Oil Prices Are Plummeting

Futuresource ^

[zencat]

Oil prices, already near four-month lows, fell again today. In fact, oil is now below $28/barrel.

http://www.futuresource.com/quotes/quotes.asp?fmt=s&type=future%2Cindex&symbols=cl&image53.x=13&image53.y=8

Falling oil prices have almost the identical effect as tax cuts on an industrialized economy. This could have a major economic impact as it costs less to produce and transport all goods and services.

More bad news for the Democrats.

[the gillman@blacklagoon.com]

Why are gas prices so high?

[mattdono]

I thought that Bush and Cheney would colluding with Halliburton to make tons of money?

Hmmm. Odd. </sarcasm>

[Choose Ye This Day]

Ummm...perhaps because current supply was refined from much higher-cost oil? Give it some time, man...

Meanwhile, Dascle is deeply saddened...

[q_an_a]

Nigeria and Venezuela both have had major supply problems; Black outs and summer shut downs added more empty storage tanks, the system took advantage by selling at higher prices even if there was plenty of oil in the pipeline.

One day the Saudi will be wondering why we are all so happy driving the Toyota hybrid engines, it is so we can punish them. The end of the stone age did not occur because of a lcak of stones. The end of the oil age will happen before most of us die. We can dance on their grave.

[EggsAckley]

I paid $2.19 per gallon for low test yesterday.

[zencat]

Actually from Labor Day, my gasoline prices are down 17 cents already. I was paying $1.66 in Missouri, and am now paying $1.49. While 17 cents may not sound like a lot, that's over a 10% drop in just 2 weeks.

[Eva]

There is absolutely no reason that most people in the oil industry that I have talked to, can site for the high prices. Some of them will give you bogus excuses, such as the blackout and the Arizona pipeline problem, but no legitimate explanation.

We live near two refineries where a lage portion of the oil for the west coast is refined, and yet we pay the highest prices in the state.

[G L Tirebiter]

I paid $2.19 per gallon for low test yesterday.

California? $1.39 today in GA. Down from $1.44 yesterday.

[Texas_Dawg]

We're all doomed.

[Labyrinthos]

While 17 cents may not sound like a lot, that's over a 10% drop in just 2 weeks.

Except when the price of oil goes up the impact at the pump is almost immediate, like a 17 cent increase in two days, but when the price of oil goes down, the impact of the pump is seen over a period of weeks.

[Enterprise]

It is a lot. Recently we paid about $2.00 a gallon before Labor Day. After Labor Day it dropped to $1.91. And yesterday I saw it at $1.85.

So, I have positive proof why gas prices are so high. They are caused by Holidays!

[Einigkeit_Recht_Freiheit]

Sorry, but it bad news for all of us. It may be a nice short terms boost for the economy, but oil is Americas additction and getting some good cheap stuff never helped any addict recover.

We need a massive nation-wide effort to switch to alternatives. The world spends $800 billion a year on oil (give or take) and most of it goes to our favourite global hot spot. It would take an estimated $5 trillion to generate all the worlds electricity with wind. That isnt a bad investment as far as I am concerned. If we add in some solar, buclear and biomass, it is even cheaper.

There is nothing American about oil. There is nothing about our way of life that requires we use oil as a source of energy. There are a lot of problems with oil, the most important of which is that we dont have very much of it. and the people who do hate us.

I dont need a climate change argument to convince me that oil is bad for America. But, being a student of Pascal`s wager, it tells me that the consequences of not acting and it being true are much worse than the consequences of acting and it being false.

Bring it on.

[EggsAckley]

Yeah, Santa Cruz. The whole coastal area is being reamed by the price of gas. It's obscene. Gas is cheaper up at Lake Tahoe, or Reno. Makes no sense.

[wayoverontheright]

Oil Prices Are Plummeting...

They are inching down compared to the CLIFF they will fall off when the market realizes that the former Russian federation countries' refusal to play ball and the Iraqi oil coming on line will soon deal the double death blow to OPEC.

The futures markets will start to function again as they did before OPEC, facilitating entry to market, and thereby increasing competition at all levels of the industry, from extraction to refining.

This will be the least expensive war we ever fought, in overall fiscal impact.

[wayoverontheright]

Oil Prices Are Plummeting...

They are inching down compared to the CLIFF they will fall off when the market realizes that the former Russian federation countries' refusal to play ball and the Iraqi oil coming on line will soon deal the double death blow to OPEC.

The futures markets will start to function again as they did before OPEC, facilitating entry to market, and thereby increasing competition at all levels of the industry, from extraction to refining.

This will be the least expensive war we ever fought, in overall fiscal impact.

[Texas_Dawg]

This will be the least expensive war we ever fought, in overall fiscal impact.

No kidding. People worrying about spending $87B or more on Iraq need to go look at our deficits as a percentage of GDP in WWII. We're nowhere even close to that.

[Steely Glint]

Gasoline prices are determined by refining and transportation costs and local, state, and federal TAXES.

Are gas prices high in your city? They aren't in mine, but we have a gasoline refinery here and low state and local gasoline taxes. If your community has worked hard to keep energy sources out/far away and has high local and state tax gasoline rates, guess what? You're screwed.

I used to work for Big Oil. They don't engage in conspiracies, aren't out to screw you over, and don't raise prices without a reason. (Sure, they're out to make money, but any business that isn't will go out of business rather quickly.) Heck, breakfast cereal companies have higher rates of return. If you want to look for conspiracies, you might try looking in the world of agriculture instead.

[Arrowhead1952]

I paid $2.19 per gallon for low test yesterday.

California? $1.39 today in GA. Down from $1.44 yesterday.

Here in Austin, TX we have prices for regular unleaded anywhere from $1.40 - $1.59. There is one station that had $1.37 yesterday. Bad news for the RATs.

[2timothy3.16]

Why are gas prices so high?

And home heating oil?

[zencat]

Just a quick update.

October deliveries are currently down 64 cents a barrel to $27.50. The same oil near the end of August was $32.00+ a barrel.

This is significant and should greatly assist with the economic recovery.

[BJungNan]

Why are gas prices so high?

Why are gas prices so high?

[Doodle]

We need a massive nation-wide effort to switch to alternatives.

So how do you propose we do this? By government fiat?

It would take an estimated $5 trillion to generate all the worlds electricity with wind. That isnt a bad investment as far as I am concerned.

If this is such a good investment, why not let the market take care of it?

If the market doesn't take care of it, do you advocate some kind of subsidy?

And do you advocate paying for this subsidy by taxing me?

[BJungNan]

Ummm...perhaps because current supply was refined from much higher-cost oil? Give it some time, man...

enhhhhh! Wrong answer.

Because taxes on gasoline are so high.

[bandleader]

That's what I'd like to know?While it took only two-weeks in August for gasoline prices in The Berkshires(Western Mass)to rise 30-cents($1.53/$1.83),they have only declined by 4-cents($1.79)!Fortunately,I have two vehicles and one of them is a gas-sipper!!!

[newcats]

Why are gas prices so high?

Greed...plain and simple.

[bandleader]

DasHole might be"deeply saddened",but the term he uses most(Meet The Depressed)is:"Tim,I'm Deeply Troubled"!!!

[bandleader]

Are you (by any chance)Chicken Little?

[oyez]

All your oil price are belong to us.

[Arrowhead1952]

This is significant and should greatly assist with the economic recovery.

This is absolutely HORRIBLE news for the dims and Tom Dashole is DEEPLY, DEEPLY SADDENED by this news.

[alnitak]

You're an idiot. The gasoline retail business is ferociously competitive. If you don't believe me, buy a retail station and add 5c per gallon to all the prices your supplier recommends you charge. See how long you last.

The oil company's margin is usually less than 5c per gallon.

Why do you think all those fully automated unmanned retail stations are popping up? A desperate need to cut costs, driven by a competitive free market.

[polemikos]

Yeah, Santa Cruz. The whole coastal area is being reamed by the price of gas. It's obscene. Gas is cheaper up at Lake Tahoe, or Reno. Makes no sense.

California has higher state taxes on gas than Nevada. Also, a couple years ago, CA passed a law mandating a special formulation in CA gas "for the air". This in effect requires special refining capacity and delivery systems for CA alone. In effect, it takes CA gasoline out of the commodity market and into a specialized one. With less competition, gas prices have gone up. Also, any mild hiccup in the production line (e.g., a small fire shuts down a CA refinery for a day) totally screws-up the system and prices jump dramatically. I don't know if the enviro-nazis had this planned, but it was a "brilliant" move, because the resulting price increase was greated than that expected from the mere formulation change.

[BJungNan]

I paid $2.19 per gallon for low test yesterday.

Dang, where is that station? $2.39 here. $2.49 for what they are calling premium these days (91 octane, ;0)

[Ditto]

The world spends $800 billion a year on oil (give or take) and most of it goes to our favourite global hot spot. It would take an estimated $5 trillion to generate all the worlds electricity with wind. That isnt a bad investment as far as I am concerned. If we add in some solar, buclear and biomass, it is even cheaper.

So are you going switch to an electric car or fly in an electric 747? We use very little oil to generate electricity --- something around 3% of our electricity is from oil fired units. Coal, Nuclear and Natural Gas are what keeps the lights on, not oil. Oil keeps cars moving, trains rolling and aircraft flying.

Think energy mix.

[Johnny Gage]

As oil prices fall, US Oil companies continue to gouge the consumer by maintaining infalted prices for gasoline.

[BJungNan]

You're an idiot. The gasoline retail business is ferociously competitive. If you don't believe me, buy a retail station and add 5c per gallon to all the prices your supplier recommends you charge. See how long you last.

Yea, well if you put everything up at self-serv like everyone else, never pump gas for anyone or check their oil, never wash a windshield, and everyone else is doing the SAME THING you are all going to get the same low price.

You have to work to earn your money, not just put a pump out for dispensing gas and charge the customer. How much profit do you expect for no service.

[Texas_Dawg]

Are you (by any chance)Chicken Little?

No. "We're all doomed" has become our phrase of choice for describing the paleo doom and gloom morons that lurk around FR.

[muleskinner]

Well, back before the Arabs formed OPEC, oil was $3.50 a barrel from the Middle -East and gas was between $.20 and $.25 /gallon.

The closer oil gets to the $20/barrel price, the better for Western economies. Anything below 20 is gravey. A quicker, bigger employment recovery around the corner.

Kudlow and Kramer had some oil expert on a few months back and he expects around $18/barrel.

[Einigkeit_Recht_Freiheit]

Actually the answers to your questions are really quite simple. All we really need to do is make the price of oil reflect its real costs.

This would have to manifest itself in yes, a tax. But let`s look at what extra costs oil cause us. I don`t honestly have the time to look up stats right now - please forgive. But, I am sure it is possible to determine that the subsidies already given to oil companies combined with the benefit of investing money in American products and American companies that could produce the equipment to generate those alternatives, that benefits might begin to look just about as good as the downsides. We can talk about the cost of approximate costs to our own and future generations of dumping the gases produced by buring oil into our atmosphere until we are blue inthe face, but that is probably a different thread.

Unfortunately, the market does not always provide the best solutions to all problems. Overshoot is probably a new concept for you (apologies if it is not), but I will explain in terms of the easiest analogy.

In left to the market, human beings will eventually overfish every single productive fishery in the ocean (and we are). The reason why is that as fish catches decline, the price for fish rises. Which, in turn encourages investors to build more boats and catch more fish, which causes there to be even fewer fish. This is a negative feedback loop. It also called in overshoot (or the tragedy of the commons). Because fish have a pretty impressive capactiy to reproduce, and in fact do better when there arent the maximum number of fish in the ocean (density) there is a fairly high sustainable catch. Unfortunately, once that optimal density is lower, there ability to reproduce declines dramatically causing a crash in the population that takes a very, very long time to recover - if ever.

Oil is a bit different and would take longer to explain, but the fundamentals are the same.

What it comes down to is that a tax on oil dedicated to switching to alternatives will improve American security (and I am sure you are willing to pay taxes for that) and independence (I`ll bet you are for that as well). This is a hard addiction to break. It is even hard to imagine, but we really really need to do it. The whole world and especially the United States would be a better place for it.

[Dead Dog]

Actually we do have a lot of it.

[EggsAckley]

"Dang, where is that station?"

Aptos 76 station. Chevron in Aptos is $2.29.

[dyed_in_the_wool]

Right on.
If you discount all of the taxes on gas at the pump (we can dream, can't we) gas would be cheaper than water.
(Oh wait, it already is.)

Seriously, though, Saudi Arabia is fighting a war on two sides. You notice none of the libs are talking about 'petro euros' anymore?
For anyone who remembers the 'petro dollars' it's what led to the massive inflation of the 70's.
If Europe wants that, then I say, "Go for it".

[alnitak]

Well, you have to express in constant dollars to get any meaningful data. This PDF will show the trend. You need to go 11 pages in.

It's part of BP's annual energy review

[Texas_Dawg]

As oil prices fall, US Oil companies continue to gouge the consumer by maintaining infalted prices for gasoline.

Thanks for that expert analysis, Karl. Tell me... why doesn't a foreign company or someone else just undercut them then and make a killing?

[KC_for_Freedom]

You are reaching deep into the environmentalist movement's tools to bring out the "actual cost of oil arguement".

While I agree with you that subsidies do ultimately screw up the free market, the market in oil is worldwide and tankers go where they can make the most money.

The USA should development an energy program that reduces our interest in Middle East oil, and this includes drilling in our country and building renewable energy nuclear reactors.

A good part of the actual cost of oil is fighting the political battle to keep the government from subsidizing the so called energy alternatives, all of which will come about when the market identifies them as the best solution to our energy problems.

[VOA]

I thought that Bush and Cheney would colluding with Halliburton to make tons of money?

I think it was during the Pres. campaign that Dubya said that if he and his
father actually could make oil prices go up...and hadn't...
their friends in the Texas sector of the oil bidness would have killed them.

[alnitak]

Yea, well if you put everything up at self-serv like everyone else, never pump gas for anyone or check their oil, never wash a windshield, and everyone else is doing the SAME THING you are all going to get the same low price.

---

Agreed. But is there a demand for such service? There may have been in the past, but I am not so sure. Certainly here in Europe it is non-existent, everything is self-serve.

You are fighting a trend, in that the cost of labour in western economies is rising compared to the cost of the raw material (oh, don't forget the government may c**p all over your business model at any time by changing employment laws, taxes + regs). At some point, it just becomes uneconomic to provide "service plus".

[jpl]

Eventually our economy will start to transition away from oil, but it's not going to happen overnight, it will be a slow but steady gradual process, and we'll probably see it start within the next 10-15 years. And it won't happen because of government mandates either. There are options right now, such as fuel-efficient hybrid cars and diesel engine cars that run on vegetable oil, and I expect these options will naturally get cheaper over time.

[Texas_Dawg]

I think it was during the Pres. campaign that Dubya said that if he and his father actually could make oil prices go up...and hadn't... their friends in the Texas sector of the oil bidness would have killed them.

Yeah... my cousin's brother's veterinarian's assistant's mom read that same thing on the internet and told me about it. It's all true.

[Gringo1]

Got it for 1.30 this morning in Larenceville,Ga.