Author Topic: Why we pay $3 a gallon for gas.  (Read 17069 times)

rbodell

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Why we pay $3 a gallon for gas.
« on: January 21, 2008, 11:30:04 PM »
I don't know why these didn't come through. Did it the same as before but the pictures didn't come out, The links work thoug so you can click on them. When the first one comes up just click the NEXT arrow at the top.

<a href="http://picasaweb.google.com/rbodell/WhyWePay3AGallonForGas/photo#5158068898573340514"><img src="http://lh3.google.com/rbodell/R5UkVap0T2I/AAAAAAAAAh8/cg1_6OMPULM/s144/house.jpg" /></a>

Here is his website, be sure to sign his guestbook. http://www.sheikhzayed.com/index_flash.htm#
« Last Edit: January 21, 2008, 11:36:58 PM by rbodell »
The shear depth of my shallowness is perplexing yet morbidly interesting. Bob 2007

Doug

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Re: Why we pay $3 a gallon for gas.
« Reply #1 on: January 22, 2008, 12:03:55 AM »
The reason you pay $3.00 a gallon for Gasoline ( and thats actualy a bargin, I think I pay more ) is 2 Billion Chinese and Indians pulling up tpo the pumps to buy Gas, diesel and kero now on mass.

Giant American cars driving up demand.

Depreciating American dollar.

Now I f I had the Saudi guys money I'd buy you all some Nanos lol and pay an India fellow to do the bodies in Silver leaf lol.

It's a Good Life, If You Don't Weaken

captfred

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Re: Why we pay $3 a gallon for gas.
« Reply #2 on: January 22, 2008, 09:35:40 AM »
Taking into account adjustments for inflation, gas was slightly more expensive in 1980 than it is today.

I'd love to pay only 3 bucks for a gallon of gas - we're kissin' 4 bucks a gallon here. :'(

Fred

rbodell

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Re: Why we pay $3 a gallon for gas.
« Reply #3 on: January 22, 2008, 02:49:53 PM »
Taking into account adjustments for inflation, gas was slightly more expensive in 1980 than it is today.

I'd love to pay only 3 bucks for a gallon of gas - we're kissin' 4 bucks a gallon here. :'(

Fred

we don't realize how lucky we are.
« Last Edit: January 22, 2008, 02:51:50 PM by rbodell »
The shear depth of my shallowness is perplexing yet morbidly interesting. Bob 2007

dieseldave

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Re: Why we pay $3 a gallon for gas.
« Reply #4 on: January 23, 2008, 04:26:53 AM »

   Thats why I drive a VW Jetta TDI!   I have got 63.9 MPG Highway with this vehicle. Our gallon has 4.54Litres. US Gallon has 3.78Litres.

listerdiesel

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Re: Why we pay $3 a gallon for gas.
« Reply #5 on: January 23, 2008, 08:22:05 AM »
It was £1.11 per LITRE last week on the motorway services.

Adjust that for the US gallon and currency, and you'll see that $3 a gallon US is nothing to bitch about.

Peter

xyzer

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Re: Why we pay $3 a gallon for gas.
« Reply #6 on: January 23, 2008, 08:50:51 PM »
It was £1.11 per LITRE last week on the motorway services.

Adjust that for the US gallon and currency, and you'll see that $3 a gallon US is nothing to bitch about.

Peter

After a little trip to the Netherlands I came home and told all the bitchers here in the states you aint seen nothin....told them to keep on bitchin but grin when you do it cause it aint all that bad here!!!! Fuel is just the tip of the iceburg....Taxes are also somthing we bitch about...keep grinnin I say!
Dave
« Last Edit: January 23, 2008, 08:53:04 PM by xyzer »
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dpollo

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Re: Why we pay $3 a gallon for gas.
« Reply #7 on: January 27, 2008, 02:51:11 AM »
How I yearn for the days when gasoline in western Canada was 43 cents per Imperial gallon and beer was $2.52 per dozen, 20 cents per glass in the bar . I made $ 1.25 an hour and figured I had the world by the tail. Bought four Good year polyglas tires for my '50 Plymouth for $ 135. Ran that old car 120 000 miles over what it had on it when I bought it for $50 in 1965.

 If you move the decimal point over a space, things don't look so bad, but I am not able any more to summon up the optimism for our future that I could back in 1968.   dp

lowspeedlife

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Re: Why we pay $3 a gallon for gas.
« Reply #8 on: January 27, 2008, 04:19:25 PM »
alll of this is true but we in the us still are hoarding our own oil (anwar & the capping of producing wells in colorado) & we haven't built a new refinery in over 30 years. the functioning refineries are operating (when operating) at 115% capacity, when maitainence is done the refinery now must meet the new epa regs, even thought it was built in 1950. until we start drilling for ourselves (we can't drill off the coast of florida but castro sure is!) & build a refinery or two & seriously look into alternatives ( no the prius is not a viable option) were all just going to have to pay up. scott r.
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captfred

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Re: Why we pay $3 a gallon for gas.
« Reply #9 on: January 27, 2008, 08:35:16 PM »
If any administration  could have limited or removed epa restrictions on new refinery construction and offshore drilling it is this one (hey, they were able to remove habeas corpus).

Why didn't refineries get built - or offshore drilling begin in new areas?  Oil and fuel are both strategic to our economy and national security.  Maybe they know something they're not telling us (secret energy policy meetings) -  like we've reached global  Peak oil and building new refineries to process a dwindling resource would be a waste of other resources?

Don't know.

Fred


Stan

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Re: Why we pay $3 a gallon for gas.
« Reply #10 on: January 27, 2008, 10:23:41 PM »
Or like maybe if there were a couple of big new refineries, and lots of new sources in the Gulf of Mexico, there would be a lot more reserve and the prices of refined products would plummet, losing all the big executives lots of money on their stock options!  Where's the incentive there?

The decision makers have to decide on;

1.   increase the reserves and give us all cheaper gas, and make their stock options worth far less, or
2.   keep the status quo and make a ton of money.

Duh  ???

Stan

ghmorris

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Re: Why we pay $3 a gallon for gas.
« Reply #11 on: January 28, 2008, 02:28:49 AM »
Stan, with the greatest respect, it simply doesn't work that way.

Yes, we can produce a bunch of oil. How much, for how long, is a simple (or fairly simple) matter of economics.

Secondary and tertiary recovery of resrerves was a well know science even in the 80s when I was in the business.

For every dollar increase in the selling price, you gain a percentage in recoverable reserves. Very easy math.

That's why the oil sands make economic sense today. Increase the price of oil past $150 per barrel and you will be amazed at thei increase in reserves and production. But eventually its going to run out. We should not be burning fossil fuels, they are far too useful for other applications like plastics etc.

George

Doug

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Re: Why we pay $3 a gallon for gas.
« Reply #12 on: January 28, 2008, 02:49:53 AM »
Maybe its just me but in my line of work the players have become huge multi national. The reason behind the mergers was the high cost of developing new mines. Therefore it was cheaper to buy smaller companies with reserves rather than develop new ones.

The new bigger fish in the shrinking pond can turn big proffits from doing nothing so why risk money exploring on anything that isn't a sure thing? Disaplin is the name of the game produce only what you know you can make long term money

Non ecconomic producers from the past on the other hand do have an incentive to increase producion because things that in the past didn't contribute much to the bottom line now do. A good example is Sumitomo Metal Mining. A light weight in the mining buisness but big in smelting, they found a niche in refining waste producst like fly ash from other metal compnaies to extract nickel. At 5 dollars a pound this doesn't makes sence, but at 12 it does. And nickel pig iron is another example some Chinese companies do. Sure you can extract nickel from Laterite ore with convensional blast furnace technolgy but this isn;t a way to actulay increase the amount of metal it just takes the edge off 20 dollar nickel and makes it a slightly less insane 15....

Why should the oil buisness be any different from mining?
It seems that the mining buisness followed the lead of the oil companies, in fact some of them like BHP&B and Teck Cominco have gotton into the oil buisness off shore ( Neptune for BHP, Tar sands for Teck ).

So yes I can see small players in the energy buisness moving in but they realy don't make a difference.

Like you ever heard of Teck Cominco??????   

I can't realy argue any points about peak oil I'm not an expert, but I believe we are seeing peaks in other things like Nickel, PMGs and special rare earth metals ( that I have better insight into ).

Save oil for plastics, well I guess thats better than burning it all
It's a Good Life, If You Don't Weaken

Stan

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Re: Why we pay $3 a gallon for gas.
« Reply #13 on: January 28, 2008, 03:37:48 AM »
George...I know, peak oil is here, but will still take a few months/years to have significant effect.  I was speaking of the LAST few years and why the big wigs in charge of the oil supply didn't want their stock options dilluted by too large a supply.  You have to agree, when the size of reserves goes up, the price of stock goes down, right?.
Stan

ghmorris

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Re: Why we pay $3 a gallon for gas.
« Reply #14 on: January 29, 2008, 12:34:22 AM »
Beyond a doubt Stan.

I was working off shore in the North Sea in the late '70s and '80s. We were already well past peak in most of the oil fields I worked. Enhancing production to recover more oil was always a cost/benefit decision based on current and forecast oil prices. Getting fancy with more sophisticated drilling and production technicques can be very expensive. High angle directional holes are much more expensive to drill than a traditional well. Same goes for advanced production methods. $20 dollar/bbl oil simply won't pay for extracting that kind of oil, and most of the oil that is left today is much harder to get out.

I'm certainly not saying there is no market manipulation, of course there is. But the reality is that energy production costs have been going up steadily for at least 30 years to my personal knowledge, and its pretty widely accepted that there are unlikely to be any more finds on say the scale of the North Sea or North Slope.

There is a heck of a lot of oil left even in old fields. Its a matter of how much you have to pay to get it out in economic quantities and turn a profit in the process, and at $100/bbl or better production economics sure look better!! 8)

George