PUMPED UP (trip down memory lane..high gas prices)

PBS.org ^ | 3/15/00

[GailA]

March 15, 2000

Only last year, gas prices were at record lows: 90 cents a gallon for regular unleaded then, to $1.56 a gallon and higher today. But oil-producing nations, including members of the OPEC Cartel, agreed last year to limit the supply of oil they put on the market, driving prices up to beyond $30 a barrel. After adjusting for inflation, these prices are still nowhere near historic highs set in 1980, which hit $2.66 a gallon.

But the sudden price hike has affected the transportation industry, as well as individual commuters, sure ingredients for a political fight. On Capitol Hill, some Republicans briefly called for a repeal of the 4.3-cent gasoline tax passed in 1993.

Vice President Gore cast the deciding vote on the economic package that included the tax, and Republican leaders were eager to dub it the "Gore Tax." But that idea was pulled off the table, as Democrats and Republicans said repealing the tax would hurt transportation funding. Others in Congress and in the trucking industry are calling on the administration to release oil from the nation's strategic petroleum reserve. That reserve contains 600 million barrels of oil in Texas and Louisiana. It was set aside by a 1975 law for use in a national emergency.

[GailA]

LONG article

[lilylangtree]

Consumers are being ripped off mightily because there's no real reason why prices are being hiked up. Whatever happened to the federal investigation announced in August 2003?

[Alberta's Child]

Consumers are being ripped off mightily because there's no real reason why prices are being hiked up.

Sure there is. The price of oil today is higher today than it was a couple of years ago, primarily because the U.S. dollar has declined against almost every foreign currency -- in fact, it has lost about 30% of its purchasing power over that period of time.

[international american]

"Only last year, gas prices were at record lows: 90 cents a gallon for regular unleaded then, to $1.56 a gallon and higher today. But oil-producing nations, including members of the OPEC Cartel, agreed last year to limit the supply of oil they put on the market, driving prices up to beyond $30 a barrel. After adjusting for inflation, these prices are still nowhere near historic highs set in 1980, which hit $2.66 a gallon."

Why don't you quote prices in 1987 when it was 67 cents a gallon?? What utter crap!!!!!!!!!!!!

[Fyscat]

"Sure there is. The price of oil today is higher today than it was a couple of years ago, primarily because the U.S. dollar has declined...."

Which means, if you live in the U.S., your standard of living has decreased by that 30%. Paying more for fuel is just one area you feel that.

[international american]

That is crap! The currency in our major trading partners has barely changed at all. I travel the world, and that is patently untrue...We are being raped not by Europe, but right here in town!!

[Alberta's Child]

In late March of 2003, the U.S. dollar was worth about 1.15 Euros. Today, it's worth about 0.83 Euros. That's a decline of about 28%.

In late March of 2003, oil was trading at about $28 per barrel. Today, it closed at almost $36 per barrel. That's an increase of -- you guessed it -- about 28%.

Oil isn't any more rare today than it was a year ago. In fact, the price of oil looks to be quite stable when priced in Euros. The only thing that has changed in the last year has been a 28% decline in the value of the dollar against the Euro.

[international american]

We don't live in euros, and dont purchase in euros. By the way,the prices for the gas we consume today were set almost a year ago. Buy stock in Shell..Exxon/Mobil....they will go way up as they always do when they gouge us!!

[Rodney King]

Which means, if you live in the U.S., your standard of living has decreased by that 30%.

Not true. That's only true if you only bought foreign goods.

[CHICAGOFARMER]

Readers of this post need to understand the following:

1. We need a long term energy policy with Coal and Atomic power leading the way replacing all of the peaker units now generating electricity with natural gas and crude oil. It now takes 10 years from start to finish to build a new large electrical power plant, and 20 years for nukes.

2. Current Oil in the ground estimates that around the year 2010 most all known reserves of oil will have been located as 90% are known today.

3. The washington bunch needs to act now for the energy package.

By the way in todays dollars as a percent of takehome pay, do you know when we paid the most for gasoline in the last 30 years, last 100 years?

So in my opinion to whine about fuel prices most who talk about it don't know what they are opining about?

[Rodney King]

The currency in our major trading partners has barely changed at all. I travel the world, and that is patently untrue...We are being raped not by Europe, but right here in town!!

Your world travels apparently don't take you to Europe, England, or Switzerland.

[Rodney King]

Buy stock in Shell..Exxon/Mobil....they will go way up as they always do when they gouge us!!

How do you think this gouging works? They just decide to set prices high? Why doesn't any competitor come in and cut prices? Everyone is colluding? OK, well then why do prices ever come down? Why did they wait until now to raise prices to this level when they could have done it 10 years ago? Are they that stupid?

Besides, the world price of Crude (the stuff that they make gas out of) has gone up. Are you saying that they should have kept gas prices the same when the input went up? Do you know the slightest bit about the energy industry? Do you know the slightest bit about economics? If so, please explain to me how this gouging works.

[Rodney King]

2. Current Oil in the ground estimates that around the year 2010 most all known reserves of oil will have been located as 90% are known today.

Theoretically, how does one know by what % one has discovered and unkown quantity?

[international american]

"Why doesn't any competitor come in and cut prices? Everyone is colluding? OK, well then why do prices ever come down? Why did they wait until now to raise prices to this level when they could have done it 10 years ago? Are they that stupid? "

What competitors!! This is an oligopoly, and even Bush is pissed off!

[Rodney King]

By the way,the prices for the gas we consume today were set almost a year ago

Huh? Where did you get that from? That is totally untrue. Even if it was, so what? Let's say you bought an once of gold for $280 a few years ago. Today you go to sell it. Would you sell it for the current market price, or would you sell it for a slight markup over what you paid for it? What if the buyer says "Hey, the price for the gold you are selling me was set two years ago!"?

[Rodney King]

What competitors!! This is an oligopoly, and even Bush is pissed off!

Assuming that is true, why did the oligopoly wait until now to raise prices? Why has gas been so historically cheap throughout the 80's and 90's? Are the oil companies that stupid that they didn't think to raise prices until now?

[Michael.SF.]

Changes in gasoline prices 1982-2004

The above link is to a PDF file which shows the per cent change in gas prices compared to other goods, from 1982 to today.

It is very informative, to those who chose (as I do) to believe API.

[cajun-jack]

why don't you quote prices in 1965 when it was 24.9/10 for full service. I know cause that was my after school job. pumping gas and checking oil and air in tires and people would only buy a dollar's worth...some would even buy whatever change they had.

[CHICAGOFARMER]

Posted by Rodney King to CHICAGOFARMER
On News/Activism 03/29/2004 7:04:11 PM CST #13 of 18

2. Current Oil in the ground estimates that around the year 2010 most all known reserves of oil will have been located as 90% are known today.
Theoretically, how does one know by what % one has discovered and unkown quantity?


xxxx

yea I know for the intellectuals in this worlds, not knowing the unknown means it is unknownable.

Google the title and study the graphs


OIL PEAKING Presentation at the Technical University of Clausthal
C.J.Campbell
December 2000

1. Title
Ladies and Gentlemen
· Thank you for inviting me to make this presentation.
· To-day, I am going to talk about the depletion of oil. I am a petroleum geologist and have been studying the subject directly and indirectly for many years. It is a very important subject, as is amply confirmed by recent events.
· I compliment the organisers for raising the subject in Germany. It is a large and strong country, which can exert its influence both on Europe and the World. Truth has always proved a powerful weapon. It needs to take action.

2. Sub-Title
The title of my talk is Peak Oil. It truly is a turning point for Mankind. It will affect us all. It is a large subject, and it will take us about an hour to work through it.

3. Purpose
The purpose of the talk is to evaluate the resource base and its depletion. Then we can go on to study the present crisis and try to see how it will evolve. Finally we can think specifically about Germany's predicament.

4. Main Points
In summary, these are the main points that we have to grasp:
· Conventional oil - and I will explain what I mean by that - provides most of the oil produced today, and is responsible for about 95% all oil that has been produced so far.
· It will continue to dominate supply for a long time to come. It is what matters most.
· Its discovery peaked in the 1960s. We now find one barrel for every four we consume.
· Middle East share of production is set to rise. The rest of the world peaked in 1997, and is therefore in terminal decline
· World peak comes within about five years
· Non-conventional oil delays peak only a few years, but will ameliorate the subsequent decline
· Gas, which is less depleted than oil, will likely peak around 2020


5. Discontinuity
· As I said, peak oil is a turning point for Mankind.
· The economic prosperity of the 20th Century was driven by cheap, oil-based energy
· Everyone had the equivalent of several unpaid and unfed slaves to do his work for him
· These slaves are now getting old and wont work much longer
· We need to find how to live without oil.

10. Depletion
Depletion is an easy concept to grasp.
· Think of an Irish pub full of happy people. Think of their pleasure at the first sip from a full glass
· Think of the frowns that begin to cross their faces when their glasses are half-empty. They know they have drunk more than is left. It is the turning point
· Watch them savour the last drops
· But the evening is young. When the glasses are empty, they can order another round.
· But eventually closing time comes when there are no more rounds to be had
· That is the meaning of depletion
· We need to know how big each glass - or oilfield - is, and
· We need to know how many more rounds there are - that is to say how many more oilfields are left to find


11. Date of Peak
I stress that we are not about to run out of oil, but production is about to reach a peak. When peak comes depends on the issue of Rates
· Discovery Rate - we now find one barrel of conventional oil for every four we consume
· Extraction Rate is controlled by the physics of the reservoir
· Demand is driven by economic growth and price.
Remember price is not the same as cost. It depends on cost but also tax and scarcity

12. What to Measure
Before measuring something, the first step is to decide what exactly to measure. It is a question every butcher asks. Does he weigh the meat or the bones as well?
· There are many different kinds of oil
· Each has its own endowment in Nature, characteristics, costs, and rate of extraction.
· Production of each type starts and ends at zero reaching a peak in between,
· Some rise to peak slowly, others quickly
· We need to identify and measure each type : we need to separate the meat from the bon


27 Creaming Curve
This is the so-called creaming curve.
· It plots discovery against exploration wildcats. They are the wells that either do - or do not - find a new field
· The largest fields are usually found first for obvious reasons, being too large to miss.
· The curve flattens until new discoveries are too small to be viable. It gives a good idea of how much is left to find.
· There are other statistical techniques but there is n't time to cover them here


HAVE FUN

[international american]

It was the same price in 1972....so what!