Gas Prices

[MannyIsGod]

you said it yourself.. there are SHORTAGES OF BOTH! so, regardless of the refining capacity there is STILL A SHORTAGE OF OIL!!!

God, I don't know how else to explain it to you. I give up.

[Clandestino]

In case no one in this thread mentioned it, oil is a major component in PLASTIC.


Raise your hand if you or anyone you know use anything made out of that stuff, or know what it can be used in/for.

It's not just transporation. Many plastic injection molders in the country, for example, folded and sent their jobs overseas, where the cheaper labor made up for the hike in the cost of oil...which drastically increased the cost of manufacturing the plastic resin. I was one of those people.

It's not just a matter of your daily commute.

ohhhh...nice one... and all those polyester shirts manny wears too are made from petroleum products!

[MannyIsGod]

In case no one in this thread mentioned it, oil is a major ingredient in PLASTIC.


Raise your hand if you or anyone you know use anything made out of that stuff, or know what it can be used in/for.

It's not just transporation. Many plastic injection molders in the country, for example, folded and sent their jobs overseas, where the cheaper labor made up for the hike in the cost of oil...which drastically increased the cost of manufacturing the plastic resin. I was one of those people.

It's not just a matter of your daily commute.

That is rather interesting. It's my understanding that oil refined into gas is the largest percentage of what is done with the oil in our economy. Thats why the the figures having to do with mpg and the importation of forgein oil.

I'll look for some raw data later on tonight, I'm sure it's readily available.

[The Ressurrected One]

ohhhh...nice one... and all those polyester shirts manny wears too are made from petroleum products!

Don't forget pocket protectors and slide rules.

...and condoms.

[MannyIsGod]

ohhhh...nice one... and all those polyester shirts manny wears too are made from petroleum products!

I support cotten farmers more often than not thank you very much.

[Clandestino]

Petroleum Products Yielded from
One Barrel of Crude, 2000
Product Gallons
Finished Motor Gasoline 19.69

Distillate Fuel Oil 9.70
Kero-Type Jet Fuel 3.99
Residual Fuel Oil 1.76
Still Gas 1.89
Petroleum Coke 2.14
Liquefied Refinery Gas 1.76
Asphalt and Road Oil 1.34
Naptha for Feedstocks 0.63
Other Oils for Feedstocks 0.50
Lubricants 0.46
Special Naphthas 0.13
Kerosene 0.17
Miscellaneous Products 0.17
Finished Aviation Gasoline 0.04
Waxes 0.04

Total 44.41

[Clandestino]

I support cotten farmers more often than not thank you very much.

sheepskin condoms too i presume?!!!

[MannyIsGod]

So about 40 of the oil we bring in is used for gasoline?

[mookie2001]

quattro razors 0.0001

[Clandestino]

One barrel of crude oil, when refined, produces 19.9 gallons of finished motor gasoline, as well as other petroleum products. Most of the petroleum products are used to produce energy. For instance, many people across the United States use propane to heat their homes and fuel their cars. Other products made from petroleum include: ink, crayons, bubble gum, dishwashing liquids, deodorant, eyeglasses, records, tires, ammonia, and heart valves.

[SpursWoman]

That is rather interesting. It's my understanding that oil refined into gas is the largest percentage of what is done with the oil in our economy. Thats why the the figures having to do with mpg and the importation of forgein oil.

I'll look for some raw data later on tonight, I'm sure it's readily available.

I'm not sure what percentage of a barrel of crude is specifically designated for plastics manufacturing, but I do know the percentage increase in resin cost is directly proportional to the increase cost per barrel. We told Dell we'd have to increase the price on monitor covers, etc. to compensate for the increase cost of resin, and they said, "Okay, now GTFO. We're moving our molding to our plant in Malaysia."

[MannyIsGod]

One barrel of crude oil, when refined, produces 19.9 gallons of finished motor gasoline, as well as other petroleum products. Most of the petroleum products are used to produce energy. For instance, many people across the United States use propane to heat their homes and fuel their cars. Other products made from petroleum include: ink, crayons, bubble gum, dishwashing liquids, deodorant, eyeglasses, records, tires, ammonia, and heart valves.

And a barrel is 44 gallons. So 19/44 is over 40%.

So the largest use for imported oil (by far) would be gasoline. Therefore, cutting back gasoline usage would be the easiest, fastest, and most efficent way to reduce dependency on oil, especialy forgien oil.

Edit - it's 43%

[MannyIsGod]

I'm not sure what percentage of a barrel of crude is specifically designated for plastics manufacturing, but I do know the percentage increase in resin cost is directly proportional to the increase cost per barrel. We told Dell we'd have to increase the price on monitor covers, etc. to compensate for the increase cost of resin, and they said, "Okay, now GTFO. We're moving our molding to our plant in Malaysia."

Yeah, that makes sense. The cost of the end product would be directly porportional to the cost of the starting product.

What I was trying to explain to Clandestino was that even though that is the case there may be other factors in the product manufacturing (the refining in gasolines example) that can have a greater impact on a price increase.

Man, actualy, the example you gave is also a great parallel. Maylasia has to pay the same for oil, but because of cheaper abor, thereby allowing them to produce a cheaper petroleum based product.

[hunter-thereckoning]

Gas Is Expensive Man

[SpursWoman]

Yeah, that makes sense. The cost of the end product would be directly porportional to the cost of the starting product.

What I was trying to explain to Clandestino was that even though that is the case there may be other factors in the product manufacturing (the refining in gasolines example) that can have a greater impact on a price increase.

Man, actualy, the example you gave is also a great parallel. Maylasia has to pay the same for oil, but because of cheaper abor, thereby allowing them to produce a cheaper petroleum based product.

But plastic can be recycled, too. Another way to be environmentally friendly and help (even to a miniscule degree) cut back on oil demand.

[Nbadan]

You're partly right however, if the environmentalists would get off industry's back, we'd have plenty of refining capability

While we do have a refining problem, as ANWAR has proven, I think the environment is the last thing that will ever come into consideration for politicians and private businesses in the U.S. if we didn't have these protections. Besides, why can't we subsidize our refining needs to other countries like Mexico that have less enviromental regulations like we out-source our jobs?

[Nbadan]

The real reason that no one is building more refineries, by the way, isn't only because its costs prohibitive, or because of environmental protections as many here have contended, but also because we are past Peak Oil - the point where the world is running out of cheap oil.

[Nbadan]

US Appears to Have Fought War for Oil and Lost It
By Ian Rutledge
The Financial Times
Monday 11 April 2005

From Dr. Ian Rutledge.

Sir, Your recent report that oil prices have reached an all-time nominal high and that Goldman Sachs has suggested the possibility of a "super e" in prices to as high as $105 per barrel ("Crude at all-time high despite Opec's efforts", April 5) should be of no surprise to anyone who has studied the informed opinions of US energy experts in the period leading up to the invasion of Iraq. Nor, for that matter, to anyone who has seen my own observations on future world oil prices in my recent book Addicted to Oil.

In a crucial report to President George W. Bush by the US Council on Foreign Relations in April 2001, the president was warned that: "As the 21st century opens, the energy sector is in a critical condition. A crisis could erupt at any time . . . Theworld is currently close to utilising all of its available global oil production capacity, raising the chances of an oil supply crisis with more substantial consequences than seen in three decades."

With US oil consumption in 2001 at an all-time high (19.7m b/d), import penetration at 53 per cent, and dependence on Arabian Gulf oil also at an all-time record (14.1 per cent of total US domestic and foreign supplies), the council stated that it was absolutely imperative that "political factors do not block the development of new oil fields in the Gulf" and that "the Department of State, together with the National Security Council" should "develop a strategic plan to encourage reopening to foreign investment in the important states of the Middle East".

But while the council argued that "there is no question that this investment is vitally important to US interests" it also acknowledged that "there is strong opposition to any such opening among key segments of the Saudi and Kuwaiti populations".

However, there was an alternative. In the words of ESA Inc (Boston), the US's leading energy security analysts: "One of the best things for our supply security would be liberate Iraq"; words echoed by William Kristol, the Republican party ideologist, in testimony to the House Subcommittee on the Middle East on May 22 2002 that as far as oil was concerned, "Iraq is more important than Saudi Arabia".

So when, according to the former head of ExxonMobil's Gulf operations, "Iraqi exiles approached us saying, you can have our oil if we can get back in there", the Bush administration decided to use its overwhelming military might to create a pliant - and dependable - oil protectorate in the Middle East and achieve that essential "opening" of the Gulf oilfields.

But in the words of another US oil company executive, "it all turned out a lot more complicated than anyone had expected". Instead of the anticipated post-invasion rapid expansion of Iraqi production (an expectation of an additional 2m b/d entering the world market by now), the continuing violence of the insurgency has prevented Iraqi exports from even recovering to pre-invasion levels.

In short, the US appears to have fought a war for oil in the Middle East, and lost it. The consequences of that defeat are now plain for all to see.

News.FT.com

[MannyIsGod]

Gas prices seen peaking in May
Drivers hit by surging crude prices, strong demand

Fueled by strong demand and surging crude oil prices, the average price of gasoline price in the U.S. is expected to rise to $2.35 in May and then ease, according to the government's annual forecast for the summer driving season.
American drivers will burn through an average 9.3 million barrels per day of gasoline this summer -- up 1.8 percent from last year, according to the U.S. Energy Information Administration. That would be higher than the five-year average, the agency said.

"Refiner output increases are not expected to keep up with demand growth due to limited growth in refinery capacity," the report said.

Imports will have to make up the difference, rising 4.7 percent from last year. About 10 percent of U.S. gasoline demandis currently met by imports.

But those foreign supplies "may be harder to obtain than in previous summers and are expected to be costly," the EIA warned.

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Predicting a summer rise in gasoline prices is a little like forecasting a heat wave in August. While it’s almost certain to happen, it’s all but impossible to know just when and how bad it will be. Last year at this time,the government forecast summer gas prices would hit $1.81 before backing down. In fact, summer prices eventually peaked at just over $2 a gallon.

Pump prices on the West Coast have already hit an average of $2.40 a gallon. (Prices of refined products are generally higher west of the Rockies because of added transportation costs; there aren't enough refineries locally to meet demand.) Prices are lowest in Texas, home of the biggest concentration of refineries, where gas is still selling for just under $2 a gallon. [Correction: As of the week of April 4, the lowest gas price recorded by EIA was in Houston, at $2.08 a gallon]

Nationwide, the national average price of unleaded regular this week hit $2.22 a gallon, up from $1.78 a year ago, according to EIA. And some analysts are already forecasting price will move higher than the EIA's summer forecast.

“Barring a reversal (of the run-up in crude prices), a jump in the retail pump price to $2.45 a gallon by Memorial Day — the traditional start of the summer driving season and the traditional seasonal peak for gasoline prices — now seems likely,” Morgan Stanley chief economist Richard Berner wrote in a report this week.

Motorists and businesses aren't the only ones who are feeling the squeeze from higher pump prices. The relentless rise in energy costs is beginning to put pressure on Congress and the White House. Energy Secretary Samuel Bodman, on Capitol Hill Tuesday to meet with legislators about the administration's long-stalled energy bill, said the White House is working to speed construction of new refineries and spur investment in alternate energy sources.

The Bush administration plans to allow oil companies to drill in areas off the Florida coast that are currently off-limits beginning in 2007. Sen. Lamar Alexander, R-Tenn., on Wednesday proposed legislation that would give governors the power to open some or all of their states’ offshore lands restricted by federal moratoria.

But Bodman said there is little Congress or the White House can do to ease higher energy prices in the short term.

“There is nothing of which I’m aware,” he told CNBC.

Usual suspects
The rise in gasoline prices can be traced to most of the usual suspects, especially the surging price of crude oil, which recently hit $58 a barrel before backing a few dollars by Tuesday’s close.

“Around this time last year we were at about $35 a barrel, so you’re looking at a $20 difference in oil prices year over year,” said Jacques Rousseau, an analyst who follows the oil refining industry at Friedman, Billings, Ramsey in Houston. “So about 50 cents of today’s gas price represent the increase in crude prices since last year.”

Oil consumption typically dips this time of year between the peak demands of winter heating and summer driving in the northern hemisphere. But with global demand closer than ever to production capacity, U.S. oil prices have surged by more than 30 percent this year. A Goldman Sachs analyst last week predicted prices could e above $100 a barrel.

Revving up demand
To help meet the peak demand for gasoline during the summer driving season, refiners typically begin building up inventories this time of year to head off summer shortages. Those stockpiles are currently higher than last year, but so is demand. Adjusted for that increased consumption, refiners have stockpiled just 24.5 days worth of demand, just slightly ahead of the five-year low of 23.8 days for this time of year, which was hit last spring, according to Rousseau.

“It’s not like anybody is holding back production,” said Rousseau. “(Refiners) are operating at 90-plus utilization rates and producing as much product as they can.

With refiners running near maximum capacity, any production cutbacks for maintenance or accidents would likely further tighten supplies. An explosion last month at a Texas BP refinery, the nation’s third largest, killed 15 people and severely damaged some refining equipment. But company officials have said production cuts will be less than 5 percent.


http://www.msnbc.msn.com/id/7407519/

[Useruser666]

And a barrel is 44 gallons. So 19/44 is over 40%.

So the largest use for imported oil (by far) would be gasoline. Therefore, cutting back gasoline usage would be the easiest, fastest, and most efficent way to reduce dependency on oil, especialy forgien oil.

Edit - it's 43%

Uh, problem with your math. The number of gallons in a barrel of oil are not equal
to the number of gallons of gas refined from that barrel.

A rough example:

A 44 gallon drum of oil may produce:

19 gallons of gas
11 gallons of heating oil
8 gallons of aviation fuel
5 gallons of lubricant oil
3 gallons of road oil
2 gallon of naptha
1 gallon of acetone

Notice that equals 49? The end products are a ratio of volume to the oil depending on their densities. Like in mining. It takes so many tons of ore to yield a lesser amount of iron.

[MannyIsGod]

Ok, but unless you're talking a bigger difference than that, the fact that gasoline is by far the largest percentage of a refined petroleum product stands. Even if you produce 19/49, thats still 40%

[Useruser666]

I don't believe those numbers take into account plastics.

[MannyIsGod]

Chris, so you really don't believe that Gasoline is by far the largest reason we import oil? We're about to import refined gasoline itself! Are you really disputing that?

[MannyIsGod]

 PRODUCT SUPPLIED
Finished Motor Gasoline                   9,069    9,075    9,095    9,089
Kerosene-Type Jet Fuel                    1,737    1,712    1,530    1,535
Distillate Fuel Oil                       4,415    4,234    4,233    4,248
Residual Fuel Oil                           889      806      777      653
Propane/Propylene                         1,450    1,173    1,189    1,160
Other Oils                                3,291    3,326    3,389    3,510
Total Product Supplied                   20,851   20,325   20,213   20,195

http://www.eia.doe.gov/oil_gas/petro.../gasoline.html

Thats over the past few weeks by thousands of barrels, and it breaks down everything from importation to distrobution and production across the country. And actualy, the gasoline being used in this country is more than the amount being produced each month because we are having to import it as well.

[Clandestino]

RE- ING-GARDLESS, the rising price of oil plays a huge factor in our gas prices.. manny, wants to say it is only bc of the lack of refining capabilities...