Why is gas So High?
I am thinking it is time to elect President and vice President that are not tied into Oil.
It is costing me over 500.00 a month for gas[:(!]
Ok I fell better now... Sort of[:I]
It is costing me over 500.00 a month for gas[:(!]
Ok I fell better now... Sort of[:I]
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quote:Originally posted by nemesisenforcer
quote:Originally posted by dlrjj
OPEC does not have a monopoly on the production of crude oil, and that is easily demonstrated by a simple look at the countries that produce crude oil and observing the fact that not even a reasonable portion of the producing countries are members of OPEC.
OPEC is not in the least illegal since they are a cartel, and that is not illegal when it involves multinational entities.
Cartels are illegal in many countries, and they are not only illegal in the United States, it is illegal for a US company to be a member of one of them, but they are not illegal across the board on the international markets.
We do not control international markets, and that's why they are called international markets, not U.S. markets, so we can't stop cartels from existing in all cases, and when they do exist, we often have no choice but to buy from them if we wish to have their products. Buying from them is not illegal.
OPEC doesn't have a monopoly on crude? Maybe not by the strictest definition, but OPEC countries produce the OVERWHELMING majority of the oil pumped out of the ground. Ever wonder why the world shudders at the threat of an OPEC embargo? BECAUSE THEY CONTROL ALMOST ALL THE WORLD'S CRUDE PRODUCTION. You don't have to have an absolute, out and out monopoly to be such a big player that you have a de facto one, and that's what OPEC is. All of the production from non-OPEC nations pales in comparison to the amount extracted from OPEC members.
As for the difference of opinion regarding cartels, monopolies, illegal, unjustifiable or otherwise, I guess we'll just have to agree to disagree.
Here's some world oil production figures for you. Please point out which ones are the "pales in comparison" numbers.
They come from here.
http://www.eia.doe.gov/oiaf/ieo/oil.html
Figure 30. OPEC and Non-OPEC Total Petroleum Liquids Production, 1990, 2003, and 2010-2030
Million Barrels per Day
OPEC Non-OPEC
1990 24.427 42.053
2003 29.84353 50.27577
2010 37.26042 54.3742
2015 39.71191 58.60943
2020 40.42237 63.65736
2025 42.54558 68.18279
2030 45.31714 72.64215
The graph is about half way down the page on the right. Take a look.
Here's another one.
Non-OPEC Fact Sheet
NON-OPEC Countries
Non-OPEC countries (countries not members of OPEC - the Organization of the Petroleum Exporting Countries) produced 60 percent of the world's oil (total liquids) in 2004, down from 62 percent in 2003. Since 1970, non-OPEC production as a share of world total oil production reached a high of 71 percent in 1985 and a low of 48 percent in 1973, with a 60 percent average.
It comes from this article.
http://www.eia.doe.gov/emeu/cabs/nonopec.html0 -
What I would like to know is how come I seen on the news where there were rumors that made the price of gas go up and then when the rumor was found out to be false, the price never came back down. I have seen that happen twice in the last two months now. If you ask me, the oil companies use whatever excuse they can come up with just to raise the price. Plain GREED in my opinion.[:(!][:(!] 0 -
quote:Originally posted by kabar
What I would like to know is how come I seen on the news where there were rumors that made the price of gas go up and then when the rumor was found out to be false, the price never came back down. I have seen that happen twice in the last two months now. If you ask me, the oil companies use whatever excuse they can come up with just to raise the price. Plain GREED in my opinion.[:(!][:(!]
Try this link and I believe you will be able to find your market setters.
http://www.nymex.com/index.aspx0 -
quote:Originally posted by dlrjj
Just what in the hell do you think opinion has to do with legality? Cartels either are legal or they are not, and no opinion one way or another has any damn effect at all. Good God Almighty, get a grip on a part of reality.
OPEC is legal, and no opinion by some person upset with fuel prices is going to change that in the slightest.
so OPEC is "legal" because YOU say so but not illegal or immoral because I say so? Got it.
Talk about getting a grip on reality. . .0 -
Simple; Because we buy it. Everything else trying to explain it is just words.
Stop buying gas and gas prices will fall like a rock.0 -
quote:Originally posted by dlrjj
quote:Originally posted by nemesisenforcer
quote:Originally posted by dlrjj
OPEC does not have a monopoly on the production of crude oil, and that is easily demonstrated by a simple look at the countries that produce crude oil and observing the fact that not even a reasonable portion of the producing countries are members of OPEC.
OPEC is not in the least illegal since they are a cartel, and that is not illegal when it involves multinational entities.
Cartels are illegal in many countries, and they are not only illegal in the United States, it is illegal for a US company to be a member of one of them, but they are not illegal across the board on the international markets.
We do not control international markets, and that's why they are called international markets, not U.S. markets, so we can't stop cartels from existing in all cases, and when they do exist, we often have no choice but to buy from them if we wish to have their products. Buying from them is not illegal.
OPEC doesn't have a monopoly on crude? Maybe not by the strictest definition, but OPEC countries produce the OVERWHELMING majority of the oil pumped out of the ground. Ever wonder why the world shudders at the threat of an OPEC embargo? BECAUSE THEY CONTROL ALMOST ALL THE WORLD'S CRUDE PRODUCTION. You don't have to have an absolute, out and out monopoly to be such a big player that you have a de facto one, and that's what OPEC is. All of the production from non-OPEC nations pales in comparison to the amount extracted from OPEC members.
As for the difference of opinion regarding cartels, monopolies, illegal, unjustifiable or otherwise, I guess we'll just have to agree to disagree.
Here's some world oil production figures for you. Please point out which ones are the "pales in comparison" numbers.
They come from here.
http://www.eia.doe.gov/oiaf/ieo/oil.html
Figure 30. OPEC and Non-OPEC Total Petroleum Liquids Production, 1990, 2003, and 2010-2030
Million Barrels per Day
OPEC Non-OPEC
1990 24.427 42.053
2003 29.84353 50.27577
2010 37.26042 54.3742
2015 39.71191 58.60943
2020 40.42237 63.65736
2025 42.54558 68.18279
2030 45.31714 72.64215
The graph is about half way down the page on the right. Take a look.
Here's another one.
Non-OPEC Fact Sheet
NON-OPEC Countries
Non-OPEC countries (countries not members of OPEC - the Organization of the Petroleum Exporting Countries) produced 60 percent of the world's oil (total liquids) in 2004, down from 62 percent in 2003. Since 1970, non-OPEC production as a share of world total oil production reached a high of 71 percent in 1985 and a low of 48 percent in 1973, with a 60 percent average.
It comes from this article.
http://www.eia.doe.gov/emeu/cabs/nonopec.html
so OPEC only controls 40%of the world's oil production? I stand corrected. That's hardly a drop in the bucket. [/roll eyes]0 -
Find one spot where I said that they only produced a "drop in the bucket".
I never claimed that they produced the "overwhelming majority" of the world's production, and that all other countries "pale in comparison" - roll your eyes all you please - I made no production claims at all. That was done by someone else, I believe. You might know who it was.0 -
Now just how in the hell can they keep control of us if we are all driving all over hells half mile?? Call me a tin foil hat wearer, this does not have a damn thing to do with China or demand and supply. 0 -
Isn't it strang the people that want the US to reduce its dependency on foregin oil are the ones that dont want us drilling on our own land. I smell a double standard.
At least part of the problem will be solved if we cut out the middle terrorist man.0 -
quote:Originally posted by nemesisenforcer
quote:Originally posted by dlrjj
Just what in the hell do you think opinion has to do with legality? Cartels either are legal or they are not, and no opinion one way or another has any damn effect at all. Good God Almighty, get a grip on a part of reality.
OPEC is legal, and no opinion by some person upset with fuel prices is going to change that in the slightest.
so OPEC is "legal" because YOU say so but not illegal or immoral because I say so? Got it.
Talk about getting a grip on reality. . .
No, I don't believe that you do get it. OPEC is legal because the world says it's legal, not some individual who can't figure out that U.S. laws don't control world markets.
Here's a history.
http://www.opec.org/aboutus/history/history.htm
Here's a brief piece on cartels.
http://en.wikipedia.org/wiki/Cartel
And an excerpt from it.
"OPEC: As its name suggests, OPEC is organized by sovereign states. It cannot be held to antitrust enforcement in other jurisdictions by virtue of the doctrine of state immunity under public international law. However, members of the group do frequently break rank to increase production quotas.
Many trade organizations, especially in industries dominated by only a few major companies, have been accused of being fronts for cartels:
Although cartels are usually thought of as a group of corporations, some consider labor unions to be cartels, as they seek to raise the price of labor (wages) by preventing competition.[1]
An example of a new international cartel is the one created by the members of the Asian Racing Federation and documented in the Good Neighbour Policy signed on September 1, 2003."
Here's another source for legality.
Cartels Law & Legal Definition
Related Legal Forms
Cartels
A cartel is a united group of industrial corporations which band together for the purpose of restricting trade for their mutual benefit. Cartels may agree to control distribution, set prices, reduce competition, and sometimes share technical expertise. Such companies usually are international and cartels generally exist outside of the United States, since U.S. antitrust laws generally prohibit the formation of cartels.
The most well-known cartel is OPEC (Organization of Petroleum Exporting Countries), which represents all of the oil producing countries in the Middle East, North Africa and Venezuela. Some cartels operate secretively, such as illegal drug cartels.
-It's from here;
http://definitions.uslegal.com/c/cartels/
My opinion means not one bit more than yours on this topic. Cartels are legal as constructed and being ticked off at them won't change that at all.0 -
Well with reference to the Cartel, they are in the business of price fixing. So this commomody is not floating with supply and demand of the actual market forces. This is the same game played with coffee and other products, create a shortage and fix a new higher price.
There are so many factors controlling the price of oil that I for one do not think that there is much of a free market system remaining in this industry.
Shortage of refinerys, holding oil on the tankers to get a higher price, oil cartels, control of oil land leasing, restricting drilling, nationalization of oil resources, taxation and many other man made controls.
The oil companies can charge about anything they want if they can take the heat when earnings are reported. They have a world standard to hold over our heads that reflects a much higher price for the product in Europe.
I had high hopes that alternative sources of energy would put a little pressure on the oil companies to back off a bit. But government has allowed the oil companies to buy into most of the new energy sources so it will just be more of the same. They will jack us around when they take control of other sources. There is no real competition in energy when the players are all on the same team.0 -
Yep sig, and diamonds are another cartel. The whole concept of a cartel is to increase market control.[:)] 0 -
Well, it was mentioned before but I'll mention it again. The dollar is weak. It's called inflation.
Next up, China. Originally, China had very few automobiles and relied on their own supply to keep up with their demand. That was then, this is now. They went from a net exporter to a growing net importer. Within the next few years, they will have more automobiles on the road than the US does. That's a lot of cars. Even if they are more fuel efficient than ours.
You're crazy if you don't think they will have a major impact on the market. They probably are already. They are competing with us for it.
Iran has one refinery. They have to import fuel to keep up with demand. I doubt the number of vehicles are decling in any developing countries.
It isn't the 1950s anymore. Major world players are going to be competing for it against us from here on out.
On top of that, you have big oil's greed.
On top of that, station owner's greed.
On top of that, you have high taxes on it.
On top of that, you have the occasional natural disaster wiping out refineries.
Only gonna get worse folks. Eventually, an alternative will become essential.
But, so long as people can keep slapping 70 dollar tanks of gas on their 19.99% apr credit cards, we'll be ok.0 -
OPEC could disband Tuesday morning and the price of crude would not fall by even one cent. We could drain Alaska dry and drill off shore to the point of blocking the sun rise/sun set with off shore rigs and the price of oil would not fall. It is all about demand and there are few signs that demand is slacking off, even as prices spike once again. There is currently very little reserve capacity for crude oil production on this planet and even less capacity for refining. Crude oil is useless unless it can be refined and even if large fields were discovered and opened there will be little chance of getting refined petroleum products into the hands (gas tanks) of consumers at lower prices. The idea of pumping enough crude to lower it's price is doomed to failure, only a drop in consumption can lower prices and there is no indication at all that Americans are not willing to pay $4 per gallon for motor fuels if it means keeping their current life/driving styles. As long as we can get our hands on motor fuels without waiting in line or having it rationed I don't see a roof on the price of motor fuels in this country, which are still the lowest in the G-7 nations (and please, I know all about the tax structure). 0 -
quote:Originally posted by vess1
Well, it was mentioned before but I'll mention it again. The dollar is weak. It's called inflation.
Next up, China. Originally, China had very few automobiles and relied on their own supply to keep up with their demand. That was then, this is now. They went from a net exporter to a growing net importer. Within the next few years, they will have more automobiles on the road than the US does. That's a lot of cars. Even if they are more fuel efficient than ours.
You're crazy if you don't think they will have a major impact on the market. They probably are already. They are competing with us for it.
Iran has one refinery. They have to import fuel to keep up with demand. I doubt the number of vehicles are decling in any developing countries.
It isn't the 1950s anymore. Major world players are going to be competing for it against us from here on out.
On top of that, you have big oil's greed.
On top of that, station owner's greed.
On top of that, you have high taxes on it.
On top of that, you have the occasional natural disaster wiping out refineries.
Only gonna get worse folks. Eventually, an alternative will become essential.
But, so long as people can keep slapping 70 dollar tanks of gas on their 19.99% apr credit cards, we'll be ok.
China announced that their imports for March were up almost 9% over last year. Pure demand and supply pressure, and it's not going to go down soon.0 -
it costs as much as we're willing to pay it. 0 -
quote:Originally posted by kristov
OPEC could disband Tuesday morning and the price of crude would not fall by even one cent. We could drain Alaska dry and drill off shore to the point of blocking the sun rise/sun set with off shore rigs and the price of oil would not fall. It is all about demand and there are few signs that demand is slacking off, even as prices spike once again. There is currently very little reserve capacity for crude oil production on this planet and even less capacity for refining. Crude oil is useless unless it can be refined and even if large fields were discovered and opened there will be little chance of getting refined petroleum products into the hands (gas tanks) of consumers at lower prices. The idea of pumping enough crude to lower it's price is doomed to failure, only a drop in consumption can lower prices and there is no indication at all that Americans are not willing to pay $4 per gallon for motor fuels if it means keeping their current life/driving styles. As long as we can get our hands on motor fuels without waiting in line or having it rationed I don't see a roof on the price of motor fuels in this country, which are still the lowest in the G-7 nations (and please, I know all about the tax structure).
We import right around one million barrels of gasoline per day in addition to the crude oil we import for use in our own refineries. We can't begin to keep production of fuel up to the level of demand we have, and every tiny blip in production, and every shut down for service and repair makes the shortage worse. We can't burn crude oil, it has to be refined, and we can't do enough of that.
Nigeria is having problems and they are a major supplier of crude and Belgium refinery workers are threatening a strike, and that could reduce world fuel production by about one million barrels a day.
Could get interesting again.[:)]0 -
Because not enough people are eating Bush's Best Baked Beans. 0 -
quote:Originally posted by dlrjj
quote:Originally posted by kristov
OPEC could disband Tuesday morning and the price of crude would not fall by even one cent. We could drain Alaska dry and drill off shore to the point of blocking the sun rise/sun set with off shore rigs and the price of oil would not fall. It is all about demand and there are few signs that demand is slacking off, even as prices spike once again. There is currently very little reserve capacity for crude oil production on this planet and even less capacity for refining. Crude oil is useless unless it can be refined and even if large fields were discovered and opened there will be little chance of getting refined petroleum products into the hands (gas tanks) of consumers at lower prices. The idea of pumping enough crude to lower it's price is doomed to failure, only a drop in consumption can lower prices and there is no indication at all that Americans are not willing to pay $4 per gallon for motor fuels if it means keeping their current life/driving styles. As long as we can get our hands on motor fuels without waiting in line or having it rationed I don't see a roof on the price of motor fuels in this country, which are still the lowest in the G-7 nations (and please, I know all about the tax structure).
We import right around one million barrels of gasoline per day in addition to the crude oil we import for use in our own refineries. We can't begin to keep production of fuel up to the level of demand we have, and every tiny blip in production, and every shut down for service and repair makes the shortage worse. We can't burn crude oil, it has to be refined, and we can't do enough of that.
Nigeria is having problems and they are a major supplier of crude and Belgium refinery workers are threatening a strike, and that could reduce world fuel production by about one million barrels a day.
Could get interesting again.[:)]
I am sure that you look over the same petroleum market data that I look at so you are well aware that the world reserve production capacity for crude oil over the past two years has been at it's lowest point in nearly twenty years. Right now there is about a 1.5 million bpd reserve production capacity, down from nearly 6 million bpd back in 2002 and this makes for a very nervous market. Crude oil and motor fuel stocks (inventory) are down, but propane inventory is up so warmer weather should help reduce deamnd for heating oil and this would put less strain on the motor fuel market which should lead to a stable price in gasoline and diesel fuel. I am betting that we won't see the usual spike in prices for the "summer driving season" this year because there should be a gradual increase in crude oil inventory as well as enough refinery capacity on line to handle it. Bottom line is it is still going to cost more to take that road trip this year. Consumption estimate for motor fuels in 2008 and 2009 show an increase in demand of around 1.5% and 1.3%. This is sustainable...For now. Petroleum independence in the United States is a web-site pipe dream because our crude oil consumption far outpaces our production and refinery capacity and that is not going to change unless we move over to alternate motor fuels and someone in DC is going to ahve to step up and simply say that we either become proactive about ethanol/methanol or we continue to pay whatever it costs for gasoline and diesel fuel.0 -
Figure 1. The Rising Federal Gasoline Excise Tax
Source: Congressional Research Service, Tax Foundation.
In 1932, the federal government imposed the first federal gas tax. It began as a temporary levy with a rate of just 1 cent per gallon. Over the years, the tax burden has increased significantly. The Revenue Act of 1941 made the federal gas tax permanent and increased the rate to 1.5 cents per gallon to help fund the war effort. A decade later in 1951, the tax was increased to 2 cents per gallon to assist in the funding of the Korean War.
After President Eisenhower's idea of an interstate highway system had been instituted, the federal gas tax was raised to 4 cents per gallon in 1959. As recent as 1981, the federal gas tax remained at 4 cents per gallon. Significant tax increases in 1982, 1990 and 1993 increased the federal gas tax by 14.4 cents per gallon, or 360 percent from 1981 levels.
In 1919, Oregon became the first state in the nation to place a tax on gasoline and every state has subsequently adopted this form of taxation. This year, according to the Energy Information Administration the average state gas tax is 20.8 cents per gallon. In addition to statewide taxes, often consumers pay local excise taxes on gasoline purchases (see Figure 2).
Figure 2. Combined Local, State and Federal Gasoline Taxes, August 2005 (Click for larger image.)
Source: American Petroleum Institute, Tax Foundation.
Today, the combined burden of federal, state and local gas taxes costs American drivers an average of 45.9 cents on every gallon purchased. As Figure 2 illustrates, in some states the combined taxes exceed 60 cents for every gallon purchased. According to data on gasoline use from the U.S. Department of Transportation, that amounts to an annual gas tax burden of roughly $271 for every man, woman and child in the United States. In these times of concern over high gas prices, American consumers should remember that gasoline taxes have a significant impact on the amount they spend at the pump.
(For more information, contact Jonathan Williams at (202) 464-5119.)0 -
let's get one thing straight:
the market is NOT controlled by guys like "you and me". It is controlled by major hedge funds, many of which have an oil industry connection.
The fact is that the average small investor does not have enough capital to throw around to sway oil prices and would be a fool to risk his money in futures markets.0 -
quote:Originally posted by KSUmarksman
let's get one thing straight:
the market is NOT controlled by guys like "you and me". It is controlled by major hedge funds, many of which have an oil industry connection.
The fact is that the average small investor does not have enough capital to throw around to sway oil prices and would be a fool to risk his money in futures markets.
I have no interest at all in zero sum commodity investments, but the related effect on oil stocks can be interesting.[:)]0 -
quote:Originally posted by kristov
quote:Originally posted by dlrjj
quote:Originally posted by kristov
OPEC could disband Tuesday morning and the price of crude would not fall by even one cent. We could drain Alaska dry and drill off shore to the point of blocking the sun rise/sun set with off shore rigs and the price of oil would not fall. It is all about demand and there are few signs that demand is slacking off, even as prices spike once again. There is currently very little reserve capacity for crude oil production on this planet and even less capacity for refining. Crude oil is useless unless it can be refined and even if large fields were discovered and opened there will be little chance of getting refined petroleum products into the hands (gas tanks) of consumers at lower prices. The idea of pumping enough crude to lower it's price is doomed to failure, only a drop in consumption can lower prices and there is no indication at all that Americans are not willing to pay $4 per gallon for motor fuels if it means keeping their current life/driving styles. As long as we can get our hands on motor fuels without waiting in line or having it rationed I don't see a roof on the price of motor fuels in this country, which are still the lowest in the G-7 nations (and please, I know all about the tax structure).
We import right around one million barrels of gasoline per day in addition to the crude oil we import for use in our own refineries. We can't begin to keep production of fuel up to the level of demand we have, and every tiny blip in production, and every shut down for service and repair makes the shortage worse. We can't burn crude oil, it has to be refined, and we can't do enough of that.
Nigeria is having problems and they are a major supplier of crude and Belgium refinery workers are threatening a strike, and that could reduce world fuel production by about one million barrels a day.
Could get interesting again.[:)]
I am sure that you look over the same petroleum market data that I look at so you are well aware that the world reserve production capacity for crude oil over the past two years has been at it's lowest point in nearly twenty years. Right now there is about a 1.5 million bpd reserve production capacity, down from nearly 6 million bpd back in 2002 and this makes for a very nervous market. Crude oil and motor fuel stocks (inventory) are down, but propane inventory is up so warmer weather should help reduce deamnd for heating oil and this would put less strain on the motor fuel market which should lead to a stable price in gasoline and diesel fuel. I am betting that we won't see the usual spike in prices for the "summer driving season" this year because there should be a gradual increase in crude oil inventory as well as enough refinery capacity on line to handle it. Bottom line is it is still going to cost more to take that road trip this year. Consumption estimate for motor fuels in 2008 and 2009 show an increase in demand of around 1.5% and 1.3%. This is sustainable...For now. Petroleum independence in the United States is a web-site pipe dream because our crude oil consumption far outpaces our production and refinery capacity and that is not going to change unless we move over to alternate motor fuels and someone in DC is going to ahve to step up and simply say that we either become proactive about ethanol/methanol or we continue to pay whatever it costs for gasoline and diesel fuel.
That amount of reserve is only about 1.5-2% of actual daily demand, and there is not much incentive/ability to increase the reserve at the current time. Creating spare, but unused, capacity flies in the face of the basic purpose of stockholder owned companies, and few nationally owned enterprises have the spare capital to be able to use to create a resource that will not give a return in the immediate or predictable future. I suspect Saudi Arabia may be the only one of that type with enough real surplus capital to make a difference. I understand that they have committed $50 billion over the next few years to just that factor.
It doesn't stop there either, because there has been an underinvestment in pipelines and shipping capacity in addition to the obvious deficit in refining capacity, all of which places bottlenecks in the supply flow that can be a major stopper at any time. If it wasn't for Russian increased capacity over the last few years, the situation would likely be much worse, but I don't see much more short term relief from that source, though there is long term help available. That assumes a continued flow of investment capital from the world market since the Russians just don't have it to spare.
The upshot of this is that we are at the mercy of any major spikes or disruptions, and should be anticipating increased price volatility for the next few years. It could be a rollercoaster ride, but the price swings that are coming regardless will provide some excellent investment opportunities.0 -
Because they can.
[V][V]
BW0 -
Pure and simple GREED all the way from the oil fields to heads of state. 0
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