Fuel Prices

Originally Posted by ultraflo

The 100 octane unleaded turbo blue I run in my Mach1 has managed to stay at the same $3.89 that it was at the beginning of last year...

really? that is surprising actually.

[MEDIK418]

Second, the people with the large, expensive SUV's, don't give two shits about how much they pay for fuel. If you can afford these large, gas guzzling vehicles, you can certainly afford to drop a $100 into the tank. Mentality like that also keeps the demand high.

Ok, now we're getting somewhere. Maybe I forgot to finish part of my last quote. EVERYONE is going to have to stop driving so much. Did you know that we are driving MORE now than we were two years ago. On average Americans are driving more than when gas prices shot up two years ago. Not just the big rich SUV drivers (which by the way, I take tremendous offense with your reference that only rich people can afford to drive but I'll address that in a minute) but every one of the little buzzmobiles I see every time I visit San Diego. The traffic never seems to stop 24 hours a day out there. Something else too, how many do you see in the express lanes? Not many. Phoenix, California, Washington DC, you name the place we as America are too self involved to share a ride with the people we work with every day. Oh, there are a few but there again, it seems the country wasted a lot of taxpayer money building carpool lanes that sit empty until after rush hour is over.
Theory? It's not a theory that we are running on one tenth the number of refineries we were in 1970. There wasn't a shortage then and there's none now. The plant I work in is running at maximum but our tanks are as full now as they were a month ago. The summer rush had more to do with inventories than Katrina did. Yes, there were spot shortages while the big pipelies were down but that should have corrected itself by now. And it has according to gas prices. Remember. . . .oil companies jack prices up in an attempt to make us drive less and use less gas bacause they forsee an opportunity for shortages later on down the road. It should be a harbinger of things to come, not a reason to gripe and blame politicians.
Let's address government stockpiles of crude oil. Do you actually know how much they have for us? Not even a day's worth of crude, that's how much. If you turned off the wells, the tankers coming from Russia, and the middle east, they government stockpile wouldn't last a day. It's a joke. The only reason they keep them around is that it makes politicians warm and fuzzy thinking that they have us convinced that we're safe relying on the spare oil they stocked up on. It's a joke. I'm not making this up, look in the business section of your local newspaper. It tells right there in black and white how much crude oil we go through each and every day of our lives and it makes the federal government look awful stupid when you consider how much oil is in this so-called government reserve. The only affect that releasing the oil they said they were going to was the same affect that 9/11 had on the price of gas. People THOUGHT there was going to be a shortage so they went into a panic-buying frenzy and caused spot shortages across the country. This time, with Katrina, the government said they were going to release some oil and people relaxed a little. The jobbers realized the panic was about over and prices started going down. It happens every time there's a hiccup in the oil industry nowadays.
Here's a little lesson to mull over. The plant I work at suffered through a series of really bad luck events beginning in January. Failed airfins, an explosion, a couple of fires. . .all contributed to our not being able to produce ANYTHING for 123 days. That was 144,000 barrels of crude that didn't get processed every day we were down. Did you see a jump in gas prices? Nope! not a one. Why? Because the press didn't get wind of it that's why. The good ole news media didn't have the opportunity to put America in a panic like they so love to do. We're so far back in the sticks, they didn't find out about us.
Now, let's talk about the people with the large SUVs who don't give a crap about how much we pay for gas. Your theory is full of bugjuice. Like I said, I drive one and I've had to shut down a lot of driving lately. My son who has a 120mile commute (one way) has opted to live in the town he works in for the 7 days he has to be there (7 on and 7 off) Why? Because we pay the same price for gas as everyone else and it hurts us just as much as the next guy. I've gone from driving about 3 tankfulls out every month to one. That's with two of us driving it to work. I've ressurected an old Suzuki 750 to get to work in a week or so. We look for ways to consolidate errands to make the most of the gas we have. I'm not sure how much you think a person has to make for a living to buy one of these things but it's not much more than most small cars on the market these days. (Besides that, California has more little cars running around the state than anyone and they use more gas than most other states.) I drive it because I like the room and yes, I choose to pay the penalty for doing so at the pump but don't tell me I don't hurt every time I fill up. You don't have a monopoly on cash limits here. I've got a Mustang in the driveway that's a clutch and a X-pipe away from being finished enough to drive but guess what? I spent most of the extra money on gas last month. I still stand by what I said. You want to slow the price of gas down a bit? Stop driving so much. EVERYONE. If theres' no market for the stuff, it won't be worth as much. Another thing, next time there's a calamity like the one that happened to the Gufl coast, dont' cause the prices to shoot shy high by lining up at the pump in block long lines to get the last drop of gas before the next truckload shows up. This kind of crap feeds the media like a school of sharks. One front page headline with a picture of the morons sitting in line for gas is usually all it takes for the gasoline distributors to start seeing dollar signs. Why do I say this? Because I know several of them and they love this stuff. It would take weeks for an event like that to start affecting the gasoline and oil reserves in this country. OK, forget I mentioned reserves, insert the word inventories for that. Anyway, I don't mean for this to be mean spirited but I'm sick of the lies that the national media is telling about anything that affects this country and on this subject, I can shed a little light. I've been in this business for over 25 years now and I laugh every time I see a story on the gas crisis. Not because of the effects but becasue of the lies I see in the news over it. Think of how many personal owned vehicles we have in this country. Millions upon millions. Think how much gas we would save for another day if each of those vehicles drove just 2 percent less each week. I don't have the answer buy can bet it would make a big dent in the price of gas in this country. Till then, I can promise that there are a lot of folks out there who are doing all they can to make as much gas as they possibly can with the equipment they have to work with and they'll continue to do so as long as we can.

[Unit 5302]

I've never met or talked to a person working for an oil company that wasn't brutally patriotic about their company or their industry. They always have a dozen really lame-o reasons why they're not to blame. How it's the government's fault. How it's the consumer's fault. How it's OPEC's fault. It's never the oil company's fault, though.

Comparing the costs today vs 20 years ago looks good on paper until you start seeing things like Exxon Mobil recording a $10 billion profit last quarter.... That's more than any company in the history of the world.

The oil companies ARE price gouging. There is no competition in the industry since the monopolistic merger of Exxon and Mobil. The companies in that industry are recording record profits for their industry, and in the case of the aforementioned Exxon-Mobil, in any industry in the history of the planet. The comment that oil companies jack up the price to control our driving habits is ludicrious, and simply insulting. They jack up the price because they know our driving habits, and how to take advantage of them.

Refineries routinely go down in this country. Having one or two down isn't uncommon. Especially around or just before a typical driving holiday. That creates a theoretical shortage and voila, a reason to jack up prices. I've seen it used on several holiday's especially Memorial Day and Labor Day.

The argument that you can find a good job just around the corner is positively uninformed. Many states in this country have urban sprawl models in place that limit the expansion of business into the suburbs or away from the existing major metropolitan areas. With housing costs rising in the 10-20% range for the majority of the US metro areas, it creates great pressure to move further away from the major employers and commute further to work.

It's not the federal government keeping the oil industry down by not allowing more drilling in North America. It's the federal government pumping billions of dollars of tax breaks and grants into the industry as a political kick back in turn for the soft money under the table that our politicians get from big oil. The lame attempt at passing the buck along is just the average joe in this country speaking. Most people can't take responsibility for anything, and they simply pass the blame along. As if oil companies aren't a major part of the problem.

Whatever.

[Mr 5 0]

Originally Posted by Unit 5302

I've never met or talked to a person working for an oil company that wasn't brutally patriotic about their company or their industry. They always have a dozen really lame-o reasons why they're not to blame. How it's the government's fault. How it's the consumer's fault. How it's OPEC's fault. It's never the oil company's fault, though.

Big companies make big profits. Microsoft makes many billions every year and, except for some money-grabbing federal lawsuits from the Clinton administration, no one cries 'foul'!

MEDIK418 has brought out some very good, factual points surrounding the price of gas...as well as the cost of gas that cannot be waved away as simply loyality to the business he's employed in. Not if you are going to be honest and not give in to knee-jerk, anti-capitalist reflexes or buy into the media demonization of 'big oil' as inherently 'evil'. I trust this will not be the case here.

Comparing the costs today vs 20 years ago looks good on paper until you start seeing things like Exxon Mobil recording a $10 billion profit last quarter.... That's more than any company in the history of the world.

So what? Why should there be a cap on what a company earns? If the price of the product being sold can be justified, which it can, as Exxon Mobil stations were charging retail gas customers prices in the mid-two-dollar range during that last fiscal quarter you mentioned, I see no reason to take their profits , whatever they are, as some smoking gun indicator that they are 'gouging'.

The fact that, adjusted for inflation, we now pay only a bit more for gas than dad did years ago is a significent factor in understanding the reality of the cost - and the price - of gas. That it undercuts your contentions is probably why you are eager to dismiss it but it remains a fact.

The oil companies ARE price gouging. There is no competition in the industry since the monopolistic merger of Exxon and Mobil. The companies in that industry are recording record profits for their industry, and in the case of the aforementioned Exxon-Mobil, in any industry in the history of the planet. The comment that oil companies jack up the price to control our driving habits is ludicrious, and simply insulting. They jack up the price because they know our driving habits, and how to take advantage of them.

You state that as if these oil companies operated without any federal or state regulations whatsoever! That's absurd. The government has plenty of oversight of oil companies and they also tax gas to death, something you neglected to mention. The oil companies do raise pump prices ('jack up') to make a profit, as MEDIK418 stated, and an ancillary benefit is that higher gas costs can lower overall use to some extent. That is axiomatic and will happen whether the oil companies intend it or not.

Refineries routinely go down in this country. Having one or two down isn't uncommon. Especially around or just before a typical driving holiday. That creates a theoretical shortage and voila, a reason to jack up prices. I've seen it used on several holiday's especially Memorial Day and Labor Day.

Profit-taking is a staple of business and raising the price is not a crime. Think about that the next time you buy a $9.00 movie ticket - or a $32,000 Mustang. Watch your insurance rates climb next year when the insurance companies start paying out millions to Gulf Coast residents who lost homes, property and cars...by the hundreds. It's simply the way most companies make a profit in the face of increased costs and by doing so, keep our economy churning quite nicely.

The argument that you can find a good job just around the corner is positively uninformed. Many states in this country have urban sprawl models in place that limit the expansion of business into the suburbs or away from the existing major metropolitan areas. With housing costs rising in the 10-20% range for the majority of the US metro areas, it creates great pressure to move further away from the major employers and commute further to work.

You take a job 30 miles away from your home with the full understanding that you will have to use a larger portion of your budget for gasoline to drive to and from work, as well as spend time on the road. It's a choice we all make. I've done this and so do millions of others. Buy an economical vehicle and you'll get around 30 MPG which will cost you - at today's $3.00-per-gallon prices, about $30. per week for gas to commute. If you can't even afford that, then the job must be part-time and pay minimum wage. Even then, at $6. per hour, you would be making over a hundred dollars a week on a 20-hour schedule. Paying $30. a week for gas would be a noticable bite from your paycheck, but you would still have over $60. per week, net, after gas and taxes. If that isn't enough, then either buy a motorcycle or find a job where you can get public treansportation. Many people do, Kell. I know some.

It's not the federal government keeping the oil industry down by not allowing more drilling in North America. It's the federal government pumping billions of dollars of tax breaks and grants into the industry as a political kick back in turn for the soft money under the table that our politicians get from big oil. The lame attempt at passing the buck along is just the average joe in this country speaking. Most people can't take responsibility for anything, and they simply pass the blame along. As if oil companies aren't a major part of the problem.

Whatever.

The big oil companies you seem to resent so much are owned by shareholders, many of them average Americans, and they want those companies to make a nice profit. The oil companies do make big money - but they are very regulated by government. A government that could cripple them if it really wanted to but won't, for obvious reasons: we need the gas and oil to survive as a nation. The oil companies, like every other big business in America, shovels big checks to both political parties to ensure they are not further regulated - and risk losing more money because of it. Granted, the deals the new federal energy bill gave to the oil companies seemed excessive, so I won't let them off the hook entirely. Money talks. However, I would check my congressman and senator's voting record to see if he or she approved this bill. If so, let them know you are displeased. Ask them to defend their vote. It's the American Way.

However, if government were less involved with the oil business, taxed the product a bit less (fat chance) and didn't place insane restrictions on building refinaries and drilling in frozen wastelands, it would benefit everyone. Unfortunately, that is not the case. So, the oil companies use their largess to influence politicians, as any government-regulated business has been doing for a hundred years. Take the politicians out of the game and the oil companies won't be sending millions to Washington, D.C. every year - because they wouldn't have to. Until then, the oil companies play the hand they are dealt. That we still have an abundent supply of affordable gasoline under the conditions MEDIK418 described is a testimony to the oil companies inventiveness and a temporary spike in gas prices is hardly a reason to demonize them once again, as the media and the anti-business crowd has done. However, this is an old game, promoted by the (mostly) anti-business media and so, will be going on a very long time.

I'm still pleased have gasoline readily available at an affordable price, even if some folks think they should be getting their gas at 1995 prices. Of course, these same folks don't see anything wrong in selling the home they bought in 1995 for three times the price they paid for it. Noooo. That's just 'taking advantage of the market'...when they do it. But let gas prices rise by 30 or 40%, even temporarily, it's 'gouging' and a 'rip-off'.

Whatever.

[Mr 5 0]

Originally Posted by MEDIK418

Ok, now we're getting somewhere. Maybe I forgot to finish part of my last quote. EVERYONE is going to have to stop driving so much. Did you know that we are driving MORE now than we were two years ago. On average Americans are driving more than when gas prices shot up two years ago. Not just the big rich SUV drivers (which by the way, I take tremendous offense with your reference that only rich people can afford to drive but I'll address that in a minute) but every one of the little buzzmobiles I see every time I visit San Diego.

The traffic never seems to stop 24 hours a day out there. Something else too, how many do you see in the express lanes? Not many. Phoenix, California, Washington DC, you name the place we as America are too self involved to share a ride with the people we work with every day. Oh, there are a few but there again, it seems the country wasted a lot of taxpayer money building carpool lanes that sit empty until after rush hour is over.

Theory? It's not a theory that we are running on one tenth the number of refineries we were in 1970. There wasn't a shortage then and there's none now. The plant I work in is running at maximum but our tanks are as full now as they were a month ago. The summer rush had more to do with inventories than Katrina did. Yes, there were spot shortages while the big pipelies were down but that should have corrected itself by now. And it has according to gas prices. Remember. . . .oil companies jack prices up in an attempt to make us drive less and use less gas bacause they forsee an opportunity for shortages later on down the road. It should be a harbinger of things to come, not a reason to gripe and blame politicians.

Let's address government stockpiles of crude oil. Do you actually know how much they have for us? Not even a day's worth of crude, that's how much. If you turned off the wells, the tankers coming from Russia, and the middle east, they government stockpile wouldn't last a day. It's a joke. The only reason they keep them around is that it makes politicians warm and fuzzy thinking that they have us convinced that we're safe relying on the spare oil they stocked up on. It's a joke. I'm not making this up, look in the business section of your local newspaper. It tells right there in black and white how much crude oil we go through each and every day of our lives and it makes the federal government look awful stupid when you consider how much oil is in this so-called government reserve. The only affect that releasing the oil they said they were going to was the same affect that 9/11 had on the price of gas. People THOUGHT there was going to be a shortage so they went into a panic-buying frenzy and caused spot shortages across the country. This time, with Katrina, the government said they were going to release some oil and people relaxed a little. The jobbers realized the panic was about over and prices started going down. It happens every time there's a hiccup in the oil industry nowadays.

Here's a little lesson to mull over. The plant I work at suffered through a series of really bad luck events beginning in January. Failed airfins, an explosion, a couple of fires. . .all contributed to our not being able to produce ANYTHING for 123 days. That was 144,000 barrels of crude that didn't get processed every day we were down. Did you see a jump in gas prices? Nope! not a one. Why? Because the press didn't get wind of it that's why. The good ole news media didn't have the opportunity to put America in a panic like they so love to do. We're so far back in the sticks, they didn't find out about us.

Now, let's talk about the people with the large SUVs who don't give a crap about how much we pay for gas. Your theory is full of bugjuice. Like I said, I drive one and I've had to shut down a lot of driving lately. My son who has a 120mile commute (one way) has opted to live in the town he works in for the 7 days he has to be there (7 on and 7 off) Why? Because we pay the same price for gas as everyone else and it hurts us just as much as the next guy. I've gone from driving about 3 tankfulls out every month to one. That's with two of us driving it to work. I've ressurected an old Suzuki 750 to get to work in a week or so. We look for ways to consolidate errands to make the most of the gas we have. I'm not sure how much you think a person has to make for a living to buy one of these things but it's not much more than most small cars on the market these days. (Besides that, California has more little cars running around the state than anyone and they use more gas than most other states.) I drive it because I like the room and yes, I choose to pay the penalty for doing so at the pump but don't tell me I don't hurt every time I fill up. You don't have a monopoly on cash limits here. I've got a Mustang in the driveway that's a clutch and a X-pipe away from being finished enough to drive but guess what? I spent most of the extra money on gas last month. I still stand by what I said.

You want to slow the price of gas down a bit? Stop driving so much. EVERYONE. If theres' no market for the stuff, it won't be worth as much. Another thing, next time there's a calamity like the one that happened to the Gufl coast, dont' cause the prices to shoot shy high by lining up at the pump in block long lines to get the last drop of gas before the next truckload shows up. This kind of crap feeds the media like a school of sharks. One front page headline with a picture of the morons sitting in line for gas is usually all it takes for the gasoline distributors to start seeing dollar signs. Why do I say this? Because I know several of them and they love this stuff. It would take weeks for an event like that to start affecting the gasoline and oil reserves in this country. OK, forget I mentioned reserves, insert the word inventories for that.

Anyway, I don't mean for this to be mean spirited but I'm sick of the lies that the national media is telling about anything that affects this country and on this subject, I can shed a little light. I've been in this business for over 25 years now and I laugh every time I see a story on the gas crisis. Not because of the effects but because of the lies I see in the news over it. Think of how many personal owned vehicles we have in this country. Millions upon millions. Think how much gas we would save for another day if each of those vehicles drove just 2 percent less each week. I don't have the answer buy can bet it would make a big dent in the price of gas in this country. Till then, I can promise that there are a lot of folks out there who are doing all they can to make as much gas as they possibly can with the equipment they have to work with and they'll continue to do so as long as we can.

Thanks again for another informational post.

I believe we have some 200 million vehicles on the road today and our driving population has also gone way up in the past 25 years. Something no one seems to take into account when talking about the availability and price of gas. Glad you brought it up.

The fact that the morons who instantly top off their gas tanks at the slightest indication of some possible slowing of the gas flow to the pumps has always been a problem, as far back as the 1973 gas 'crisis'. Nothing has changed and the media is as guilty as ever of promoting the 'panic' over gas 'shortages', then making alarmist noises (interviewing grumpy people complaining about the price of gas) when the price inevitably goes up. That so few folks seem to see the correlation between panic buying , some actual gas shortages - and the rise in price is a given.

I doubt this will change, but thanks for the attempt to shed some light on the subject from the point of view of one working inside the oil industry, the medias favorite whipping boy, right after President Bush.

BTW: formatting is your friend. It just reads so much easier.

[ultraflo]

Originally Posted by digital3.3

really? that is surprising actually.

Just goes to show how much of a 'game' it is to jack with fuel prices. Before it was raised to $3.89, it was $3.69 for the longest time, even before/during/after the price hikes associated with 9/11.

[scootro]

dammmmm bloodsuckers

[nastyn8]

haha master debater.......... you guys argue like little kids man. sometimes you got to know when to just let something go.
Heres a little joke for mr 50. "arguing on the internet is like running in the special olympics.... even if you win your still retarded".

Are you trying to talk shit about flipping burgers? Well ive worked at Hardees for almost 4 years now and when I started minimum wage was at 5.15, now at 6.50. I make over $10 an hour now so I can't complain much other than I hate most ppl I work with. Everytime I see someone thats overweight I think to myself now thats job security. If fast food is the only thing available or the only thing flexible with school (which works for me) you might as well do it.

I know there's job security in the insurance business but honestly who likes an insurance salesman. Insurance ppl are on the food chain right next to bankers and car salesmen.

Anyway off from the personal shit... I was shocked by fuel prices, not depressed.
I immediately decided I am going to cut down on my fuel usage. Although I dont even average 20 miles of commuting a day. I drive 12 miles round trip for school and not even 4 miles to work and back. Then I got to thinkin there are back roads I can take from my house to college so I decided to ride my fourwheeler I bought in May. I road it to school 6 days and didnt even burn a half a tank. Then i got tired of goin to class with my hair filled with gravel dust and bugs in my teeth so I decided to start driving my truck again.

Are any other areas limiting their police potroling? Here and a few other towns are limited to 20 miles a day per officer and they are not allowed to drive the cruisers home at night. something they should have come up with years ago. HAHA

Its just money, to hell with it. Some people should stop and think American Currency doesn't mean dick in Hell.

Well guys 2 cents is your change, thank you and have a nice evening ,.|..

[Mr 5 0]

Originally Posted by nastyn8

haha master debater.......... you guys argue like little kids man. sometimes you got to know when to just let something go.
Heres a little joke for mr 50. "arguing on the internet is like running in the special olympics.... even if you win your still retarded".

Why did you bother reading the posts if it's all so 'retarded' to simply exchange opinions? You apparently missed the raison d'être for the political forum...which is to discuss issues of national and cultural interest. Sorry if you're not up to doing so but foolishly trying to belittle those who do is lame. That Unit 5302 gets all huffy and dismissive when he can't dominate a discusssion here is old news for those of us who have debated him on many previous occasions. I expected the discussion to end with his pouting. Nothing new.

Are you trying to talk shit about flipping burgers? Well ive worked at Hardees for almost 4 years now and when I started minimum wage was at 5.15, now at 6.50. I make over $10 an hour now so I can't complain much other than I hate most ppl I work with. Everytime I see someone thats overweight I think to myself now thats job security. If fast food is the only thing available or the only thing flexible with school (which works for me) you might as well do it.

Thanks for sharing those thoughts with us.

I know there's job security in the insurance business but honestly who likes an insurance salesman. Insurance ppl are on the food chain right next to bankers and car salesmen.

You are making false assumpions about someone you do not know from Adam. Your mistake.

Anyway off from the personal shit... I was shocked by fuel prices, not depressed.
I immediately decided I am going to cut down on my fuel usage. Although I dont even average 20 miles of commuting a day. I drive 12 miles round trip for school and not even 4 miles to work and back. Then I got to thinkin there are back roads I can take from my house to college so I decided to ride my fourwheeler I bought in May. I road it to school 6 days and didnt even burn a half a tank. Then i got tired of goin to class with my hair filled with gravel dust and bugs in my teeth so I decided to start driving my truck again.

Well, all actions have consequences in one form or another.

Are any other areas limiting their police potroling? Here and a few other towns are limited to 20 miles a day per officer and they are not allowed to drive the cruisers home at night. something they should have come up with years ago. HAHA

Its just money, to hell with it. Some people should stop and think American Currency doesn't mean dick in Hell.

I must write that one down. It's so darn elegant.

However, we are not in 'hell' and American currency means quite a lot to us, the living, thank you.

Well guys 2 cents is your change, thank you and have a nice evening ,.|..

Did you say something?

[nastyn8]

Originally Posted by Mr 5 0

Did you say something?

yeah i said something, you're a lame p.o.s. and I could care less what you think or say about me or any other of these guys.

You come up insulting everyone with just what they think may be what is happening. There's a big difference between correcting someone and insulting someone. I'm not going to discuss this with you anymore b/c you're all talk.

[Mr 5 0]

Originally Posted by nastyn8

yeah i said something, you're a lame p.o.s. and I could care less what you think or say about me or any other of these guys.

The feeling is mutual, I assure you.

You come up insulting everyone with just what they think may be what is happening. There's a big difference between correcting someone and insulting someone. I'm not going to discuss this with you anymore b/c you're all talk.

I believe that 'talk' is all we have to work with on the internet.

In any case, Unit 5302 and I had a rather civil discussion regarding our divergent views on gas prices until he became frustrated when he couldn't dominate the discussion and started attacking me, as he tends to do when he can't keep pretending to be the smartest guy in the room, as it were. The other guy I exchanged messages with was simply uninformed, nothing more, but he didn't handle that reality well, either, just like you.

Oh well. It's just the internet. Here today, forgotten tomorrow.

[nastyn8]

Well maybe we can come to terms. Its not all in what you have to say man it's your tone. Anyway have a good one

[Capri306]

Honestly, I was hoping for over $5/gal, but it's already heading below $60/barrel for crude, so that dream is gone.

[grey88gt]

Originally Posted by Capri306

Honestly, I was hoping for over $5/gal, but it's already heading below $60/barrel for crude, so that dream is gone.

I think were gona see your $5/gal prices after Rita gets done. I have heard so many diffrent reasons for gas prices changing. LOL everyone of the oil companys around here that buy parts from us for there trucks and equipment have a diffrent reason. One guy told he was filling up his field truck to go run the wells and got a cursing, buy someone else buying gas. I hope you guys work it out, Mr 50 and Unit, your disscusion is ventureing away from fuel prices. We are all in here reading and trying to understand WHY the prices are sooooooo high. Thanks for the good opinions and info!

[nastyn8]

I was too. The day it jacked up a whole buck here there was like 40 people at every gas station in town. $3.69 was the tallest it got here. A whole bunch of old people were filling their cars up and they all had a couple of cans with them. It was some what amusing to.

[Capri306]

I dunno about you guys, but I can feel the love in here.

[HoodStrype]

I like birds... they are pretty. Birds come in many shapes sizes and colors. I especially like big birds. Birds fly in the air. They build nests in trees, and sometimes in my house.

Birds are good for the environment because they die. After a few million years under many layers of sediment they give way to the heat and pressure and are transformed into oil. I hope my doggy Scruffy will be turned into oil too. He likes antifreeze.

My mommy says oil costs too much. But I told her it had to drilled and sucked out of the earth. Then it had to be taken by way of boat and/or truck hundreds of miles to get here. Then it had to be refined by taking the lightest of the gases and skimming them of of the top. There is very little that actually becomes gas. Then it has to captured and trucked once again to wholesalers, then to gas stations and to you. Yet a gallon of gas doesn't cost anymore than two bottled waters... unless you're at Disney Land and I here gas is cheaper than bottled water.

If you add in the fact that inflation means a dollar isn't what it used to be, gas cost even less.

I like birds, they are cool.

[Capri306]

Yes, I believe I may have been right about the fuel prices rising; $3.00/gal might be a 'deal' in a week's time from tonight if things go as bad as they appear to be.

Getting back on the thread topic, yes, this may happen (~$5.00/gal) as long as no more refineries are built in the United States. We haven't built a single refinery since the 1970's, yet we're using more fuel as time goes on.

Here's a novel idea: try not to think of fuel in terms of gasoline alone. Fuel, in the form of refined petroleum, powers EVERYTHING: our cars, trucks (both gasoline and diesel come from petroleum), many of our power plants, etc. All of the things we take for granted in the 21st Century depend upon refined petroleum.

Today I heard that something like 23 refineries were closing temporarily due to Hurricane Rita coming, and that this would cripple our refining capacity by 26%!!! WTF?!?

Here's a quote from one of the online papers I read (emphasis mine):

Together with the 5 percent of U.S. refinery capacity shut since Katrina, the four closed Texas refineries add up to 11.5 percent of U.S. oil refining.

How sad is this? We need more fuel, yet the supply is more crippled than ever before.

Demand is outpacing supply. This is Economics 101, folks. Of course you're going to see high gasoline prices; there simply isn't enough to go around in great abundance. If the laws prohibiting the building of refineries were repealed or removed altogether, you'd have sub-$2.00/gal gasoline almost as soon as they were built.

As for those people who believe that the oil companies are "gouging" us, you're half right. They charge what they do because no one will stop them. However, don't you think that they'd be making more of a profit if they could produce more gasoline? It's better to sell 10 billion gallons of gas at $2.00/gal than 2 billion gallons at $3.20/gal, no? The long-standing economics of the auto industry do not apply here; not everyone needs a new car, but everyone needs petroleum.

Personally, I think the price per gallon is 'shocking' to people, but they're not really spending much more at the pump. They're just limiting their spending on gasoline, and perhaps making less trips than they would otherwise.

I live in Grand Rapids right now, because I'm going to college. I will honestly claim that I don't go home on weekends as often as I did last year, and that it's mostly because of the gasoline cost. However, I don't think I spend much more money at the gas station because of the higher prices. I simply cut down on the number of trips that I make, only using the car when NECESSARY. Perhaps I'm spending LESS than I did last year on gasoline, but I can't say that and be sure of it. I do know that I am absolutely more conscientious of how much I drive and how much gasoline I use.

[Mr 5 0]

Originally Posted by Capri306

As for those people who believe that the oil companies are "gouging" us, you're half right. They charge what they do because no one will stop them. However, don't you think that they'd be making more of a profit if they could produce more gasoline? It's better to sell 10 billion gallons of gas at $2.00/gal than 2 billion gallons at $3.20/gal, no? The long-standing economics of the auto industry do not apply here; not everyone needs a new car, but everyone needs petroleum.

Personally, I think the price per gallon is 'shocking' to people, but they're not really spending much more at the pump. They're just limiting their spending on gasoline, and perhaps making less trips than they would otherwise.

Thanks for underlining my contention that while gas prices are clearly high, relative to a few months or a year ago, drivers are far from being 'gouged' in the ridiculous way some folks seem to believe. Why do some people assume that that cheap gas is somehow a constitutional right? It is not. It is a commodity and subject to all the vicissitudes of any commodity sold on the open market. Of course pump prices will rise when the gasoline supply is falling below demand, as you clearly stated. That is a given, to any rational person.

Do we like it? Of course not! Higher gas prices take more out of our personal budgets - and no one wants that. However, we still pay a relatively low price for our gas and considering the lack of refineries and the increase in cars and drivers on the roads over the past 30 years, the U.S. is doing pretty darn good as far as the price - and availability - of gas goes. That two oil companies merged, are more efficient and - due tpo demand - sell more gas and oil and thus, make more profits is not the sinister situation some people seem to want to believe. I am pleased that you seem to understand that. Pass the word.

It's easy to demonize 'big oil' and whine about gas prices, making accusations about 'gouging' and 'rip-offs', etc. A whole lot easier than actually considering some of the realities associated with the pumping, refining and selling of gas and oil, looking at the relative price of gas at the pump, which is still reasonable, and understanding that while the oil companies make big profits, they sell a lot of product, have huge expenses and are already well-regulated.

[MEDIK418]

It’s me again. I apologize for walking out of this debate some time back but I got busy and wanted to do some research before I weighed in again. I have been told for so many years that the price of gas is market driven and that was that. It gave me a warm fuzzy thinking I was in on some great secret that nobody but us insiders could ever understand and all you poor fools were just going to have to suffer your ignorance. Truth was, I had little clue what drove the price of gasoline at the pump or the refinery up or down.

My arguments of past haven’t changed and as limited as they were in detail, they still stand true. The market does indeed drive the price at the pump but there’s a lot reasons and none of them have anything to do with “Big Oil” trying to scam us.
Have you ever wondered why the big oil companies have NEVER been found guilty of price gouging? There have been plenty of investigations and don’t tell me it’s the republican cover-up either. There have been plenty of Democrats whining over the years and so far, not one oil refiner has been found to be gouging anyone.

I read where someone here claims they’ve never talked to an oil company employee who wouldn’t defend his company to the bitter end. I say he hasn’t talked to anyone I know. This is the oil belt here sir and most of the employees in these parts spend the better part of their existence trying to find ways to screw the company or bring to light the ways the company is trying to put it to them. You’ll almost never hear one defending the company name unless you count the number of times they try to correct the spelling of “Mickey mouse outfit”

The cartoon “Dilbert” is a great example of how most of us here feel about the people who run this place.

But as evil as we think they are, we all understand that as prices go up and down, we get it in the arse just like everyone else in the country. We simply choose to whine about the price of Nikes and bottled water instead of gas because we understand what it takes to make a gallon of it and knowing that, it’s hard to find fault with the cause of our grief when it’s our efforts, good or bad, that go into how much we pay at the pump. I think that, more than company loyalty may be cause for any defensiveness you will find with an oil company worker.

Why the high prices?
First off look at what it takes to make a gallon of gas. It’s amazing it’s not higher than it is. Take for example the natural gas bill for one month. Two months ago our balance sheet showed a gas bill of $275,000 for one month. In December, that price will double for us just like the rest of you. Every process here relies on heat, chemical reactions and electricity. Two of these are paid for just like you do for your house. We don’t get any breaks on price either since we buy the stuff from outside firms who don’t care how much we have to spend for it. If we don’t buy it someone else will.
Crude oil prices: There a number of costs that make up the price of a gallon of gasoline. Utility costs, maintenance costs, marketing costs and of course, crude oil prices which make up 44 percent of the price of a gallon of gas. If crude goes up, that 44% is bigger, so goes the reduction of crude prices.

By the way, did any of you notice that OPEC announced last week that our oil companies needed to increase our refining capacity so we wouldn’t have shortages when disasters like Katrina hit us? Aren’t these the same guys who not 6 months ago said the United States uses too much oil ( fact is we use about 10 times more than any other country on the planet) Do you think that they’re hurting now that we can’t refine as much as they are used to sending us and it’s scaring them a little. If we stop buying their oil, they’ll be in a bad way in a short time.


Ok, enough stonewalling. Why does the price of gas fluctuate so much if the big oil companies aren’t causing it? It’s really pretty simple when you start to root out all the garbage that goes on to buy a gallon of it.
Let’s say you are a jobber. He’s the guy who delivers the gasoline to the gas stations, convenient stores . . . wherever. I’ve laid a lot of blame on jobbers in years past for the ridiculous jumps in gas prices and still do but now it’s tempered with a little more understanding of how the system works. I laid this blame after watching the price of gas out the door at this plant remaining the same through a three week period that saw fluctuations of over 40 cents a gallon in our area.

Anyway, you’re a jobber. Your primary responsibility is to make sure the people you supply gasoline to have a constant supply to sell. Most jobbers have contracts with outlet stores and are committed to see they have product to sell. If you can’t supply the product, they can’t buy, if they can’t buy, they go out of business. They go under, pretty soon you start to lose enough customers that it’s looking bad for Christmas this year. If they go under because you couldn’t keep up your end of the contract . . . can you say lawsuit?
It stands to reason that the jobbers have good reason to be competitive enough to maintain a reliable supply to their customers.

Let’s have a hurricane. Better yet, let’s have one that takes out roughly 30 percent of the nation’s refining capacity. Add to that the loss of 45 percent of the offshore wells we get our oil and natural gas from. Shoot. . . let’s don’t even go that far. Let’s sink an oil tanker in the Red Sea. Gee. . . That might happen again, or the oil transporters may choose not to send as many tankers that way until the danger is over. Whatever the reason, Americans will start to panic buy at the pumps. Think it ain’t so? Look what happened after Sept. 11, 2001. People went nuts in this country and if you were one of the knot heads who ran to the pumps after it happened, I’m talking about you. The only reason they went nuts like that was a fear that the oil refineries were next. Oh My!

Before any of you think I thought this up, think again. I did a lot of research with oil industry publications and some of the marketing people in our company and some of the few jobbers I know around here. There’s no big secret about how it works but not many people understand it so here’s my limited view of what I found.

When these calamities occur, jobbers begin to bid higher for the gasoline they buy. Ever hear about gasoline futures? Jobbers buy gasoline on huge bundles. Month by month or week by week, they buy gasoline today for the empty tanks of three weeks from now. Forget the time intervals as they vary depending on the customer base and average sales volume for that jobber. They see a problem on the horizon and they start to worry. People panic buy. That’s a fact of life so you might as well prepare for it. He starts to bid higher for the gas he needs next week or even tomorrow.

Pretty soon all of them are in a bidding war in hopes of maintaining inventory so outlets don’t go dry. Once the bidding goes through the roof, they have to raise the price at the pump to offset the price he just promised to pay three weeks from now. Typically, jobbers don’t have the “deep pockets” the big guys do and to expect them to be able to absorb the temporary deficiency is often asking a lot.

Who are they bidding? The refiner, that’s who, Please don’t insult your own intelligence by trying to rationalize how a responsible refiner would refuse the higher bid so everything will be fair and everyone will be happy. They’re in this for the money. They accept the high bids happily. If the bids go high enough for long enough, the margins start to go higher and they make obscene amounts of money from it.

Margins are those magical costs versus profit leftovers. If it costs 40 dollars a barrel to process everything you can wrench of a barrel of oil and you can sell all of the resulting products for 50 dollars a barrel, you have a 10 dollar a barrel (profit) margin. It’s also called crack spread. Normally it takes a 3-4 dollar margin for a refinery to stay afloat. Anything less and you are in the red. Most years, you try to balance the red with the black and hope the end result is the right color.

As I said, oil companies are completely and totally at the mercy of the almighty margin. An oversimplification is that while they do have some blame for the steady state price of gas, they don’t have much control over margins.

Recently (last year or two) calamities of one sort or the other have conspired to cause jobbers to make those god-awful bids simply due to uncertainties in the oil market. No one thing caused it but rest assured it was all based on how they perceived you and I would react to the news. Some of the costs are from the big guys having to spend more in utilities and raw products but those are slow in coming. Don’t take my word for it, look at the business section of your local newspaper. The refinery prices have been in there for years for all to see.

I’ve said it for years and will continue to say it. If you want the price of gasoline to go down, stop driving so much. Eventually, after figuring out the wars, hurricanes and every other short term calamity, the price will come down. It’s been proven over and over again. Look back over the gas prices for the last ten to twenty years and you can’t argue that point. Not so much because we’ve driven less but because when the “emergency” is over, things tend to go back to normal. If you stop driving as much as we do now, the market simply won’t bear the glut and the price will work its way down.

Want to stop the sudden jumps at the pump? Stop being the idiot who runs to the gas pump every time an oil well blows up in Iraq or some terrorist decides to make a threat that might . . . MIGHT affect some small part of the oil industry. We’ve seen first hand how we can lose over a third of our refining capacity in this country and after the initial freak-out by the press and the numbskulls who believe everything they see in the news; we can bounce back pretty quickly. True, we’re not back to the norm of a year ago but we’re headed that way and barring any sort of major disaster we should be back to business in 8-12 months. Gas prices may never go back to the dollar and a dime levels we saw a while back. It simply costs more now to make a gallon of it. I do believe that we will see another half dollar come off after everything is back up and running in the Southern half of our world.

OK, I’ve opened Pandora’s box, let the stoning begin.