Posted on 04/27/2006 8:43:37 AM PDT by kellynla
Get used to it.
Gasoline at $2 a gallon has probably gone the way of 5-cent coffee and 15-cent cheeseburgers.
The grim facts are these: Demand for oil is rising around the globe, especially in Asia. Supplies are generally static. Unless something happens to put a damper on demand, simple economics dictate that prices have nowhere to go but up.
In the short term, however, we may get a break. Gasoline prices, now averaging more than $3 a gallon in Orange County, are expected to fall below that level around Memorial Day as refineries ramp up production after completing maintenance work, analysts say.
Here's a look at what's driving this week's higher prices at the pump:
(Excerpt) Read more at ocregister.com ...
There is a BIG problem with your analogy.
The oil prices are traded on FUTURES not actual supplies so they are not charging what the market will bear. So, in order for your analogy to be true, you have to go to your employer and tell them that I am going to charge you $150,000 for my services...even though I'm really only worth $100,000...because in the future...I am SPECULATING I will be needed at a greater cost.
And that is what is happening here. Oil is not traded at what it is actually worth. If we actually paid what oil is worth per barrel and took speculations out of it...oil is actually a LOT cheaper. It is estimated that futures adds at least $30 per barrel. Now...how much were you paying per gallon when oil was trading at $40 per barrel? Well...that's about what you SHOULD be paying now if oil was traded on the supply market...and not as a futures.
In other words, because the state is filled with leftist, tree-hugging, envirowackos.
Good for them! Glad, for the millionth time, I don't live there. Feel sorry for decent folks that do.
Estimated by whom? Certainly not those actually buying the futures, unless they're all in the habit of setting their money on fire. They believe oil prices will continue to rise; if you disagree you can bet against them and make an easy profit if you're right.
No. They wouldn't charge the same amount.
The reasons for higher gas prices at the pump right now are not that complex and there is no damn conspiracy:
1. Increased demand (summer in the USA, rapidly expanding economies in China and India)
2. Static supply
3. Market uncertainty because of Mid-East, African and South American political situations
4. Ridiculously inadequate refinery capacity and equally ridiculous refined fuel grade requirements that vary from locale to locale in the US
5. Confiscatory taxes
There is little to nothing that can be done about 1, 2 and 3 in the short term.
We could do something about 4 and 5, but the dems (and depressingly, a significant faction in the GOP) won't let us.
But, there is no conspiracy by Exxon/Mobile/BP and only drooling morons, low functioning retards and grandstanding politicians think that there is one.
I'm guessing that eventually, they probably would jack the price up, but I imagine they would do it incrementally. This would at least give people some relief for a time, and it would make the govt look really good, especially at a time when it is badly needed.
I doubt that any individual employee is absolutely necessary to almost everyone, while fuel is.
That was their words...it's not mine. It was on KPRC...950AM.
Agree.
My own gas-price-crisis measurement tool is traffic. When traffic starts getting lighter, then I'll believe we have a crisis.
The biggest reason that the gas price continues to go up is that people keeping buying it.
I think everybody complaining about oil profits and *greed* should be required to read that pie chart and be forced to explain what it means so they can't pretend they don't know or nobody told them.
I think it's more like people have to buy it, than keep buying it.
"With daily global demand roughly 85 million barrels per day, the world's oil producers have less than 2 million barrels per day of spare production capacity, and most of that is for Saudi blends of oil that are less ideal for manufacturing transportation fuels."
"http://www.chron.com/cs/CDA/printstory.mpl/business/energy/3817761
Like I've said repeatedly, America needs to follow Brazil's lead and get off foreign oil dependency altogether. And follow France's lead who now generates 75% of their electricity from nuclear power.
Those both would be great starts. There was a great article in National Geographic last month about Nuclear energy's resurgence and how new technology will make it possible to create much more efficient reactors.
I don't know how elastic the supply and demand curves for gas are, but nobody *has* to buy it. They buy it because they value the gas at least as much as they have to pay for it. So they buy it.
I'll back up a little: by saying it isn't a crisis I don't mean to say it isn't an annoyance. Of course it is. But there is an evolving new reality happening in the global demand for oil that we are adjusting to, and there simply is no way around it. Some of the adjustment will come by higher prices that don't come back down all the way. Some of the adjustment will be about changing some habits or changing some things away from oil-power to some other source.
That said, I don't know if the title on this thread is accurate or not, whether the price will go back down under $2. It might. But it might not.
I agree about the nuclear bit. We should've had many more of them than we do, and we can still fix that.
I'm not so sure that it matters where we buy our oil. In fact... if there is a national security component to this it would be to save our own reserves for even leaner times. If we're concerned that some foreign country is going to cut off our oil supply then we're better off taking as much of their oil as we can now, before they do. Then we'll still have plenty of our own supply left for when they do.
Just a thought.
Most people in the US, drive to work.....to me, that means they have to buy it.
Oh come on.. that's the standard American way. Our companies are so nice and such good corporate citizens that we give back to them in our salaries.
Which is why honest, hard working Americans are leaving that forsaken state in droves.
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