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Yes, it gets a little confusing sometimes because this morning I heard that the lack of a demand just caught up with a market, as a justification for the drop in crude oil.... In the age of supercomputers that's a long lag.
I guess the 244,000 new jobs that were created will increase demand and the cycle will reverse the trend of oil prices...Who knows?
Since it was an unusual work day, it seems to me that the House of Representatives could have at least come up with a nonbinding resolution to honor the CIA the the Navy SEALS for their bravery. But they did have time to unanimously block a motion from Democrats to consider legislation to end subsidies to oil companies.... They included it in their budget proposals but when it comes to actual legislation " lobbyist money speaks louder than votes."
One amazing coincidence to me in the price drop is the scant two weeks it's been since the Attorney General announced the formation of the Oil & Gas price fraud investigation working group.
No doubt the investigation and the subsequent price drop are unrelated.
Good info,did you read the Yahoo news where a pricing director said the price might go down to $3.50 by June and probably won't reach $4.00?I guess that's something.
Hmmmmm....oil fell below $100 a barrel today.
I'm certain the gas prices will fall as quickly as they rose.....JK.
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Wow,sounds plausiable and I agree with the example you gave.I also remember a story about refineries not wanting to expand in place because they couldn't get tax incentives for that and for new exploration......I'll look that up tomorrow.
Thanks for info what a crazy regulatory world we live in...:-)
Just a little of topic Mike, if I may...
I saw a news report somewhere last week, I don't remember where, anyway it had to do with the permitting to add units to a existing nuclear reactor. So in a way it relates to the permitting of oil refinery s.
The gist of the story had to do with the control room. The permitting process started in the late 80's so the almost completed control room has lots of gauges, dials and indicator lights. Not a single digital readout anywhere.
The explanation given, was that that was the way the control room was designed when permitted, so it has to be completed that way, any changes would result in a new permitting process to be undertaken resulting in more delays.
After the new units are on line and checked out, they plan to shut them down and upgrade controls to today s technology. That way it would be maintenance, not new construction.
To me that seems to be a waste of time and money, I don't know if such strict design standards apply to refinery s or not, but it just might be one reason corporations are hesitant to even begin design of new facilities.
Now you are free to write your own blog praising the oil companies and you can give the exact opposite view of every detail I write..I won't bother you at all.
I tired of all the nit picking know it all..My scource is always right posting....Now,tell the world on your own blog.
Well, an approved permit for an oil refinery will not bring immediate relief because it takes so long to build them, they are expensive and heavily regulated, like nuclear energy, so investors on Wall Street are not that eager to finance them .Why would big oil dip into the Golden Parachute fund to build a refinery?...Imagine that; using their own profits to build a refinery. The status quo is just fine for them, read their financial reports..... Besides The National Petrochemicals and Refiners Association says that the last refinery built in the United States was Marathan Ashland's Garyville, La., plant—and it was completed in 1976. According to this report, between 1999 and 2002 refining capacity in the United States rose only 3 percent, squeezing up prices since demand grew much faster than that. Who's to blame for the fact that refining supply can't keep up with our thirst for oil? .
A lot of administrations have been in place since 1976.... The state of Florida does not want offshore drilling, should we force them? That's the same for California.... We should've taken steps to get off the fossil fuels a long time ago, but politicians couldn't move fast enough, because the were weighted down with lobbyist money.
I'm a proud "tree- hugger" who wants clean air and water over profits...What's the lawsuit about? Is every lawsuit brought on by environmentalist frivolous? Do the oil companies always have our best interest? Evidently environmentalist lost a couple of cases in California because we have two nuclear plants located on earthquake faults.
This blog was supposed to be about general information and not about the political divide because there are always two sides to a issue....If I held the position of authority in handing out deep -sea drilling permits, I would take my time to cross every T and dot every I..... If another disaster happens; guess who gets the blame? It's easy to just say " drill baby drill" if you don't have to suffer the consequences of another disaster.
Why would big oil be filing requests to build refineries when they are guaranteed the same reception from this administration as the one they received for all the requests to drill in the Gulf, i.e. the Permitorium? Not to mention the certain onslaught of lawsuits from the tree-huggers, regardless of where the refinery is to be located.
I would like to agree with your concept because yesterday oil futures did drop significantly but it was due to our weakening demand. I still think refining capacity is a bottleneck, because you can have all the crude in the world but you still have to be able to refine it. I would bet that big oil is not not filling out permits to build more big expensive refineries.
The Department of Energy said U.S. oil inventories rose 3.4 million barrels last week, above the 2-million-barrel increase forecast by analysts, suggesting weaker demand from refiners.
The report is just one of several readings oil traders have received this week suggesting weakening U.S. fuel demand. On Tuesday, a SpendingPulse report issued by MasterCard Advisors showed U.S. weekly gasoline demand fell 1% last week.
Perhaps you can answer a question I'm struggling with.....Say, as you suggested, we suddenly started the " drill baby drill" ,I assume for our own consumption... I would assume OPEC would cut back production(saving their resources) and let's just say that they set the world crude price at $3.89, why would U.S. oil companies sell below $3.89? It certainly won't be because of their patriotism but perhaps it might still be profitable for them, at that price but they're using up limited resources,..That's unless you believe we have an unlimited supply.
My outlook may be wrong.
I love the way you cut to the chase; either we adapt or we suffer the consequences.
That's true,newcowboyintown, I'm sure there are still traffic jams near Sugar Land every morning in the same thing for Highway 35 as you enter Austin but in the northeast, people are relying more on public transportation. And there is a reason.
Washington, DC- A simple change adds up to major savings as gas prices rise. Riding public transportation saves individuals, on average, $10,116 annually and $843 per month according to the American Public Transportation Association’s (APTA) Transit Savings Report which bases these savings on the April 13, 2011 average national gas price ($3.81 per gallon-reported by AAA) and the national unreserved monthly parking rate. This is the largest savings in nearly three years.
Last night,KAVU reported that public transportation in Victoria is on the rise but you are right,as long as it gas prices are below $4.00 it may be harder for some but it is still manageable for most.....Texas will not go for public transportation in a big way because we love our gas guzzlers;except for times like these..:-)
Thanks for sharing
From my travels last weekend - high gas prices are not impacting us as a nation yet. We complain, but there was no less traffic on the highway and Bucee's in Luling was still standing room only. People are adjusting and still filling up their car and traveling when they want. I really believe when we just can't go when we want to go anymore - either the alternatives will truly be considered and explored, or we will develop our own resources - what ever and where ever they may be.
Best I can tell Americans pay some of the lowest prices on the planet for gas and the international oil market will offset any actions taken to lower prices further.
Over the long term high gas prices will destroy demand and folks will adapt and reduce consumption.
all the pres has to say is "drill baby drill" and futures would drop and so would the price of oil.
federal taxes is what I reported.
First there's the federal gas tax. It's a standard 18.4 cents nationwide. Then states tack on an additional excise tax. That varies from just a few cents to over 20 cents. On top of that, some states add an additional sales tax. Then in a few unlucky locales, county and city governments levy their own sales tax as well.Some states use these taxes solely for road maintenance and construction, Dougher said, while other places put the money into their general fund.
Added all up, gas taxes can range from a low of 26 cents in Alaska to a high of 66 cents in California, according to API.Aside from Alaska and New Jersey, most of the low tax states are in the South.
But just how much does the price of crude impact U.S. gasoline prices? In November 2010, when the average retail gasoline price was $2.86 a gallon, crude oil accounted for 71 percent of that price.
So what makes up the other 29 percent of gasoline prices? According to the Department of Energy, combined federal and state taxes on gasoline accounted for 14 percent of the average price. The remaining 15 percent of the price on average covers the costs of refining, transportation and marketing. The DOE chart at left shows this average price breakdown.
For those of you that don't want to read the source I provided, they got their numbers from $30 dollar gasoline purchase in 2008... It can easily be adjusted for today's prices but that didn't have anything to do with the overall general information I wrote about.... 10 economists might give you 10 different answers, so I didn't think it was worthy to put in inflation numbers from what I read........ The contradictory 2011 information was posted just to marginalize me as being factually incorrect.... Perhaps I should have stated that the numbers came from a 2008 article but I did leave a source.
I generally don't mind the contradicting post but after awhile it gets nerve wracking for the same posters to be the very first to leave a sarcastic or contradictory single sourced post..... I realize there is probably two answers to every problem or solution and most of time I like to discuss the difference of opinion, but there are those that make that possibility, .....impossible!
It was not meant to be political or a format for those wanting to push their single sourced information as a truth certain..... It seems to me that they could write a contradicting blog.
Others just like to post their provoking nonsense into get a reaction.
Most economists don't look at gas prices as a leading indication of inflation the price of oil and food prices are too volatile. Those commodities are easily influenced by things like weather and wars. The usually swing up and down depending on world events. The Consumer Price index is a better gauge of inflation. They monitor electronic, durable goods and other stable goods. That’s from a source I left...Your argument is with them.
I took the trouble to research and source my comments and I realize it's pretty easy to contradict every comma or dismal point without writing a blog. My sources are there for anyone to compare; I don't have to lie or try to deceive.
If I get any more disparaging or sarcastic remarks just to be argumentative and disruptive; I will take down this blog because I don't need that.
To be truthful, I would prefer you forever post elsewhere and ignore my blogs....