High Gas Prices

[Dave Lenton]

Originally posted by Gerald Davis:
The high price of gasoline reflects the high cost of oil. The way I see it, the high cost of oil is proof that the economys of the world are doing well so has a high demand for oil, a healthy hunger.

High prices can be down to high demand, but they can also be because of low supply. In the case of oil, its both.

Is increasing demand for oil a reflection of a healthy economy? Well, yes and no. On the one hand it is, because much of our demand for oil is to satisfy our need to the kind of consumer goods which generally increase our quality of life. The fact that we want more oil shows that people are buying these goods. Sounds good so far, as our quality of life is going up....but there is also another side to the story. So far its been assumed that the only way to increase our quality of life is to consume more oil-derived goods. Unfortunately this will get us into an eventual situation where by we are addicted to ever decreasing supplies of oil.

Eventually we'll get to the point where oil is too expensive to make extracting it for consumer goods worth while. How will we cope then? While our increasing demand now is a good sign in the short term, its not so good in the long term. Unless we can find an alternative source of power and plastics, we're going to be in deep trouble before too long. The oil problems in the 70's and the subsequent decade or two of global slow down will seem like a walk in the park. And this will happen within our life time if demand for oil continues to increase and supply is not increased accordingly.

Maybe we can increase oil supply, but its hard to see how it can be done to the levels required to match demand. Scientific improvements will increase oil yield and improve the refining process, but I doubt it will be enough. The only hope is to look at technologies which will reduce demand for oil e.g. electric cars, more efficient aeroplanes and so on. Trouble is that market forces currently make those unprofitable, and by the time this will change it could be too late to avoid the almost inevitable large scale economic downturn.
[ August 30, 2005: Message edited by: Dave Lenton ]

[Mehul Sanghvi]

This is ridiculous.
Did you ever hear of rising oil prices to such an extent just because of a natural calamity in one part of world 5-6 years ago?
Prices used to stay pretty stable then. Nowadays even if a fire cracker goes off in US or one of its allie countries it is considered as a reason enough to raise the oil prices!

About 2-3 years ago, just after the first gulf war I had recieved a .ppt as a forwarded mail explaining the economics of the war and why it was economically beneficial for major oil corporations of US.
By raising the oil prices US govt. is just recovering the money it has spent on invading Iraq. Though the average American people are also suffering as a part of this. But on the whole the entire world is held at ransom and is being made to pay through the nose.

I think its about time we get more awareness about renewable energy resources. Govts. across the world should do this right while children are in school. Though it will be a long time before it will completely replace the conventional fossil fuels.

Mehul.

[Jason Menard]

Originally posted by Mehul Sanghvi:
About 2-3 years ago, just after the first gulf war I had recieved a .ppt as a forwarded mail explaining the economics of the war and why it was economically beneficial for major oil corporations of US.

I receive all kinds of junk email. I don't for one second believe that there is some deposed prince in Africa willing to give me millions of dollars if I give him my bank account number, any more than I believe most of the other junk that flows into my inbox.

By raising the oil prices US govt. is just recovering the money it has spent on invading Iraq.

The US government does not control the price of oil on the world market. Production is controlled primarily by OPEC, and the prices are set by movements on the three major petroleum exchanges (New York Mercantile Exchange [not a government organization], International Petroleum Exchange in London, Singapore International Monetary Exchange). It never ceases to amaze me what people will try to blame on the US government.

You want to know why oil prices are sky high? Aside from OPEC, you need to look closer to home and to your neighbor to the east. Skyrocketing demand from developing nations, particularly China and India, is what is fueling the price of oil, along with OPEC's refusal to increase production.
[ August 31, 2005: Message edited by: Jason Menard ]

[Jesse Torres]

Some gas stations in the Chicago area are selling a Gallon of Regular Unleaded Gasoline for $3.69 While some suburban gas stations, about 20 miles away, are selling the same fuel for $2.89.
[ August 31, 2005: Message edited by: Jesse Torres ]

[Mehul Sanghvi]

Originally posted by Jason Menard

B]there is some deposed prince in Africa willing to give me millions of dollars if I give him my bank account number,[/B]

I have got a few of those too and I find them especially funny!

[kayal cox]

Originally posted by Jason Menard:

You want to know why oil prices are sky high? Aside from OPEC, you need to look closer to home and to your neighbor to the east. Skyrocketing demand from developing nations, particularly China and India, is what is fueling the price of oil, along with OPEC's refusal to increase production.

[ August 31, 2005: Message edited by: Jason Menard ]

This might be a good time to read thru this, and educate ourselves.

World oil markets under pressure

It is interesting to note that, US consumes 20.52 million barrels of oil each day, which is roughly 25% of the total produce. China consumes 6.63 million barrels, and India consumes a meagre 2.30 (Also take into account, the populations of these countries).

Speaking of increasing rate of consumption, US has increased its consumption by .82 whereas India has increased its consumption by just .25 over the past four years. Skyrocketing? We will let the facts speak for themselves.
[ August 31, 2005: Message edited by: kayal cox ]

[Dave Lenton]

Originally posted by Mehul Sanghvi:
By raising the oil prices US govt. is just recovering the money it has spent on invading Iraq.

Increasing oil prices wouldn't result in more money for the US government though, except through increased tax revenue from oil companies. On the contrary, higher oil prices are causing economic strains which could reduce the tax revenue that the government raises. Besides, as already said above, its OPEC that have most influence on the oil prices. The US can make a small change by freeing up some of its oil reserves, but it doesn't set the price on the international market for oil.

As for the cost of Iraq, the main tactic for recovering (a very small fraction of) the cost of that is to let the value of the dollar fall. For the most part I don't think there is any intention, or belief that its possible, to attempt to recover the cost of the war.

[Roger Johnson]

[Jesse Torres]

Originally posted by Roger Johnson:

Is this your personal picture? If so, what state are you in?

[Jesse Torres]

I just filled up my car for $3.14 for Regular Unleaded. I noticed quite a few cars in line to purchase fuel.

[Thomas Paul]

Originally posted by Mehul Sanghvi:
By raising the oil prices US govt. is just recovering the money it has spent on invading Iraq.

This might make sense if the US govt owned the oil. The people making the money are the oil producing countries such as Saudi Arabia not the oil consuming countries like the USA. So if Saudi Arabia sold the oil to the US govt for $12 a barrel and the US govt then sold it to the oil companies for $70 a barrel then you would have an argument. But that isn't the way it works.

[Thomas Paul]

Originally posted by Jesse Torres:
I just filled up my car for $3.14 for Regular Unleaded. I noticed quite a few cars in line to purchase fuel.

$3.16 a gallon. No lines. Long Island, NY, USA. The station across the street was asking $3.60 a gallon but no one was buying.

[Roger Johnson]

i got it from internet, the picture was taken in Stockbridge, Ga., Wednesday, Aug. 31, 2005.

Originally posted by Jesse Torres:


Is this your personal picture? If so, what state are you in?

[Megs Maquito]

The current price of oil I believe is not entirely dependent on the Laws of Supply & Demand. A big portion of it is speculation. Its price is dictated in the stock market.

[Axel Janssen]

Originally posted by kayal cox:

US consumes 20.52 million barrels of oil each day, which is roughly 25% of the total produce. China consumes 6.63 million barrels, and India consumes a meagre 2.30 (Also take into account, the populations of these countries).

The important point is the relative increase. If China only consumed 3.00 million barrels 5 years ago (I did not check) its a considerable increase in demand. Due to extra demand of India and China (lots of people, little natural ressources) the prices of nearly all primary products are on the rise currently.
This is not so good for the terms of trade of countries like the US and good for the terms of trade of countries which offer primary goods.
Means: US now has to sell more Oracle licenses to get 1 ton of copper.
And, of course, its not good for the US economy.

[Michael Ernest]

Where the rubber meets the road: I saw $3.25/gal last night.

From my earliest memory, gas was .28/gal. But that's 35 years or so. From my son's earliest memory gas was 1.50/gal; that's 6 years or so.

That's a jump.

[Roger Johnson]

so your point is: if India and China do not consume oil at all, oil price will be a lot lower, then it is good.

how could that be?

Originally posted by Axel Janssen:

The important point is the relative increase. If China only consumed 3.00 million barrels 5 years ago (I did not check) its a considerable increase in demand. Due to extra demand of India and China (lots of people, little natural ressources) the prices of nearly all primary products are on the rise currently.
This is not so good for the terms of trade of countries like the US and good for the terms of trade of countries which offer primary goods.
Means: US now has to sell more Oracle licenses to get 1 ton of copper.
And, of course, its not good for the US economy.

[Paul Bourdeaux]

On the plus side,
prices are starting to go back down.//

[peter wooster]

These high prices are starting to change peoples driving habits. The price in Toronto went from $.95 Canadian to $1.25 because of Katrina and then jumped to $1.35 because of the approaching long weekend last Thursday. One of my neighbours who drives a GMC Yukon decided to cancel a trip to Montreal, and hasn't driven the truck at all since then, he's driving his little Hyundai instead. Another neighbour who drives a small Mazda SUV has only put $25 in gas in it since then. We've not filled either of our 2 Camrys either, but we did take a driving trip on the weekend and I'll have to fill one of them soon.

[Paul Bourdeaux]

The price in Toronto went from $.95 Canadian to $1.25 because of Katrina and then jumped to $1.35 because of the approaching long weekend last Thursday.

Man! I need to move to Canada! $1.35 C is only $1.14 US!!!

[Jason Menard]

Originally posted by Paul Bourdeaux:
Man! I need to move to Canada! $1.35 C is only $1.14 US!!!

Unfortunately that's for 1 litre of gas, not 1 gallon.

[Roger Johnson]

Originally posted by Paul Bourdeaux:
The price in Toronto went from $.95 Canadian to $1.25 because of Katrina and then jumped to $1.35 because of the approaching long weekend last Thursday.

Man! I need to move to Canada! $1.35 C is only $1.14 US!!!

i believe he mean $1.35 C / litre.

1 gallon = 3.78 litre
so the price is 3.78 x 1.35 = $ 5.1 c/gallon = $4.31 US / gallon

[Paul Bourdeaux]

1 gallon = 3.78 litre
so the price is 3.78 x 1.35 = $ 5.1 c/gallon = $4.31 US / gallon

Ah! OK, never mind. I am happy with my $3.19 per gallon down here!

[peter wooster]

Originally posted by Paul Bourdeaux:
1 gallon = 3.78 litre
so the price is 3.78 x 1.35 = $ 5.1 c/gallon = $4.31 US / gallon

Ah! OK, never mind. I am happy with my $3.19 per gallon down here!

Yup, it's per litre, only the USofA uses the 3.78 litre gallon as a measure. there may be some places that still use the Imperial gallon, which is a bit bigger than 4 litres.

[Kalle Anka]

In Sweden a Gallon cost 6.33 USD! No joke, we have alot of taxes on petrol.

I would like all taxes on petrol to dissapear. Instead all car owners should be forced to breath directly from the exhast pipe.

[Jesse Torres]

Originally posted by Kalle Anka:
In Sweden a Gallon cost 6.33 USD! No joke, we have alot of taxes on petrol.

I would like all taxes on petrol to dissapear. Instead all car owners should be forced to breath directly from the exhast pipe.

Approximately how much is a gallon of petrol in Europe, before taxes?

[Stan James]

I would like all taxes on petrol to dissapear. Instead all car owners should be forced to breath directly from the exhast pipe.

I read that if you closed yourself in the garage with a new Volvo running it wouldn't kill you. Could that be true? Could some cars put out cleaner air than they take in in, say, LA? Surely not with more oxygen in it!

[Axel Janssen]

Germany: around 4.33 $ a gallon super.
Austria, Netherlands: 3.40 $
[ September 07, 2005: Message edited by: Axel Janssen ]

[Rick Beaver]

Currently in the UK just under $7 a gallon.

[Arjunkumar Shastry]

Here its Rs 49/litre.so that becomes Rs 185/gallon---> $4/gallon.
. In union territories ,its little cheaper.

[Kalle Anka]

I read that if you closed yourself in the garage with a new Volvo running it wouldn't kill you. Could that be true? Could some cars put out cleaner air than they take in in, say, LA? Surely not with more oxygen in it!

Hmm... I'm no chemist but now I'm gonna pretend... with the exact right preconditions, the burning process of petrol could just leave carbondioxide (if we disregards all the extra thingys oil company puts in the gas like lead - a poisionous metal, etc.). Carbondioxide is not dangerous (in reasonable levels, approx 70% i think). Perhaps thats why you could sit in a garage with the Volvo (hurray Sweden!) turned on.

However, adding all the extra carbondioxide do effect the eco system to change...

ONE thing I do know is if you closed yourself with a lot of Swedish girls, it too wouldn't kill you. aaah... beutiful Swedes.