Fun with gas prices...

[Kogarashi]

Yeah, my sister hated having to gas up in Utah. Her car requires 87 octane minimum, which was fine in NY because that was the "regular unleaded" fuel there. But in Utah regular unleaded is only 85 octane, so she had to get the "plus" fuel instead and pay more.

[FuzzyKitten99]

We bought the car back when prices were about $1.75/gallon. Premium used to only be .10-.12 cents more, which really only amounted to MAYBE $3 more than regular 87 octane. Not much of a pocket hit. Now it is something like .30-.50 cents more, which takes a bit bigger of a hit.

Honestly though, just like all price increases, this is temporary. Prices will come down. Maybe not to the $1/gallon, but lower than now. In 1984, we were producing about 9 million barrels/day. The US decreased production down to 4 million in the last 25 years. We aren't running out of oil. There is plenty to last for a long time. It is the refined, useable part of it that is in lower supply due to the inability to get past government interference to produce it.

[symposes]

It is the refined, useable part of it that is in lower supply due to the inability to get past government interference to produce it.

Not trying to start a debate, but.

If i remember correctly the first gas shortage in america, back in the 70s was caused in part by over regulation by the government.

As far as I can tell right now, the american government doesnt want to try and force the price down, simply because the companies would cut production to retain profits, more then likely.(it would be fratching territory for me to say, "Because so many of our politicians are profiting like crazy off their OWN oil investment, ala Bush and Chaney both own oil fields in america..." hehe)

Its my understanding that no new refineries have been built in the last 10-15 years, and the current ones arent running anywhere near maximum capacity.

Ofcourse, if they produce more, it will drive the supply up, and most americans will think, there is plenty of gas, and start using more and more, and what limited supplies this planet has will be used up that much faster.


Its also my understanding, that current supply and demand have less effect on the market price then we see, simply because demand has steadily decreased over the last 2 - 3 years.

Its been said, that the biggest reason the price is where it is, is largely due to the Wallstreet speculators that think something bad is looming around the corner, and have driven the price of crude up. (Did I mention there was an Oil execitive that felt it was, and I qoute, "A shame we are charging less then $100 a barrel for oil, it feels like we're just giving it a way". To me that says, they think there is plenty of room to gouge, but I digress.)

Either way, With China and India's infrastructors on the rise, they are consuming more and more resources daily, so that is another big factor in the cost.

I started riding my bike to work again when i saw gas hit 3.60 a gallon here, now its up to 3.80 and thats the cheap stuff, and this is kentucky...O_o

[FuzzyKitten99]

First thing, your info on oil refineries is wrong. Try 30 years ago. The last refinery ever built in America was in Garysville, Indiana, built in 1976. More than double the # of years you quoted. Don't think Bush & Cheney aren't the only ones with investments in oil... Try most of the US government politicians (see their tax filing info which should be on their individual sites), so don't be so bold as to pick on the usual suspects.

Do you really think that oil companies want the prices up so high that the very people that support their business, stop buying the product or less of it? What happens when people stop buying or reduce buying a product? Sales decline and profits go down. Why on earth would they make it so that most people cannot afford the very product they want to sell to as many people as possible? That doesn't sound like a strategy that would be good for business. Remember, the oil companies are just that-businesses. They are NOT charities. They ARE in business to make a profit. They are not down on the tax roll as "non-profit". Please understand that. This link proves the point that the government makes more profit off of fuel sales than the actual producer: http://www.energy.ca.gov/gasoline/margins/index.html . Refinery cost and profit is .24c/gallon. Total taxes and fees the state of California gets are .66c per gallon. I couldn't find this info for my state, and other states may/will vary.

And we won't run out of oil. At least not in the timeframe that we are being told, and if we were allowed to drill in our own country with new drilling locations, we could reduce the cost of transport and refining, thus reducing overall cost to the consumer. ANWAR has an estimated 44 billion, not million, billion barrels of crude. It would produce 1-3 million barrels per day. That is equal to our daily imports from Saudi Arabia. Talk about energy independent! That amount is enough to power 60 million cars for 75 years. Technology has vastly changed and drilling is less of an impact to the environment than ever before. ANWAR is an area of 19 million acres and only 1.5 million is needed to drill. Less than 10% of the area. And then there is the argument that it would take 10 years to see any results from ANWAR. Well, that was also said 10 years ago. If it had continued as planned, we probably wouldn't have the issue now. Then there is the Gulf Of Mexico and natural gas. If we were able to drill that, there is enough natural gas there to heat 60 million homes for 60 years. But no, we are told we can't do that because of a particular kind of fish that lives there. However we somehow have to become energy independent. That will never happen with the above kind of thinking.

Back in the 60's & 70's, my grandparents have told me they remember the "experts" that were out there telling people that the oil reserves will be depleted by 1990. Were they? No. There is actually evidence that oil is not made of dinosaur remains as once thought. Which is silly if you think about how long we have been using oil for fuel, and are still continuing to produce more, yet there were a finite number of dinosaurs, and there are no more of them left.

And the government of course is not wanting to do anything because they already have interfered with the independent market. They restrict and regulate so much that it costs far too much to even get started, with the hoops you have to jump through and all the red tape. Then you have the environmentalists and protestors filing lawsuits (how this is legal, I don't know) that cost even more money to anyone trying to do it. Why would anyone want to even attempt to get into the business if they know they are going to hit this crap?

[Broomjockey]

This went firmly into Fratching territory. Take it over there. I'm closing it now.