeared. It is precisely the same situation that would apply if a long term weather forecaster said that the summer of 2014 would be bad for the corn crop... and the price of your favorite cereal on the shelf of your super market would double tomorrow.

It is very difficult for the general public to understand that what they knew about business 15 years ago, simply doesn't apply today. Here, as well as in the rest of the country, most people know what they know. Delving into the intricacies of the financial world is generally beyond our understanding or ... more importantly, our interest.

And so back to fuel efficient vehicles, solar energy, and fracking. "Drill, Baby, Drill!... as "they" smile all the way to the bank, making money on the back room deals, and legalized collusion.

YMMV smile

_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#216342 - 03/14/12 07:49 PM Re: Gas Prices... Again [Re: itstarted]
Ken Condon Offline
enthusiast

Registered: 06/13/07
Posts: 2883
Loc: Eugene, OR
Quote:
Delving into the intricacies of the financial world is generally beyond our understanding or ... more importantly, our interest.

Don’t forget--there is principal involved too.---Not principle.
_________________________
The past is always tense, the future perfect.

Top
#216344 - 03/14/12 08:10 PM Re: Gas Prices... Again [Re: Ted Remington]
Mechanic Offline
journeyman

Registered: 04/19/11
Posts: 802
I'll not disagree TR ! The biennial "gas price spike" is something I've long been aware of. I used to get pretty busy in the spring and fall when working as a tech rep. This year things ought be even more problematic for gas vehicle drivers as warm weather overtakes us before we have supplies of "warm weather blend" gas. Operationally, I suspect this will mean a decrease in fuel mileage and some rough starting/running until the correct blend arrives at the pumps.

One thing we all should remain cognizant of however, is regardless of how gas prices are "adjusted" or reflect inflationary dollar costs, the only true standard of gas cost is how long you have to work to fill the tank ! And our
"Energy Czar" is on record as desiring our fuel prices parallel those of Europe ! (Never mind he's just disavowed that statement.) Which is a looming economic disaster as the American reality is our nation is several times the size of Europe, hasn't the PT infrastructure, and a large percentage of our population daily commute distances that could easily put you in another country in Europe. >Mech

Top
#216384 - 03/15/12 11:43 AM Re: Gas Prices... Again [Re: Mechanic]
AustinRanter Offline
enthusiast

Registered: 10/29/06
Posts: 3643
Loc: Austin, Texas
Bob...

The following is going to be an interesting situation:

Quote:
BRUSSELS — The SWIFT global financial transaction service said Thursday that it was cutting ties with Iranian banks that are subject to European Union sanctions aimed at discouraging the country from developing nuclear weapons.

The action effectively enforces EU sanction because the world's financial transactions are impossible without using SWIFT, and it will go a long way toward isolating Iran financially.

The company's name stands for Society for Worldwide Interbank Financial Telecommunication. It is a banking hub crucial to oil, financial transactions and other trades.

In a statement, SWIFT said the EU decision "prohibits companies such as SWIFT to continue to provide specialized financial messaging services to EU-sanctioned banks."

"Disconnecting banks is an extraordinary and unprecedented step for SWIFT," Lazaro Campos, chief executive of SWIFT, said. "It is a direct result of international and multilateral action to intensify financial sanctions against Iran."

In addition to sanctioning various officials and freezing the assets of certain companies, the European Union plans to institute an embargo on the import of Iranian oil in July – an attempt to choke off funding for Iran's nuclear program.

The EU sanctions are aimed at forcing Iran to demonstrate to the international community that it is not trying to develop nuclear weapons. Iran says that its nuclear program is for peaceful purposes only, but officials in many other countries – including Israel – believe otherwise.


LINK
_________________________
Turn on ANY brand of political machine - and it automatically goes to the "SPIN and LIE CYCLE" wink

Yours Truly - Gregg



Top
#216395 - 03/15/12 01:05 PM Re: Gas Prices... Again [Re: AustinRanter]
Ted Remington Offline
old hand

Registered: 07/09/08
Posts: 4890
That ought to do the trick. Wonder who was twisting all those arms. I suspect Mrs. Clinton my own self. If you thought Thatcher was the iron maiden. . ..
_________________________
Take the nacilbupeR pledge: I solemnly swear that I will help back out all Republicans at the next election.

Top
#216640 - 03/16/12 09:46 PM Re: Gas Prices... Again [Re: Ted Remington]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Lest there be any questions about the part speculation plays in gas prices, this well documented and footnoted article answers them.
Speculation

excerpt:
Quote:
The issue of unbridled and unregulated oil derivatives speculation by a handful of big banks is not a new issue. A June 2006 US Senate Permanent Subcommittee on Investigations report on “The Role of Market Speculation in rising oil and gas prices,” noted, “…there is substantial evidence supporting the conclusion that the large amount of speculation in the current market has significantly increased prices.”


The report pointed out that the Commodity Futures Trading Trading Commission had been mandated by Congress to ensure that prices on the futures market reflect the laws of supply and demand rather than manipulative practices or excessive speculation. The US Commodity Exchange Act (CEA) states, “Excessive speculation in any commodity under contracts of sale of such commodity for future delivery . . . causing sudden or unreasonable fluctuations or unwarranted changes in the price of such commodity, is an undue and unnecessary burden on interstate commerce in such commodity.” Further, the CEA directs the CFTC to establish such trading limits “as the Commission finds are necessary to diminish, eliminate, or prevent such burden.”7


Where is the CFTC now that we need such limits? As Senator Sanders correctly noted, the CFTC appears to ignore the law to the benefit of Goldman Sachs and Wall Street friends who dominate the trade in oil futures.


The moment that it becomes clear that the Obama Administration has acted to prevent any war with Iran by opening various diplomatic back-channels and that Netanyahu is merely trying to use the war threats to enhance his tactical position to horse trade with an Obama Administration he despises, the price of oil is poised to drop like a stone within days. Until then, the key oil derivatives insiders are laughing all the way to the bank. The effect of the soaring oil prices on fragile world economic growth, especially in countries like China is very negative as well.


_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#216673 - 03/17/12 12:42 PM Re: Gas Prices... Again [Re: itstarted]
Greger Offline
veteran

Registered: 11/24/06
Posts: 11848
Loc: Florida
I just mentioned in another thread the documentation of man's inhumanity to man and how scam artists are perfectly comfortable with making the miserable even more miserable for personal gain and profit.
I no longer fill my tank monthly but now add five gallons as required in the hopes that prices may drop before I need fuel again.
_________________________
"Be yourself; everyone else is already taken."— Oscar Wilde

Top
#216675 - 03/17/12 12:56 PM Re: Gas Prices... Again [Re: itstarted]
numan Offline
veteran

Registered: 08/06/08
Posts: 10853
Loc: What! Me Worry?
'

Don't you have price wars down in Floridaland, Greger?
_________________________
The ultimate result of shielding men from the effects of folly is to fill the world with fools -- Herbert Spencer

Top
#217229 - 03/20/12 11:03 PM Re: Gas Prices... Again [Re: itstarted]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
This thread began on Feb 7... today is March 20.
The gas price (below) is current for the station near the Orlando Florida Airport, according to "Gas Buddy"



Check your local low prices... HERE.
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#217237 - 03/21/12 12:20 AM Re: Gas Prices... Again [Re: itstarted]
Ken Condon Offline
enthusiast

Registered: 06/13/07
Posts: 2883
Loc: Eugene, OR
For reg--$3.95 to $4.07/per in my neck. As of date of this post.
_________________________
The past is always tense, the future perfect.

Top
#217241 - 03/21/12 01:52 AM Re: Gas Prices... Again [Re: Ken Condon]
Phil Hoskins Offline
Administrator
Carpal Tunnel

Registered: 06/07/04
Posts: 20565
Loc: West Hollywood, CA
$4.29 -5.59 is what I saw driving from WeHo to Laguna Beach today -- about 45 miles through the metro area. And that is down a cent or two over yesterday.
_________________________
Life is a banquet -- and most poor suckers are starving to death -- Auntie Mame
You are born naked and everything else is drag - RuPaul

Top
#217304 - 03/21/12 05:05 PM Re: Gas Prices... Again [Re: numan]
rporter314 Offline
old hand

Registered: 03/18/03
Posts: 4790
Loc: Highlands, Tx
Quote:
price wars

yes in texas .... the price was $0.17/gal and i got $0.09 worth

{{{{{{{ }}}}}} o sorry i meant 1966 and i had a vw
_________________________
ignorance is the enemy
without equality there is no liberty

Top
#217307 - 03/21/12 05:31 PM Re: Gas Prices... Again [Re: Mechanic]
rporter314 Offline
old hand

Registered: 03/18/03
Posts: 4790
Loc: Highlands, Tx
Quote:
[Chu] is on record as desiring our fuel prices parallel those of Europe

this is an interesting comment as i have read his remarks from 2008, 2010, 2011 and 2012 and he consistently has stated IF the prices go up etc

now i have run his statements through a number of translators, decoders rings, decrypters, etc and have as yet to find one which translates " IF as WANTS


however when i ran it through the conservative secret prism decoder i found that whatever Chu said, meant he wants to raise the price of gas ... interesting

but ... but ... there is a built-in assumption that anyone person or that the government can manipulate gas prices, so let's try it and see what that is about

to assume the president can control gas prices implies he has the largest set of cajones in the world ... in the face of poor economic conditions he would spit into the wind of political fortunes by intentional raising the price of gas

now for those of us who believe the president is not a kindergarten dropout this is pure nonsense but then again this particular spin comes from a conservative

facts and reality
_________________________
ignorance is the enemy
without equality there is no liberty

Top
#217343 - 03/21/12 09:54 PM Re: Gas Prices... Again [Re: itstarted]
Mechanic Offline
journeyman

Registered: 04/19/11
Posts: 802
Originally Posted By: itstarted
No one argues peak oil... or far east growth and the effect on world supplies. No one argues the ability to make more efficient use of energy, or the long term need to find other sources. We waste our time as we lecture each other on the obvious.

Bringing up these points is pandering to ignorance. It is the IF... Well... But... story of the oil companies, and of the politicians. It's misdirection. It's pure pandering to those who can't think or understand beyond hot button words. It's a childish "so's your old man" reply.

We all should be wise enough by now to understand the obvious. Continuing to bring up what we already know is something for the 5th grade debating team, and an insult to our intelligence.
...........................

So... back to the futures discussion, that somehow seems to be incomprehensible. The bits of information that are starting to come from congressmen, and the financial media and websites... speak to a $.50/gallon influence on the per gallon price, coming from the (Carl Levin) Futures/Derivative Market Hearings of 2002.. This is nonsense that comes from that dated information. I would contend that the actual influence, (now compounded) is more like $1.00 to $1.50 per gallon.

The day that the oil companies made the case that increased prices at the well head would be instantly reflected in the price at the pump, any thought of a supply/demand continuum disappeared. It is precisely the same situation that would apply if a long term weather forecaster said that the summer of 2014 would be bad for the corn crop... and the price of your favorite cereal on the shelf of your super market would double tomorrow.

It is very difficult for the general public to understand that what they knew about business 15 years ago, simply doesn't apply today. Here, as well as in the rest of the country, most people know what they know. Delving into the intricacies of the financial world is generally beyond our understanding or ... more importantly, our interest.

And so back to fuel efficient vehicles, solar energy, and fracking. "Drill, Baby, Drill!... as "they" smile all the way to the bank, making money on the back room deals, and legalized collusion.

YMMV smile



IS said: "No one argues peak oil..."

Actually a lot of very qualified folks do ! There's some very interesting papers out there discussing just how - and from what - oil is formed, and where.

IMO the term "peak oil" is a ruse ! Since we don't know the extent of oil deposits in the ground we can't very well determine a "peak"; except in the relative terms of current recovery rates and "proven field reserves" ! (Which may also be suspect as fields once declared "exhausted" are again pumping oil. ) Even without further exploration the U.S is uniquely endowed with energy resources; and awash in oil and gas from coast to coast and (almost) border to border. Seems to me what we have long lacked is a comprehensive plan to explore and exploit these resources to our maximum benefit !

The administration is touting a "2% energy " meme; which is as transparently false as its "90%" claim regarding cartel gun sources has proven to be ! Certainly, pogoms and restrictions imposed by its agencies/departments are driving forces in the current "gas price crisis". The EPA forced shutdown of key East Coast refineries, its rulings for "boutique fuels" for specific markets, and its (effective) ban on new domestic exploration, new refining capacity, and even its "over the top" attempts to delay or prevent development of the Marcellus Shale formation are just but a few of overt governmental "anti-energy" actions. Strange not one MSM outlet has mentioned the President's avowed intent to "kill coal" as a source of "base load" electrical energy without offering a replacement.

But to get "back to gas".... So far all the Obama Presidency has "put on the table" for Americans is "make do with less", solutions. I.e. smaller, less safe, more expensive and less durable, cars; less efficient and more expensive trucks, no viable public transport, and the threat of restricted electrical energy ! As gas prices rise to levels Obama's "Energy Czar" Chu, deems appropiate more and more "Joe the Plumber" types lose their jobs ! Even the "Liberal Elites" are going to be making the gas/food choice !

But it has long been such when government intervenes in the market ! Right now the Obama Administration has skewed the nation's energy market with regulations, bans and subsidies, justifying it as "necessary for the greater good" . Too bad most of these poltroons are too far from the farm to comprehend the basic concept, "the mule has to be able to pull the wagon to get where you want to go." The mule can't and the administration won't ! >Mech

Top
#217368 - 03/21/12 11:06 PM Re: Gas Prices... Again [Re: Mechanic]
Ardy Offline
veteran

Registered: 12/22/05
Posts: 11531
Loc: San Jose, Ca USA
Originally Posted By: Mechanic

IMO the term "peak oil" is a ruse ! Since we don't know the extent of oil deposits in the ground we can't very well determine a "peak"; except in the relative terms of current recovery rates and "proven field reserves"


FOr the sake of discussion, let's assume that there are essentially limitless reserves of oil... and beyond that, let's agree that synthetic oil can be manufactured by a variety of means. Still, it seems to me that does not solve the problem of (near) exponentially increasing demand.

The cost of recovery (or synthesis) of this oil is neither free nor fixed. Regardless of the absolute supply of oil... the cost of extracting that oil has constantly increased. It used to be that you could stick a pipe in the ground and get a fantastic gusher. This is an increasingly less common circumstance. Instead you have reserves like the Tar sands, oil shale, and deep drilling in the gulf of mexico. It seems unlikely that these and similar new supplies will become available at costs comparable to those first oil gushers.

So given undeniable increases in demand and costs of production... it also seems inevitable that the market cost of this commodity will increase over time. The only thing that could possibly be in dispute is the rate of increase in market cost.

It also seems to be fairly clear that the over all supply demand equation is moving from a scenario where new supplies generally exceeded demand.... to a scenario where it will be increasingly difficult to bring new supplies on line. Given the enormous economic importance of oil, any threatened supply shortage will likely result in rapid price escalation as users compete to lock up the available supply. This effect will only be amplified by financial interests who will seek to take advantage of this situation by speculating on the price/supply of the increasingly scarce commodity.

The concept of Peak Oil is not so much about some arbitrary fixed supply... it is about the world wide ability to produce and or increase production at any given price. It does not really mater if there is an infinite amount of oil available if the costs of production escalate to economically unsustainable level.


As a trivial example, there is a huge amount of gold disolved in ocean water. This huge supply of gold does not depress the price of gold because that cost of recovery is (at this time) exorbitant. Large theoretical supplies of gold or oil are both irrelevant if the cost of production is excessive.
_________________________

"Not everything that counts can be counted, and not everything that can be counted counts."

Top
#217390 - 03/22/12 01:13 AM Re: Gas Prices... Again [Re: itstarted]
Mechanic Offline
journeyman

Registered: 04/19/11
Posts: 802
Good riposte Ardy !!

But with "limitless energy" creating oil - or its derivatives - is merely engineering and base material stock supply ! Which has little to do with the current state of "energy affairs" in the U.S. ! We're not positioned - for a long litany and political history or "reasons" - to do that ! Even more on point our current administration is far more intent upon creating economic conditions conducive to its pogroms than beneficial to the welfare of the nation ! >Mech

Top
#217399 - 03/22/12 07:57 AM Re: Gas Prices... Again [Re: itstarted]
chunkstyle Offline
journeyman

Registered: 10/01/07
Posts: 558
I suppose it's far better to extract oil at an ever increasing rate than to drop the tank of your mule and patch the leaks in the tank . Easpecially if your lazy or like to kid yourself out of the onerous task to get the leaks fixed.

Top
#217413 - 03/22/12 09:46 AM Re: Gas Prices... Again [Re: Ardy]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Quote:
So given undeniable increases in demand and costs of production... it also seems inevitable that the market cost of this commodity will increase over time. The only thing that could possibly be in dispute is the rate of increase in market cost.


Exactly... and that was precisely the main point in my own argument about the recent escalation in the price of oil.

Two points:
1. To date, (since the rapid price increase) there have been no serious interruptions of supply.
2. The oil sources, thus far, have not sequestered or reduced production. They dare not, in any case, as the oil is the stable base of their economy.
...........
Now, lets look at the price of coffee over the past year. Just the opposite took place. The crop was reduced by nature, and the sources in effect went on strike, by withholding the crop that is available.

If the orange crop in Florida was laid waste by weather, the price would rise according to supply demand, but given a good crop the next year, the prices would again fall. Supply anf demand.

Oil is neither coffee, nor oranges. The price on the oil/gas,at the final destination has risen on rumor, scare, and an engineered price fixing scheme, involving back room deals in an unregulated industry. While the speculation by the banks and brokers who have no interest in taking possession of the product... of course the rising prices favor all parties in the pipeline. The sources (oil producing nations), the refiners, the oil companies, and the stockholders.
At the same time, any hope of completing the legislated controls on speculation has disappeared because of the continuing flow of money into the "campaign" funds of those charged with this legislative responsibility.

In short, the current run up in prices, has little to do with the coming long term supply/demand problems, and that is what we are dealing with today.

Pump prices are developed by a formula that uses the current "spot" prices. The spot prices are based on the oil that will be at the pumps in a matter of months... not years.

http://www.bloomberg.com/energy/ oil spot prices

http://data.tradingcharts.com/futures/quotes/RB.html unleaded spot prices

In the past, the prices were bid on, and therefore "set" by end users... Airlines, energy Companies, trucking companies, etc., with 85% of the purchases made by these end users. Today, the end users account for only 15% of the sales, with 85% of the purchases now being made by speculators, using derivatives, which can be leveraged by as little as 2 cents on a dollar.

Not to drag this out too far, but when challenged on the risk involved the banks point to the fact that they are safe, and protect against loss by insuring their positions with... guess what... Credit Default Swaps. As the bubble builds and the CDS's are reinsured, and reinsured again, you begin to understand why you hear about hundreds of trillions of dollars in derivatives.

(if you get lost in that last paragraph, be assured that you are not alone.)
...............................................

So, am I saying that gas prices should not go up?... that there is no problem? Of course not. Is there no problem with energy supplies... Of course not. The problem is real... and alternatives must be found, and efficiency must be improved.

The price of unleaded gasoline has risen 43% in the past 18 months (since October 2009). During that time, there have been no shortages at the pump, no serious supply disruptions except for unscheduled refinery shutdowns, and only normal, expected increases in demand from China and India, who, by the way, are not major participants in the futures market as end users. (remember the 15% end user market makers).

Since Oct. 2009, the actual supply has increased in line with the demand, and the demand has increased in low single digits... nowhere near the 43% increase in price.

Remember... the prices are being set on oil that will reach the pumps three months from now, but the increased prices you have been paying since Oct. 2009... are not based on supply/demand.

I am saying that the price hikes are a result of speculation... and not that there is a problem with supply/demand in the short term... which of course is the reality... similar to the supply/demand price of oranges. I believe price fixing by means of collusion, but of course, with no regulations, who would know?

Why haven't you heard about this from our leaders, or from the media? Hmm

_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#217414 - 03/22/12 10:07 AM Re: Gas Prices... Again [Re: itstarted]
Ted Remington Offline
old hand

Registered: 07/09/08
Posts: 4890
Quote:
[/quote]Mechanic:

This caught my eye while I was reading your post:

[quote]The EPA forced shutdown of key East Coast refineries, its rulings for "boutique fuels" for specific markets, and its (effective) ban on new domestic exploration, new refining capacity, and even its "over the top" attempts to delay or prevent development of the Marcellus Shale formation are just but a few of overt governmental "anti-energy" actions. Strange not one MSM outlet has mentioned the President's avowed intent to "kill coal" as a source of "base load" electrical energy without offering a replacement.


I am only going to refute your first statement of "fact", that the EPA "forced" east coast refineries to shut down. That is not true. Let me rephrase that. That is false. Just to make sure you understand that, let me repeat. It is not true that the EPA forced those refineries to shut down.

Here is the reality:

Quote:
Valero Energy Corp said on Monday it will halt operations at its 235,000 barrel-per-day Aruba refinery by the end of March, the second time since 2009 that the plant has been forced to shut due to low margins that have battered Atlantic Basin refiners.

The move will further tighten fuel markets in the region, which has seen a string of shutdowns that have already threatened 1.9 million bpd of refining capacity in Europe, the United States and the Caribbean due to the high cost of crude oil that have hit profits. Valero, which had already cut processing rates at the refinery, may continue to operate the site as a terminal and storage operation, the company said in a press statement on Monday

Source

If you don't believe that one, try this one:

Quote:
Citing market factors, and economic viability, Sunoco (NYSE: SUN) closed its Marcus Hook, N.J., refinery, and plans to shutter another one in June. ConocoPhillips (NYSE: COP) shut down its 18-million-barrel-a-day refinery last year near Philadelphia, and hopes to sell it.

A third company, Hovensa, a joint venture with Hess Corporation (NYSE: HES), and Petroleos de Venezuela, announced in January that it, too, was closing down a refinery in the U.S. Virgin Islands, a loss of 500,000 additional barrels of refined crude oil a day to the east coast.

The announcements by Sunoco and ConocoPhillips were heavily criticized at the time by Rep. Ed Markey (D-Mass.), Rep. Robert Brady (D-Pa.), and Rep. Henry Waxman (D-Calif.).

Markey, who sits on the House Natural Resources Committee, said the closures were "profit driven."

Source

Now, let's talk about the rest of your allegations:

Fellow Ranters have repeatedly asked you to provide sources for what you allege to be facts. I once again ask you to provide for us citations to prove your allegations. Specifically, you stated that Obama has promised to "kill coal." I want to see a creditable source (not Rush Limbaugh) where Obama is quoted as using the words "kill coal."

If you cannot provide such a source I expect you to withdraw the statement.

I am also specifically asking you to provide a source for the statement that "boutique" fuels are a reason for the increases in prices.
_________________________
Take the nacilbupeR pledge: I solemnly swear that I will help back out all Republicans at the next election.

Top
#217415 - 03/22/12 10:10 AM Re: Gas Prices... Again [Re: Mechanic]
Ted Remington Offline
old hand

Registered: 07/09/08
Posts: 4890
Originally Posted By: Mechanic
Good riposte Ardy !!

But with "limitless energy" creating oil - or its derivatives - is merely engineering and base material stock supply ! Which has little to do with the current state of "energy affairs" in the U.S. ! We're not positioned - for a long litany and political history or "reasons" - to do that ! Even more on point our current administration is far more intent upon creating economic conditions conducive to its pogroms than beneficial to the welfare of the nation ! >Mech



Do you have any idea what a pogrom really is?

I request yet again that you abide by the guidelines of this forum. Please provide a citation for the last sentence of your post.
_________________________
Take the nacilbupeR pledge: I solemnly swear that I will help back out all Republicans at the next election.

Top
#217422 - 03/22/12 11:35 AM Re: Gas Prices... Again [Re: Mechanic]
Ardy Offline
veteran

Registered: 12/22/05
Posts: 11531
Loc: San Jose, Ca USA
Originally Posted By: Mechanic
Good riposte Ardy !!

But with "limitless energy" creating oil - or its derivatives - is merely engineering and base material stock supply ! Which has little to do with the current state of "energy affairs" in the U.S. ! We're not positioned - for a long litany and political history or "reasons" - to do that ! Even more on point our current administration is far more intent upon creating economic conditions conducive to its pogroms than beneficial to the welfare of the nation ! >Mech



Sorry Mech, I entirely miss your point


Oil, as with gold, trades in a world wide market. There is no special price for gold in the USA and there is no special price for oil in the USA

US corporations--- or the US government couold spend how ever much they desire to add to supplies of oil.... but in the end, oil will trade at the world price. If there is greater supply in the USA, that excess supply will be bought by international oil traders... rather than lowering the price of oil in the USA

Overall, US efforts in this will be no more effective than trying to lower the cost of gold by some gargantuan effort to mine more gold in the USA

I know of no effort that we could make that would dramatically increase world oil supplies AT AN AFFORDABLE PRICE. Of course we could spend $200 per barrel and produce lots of oil one way or another.... but what is the point of that?

If and when the world economy recovers, we can expect to see the price of oil increase further... it is simple economics.


Edited by Ardy (03/22/12 11:52 AM)
_________________________

"Not everything that counts can be counted, and not everything that can be counted counts."

Top
#217469 - 03/22/12 05:22 PM Re: Gas Prices... Again [Re: Ardy]
pondering_it_all Offline
old hand

Registered: 02/27/06
Posts: 4249
Loc: North San Diego County
Quote:
I know of no effort that we could make that would dramatically increase world oil supplies AT AN AFFORDABLE PRICE.


"We" as in President Obama (who seems to be getting the blame here) can't do much to affect world oil supplies or prices. But I just read that the Saudis could easily crank up their production by 25%, with their existing infrastructure. So if we (the American people) throw Obama out of office in November because of high gasoline prices, then we will have let the Saudis determine who should be the President.

I don't think that is something I can support.

Republican politicians are flogging the public's dissatisfaction over high gasoline prices as if their policies would bring any relief: This is total nonsense because the only way increased American oil production (or increased oil flow from Canada via the Keystone pipeline) would remain in the US to lower gasoline prices, is if we established regulations forbidding oil producers from selling their oil to the highest bidder on the world market and nationalize oil refineries rather than let their owners shut them down. And THAT is complete heresy to Republicans. Their ideology requires that the right of corporations to make the most money possible FAR outweighs Joe Blow's desire for lower prices at the pump.

If you really want such export controls, then you will have to elect a Democrat much further to the left than Obama, and give him unstoppable majorities in both Houses of Congress. Then convince them all that it will be good for the country to "do a Chavez" and reserve a good chunk of US oil production to give us artificially-low prices like they have in Venezuela. (18 cents/gallon!) Is that what Republicans want?

Top
#217480 - 03/22/12 06:37 PM Re: Gas Prices... Again [Re: itstarted]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
In all fairness, here is an article that directly conflicts with my post on speculation. Opposing view

For the time being, I'll stick by my position.
_________________________
In what concerns you much, do not think that you have companions: know that you are alone in the world. ~ Henry David Thoreau

Top
#217521 - 03/23/12 01:04 AM Re: Gas Prices... Again [Re: itstarted]
Ardy Offline
veteran

Registered: 12/22/05
Posts: 11531
Loc: San Jose, Ca USA
Originally Posted By: itstarted
In all fairness, here is an article that directly conflicts with my post on speculation. Opposing view

For the time being, I'll stick by my position.


What if anything would alter your position? No offense intended but it seems to me that you have a given view and are locked in that position by confirmational bias
_________________________

"Not everything that counts can be counted, and not everything that can be counted counts."

Top
#217539 - 03/23/12 12:26 PM Re: Gas Prices... Again [Re: Ardy]
itstarted Offline
old hand

Registered: 01/27/03
Posts: 6354
Loc: Florida/Illinois
Quote:
No offense intended but it seems to me that you have a given view and are locked in that position by confirmational bias


It may seem that way.
I have had my mind changed many times on these forums.

Top
#217597 - 03/23/12 07:13 PM Re: Gas Prices... Again [Re: itstarted]
Ted Remington Offline
old hand

Registered: 07/09/08
Posts: 4890
Mechanic:

Waiting on you to provide sources. See posts above.
_________________________
Take the nacilbupeR pledge: I solemnly swear that I will help back out all Republicans at the next election.

Top
#217598 - 03/23/12 07:14 PM Re: Gas Prices... Again [Re: itstarted]
rporter314 Offline
old hand

Registered: 03/18/03
Posts: 4790
Loc: Highlands, Tx
from your source
Quote:
global crude supply remains uncommonly tight

now when compared with previous citation which notes that the Saudis can raise production 25% all the while already producing above demand at a rate of +2 million bpd with a surplus of 58 days and closing in on 60 days

it is not in the best interest of the Saudis to kill the global economy

someone is lying
_________________________
ignorance is the enemy
without equality there is no liberty

Top
#217618 - 03/23/12 11:04 PM Re: Gas Prices... Again [Re: pondering_it_all]
Greger Offline
veteran

Registered: 11/24/06
Posts: 11848
Loc: Florida
Quote:
"We" as in President Obama (who seems to be getting the blame here) can't do much to affect world oil supplies or prices.
President Obama has no ties with the petroleum industry and hence no strings to pull to readily effect the price of fuel.

I see diesel is well over $4 in my little town now. I couldn't look at what I paid yesterday. I just put in 5 gallons and drove away.

President Bush and Vice President Cheney(is he still alive?)were both Texas oil men, they had plenty of strings to pull and to my mind are responsible for this entire fuel price mess. Deny it if you will, but prices were relatively stable before they took office and we may never see stable fuel prices again.

Just my opinion of course, and I blame everything on Republicans.
_________________________
"Be yourself; everyone else is already taken."— Oscar Wilde

Top
#217620 - 03/23/12 11:22 PM Re: Gas Prices... Again [Re: itstarted]
numan Offline
veteran

Registered: 08/06/08
Posts: 10853
Loc: What! Me Worry?
'
Originally Posted By: itstarted

I have had my mind changed many times on these forums.

Well, that makes you unique.
_________________________
The ultimate result of shielding men from the effects of folly is to fill the world with fools -- Herbert Spencer

Top
Page 1 of 12 1 2 3 ... 11 12 >

Who's Online
0 registered (), 21 Guests and 3 Spiders online.
Key: Admin, Global Mod, Mod
Newest Members
xiawei, Marzman, kyleyoung8, Retread, solafeian
6003 Registered Users
A2