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06-05-2006, 12:38 PM #1
did gas just go up 10+ cents today?
Is there a reason, or has it just been a whole 2 weeks since the oil companies gave us a good bendover?
I just wanna know.I rarely tele.
06-05-2006, 12:43 PM #2
06-05-2006, 12:45 PM #3
mobilexxon didn't have double-digit growth last month?
06-05-2006, 12:46 PM #4
I think your reason is perfect justification.
Apparently there are "worries" over Iran again, and the price of oil jumped to $74/barrel. I guess the price of oil doesn't drop when no one's worried?
Either way, this whole oil deal is the biggest clusterfuck I've seen in recent history... how price gouging hasn't come up is news to me.
06-05-2006, 12:54 PM #5
you guys are going to slam me for posting this, but I'll be damned if walter williams doesn't make more sense than just about any other columnist out there.
A MINORITY VIEW
BY WALTER E. WILLIAMS
RELEASE: WEDNESDAY, MAY 31, 2006, AND THEREAFTER
ECONOMICS OF PRICES
Here's what one reader wrote: "Williams, I can understand how the destruction of Hurricane Katrina and Middle East political uncertainty can jack up gasoline prices. But it's price-gouging for the oil companies to raise the price of all the gasoline already bought and stored before the crisis." Several other readers made similar allegations. Such allegations reflect a misunderstanding of how prices are determined.
Let's start off with an example. Say you owned a small 10-pound inventory of coffee that you purchased for $3 a pound. Each week you'd sell me a pound for $3.25. Suppose a freeze in Brazil destroyed half of its coffee crop, causing the world price of coffee to immediately rise to $5 a pound. You still have coffee that you purchased before the jump in prices. When I stop by to buy another pound of coffee from you, how much will you charge me? I'm betting that you're going to charge me at least $5 a pound. Why? Because that's today's cost to replace your inventory.
Historical costs do not determine prices; what economists call opportunity costs do. Of course, you'd have every right not to be a "price-gouger" and continue to charge me $3.25 a pound. I'd buy your entire inventory and sell it at today's price of $5 a pound and make a killing.
If you were really enthusiastic about not being a "price-gouger," I'd have another proposition. You might own a house that you purchased for $55,000 in 1960 that you put on the market for a half-million dollars. I'd simply accuse you of price-gouging and demand that you sell me the house for what you paid for it, maybe adding on a bit for inflation since 1960. I'm betting you'd say, "Williams, if I sold you my house for what I paid for it in 1960, how will I be able to pay today's prices for a house to live in?"
If there's any conspiracy involved in today's high gasoline prices, it's a conspiracy of cowardice and stupidity by the U.S. Congress. Opening a tiny portion of the coastal plain of the Arctic National Wildlife Refuge in Alaska to oil and gas production, according to the U.S. Geological Survey's mean estimate, would increase our proven domestic oil reserves by approximately 50 percent. The Pacific, Atlantic and eastern Gulf of Mexico offshore areas have enormous reserves of oil and natural gas, but like the Alaska reserves, they have been put off limits by Congress. Plus, the U.S. Office of Naval Petroleum and Oil Shale Reserves estimates the world supply of oil shale at 1.6 trillion barrels, of which 1.2 trillion barrels are in the United States.
Because of costly regulations and political restrictions, U.S. nuclear energy production is a fraction of what it might be. Nuclear power creates 75 percent of France's electricity, nearly 50 percent of Sweden's and only 20 percent of ours. Nuclear energy is very safe. That's something to keep in mind when we hear of tragic deaths of coal miners. There would be fewer mining deaths if we used less coal and more nuclear power for electricity generation.
You say, "What about the effect on prices of all those oil company profits and CEO pay and retirement benefits?" If Congress mandated that CEOs work for zero pay, gasoline prices would fall by less than a penny. If Congress mandated that oil companies earn zero profit, gasoline prices might fall by 10 cents; of course, we'd have to worry about gasoline availability next year.
CEOs tend to be cowards when dealing with politicians and environmental extremists, but I have a recommendation that requires only a modicum of courage. At each gasoline station they should put up photos, perhaps videos, of penguins, caribou, polar bears and other critters frolicking along Alaska's coastal plain. Then have a voice-over or caption reading:
Don't be selfish. Your paying $3, $4 and $5 a gallon for gas keeps these critters happy and their play space clear of oil rigs.
06-05-2006, 12:55 PM #6
So it's just that it's been 2 weeks since they gave us a good bendover.
It's the old "something bad might happen" that sends futures up and since futures are up then current supply needs to go up too, you know just in case. Even though the current supply of refined petroleum products has nothing to do with the supply that might be produced with the oil that might be more expensive because speculators in the futures market might have forseen some problems in the Middle East that might affect the supply of oil 30-60 days from now if certain events happen.
OK, I've got it now.
ThanksI rarely tele.
06-05-2006, 12:57 PM #7Originally Posted by teledave
Iran just threatened to cut off oil to the West and bomb tankers in the Straits of Hormuz (or whatever it is) unless we comply and give them all our nukes..
06-05-2006, 01:00 PM #8Originally Posted by splatQuando paramucho mi amore de felice carathon.
Mundo paparazzi mi amore cicce verdi parasol.
Questo abrigado tantamucho que canite carousel.
06-05-2006, 01:02 PM #9
That's a nice article, but the coffee example isn't exactly applicable here. The price of oil did not go up because of something that actually happened- it went up because of something that COULD (and probably will not) happen. There's a big difference.
When something might NOT happen, why doesn't the cost of oil go down? I haven't heard any major news in the last 2-3 weeks, but gas stays right at that same price. I'm glad I don't have my SUV anymore.
06-05-2006, 01:05 PM #10Squatch Guest
the oil companies do not set the prices. get over it.
06-05-2006, 01:09 PM #11
Hoping the pumps don't reflect this till later, so I can fill up after work."boobs just make the world better really" - Woodsy
06-05-2006, 01:09 PM #12Originally Posted by Squatch
06-05-2006, 01:11 PM #13Originally Posted by steve
06-05-2006, 01:12 PM #14Squatch GuestOriginally Posted by Lloyd Christmas
the price of oil (like any other commodity) is determined by futures markets. people are trying to predict the prices in the future. You want the price to go down? One of two things has to happen: either supply goes up (unlikely in the short term, unless someone finds a magical oil fairy) or consumption goes down (also unlikely in the short term). It's very easy to restrict to negatively affect the supply, however, which is why prices jump up.
06-05-2006, 01:17 PM #15Squatch GuestOriginally Posted by PNWbrit
06-05-2006, 01:18 PM #16
The article posted makes a nice effort at explaining gas prices, but I think he complicates things with his wordy examples. Basically though, he is correct.
The rest of the article is typical of current conservatives who attack the supply side of the equation, but make absolutely no effort or mention of conservation. We could accomplish the same thing (lower our prices, reduce our dependence) by conserving, and high prices at the pump encourage conservation.
We can expand our supply of fuel now by drilling in the arctic, but that will lower our future reserves increasing our dependence on the middle east in the future. Exactly the opposite of what we want to happen.
Oil shale is still energy intensive, often meaning double CO2 outputs. Definetely not the answer we are looking for.
His defense of oil company CEO's is weak. Any executive of any public company should not receive anywhere close to the level of compensation or retirement packages that have recently been doled out.
I agree with him on the nuclear issue.
06-05-2006, 01:20 PM #17Registered User
- Join Date
- Dec 2004
- Long Beach
here's what I don't get...
I just took a trip to Juneau AK with a layover in San Francisco on the way up and Seattle on the way back (I'm in Long Beach CA). Why is the gas price virtually identical in San Francisco, Long Beach and JUNEAU, but a dime/gal cheaper in Seattle? I mean, have you ever been to Juneau? Unlike San Francisco and Long Beach it has no refineries or easy ways to get there. I expected the price to be at least a quarter/gal more - but no. Explain that one to me.
BTW, For East Coast reference, the going price is about $3.25/gal for regular unleaded here in So Cal.
06-05-2006, 01:24 PM #18Originally Posted by jackstraw
06-05-2006, 01:26 PM #19Originally Posted by boarddad
It's around .12-.15 cheaper in SC than it is in TN and that is the primary reason.
$3.25 gas would suck, but you know we are a lot closer to the SE ports (you know kinda like New orleans and such) than you guys are and we don't have those snowy mtn passes to transport goods through. Aww, who am I kidding, we all know you Californicators are loaded anyhow.I rarely tele.
06-05-2006, 01:37 PM #20Originally Posted by boarddad
Edit: lol, teledave beat me to it.
06-05-2006, 01:39 PM #21Originally Posted by boarddad
Edit: Damn, this thread's moving fast!
06-05-2006, 01:41 PM #22
There's a small refinery along the pipeline outside Fairbanks, but I believe it only makes jet fuel for Eielson AFB.
06-05-2006, 01:42 PM #23
teledave, you ever hear why a dog licks his balls?
06-05-2006, 01:44 PM #24These meaasge boards suck
Originally Posted by Squatch
- Join Date
- Feb 2005
Thats funny. I worked at a gas station (we sold texaco) in college and we often recieved faxes saying that if other name brand gas stations in our 'hood raised their prices we must immediately match their price.
06-05-2006, 01:59 PM #25Registered User
- Join Date
- Nov 2005
- In the snow
Proximity to refineries and pipelines have little to do with price. Regional prices are set by the wholesalers. For instance in Bham gas is more expensive than the rest of the state by 10-20c. However we have 4 refineries in the county. State and federal taxes are the same, and we have similar local taxes to nearby counties that have gas for 10c cheaper. I think the oil industry is punishing Bham for having so many hippies