Oil rises near $64; gasoline hits record high

AP WorldStream via COMTEX ^ | Aug 08, 2005

[softwarecreator]

It's going to cripple our country if it doesn't stop

I agree.  This is getting WAY out of hand.

[M. Espinola]

"Refinery shutdowns? We need to be building MORE refineries, not shutting down the ones we have now."

It's mandatory additional refineries be constructed and the oil companies will need more tax incentives to prod them along.

[softwarecreator]

Government meddling (EPA regs)

Come on, the EPA has been going full tilt since the 70's, doesn't explain the price rising every 10 minutes, or so it seems.

[Cobra64]

Yes. We should have begun this/these initiatives 10 years ago. The libs have prevented these actions. It takes about 7 years from exploration for gas into the tank. Our refining capacity is at the limit. Few people seem to understand the supply chain. Every time we hear people panic and say "drill now," my wife laughs (she worked for Texaco's refining and manufacturing division in Corporate). She remarks that folks who make these statements seem to think that getting petroleum to market is like flipping a light switch.

[KevinDavis]

Well they are one of the reasons.. Plus the taxes.

[RetiredArmy]

If you will take a short minute to think, it is we as a nation. Regardless. The RINOcrats in Congress certainly don't seem to want to engage the socialists on the issue and git it done now do they? I did not say YOU personally.

[AdamSelene235]

The upside is that at $100.00/bbl enough shale oil, coal gassification and more difficult tar sands deposits will be economicall viable to make us not only energy independant, but net exporters.

You're thinking in constant dollar terms. It very well may be that when oil hits $100/bbl that $100 has the purchasing power of $70 today meaning these techniques will not be viable.

[Cobra64]

Oh don't give us that unmittigated B.S. about "when you adjust for inflation" because a lot of us were not old enough to be driving in 1973 and don't give two S--TS what gas prices were then. We care what we are paying now and it's rising to ridiculous levels.

Some of us over the age of adolescnce remember Carter's era of gov't. regulated product distribution; causing hour long lines at the gas pump. Maybe you could go back to your Game Boy and watch MTV to keep your mind off of these evil times.

BTW, have you ever heard of things like war, depression, Clinton and Carter?

[Soliton]

I hope it goes to $100/bbl. Maybe we will start producing our own.

[MNJohnnie]

Sitting on a pile of future contracts hun M?

Please explain how

"concerns that shutdowns of U.S. oil refineries would reduce supply."

Oil goes INTO the refinery. How would a REDUCTION in the CONSUMERS of OIL drive the price UP? For the last 6 months all we have been hearing is "the Chinese and the Indians and buying up all the oil. There is too much demand!".

[mpreston]

Searching around for info on the difference between what a refinery pays and what the current commodity cost is, I found this site. Hope it helps understand the forces in play.

Usual disclaimers ....

From: WTRG Economics http://www.wtrg.com/prices.htm

. . . . . On March 19, 2003, just as some Venezuelan production was beginning to return, military action commenced in Iraq. Meanwhile, inventories remained low in the U.S. and other OECD countries. With an improving economy U.S. demand was increasing and Asian demand for crude oil was growing at a rapid pace. The loss of production capacity in Iraq and Venezuela combined with increased production to meet growing international demand led to the erosion of excess oil production capacity. In mid 2002, there was over 6 million barrels per day of excess production capacity, but by mid 2003 the excess was below 2 million. During much of 2004 and 2005 the spare capacity to produce oil has been under one million barrels per day. A million barrels per day is not enough spare capacity to cover an interruption of supply from almost any OPEC producer. In a world that consumes over 80 million barrels per day of petroleum products that adds a significant risk premium to crude oil price and is largely responsible for prices in excess of $40 per barrel. . . . .

[Smokin' Joe]

Refinery bid on crude oil is determined in part by the price the refineries get for their products. If product prices are really low, then the refineries cannot bid much for crude oil. If they can not pay much for crude oil, then the exploration companies (or divisions of really major oil compaines) cannot underwrite the 2 million and up it takes to drill a well. So drilling stops until there is a shortage of crude, prices climb, first at the pump,then at the wellhead, and exploration picks up.

Funny, how some people think this is crippling, but those of us in the oil exploration industry are not only grateful for steady work, but for pay raises which were virtually nonexistent from 1982 to 1996.

[Cobra64]

I'm still water skiing at almost 9pm in June here in NC. And I get up at 10am. We're late night folks.

[softwarecreator]

Well they are one of the reasons.. Plus the taxes.

Agree, they are part of the reason, a BIG part, but it doesn't explain this almost daily rise.

[sandbar]

>>>"You could be paying $6.70 a gallon in Norway. Gas is still cheap by historical standards. Beglad you live in America" >>>

Norway uses a percentage of what the US uses. Supply and demand, you need less, price goes up. Means squat over what we are paying here.

[MNJohnnie]

Can you believe this? $70 a barrel!! I get a shock every time I go to the gas station and fill up.

Let's see. Jack the price up to $3.00 a gallon. $3.00 x 30 gallons (a lot for a non commercial driver) x 52 weeks gets you


$4680.00 A YEAR.

In the same year the average family will pay at least $15-20,000 in direct and indirect taxes. And you people think I should be pissed about GAS prices????????

[sandbar]

>>>I think it was the Government meddling (EPA regs) that got us into this mess in the first place.>>>

Well, then we DO need the government to DO something. Get the hell out of it.

[Smokin' Joe]

LOL! The italics were the comment I was responding to, not my statement.

Oil is up, I am a geologist, and can (now) afford gasoline. When oil is cheap, my wife and I have a hard time keeping the tank full. (8^D)

[RetiredArmy]

Unfortunately, I have to commute across Puget Sound here to Sodom on the Sound (seattle) to work. I have to get up at 4:30 a.m. to get ready and catch a 6:20 ferry. I come in on the ferry @ 5:15 p.m. and get home about 20 minutes later. So, long day, dark or light. If you water ski up here, you have to wear a rubber, insulated suit. The danged water is COLD!

[softwarecreator]

Funny, how some people think this is crippling, but those of us in the oil exploration industry are not only grateful for steady work, but for pay raises which were virtually nonexistent from 1982 to 1996.

Oh well, when you put it that way I feel much better.  I'm happy that you're happy.  After work today I'll go to the gas pump and make your day just that much brighter!!