$5/gallon

[RisingForce]

So Vandil, youre tellin me that we dont have the infra structure for that, but Saudi's and Kuwaitis do!!??
And Klay its not baseless assumptions!
Herre is one way to estimate it. United States consumes about 20 million barrels of oil each month. A barrel of oil (which contains 42 gallons or 159 liters) will yield something like 19 or 20 gallons (75 liters) of gasoline, depending on the refinery. Therefore, in the United States, something like 400 million gallons (1.51 billion liters) of gasoline gets consumed every month. Adding 1 Million barrel to the market will cut the prices down remarkebly, but not over night! Also I dont say that releasing the reserves will help over long term, but only for now till the Katrina disaster is under control.
After all the reserves we have are in some ways for rainy days like now, right?

 

[Crag]

First post! woot. Thought i'd bring a little laughter with me.

 

[Klay]

So Vandil, youre tellin me that we dont have the infra structure for that, but Saudi's and Kuwaitis do!!??
And Klay its not baseless assumptions!
Herre is one way to estimate it. United States consumes about 20 million barrels of oil each month. A barrel of oil (which contains 42 gallons or 159 liters) will yield something like 19 or 20 gallons (75 liters) of gasoline, depending on the refinery. Therefore, in the United States, something like 400 million gallons (1.51 billion liters) of gasoline gets consumed every month. Adding 1 Million barrel to the market will cut the prices down remarkebly, but not over night! Also I dont say that releasing the reserves will help over long term, but only for now till the Katrina disaster is under control.
After all the reserves we have are in some ways for rainy days like now, right?

Its going to be months, possibly years before that area that katrina hit go back too normal. So no, opening our reserves is a mistake in my opinion, at least the amount you suggest. And yes we can't refine oil fast enough, that's fact. Blame the oil companies not our government for that. Afterall, they are private organizations and the government can only do so much considering they can't just take over their businesses.

 

[Pliskin]

Lets all trade in our Mustangs for two Honda Civics....Yessssssss

 

[ctbaker]

Someone was passing around a photo today at work for $6/gallon gas; but in this day of most pictures being photoshopped who knows what to believe any more.

 

[Jenns01TA]

Crag Welcome to the Site!

And great initial post!....

As for the price of gas and oil and the economic impact of Katrina, The Wall Street Journal had many indepth articles in today's paper. These are written by well educated individuals who have access to more economic and analytical data and people than we could ever hope to. Anyone who is questioning reserve releases and oil prices may want to find a copy and give it a read. The WSJ is the ONLY daily paper I even bother to read anymore. NO SPIN: objective and factual it imparts very insightful and accurate information onto the reader.

Jenn

 

[Klay]

I heard an interesting thing on the Oreily factor that I thought I would add to this debate. Oreily was asking what is wrong with thinking that the american oil companies should voluntarily be cutting back 20% of their profits due to this hurricane to give us some slack. While that sounds reasonable since the oil companies make billions of dollars in profit it wouldn't really work. The guy he asked this to said it would definately lower gas prices which we all agree is good but we would run out of gas REAL fast if this were to happen. We already have a crisis with the supply and lowering the gas prices would cause people to conserve gas even less thus making us consume more gas bringing demand even higher with supply lower.

I still fault the oil companies for not creating new refineries cause we know they got the reources for it. Instead of cutting back gas prices they should be using that money to build refineries so we can eventually have lower gas prices or at least stabilize them.

This does not mean it is ok for us to be gouged by gas stations. I believe they can't sell gas higher because of fear of future supply. Meaning, if they bought gas for 3.00 dollars/gallon they can sell it for 3.50 not 5 and 6 like some places are reportedly doing.

 

[Berserker]

What really gets my gander up is how in Venezuela they pay $0.16 a gallon, in Kuwait they pay $0.68 a gallon, in Caracas they pay $0.12 a gallon, etc.

It costs OPEC about $4.00 to produce a barrel of oil, yet we are being charged $70 a barrel.

It's settled, I'm moving to Venezuela. I'll put Pat Sux on my mustang and fit right in

 

[tjredgt2000]

Caracas is in Venezuela. The reason their gas is so cheap is because it is subsidized by their government. I doubt that you want to replace your standard of living with their's just to get 16 cent gas.

 

[tjredgt2000]

So Vandil, youre tellin me that we dont have the infra structure for that, but Saudi's and Kuwaitis do!!??
And Klay its not baseless assumptions!
Herre is one way to estimate it. United States consumes about 20 million barrels of oil each month. A barrel of oil (which contains 42 gallons or 159 liters) will yield something like 19 or 20 gallons (75 liters) of gasoline, depending on the refinery. Therefore, in the United States, something like 400 million gallons (1.51 billion liters) of gasoline gets consumed every month. Adding 1 Million barrel to the market will cut the prices down remarkebly, but not over night! Also I dont say that releasing the reserves will help over long term, but only for now till the Katrina disaster is under control.
After all the reserves we have are in some ways for rainy days like now, right?

Sorry dude, but the U.S. consumes 20.7 million barrels of oil per day, not per month.

http://www.eia.doe.gov/neic/quickfacts/quickoil.html

 

[05retro]

Our reserves are there in case we are in a war and gas and oil start to run short. Its not there just because you dont feel like paying a premium on gas. For now we're just gonna have to deal with it.

 

[pony_up]

to rising gas prices & price gouging. We're paying $3.19 for 87 octane here in Central PA.

 

[Arkham]

A little fact people may want to know.

You know how everyone is screaming that we lost all those refineries in LA due to the hurricane? 8?


5 of them were being refitted, producing 0 gallons a day
2 of them were running at 50 percent, producing half their normal yield
Only 1 was running at 100 percent.

 

[MyBlueOval]

Here's what they're paying in Houston, my brother just sent me this.

That's called price gouging and it's illegal. The authorities in Texas need to prosecute the ownership for that station. They can't double the price on the same gas they already had in storage because of Katrina.

 

[MyBlueOval]

The Government needs to step in and do something about it because this is ridiculus. There needs to be some kind of price control to stop this madness.

No they don't. We tried that once in the 1970s and it led to shortages and rationing. What the government can do is put heavy pressure on the domestic oil companies to squeeze their profit margins to control the cost of fuel.

Another option is conservation. If everyone started using 10-15% less fuel today then the demand curve will shift and the price will come back down. It's that simple. So, don't drive anywhere that you don't have to. Walk or cycle to the store or work if you have the option. Otherwise, if we continue to consume at the current rate, you can expect prices to approach $4 per gallon. Cheap gasoline is not a right and the government's charter doesn't include price control.

By the way, if you think it's bad now, wait until winter hits and the demand for heating oil increases.

 

[Jenns01TA]

MyBlueOval,

You are a well informed citizen and I, personally, want to commend you for understanding the long-term aspect of the entire situation.

As for refinery building, it has little to do with what the oil companies WANT to do and what they HAVE to do to meet the stringent EPA requirements associated with building a new refinery. None of us wants one in their backyard and the land space and locational requirements to receive land permits to even build a new refinery are longer than most section of the IRC (Internal Revenue Code). This is no joke. This week, due to Katrina, the federal government has issued short term waivers on some of the emissions control laws.

I would also venture to speculate that we will see a few new refineries being built in the next few years, where before Katrina this would not have occurred.

Jennifer

Here is a link to the EPA re: the gas blending waivers.

http://www.epa.gov/katrina/waivers.html

 

[scro]

There is no price gouging.

In light of reduced supply, high gas prices are necessary. If you artificially set the price of gas, i.e. price caps, then the guy who wants to cruise the mall has the same access to gas as the guy who needs to get to work. Higher prices ensure that goods and resources are distributed to where they are most needed.

And we have no right to ask oil companies to squeeze their profit margins. Do you think their profits are locked up in a big vault somewhere? No, that money is reinvested and therefor is providing jobs. To ask them to cut revenues is to cost people their jobs just so you can save a few bucks.

If you want to be mad about something, think about why supply is pinched. (See Jennifer's post.)

 

[MyBlueOval]

MyBlueOval,

You are a well informed citizen and I, personally, want to commend you for understanding the long-term aspect of the entire situation.


Jennifer

Jenn,

Thank you for the compliment. What has really struck me in all of this is how too many people have opted to take a victim mentality instead of a survival mentality. Everyone wants the government to make life comfortable for them. I want my goverment to be able to respond in a timely manner with life saving resources like food, water and shelter. Keeping gasoline under $3 per gallon isn't a necessity.

Unfortunately, the City of New Orleans, State of Louisianna and FEMA haven't done a stellar job in this double disaster. It all starts locally. Every municipality that is subject to a natural disaster needs to be able to provide basic provisions for 3 to 4 days until large scale support can be mobilized. NOLA didn't have an adequate evacuation plan even though they're sitting smack dab in the middle of hurricane country. The Gulf Coast gets hit by several hurricanes per year and this was definitely a matter of "when" and not "if". If we had invested in protecting the population by building stable levees we wouldn't be facing the severity of effects that we're experiencing today.

 

[Jenns01TA]

In light of reduced supply, high gas prices are necessary. If you artificially set the price of gas, i.e. price caps, then the guy who wants to cruise the mall has the same access to gas as the guy who needs to get to work. Higher prices ensure that goods and resources are distributed to where they are most needed.

And we have no right to ask oil companies to squeeze their profit margins. Do you think their profits are locked up in a big vault somewhere? No, that money is reinvested and therefor is providing jobs. To ask them to cut revenues is to cost people their jobs just so you can save a few bucks.

If you want to be mad about something, think about why supply is pinched. (See Jennifer's post.)

scro,

Some of the worst circumstances have been derived from people having the best intentions. Even our own government through their good intention ...... " to protect human health and the environment", has caused a detrimental impact to the economy, with the best intentions of protecting our planet.

As human beings we hold the ultimate control of both sides of this coin in our individual hand. The two problems go hand-in-hand, and at the end of the day the only place to look to see why we are here...... is in the garage. And, I too, am one of the offenders.

Jennifer

 

[Jenns01TA]

Jenn,

Thank you for the compliment. What has really struck me in all of this is how too many people have opted to take a victim mentality instead of a survival mentality. Everyone wants the government to make life comfortable for them. I want my goverment to be able to respond in a timely manner with life saving resources like food, water and shelter. Keeping gasoline under $3 per gallon isn't a necessity.

Unfortunately, the City of New Orleans, State of Louisianna and FEMA haven't done a stellar job in this double disaster. It all starts locally. Every municipality that is subject to a natural disaster needs to be able to provide basic provisions for 3 to 4 days until large scale support can be mobilized. NOLA didn't have an adequate evacuation plan even though they're sitting smack dab in the middle of hurricane country. The Gulf Coast gets hit by several hurricanes per year and this was definitely a matter of "when" and not "if". If we had invested in protecting the population by building stable levees we wouldn't be facing the severity of effects that we're experiencing today.

And here is a something for us all to ponder. With the advent of 9/11 we have another function of the government - the Office of Home Land Security. Yet, we now look to LA, MI, AL and ask... "Were we safer?" It does not matter to me if my fellow human is in crisis and squandor because of a terrorist attack or a natural disaster, yet, look at the lack of emergency response to this crisis and KNOW that we are NO SAFER than we were before 9/11, and perhaps, we are worse off.

Again, redirection of emergency funds and services to OHS has helped us how?

As a citizen I am disgusted and appauled that there are hundreds of thousands of my brothers and sisters without food, potable water, medication, the dead are lying in the streets and anarchy is breaking out to the point of considering Marshall Law, and yet if this would have happened in a 3rd world nation, we would have been there in 2 days. Look at the relief response after the Tsunami.

The only thing I feel worse about is not being able to get to those people myself and provide first hand help.

Jenn