What a day! Last Wednesday, those of us who could shell out the price of 15 barrels of crude oil were treated to a plethora of oil industry canned (barreled?) wisdom on oil and energy, its present and future, by a battery of veterans and experts in the field, from that sly and wizened old fox T.Boone Pickens to Nobel Laureate Steven Chu at the "New York Times' Energy Summit"
Much was learned, much was overlooked. In its introductory handout, that day's "Energy" special section of the New York Times, the tone was set by the Times' indefatigable oil reporter Jad Mouawad who in his featured reportage instructed us all, the great unwashed, that "oil is a global commodity whose price is set on the global market." Here was the gospel of oil patch doctrine -- with its inference that its all about 'supply and demand' when setting prices on the world market. Not a whisper about that 'force of nature,' the OPEC oil cartel, nor the massive distortion rendered by the hundreds of billions of barrels of oil traded and speculated over the world commodity exchanges.
Perhaps the highlight of the day's presentations was the 'conversation' held with our current Energy Secretary Dr. Steven Chu, who was quoted in the Wall Street Journal in 2008 saying, "Somehow we have to boost the price of gasoline to the levels in Europe," and his interlocutor, columnist Tom Friedman. The very same Dr. Chu was told earlier in March by Rep. Alan Nunnelee (R-Miss): "...I can't look at motivations. I have to look at results. And under this administration, the price of gasoline has doubled... The people of north Mississippi can't be here, so I have to be here and be their voice for them... I have to tell you that $8-a-gallon gasoline makes them afraid. It's a cruel tax on the people of north Mississippi as they try to go back and forth to work. It's a cloud hanging over economic development and job creation." Chu expressed sympathy but said his department is working to lower energy prices in the long term."There now, does that make you feel warm and cozy up there in Maine?
And so the conversation went, as though the here and now had nothing to do with the energy secretary's concerns. The price we are all paying at the pump or for heating oil was too mundane to be touched upon by Dr. Chu. A bit like leaving the aerie of the ivy covered walls of academe and getting your hands dirty on an oil rig.
Confronted with questions about the Solyndra debacle that cost the government more than a half billion dollars in failed, clearly botched guarantees, Dr. Chu interjected that Congress had set aside some $10 billion for potentially failed energy investments, as if to imply that calling him to account for a mere $500 million was not quite in line. "It is what it is," we were told.
During the entire interview, not a word about the issue on the minds of most Americans, the price they are paying at the pump. As though this was outside the purview of the Department of Energy. But see it all for yourself:
Correction: A previous version of this post quoted Rep. Alan Nunnelee as asking if the "overall goal is to get our price down."
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$11 - media noise-du-jour
$34 - geopolitical fear premium
$ 8 - speculation/hedging activity
$21 - USDollar debasement since Jan/2009
$ -3 - inventory draw/build
$15 - lack of surplus capacity
$26 - extraction cost (production weighted)
The easiest way for Americans to affect crude prices is by getting its Congress and celebrity president to address its structural deficit and national debt and reverse the devaluation of the Dollar.
Barrel Meter & Gas Pump charts: http://trendlines.ca/free/peakoil
http://www.detroitnews.com/article/20120417/AUTO01/204170368/Battery-powered-autos-proving-tough-sell?odyssey=tab|topnews|text|FRONTPAGE
THe so called "green revolution" has wasted 100's of billions of dollars. Even the Buffet rule if passed would not pay for these boondoggles.
By Matthew Philips on February 23, 2012
http://www.businessweek.com/articles/2012-02-23/angry-about-high-gas-prices-blame-shuttered-oil-refineries
For example, a hydroelectric fuel cell has been invented in Vietnam. This remarkable generator is fueled by water: fresh or salt. A 2,000 watt home unit is being prepared for production at a price of $1,600. See Moving Beyond Oil and Cheap Green at www.aesopinstitute.org for a few details about this and a few other revolutionary emerging technologies.
As awareness spreads about the little recognized threats to humanity from two potential nuclear nightmares, acceleration of decentralized renewable energy might take place faster than conventional ignorance would suggest.
The first mortal threat is from Fukushima. If an earthquake measuring 7 on the Richter scale, an event with 98% probability within 3 years, 50 years of massive release of radiation is likely. Preventing fuel pools #4 and #3 from causing such an event is an unrecognized emergency.
The second deadly threat to all is multiple meltdowns at nuclear plants worldwide due to collapse of power grids during very possible solar storms. See "400 Fukushimas?" on the same Aesop Institute website. An emergency mobilization can protect the grid and the nuclear plants. But decentralizing energy on a massive basis would be extremely wise.
Wake up folks: the life you save may be your own.
We need to build a mass transit network that will get anyone who lives in a city of 50,000 or more wherever they want to go. Make it so they don't even need to own a car.
That is the way out of this.
Stock prices are speculation about future profits, oil futures are speculation about oil prices in six months. Speculators are betting on the future, they do not determine it. Oil futures are bets on the actual or "physical" delivery price six months from now. Right now the physical price is higher than the bid - meaning speculators bet oil prices would be LOWER than they are now! Speculators lost money, they sold oil at a lower price than they had to pay on delivery. Essentially, they "shorted" the price of oil and lost big. Speculators kept oil prices down, they did not raise it. This is the opinion of neutral oil analysts, not mine.
Fact: regular gasoline costs the price of the oil to make it, plus about $1.25 a gallon for taxes, refining costs and all profit. A barrel of oil yields about 40 usable gallons, so:
price_gallon_gas = $1.25 + (price_barrel_oil / 40)
With oil at $108 a barrel, eventually regular gas prices will be:
$1.25 + ($108 / 40) = $3.95 a gallon
About where they are nationally. If you pay more or less it's strictly local. NJ has the cheapest gas, CA generally the most expensive.. No conspiracy, no speculation involved. 2/3 of the price of gas is the oil.
http://www.petroleum.org/petrokids/petroperbbl.htm
http://www.newton.dep.anl.gov/askasci/gen99/gen99675.htm
If you plot price/bbl of oil versus price/gal gas you find that at $100/bbl the base price of a gallon of gas is ~$3.25. And so at ~$4.00/gal @ the pump you have $.75/gal. 'overhead'. Now go to earlier times, say when oil was ~$50/bbl. There you'll find that the overhead is ~$.40/gal So please explain to me why when the oil price doubles so does the overhead? To ignore the influence of speculation on where gas prices are and to deny the repeated record profits of the oil companies is ignorance (willful of otherwise).
An Insight hybrid average over 40 mpg on regular, big vehicles don't even get 20 mpg (keep track of your gas if you don't believe me, highway mileage is a lie). If you drive your vehicle 160,000 miles the Insight will use 4000 gallons, the truck will use 4000 extra. At $4 a gallon that's $16K extra in gas for the truck, plus 10% extra for premium, hybrids take regular.
A Honda Insight is $18K, about what you will pay extra if you buy a truck.
Compared to trucks, hybrids are free.
That's the reality check. Truth is, Americans are innumerative, which is like illiterate but with numbers. They think the vehicle cost is what matters, but you pay more for gas now. They are likely poor because they can't think right, stupidity causes poverty and low-income.
costs about 400.-$/gal. You have read right; about four hundred dollar per gallon.
Included in this price is the protection money paid to the Haqqany network to prevent fighters from the Haqquany (difference in spelling is intentional) network to attack the tanker convoys moving through the territory of our staunch ally toward the final destination.
Chu and everything to do with the degrading of our currency. No matter what is done with energy
policy this will continue until the dollar reaches an inflation bottom.
Germany for instance collects -at the pump-
a mineral oil tax Minerloelabgabe
a mineral oil special tax Minerloelsonderabgabe
a value added tax Mehrwertsteuer
and a tax on the profit the gas station makes. Gewinnsteuer
plus a couple more taxes.
It cost me about $0.92/gallon of gasoline equivalent to fill at home. No inconvenient stops at Costco anymore for me.
To put this in perspective it cost my neighbor about $0.30/mile for fuel cost for his SUV and it cost me $0.025/mile!
When the leaders in California with the passage of AB 32 promised $5.00/gallon gasoline,
I BELIEVED THIS WAS A PROMISE THEY WOULD KEEP!