Crude oil is getting cheaper — so why isn't gas?

AP/Yahoo ^ | 15 Feb 09 | John Porretto, Jennifer Malloy, Ryan Nakashima

[dragnet2]

Hell, even Barbara Boxer ain't from Cal, she another blue blood from the east coast.

It’s not where you’re born, it’s where you move to.

LOL...Even the Texans are now saying Bush is no Texan...And I could not agree more.

[RedMonqey]

Understood.

BTW. Isn’t Texas City the port town that got virtually blown apart because a cargoe ship carrying fertilizer and small arms ammo to post-war France back in late forties or early fifties ?

[RedMonqey]

No problem. Live and learn.

[chuckles]

1947. Grand Camp filled with ammonium nitrate was allowed to dock while on fire. When the ship blew, it took out Monsanto and the others chain reacted. The Grand Camp's anchor was found several miles north of town. Denver registered and earthquake. For a long time it was the largest non nuclear explosion on earth ever recorded. I think it has been beaten now. I was born in 1951, but I had several memorable moments in my youth. I don't know of many people that sleep heavy from there. One night Union Carbide blew a unit and we were up and dressed and in the car before the windows quit rattling. To this day, I sleep very lightly. During the cold war, we were told that Texas City and Pasadena were 3rd and 4th on the Soviet nuke list. Without the gas and chemicals from there, the US couldn't recover.

Another fun fact is we had the worst toxic waste superfund site on earth there until Chernoble. I actually drove a dump truck that put it in the pit. It's as big as a lake and 20ft deep of sludge. We had to wear masks to drive on the site and the ground would move under our trucks with 10 ft of dirt on top. Now they want to dig it up and burn it and redeposit it or something like that. In Texas City, you went from High School to a plant to work or you got the hell out. I got out.

[chuckles]

Here in Texas it's about 1.85. Futures closed Friday @ 1.20 plus 40 cents tax = $1.60. 15 cent profit for the pumper and there you are. Any more than that means the tax is too high or the pumper is gouging you.

Oh, I see, CA.........you are screwed. Bail out now, the ground is approaching.

Oh and just to do a little bitching of my own, I thought the high price of fuel was what was wrong with food costs. Even ethanol closed at 1.59 Friday. That's not that far from gasoline. Anybody seen the price of grub lower? Didn't think so. Let's get back to griping about evil oil companies.

[MeekOneGOP]

bump! bump! bump!

[RedMonqey]

I knew I hear of TC and associated it with a terrible non war tragedy.

One night Union Carbide blew a unit and we were up and dressed and in the car before the windows quit rattling

The only time the windows rattle around us is when Fort Campbell shoots it's bigger guns and low clouds keeps the explosions bouncing around.

WE get use to it like the low flying (tree top) helicopters buzzing the house.

[nickcarraway]

But what you are saying is that there is no risk to being a distributor.

[TexasNative2000]

But what you are saying is that there is no risk to being a distributor.

No. There is significant risk in signing a futures contract for fuel. If half of the distributors had signed those contracts and half had not, we would not be facing this situation to this degree.

It so happens that in this particular case, most, if not all, distributors contracted long term, so they essentially created a new market within the market.

Again, I point out the example of Southwest Airlines which has gotten hammered by contracting fuel futures that have them paying significantly higher costs than their competitors. There are two factors that clobber Southwest here; they were the only airline to sign a futures contract at the high rates that they did, and the market forces in their industry mandate that they match fares with their competitors.

[TexasNative2000]

If you lock in the wrong price, you should suffer.

If everyone locks in the 'wrong price', it isn't wrong anymore. The distributors created a market within a market. Rare case.

If they all locked in futures contracts knowing prices would fall, they could be accused of two things: stupidity (buying high so they can sell low), or collusion. As it turns out, the result is the same as collusion, but there is no way that is what happened purposefully.

[Mr Inviso]

“Anybody seen the price of grub lower? Didn’t think so. Let’s get back to griping about evil oil companies.”

I’ve been seeing a few things cheaper at the grocer’s, or at least better “sale” prices, especially in the meat area.

[Force of Truth]

Good post. I also seem to remember that after oil prices began sliding in January, oil prices for February delivery remained on the high side for some reason. Gasoline sold today is likely based on this February price, while over the longer term (the next few months) these prices will likely ease.

I sure hope you are right.

[Force of Truth]

Thackney, and Eric in the Ozarks, and Smokin' Joe (and numerous others!) and I have been trying to do this for a couple of years. Some folks -- especially the 'conspiracy' crowd, of which there is no shortage here on FR -- just don't get it, sadly.

We're talking oil here, so I'll go with Tex on this one.

[SAJ]

All of the above are directly involved in different sectors of the industry, and they all know quite well whereof they speak.

[7mmMag@LeftCoast]

That's all you've got?

Of course it is.

[chuckles]

....."I’ve been seeing a few things cheaper at the grocer’s, or at least better “sale” prices, especially in the meat area.".....

Yeah, ham is cheaper here, but beef is higher. Shrimp is actually cheaper than beef now because it comes from China. I don't know where Gulf shrimp go from here, but all the stores in my town have shrimp that comes from China. Everything from eggs to flour, sugar and most everything else is higher and still rising, even soap. Recently, liter diet coke was 98 cents, now it's 1.48 at WalMart. It doesn't even use sugar or corn. Maybe the plastic bottle?