can someone PLEASE explain the gas price logic to me, without bashing bush/OPEC

[RD]

i mean, for instance, gas has been currently $3.05 where I live for the last 3-4 weeks.  Now that BP has had there incident, and a barrel of crude goes up $2.... yet, the gas price has not changed as far as getting higher.  It actually GOT LOWER?  It is now $2.97.   

I mean, if there was a hint of a hurricane in the gulf, gas prices would shoot up 10 cents or more.  If there is wars going on, the powers that be would raise gas prices just for that reason.

Can someone tell me why, after crude oil went up $2 per barrel and 8% of the U.S. oil production from Alaska has now been interrupted, that the prices have gone down or stayed the same instead of shooting up another 15-20 cents?

I am not a die hard conspiracy type of guy, but I do believe the excuses to push gas to the $3.00 mark are nothing but a bunch of crap, and this recent situation and the resulting lowering of the gas prices are definitely a good identifier of the BS that we are being fed.

What are your all thoughts...WITHOUT BEING POLITICAL OR BASHING BUSH OR TALKING ABOUT IRAQ'S POLICIES AND HOW THE U.S. INFLUENCES THEM.... BLAH BLAH BLAH

[BigBlackDodge]

Oil prices have fallen a bit actually................

http://www.eia.doe.gov/emeu/international/prices.html#Crude

I also heard the BP (Broken Pipe) will not shut everything thing down as thought before. They will run at half capacity..............which helps.

Also it looks like the middle east fiasco is winding down.

We pay for fear. Fear has no overhead (Oil company employees are not getting paid more when oil shoots up) so the Oil companys make huge profits.

BBD

[dodge freak]

Yes oil went down after it went up, think it is lower now than it was last weekend, those planes not flying as much oversea's did it. As far as the price of gas, I just seen that BP made 6 billion last quarter so they are doing more that just selling coffee and car washes. I think gas prices are a joke, its like the weather now, you don't know what they really be till that day and even that changes, I have seen it go up 20 cents form the morning to the afternoon.

As far as putting down king George, who would ever do that ??

[bull]

Near as I can tell they just do whatever they want with the prices. We need to switch to straight alcohol.

[Chryco Psycho]

sure lets see in Europe gas prices have not gone up significantly cmpared to here
now we are being made to pay world price for oil never an issue 5 years ago , here in Ab we produce a lot of oil so the price is higher here then most places in canaduh which is far higher than in the US
Make sense
Doesn`t to me either 

[JimShine]

There are laws that limit what a store can charge for my milk, why can't they do the same for my gas?

[Troy]

Some people just can't help themselves apparently... 

I guess posting the theory of oil economics ad nauseum is a total waste of time since the uninformed will still post their opinions as fact. Was there ever a time in the world where people were actually open to learning something that went against their internal beliefs? I wish I lived then.

Having a pipeline shut down is not quite the same as having Katrina wipe out infrastructure. One is controlled and, well, the other isn't. As for the price, the output of the fields is roughly 1/2 of one percent of the world's supply and about 3% of the US supply. The impact of shutting down the fields shouldn't be too terrible as there is excess oil inventory right now and the US government is willing to open the Strategic Petroleum Reserves to cover any supply issues that may arise (this is a loan). Initially, it was predicted that the shutdown would cause about a 5 cent increase per gallon in prices. Looking at the price index it seems that nationwides prices are 4-8 cents per gallon higher than last month. Weird huh? The prices initially spiked because Iran had threatened to use oil supply reduction as an act of retaliation if the UN imposed any sanctions against it. This is a much bigger deal. Since the announcement, the speedy UN has finally managed to come up with something like a cease-fire plan for Lebanon/Isreal so that is seen as a positive step towards stability by the markets. Also, the thwarted terrorist plot in Britain is good news for the world markets. Interestingly enough, all those grounded planes left quite a large surplus of jet fuel in the tanks. Finally, the oil demand is on the decrease worldwide so a small dent in the supply won't be as detrimental.

Prices fluctuate all the time and fear has a greater impact than reality in many cases. All the goobers who went out and immediately filled up their cars on the news probably caused a much bigger shortage in the local supply than the actual pipeline shutdown (which, amazingly, drove up prices even more). Remember when the news reports about Katrina came out and people immediately filled up every container they owned with gasoline? It was like a self-fulfilling prophesy where gas stations really did run out of fuel - but they would have run out even on a normal day because the astronomical demand.

This may help:
http://www.msnbc.msn.com/id/12400801/

Notes for the uninformed:
BP only owns 1/4th (26%) of the output of Prudhoe Bay.
BP made $7.3 billion last quarter.
BP has a $72 million annual budget for maintenace at Prudhoe Bay (up from $60 million last year).

On a related note (slightly political), our geniuses in Washington are again making me wonder how they manage to find their way to work each morning. Of course there will be a probe and some sort of hearings which will waste a huge amount of time and money, maybe create a few new laws which can't be enforced, and eventually equate to doing nothing. Of course it will all look good for the voters because they can blame the "evil corporations" for all the problems of the world. News flash: the pipelines are 5 years older than their expected lifespan - kinda like NASA shuttles...

Troy

[BigBlackDodge]

I just want my water powered car...................now!


BBD

[69CoronetRT]

Nice post Troy.

America has been used to cheap gas for 30 years.

Compare what the rate of inflation is for other products over the last 30+ years compared to gasoline.

What percent of the cost per gallon is taxes as opposed to commodity? (This will vary on a state and local level.)

What is the incremental cost of refining different formulas to meet mandated federal and local air quality standards? (What are the long term costs to unbreathable air?)

What are the increased costs of transport and storage? (How much will gas cost if we continue to have the NIMBY mentality to building new and more efficient refineries and storage facilities?)

What are the increased costs of exploration so demand can be met? (How much will gas cost if companies are not allowed to reinvest profits back into new and alternate sources of crude? How much will gas cost if producers are not allowed to drill in different areas?)

What national energy policy BY ANY PARTY in office over the last 30 years have you supported? (What will gas cost when there is none available?)

What have you personally done to curb use?

It's easier to rant than understand.

[dodge freak]

Well if BP did make 7 billion in 3 months time and not 6 , sorry, how much is that on gas ? What are they making per. gallon thats what I like to know. 50 cents-75 cents ? It must be way up there, think Exxon made 10 billion in 3 months, and for all we know it might be higher yet. All those profits are not from coffee sales and car washes.

[69CoronetRT]

Well if BP did make 7 billion in 3 months time and not 6 , sorry, how much is that on gas ? What are they making per. gallon thats what I like to know. 50 cents-75 cents ? It must be way up there, think Exxon made 10 billion in 3 months, and for all we know it might be higher yet. All those profits are not from coffee sales and car washes.

BP is a global company that deals with numerous facets of energy products one of which is retail gasoline. I'm sure that their financial statement would show their revenue comes from many sources and their profit comes from a combination of divisions.

http://www.bp.com/home.do?categoryId=1

http://www.bp.com/liveassets/bp_internet/globalbp/globalbp_uk_english/publications/energy_reviews_2006/STAGING/local_assets/downloads/spreadsheets/statistical_review_full_report_workbook_2006.xls

financial statement for 2005

http://www.bp.com/liveassets/bp_internet/globalbp/globalbp_uk_english/secret_area/secret_investors/STAGING/local_assets/downloads_pdfs/bp_ara_2005_annual_report_and_accounts.pdf

[253862656971]

I'll just quote myself.

I did a little research on the gas prices the other day.

Oil companies make about 15  cents per gallon of gas.

The feds have a tax of 18 cents per gallon.

Most states are in the neighborhood of 20-25 cents per gallon tax. 

http://www.gaspricewatch.com/usgastaxes.asp

I have not researched what the local gas stations make per gallon but you guys can do that just as easy as me, Ask.

Just some food for thought.

I forget how I found the profit that the oil corporations make but I think I researched a few different sites both official and not as well as the oil companies sites themselves, and the 15 cents a gallon was an average. 

[69CoronetRT]

I'll just quote myself.

I did a little research on the gas prices the other day.

Oil companies make about 15  cents per gallon of gas.

The feds have a tax of 18 cents per gallon.

Most states are in the neighborhood of 20-25 cents per gallon tax. 

http://www.gaspricewatch.com/usgastaxes.asp

I have not researched what the local gas stations make per gallon but you guys can do that just as easy as me, Ask.

Just some food for thought.

I forget how I found the profit that the oil corporations make but I think I researched a few different sites both official and not as well as the oil companies sites themselves, and the 15 cents a gallon was an average. 

The link shows data from 1/1/05. There have probably been some changes since then.

Does your data show oil companies are making a profit of 0.15 a gallon or that is their gross sale on a gallon of gasoline? Is that before or after costs are included?

[70charginglizard]

America has been used to cheap gas for 30 years.
Compare what the rate of inflation is for other products over the last 30+ years compared to gasoline.

I can agree to that but if these coorporations are going to raise the rate of gas so quickly then companies we work for should be bringing up our salaries to compensate for it. or bare minimum, someone should at least provide us with more public transporation options.
I have 1 bus that runs from my area to work. ONE! and it leaves at 5:45 am. That's just not right.
You talk inflation I say Cost of living increase or better public transporation options. 

[derailed]

[
You talk inflation I say Cost of living increase or better public transporation options. 

I totally agree with this but the problem is most americans are to in love with driving there suvs to utilize public trans

[dodge freak]

Don't be so sure, if it was available and fast and easy why not. I am going to Toronto next week and for $ 8.50 can. I can ride all the subways ,  buses and street cars all day long. The subway comes by every 3-5 min. If all towns had that system many more would ride it. In the USA in most towns the bus comes once a few hours, who the heck wants that. This talk that the USA does not want public trans. is just an excuse for the Governments not to build it. Look how much they would lose if people did not need a car, you hear how much gas is oversea's but they have other stuff to make up for it. Just going to a doctor and getting some medicine for a cold can cost well over $100, its not like that everywhere else.

Don't forget you guys who talk that gas is cheap compare to other stuff-since 2000 gas has went up over 100 % , what else has went up that fast ? Lots of things like TV 's stereo's are cheaper than in 2000.

[bull]

Is there any other product out there that the handlers of which raise and lower the prices based on emotional responses? Does the price of milk and cheese go up due to fears that the alfalfa supply might not quite be adequate six months from now? That's the reason I say they pretty much do what they want with the prices because much of the jacking around with crude oil values has to do with fears rather than reality. The oil pricing system is screwed up if you ask me. I'm not convinced the oil companies have no idea of the amount of supply they have out there. Rest assured any company that makes $7+ billion in profit damn-well knows what kind of supply they're working with.

Like I said, we should be running alcohol in this country. If it weren't for the politicians being in bed with the oil company execs the US would be completely self sufficient and the sheiks would be driving Yugos instead of riding in an air-conditioned Rolls. IIRC Henry Ford ran straight alcohol in the first cars they made until he got strong-armed into running a crappy oil by-product known as gasoline.

[Chryco Psycho]

lets see "what have I done to decrease consumption lately
well I have skipped virtually every car show this year , none of my cars have been started this year so far & I don`t drive anywhere unless I have a job to go & do & I do other errands only when I am out doing work already so I guess I am doing nothing to help

[RD]

Is there any other product out there that the handlers of which raise and lower the prices based on emotional responses? Does the price of milk and cheese go up due to fears that the alfalfa supply might not quite be adequate six months from now? That's the reason I say they pretty much do what they want with the prices because much of the jacking around with crude oil values has to do with fears rather than reality. The oil pricing system is screwed up if you ask me. I'm not convinced the oil companies have no idea of the amount of supply they have out there. Rest assured any company that makes $7+ billion in profit damn-well knows what kind of supply they're working with.

Like I said, we should be running alcohol in this country. If it weren't for the politicians being in bed with the oil company execs the US would be completely self sufficient and the sheiks would be driving Yugos instead of riding in an air-conditioned Rolls. IIRC Henry Ford ran straight alcohol in the first cars they made until he got strong-armed into running a crappy oil by-product known as gasoline.

good point on the price swings through "possibilities" and "emotions".  gotta love capitalism..... well, not really.

[John_Kunkel]

Greed= Gas prices

[TK73]

We need to switch to straight alcohol.

Tried that, in a 12-step program now...

[derailed]

 

[69CoronetRT]

Is there any other product out there that the handlers of which raise and lower the prices based on emotional responses? Does the price of milk and cheese go up due to fears that the alfalfa supply might not quite be adequate six months from now?

A serious answer is gold and another answer is muscle cars. There is no logical reason for the price escalations. It is supply and demand based on the emotional reasoning "I gotta have one too". Look at the price spike in Chargers simply because of the DOH movie.

Other energy commodities like natural gas and electricity fluctuate based on future production and storage but since you don't pay for them on a daily basis like you do gasoline and they are somewhat weather related you probably don't notice the impact as much. Natural gas prices have been going up for various reasons since 2001.

[my69]

Don't forget you guys who talk that gas is cheap compare to other stuff-since 2000 gas has went up over 100 % , what else has went up that fast ? Lots of things like TV 's stereo's are cheaper than in 2000.

VERY INTERESTING dodge freak I wondered about that to  Like all of sudden the prices are gradually goin up
Why do you think that is?  Maybe we are paying for the war(s)  just a thought  

Maybe the government is actually going broke? 

Yes supply and demand play a part as well did the hurricanes last year but you would think with the (reserves)  the prices should bounce back proir to the year 2000?  Or am i just full of it?

[Troy]

Wondering how many people actually bother to research anything before pulling "facts" out of their rear... 

BigBlackDodge:  I love the technology but hope I can afford it.

69CoronetRT: Not sure if you're asking me. Since no one else will bother to look it up:
* Gasoline prices have finally caught up to inflation http://inflationdata.com/Inflation/Inflation_Rate/Gasoline_Inflation.asp
* Gas Taxes http://www.gaspricewatch.com/usgastaxes.asp
Those took under 2 minutes to Google but I'm too tired to look up the rest.

dodge freak: you said last quarter (not 6 months) but your number was wrong. It took me almost 8 seconds to find the correct one. The profit from is made up of many factors - gasoline is only one small part. It's nowhere near 50-75 cents per gallon though. Do you know how many gallons they sell in relation to their profits? Unlikely since you didn't know how much profit they made. Believe it or not, individual stations make more profit off of coffee and fountain drinks than they do off the gasoline sales.

Since I'm all about doing research for others, here's a thread that I alluded to earlier:
http://www.dodgecharger.com/forum/index.php/topic,12987.0.html

Anyone who really cares about what makes up the price of gasoline and how profit is made/lost can read about it here: http://www.fool.com/news/commentary/2006/commentary06052404.htm Yes, you have to sign up to read it but I'm not going to post the Cliff's Notes version - you have to spend some effort and read it yourself (I already did the leg work of finding it).
If you just want numbers, here's data from 2005 (California):
http://www.energy.ca.gov/gasoline/margins/2005.html

70charginglizard: good luck with that...

dodge freak (again): the government isn't always the group doing research on public transportation. Where I live it's pretty much proven to be a waste of money by every single study no matter who did it. Other cities may be different but it's not a government cover up/conspiracy - it's a business decision. If they built it they'd raise taxes any way (where else do you think they'd get funding?). Gas is cheap - ask anyone from Canada, Germany, France, Belgium (hi Doc and CB!) - well practically anywhere except Venezuela and Abu Dabai.

Bull & partly RD: the American Dollar fluctuates thousands of times per day almost solely based on emotion/fear/uncertainty. The supply of oil from the Prudhoe fields has been decreasing for years. It isn't how much is in the ground but how much they can refine. Oil reserves are in good shape - even a little high right now. I know we've covered this before but where has it been proven that alcohol is a viable fuel source (ie. that it can be produced efficiently)?

my69: gas has not "went up" 100% since 2000 yet (must be that "new" math) so be careful where you get your information. How is the government paying for wars or avoiding bankruptcy with oil company profits??? See above for the tax revenue which is the only way the govt is making anything. I'd love to know where that logic came from (ok, maybe I don't). All of the reserves (which ones?) can't help a refining deficiency and the fact that supply continues to outstrip demand. We're using more fuel than in 2000 so more has to be produced. The reserves are there specifically to avoid a massive interruption in supply. You also need to add in other factors such as inflation and the cost of refining (more impurities means less usable fuel per gallon of oil) so there's not likely a chance that gasoline prices will drop to lower than 6 years ago.

Oh look! All kinds of neat information at the touch of a button: http://www.fueleconomy.gov/feg/gasprices/FAQ.shtml

Blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah... just checking to see who's still reading.

Troy