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Good News!!! Gas Prices going Up...

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http://www.nwherald.com/BusinessSection/376619157609695.php

Well, we got what we voted for; Clinton had 8 years to fix the problem; Bush isn't going to fix the problem; the only thing logical was that people did want it raised because they realized they either wanted to pay more for gas or they realize the oil industry isn't making money.

Thank you for voting in those high prices and vote for the cabal party again for not only higher prices for gas, but for insurance also; thank you for freezing wages though.
 

Schweddy

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We can thank the tree huggers and enviormentalists for this. The required ethanol and additional "cleaning" additives needed during the summer always spike everything up. We can thank Bush Sr. and Clinton.

Plus we are only at 30% (from what I heard on radio) capacity in the gulf currently.

It will only get worse. *sigh*
 

Kandahar

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Good. The faster gas prices go up, the faster we stop using it. Now would be a good time to start phasing in a $2 per gallon gas tax.
 

AndrewC

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vauge said:
We can thank the tree huggers and enviormentalists for this. The required ethanol and additional "cleaning" additives needed during the summer always spike everything up.


That is a bit harsh don't you think? So you don't blame the profiteers at all? Interesting how they can gouge consumers and still keep a clean image. I guess they learned it from the tobacco industry.
 

cherokee

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We can thank all of us......

Who remembers the oil embargo of the 70's?

THAT should have been a real wake up call but........:roll:
 

danarhea

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Kandahar said:
Good. The faster gas prices go up, the faster we stop using it. Now would be a good time to start phasing in a $2 per gallon gas tax.

Ahhh. The Libertarian solution, and the market approach is the correct one. Once prices go up enough, then this administration, as well as those which come after, whether the be Democratic or Republican, will have no choice but to start supporting investment in alternative approaches. If it wasnt for the high prices we have now, the Alberta tar sands would remain untapped, and there is more oil there than in the entire Middle East. Oil is now being extracted from the tar sands, but this is only a start. We need a "Manhattan Project" for an economy based on hydrogen.
 

Kandahar

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AndrewC said:
That is a bit harsh don't you think? So you don't blame the profiteers at all? Interesting how they can gouge consumers and still keep a clean image. I guess they learned it from the tobacco industry.

They aren't "gouging" anyone. Oil prices obey the laws of supply and demand, just like every other commodity. However, the government should step in to gouge consumers. It'd reduce the demand and take money out of the pockets of dictators and terrorists.
 

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Kandahar said:
They aren't "gouging" anyone. Oil prices obey the laws of supply and demand, just like every other commodity. However, the government should step in to gouge consumers. It'd reduce the demand and take money out of the pockets of dictators and terrorists.
That I have to strongly disagree with you on. The government is already robbing us blind.
 

Kandahar

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danarhea said:
That I have to strongly disagree with you on. The government is already robbing us blind.

Yes. There are plenty of other taxes that should be cut drastically or eliminated entirely; gas taxes, however, should be raised. Creating the economic climate for alternative energy is a lot more cost-effective way of funding national security, than is tactical military interventions in the Middle East.

I wrote some in-depth columns on the subject here:
http://jondthompson.com/blog/weaning-america-from-oil-part-1/
http://jondthompson.com/blog/weaning-america-from-oil-part-2/
 

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Kandahar said:
They aren't "gouging" anyone. Oil prices obey the laws of supply and demand, just like every other commodity. However, the government should step in to gouge consumers. It'd reduce the demand and take money out of the pockets of dictators and terrorists.
I have difficulty with this. Yes I know the world market scheme with regards to oil. However being that the worlds oil is marketed by only a very select few companies (the former Rockefeller trusts and some more foreign ie bp) and the fact that last year in the 3rd quarter oil companies reported record profits (think August and Sept during Katrina) and then ended the year with a record of $36 billion for one company alone; Exxon Mobile. Slap me but I find it a bit hard to believe that these sharks have no control over thier profits, and especially when the administration and congress are all in thier pockets (ie Phil Cooney)
 

aps

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I love the higher gas prices. People drive too much, and people need to think before they buy a car that guzzles gas and affects our air quality. The number of SUVs being bought has decreased substantially since the increase in gas prices. I take Metro to and from work, and I only have to fill up my car approximately once every six weeks. On top of that, I get a tax exemption because I don't use my car for business purposes.
 

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A large part of the current price increases are the fault of changing EPA regs, including the phasing out of MTBE and the switch to ethanol. More specifically, the EPA now requires 18 regional blends of gasoline. This is very costly, not only in terms of the much shorter production runs over which to spread the cost, but the infrastructure with which to distribute this many blends is not yet fully in place in all regions. The result is higher prices and maybe even some spot shortages in those areas without sufficient infrastructure (one of which, somewhat ironically, is around Houston, TX, IIRC).

Crude had dropped back to the high $58 - $60 price range, which had helped put a bit of damper on potential gasoline price increases, but have now popped back up to the $67+ range, partly as a result of Iranian military exercises and demonstration of hardware that could be used against shipping in the Straits of Hormuz and other adversaries in the ME.

In the longer run, we probably do need a fairly hefty gasoline tax, with the proceeds specifically allocated to energy R&D.. The problem with such is the tendency of Congress to spend the proceeds of any tax for any and all purposes other than that for which the tax is intended. Too often, once they get their hands on the money, its all over.
 
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oldreliable67 said:
In the longer run, we probably do need a fairly hefty gasoline tax, with the proceeds specifically allocated to energy R&D.. The problem with such is the tendency of Congress to spend the proceeds of any tax for any and all purposes other than that for which the tax is intended. Too often, once they get their hands on the money, its all over.

I agree with this. I believe we should pay a higher gas tax (or oil tax) to pay for R&D for an alternative fuel source. This of course is with the understanding that the money from these taxes will actually pay for R&D and not be used for anything else.

I don't agree with the current polcies of tax breaks now and debt later. I'd rather have taxes now and surplus later.
 

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oldreliable67 said:
A large part of the current price increases are the fault of changing EPA regs, including the phasing out of MTBE and the switch to ethanol.
Not entirely accurate. The switch was not to ethanol but swapping the methyl group in MTBE to an ethyl group. ETBE is more expensive then MTBE. MTBE though produced cleaner burning fuel, however, it ironically directly contaminates grown water.
But then the question is, how much is clean air and water worth to you?

oldreliable67 said:
More specifically, the EPA now requires 18 regional blends of gasoline. This is very costly, not only in terms of the much shorter production runs over which to spread the cost, but the infrastructure with which to distribute this many blends is not yet fully in place in all regions.
This is mainly from state regulations that are in place. Colorado burns crap for fuel while CA and MA both burn the cleanest fuel (relatively) in the US.

oldreliable67 said:
Crude had dropped back to the high $58 - $60 price range, which had helped put a bit of damper on potential gasoline price increases, but have now popped back up to the $67+ range, partly as a result of Iranian military exercises and demonstration of hardware that could be used against shipping in the Straits of Hormuz and other adversaries in the ME.
Various refining stations that have been "shut down" for maintainance has substantially contributed to the higher prices in the US.

oldreliable67 said:
In the longer run, we probably do need a fairly hefty gasoline tax, with the proceeds specifically allocated to energy R&D.. The problem with such is the tendency of Congress to spend the proceeds of any tax for any and all purposes other than that for which the tax is intended. Too often, once they get their hands on the money, its all over.
I do not trust congress to spend a single penny. They only pay lip service and spend what is popularly correct and not what is scientifically sound. ie hydrogen as a fuel source. Liquid fuels just can not be practically and safely substituted by gaseous fuels.
 

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Various refining stations that have been "shut down" for maintainance has substantially contributed to the higher prices in the US.

Right. Katrina left about 800,000 b/d of refining capacity out of action. In the aftermath, the sector put off much of its scheduled maintenance from last fall to try to catch up with demand, rescheduling that work for this spring.

For clarity purposes, here is a portion of the summary of the EIA presentation to the Senate on the effects of eliminating MTBE:

In 2005, a number of petroleum companies announced their intent to remove methyl tertiary-butyl ether (MTBE) from their gasoline in 2006. Companies’ decisions to eliminate MTBE have been driven by State bans due to water contamination concerns, continuing liability exposure from adding MTBE to gasoline, and perceived potential for increased liability exposure due to the elimination of the oxygen content requirement for reformulated gasoline (RFG) included in the Energy Policy Act of 2005. EIA’s informal
discussions with a number of suppliers indicate that most of the industry is trying to move away from MTBE before the 2006 summer driving season.
Currently, the largest use of MTBE is in RFG consumed on the East Coast outside of New York and Connecticut (Figure 1) and in Texas.1 The other RFG areas in the Midwest and California have already moved from MTBE to ethanol. Most companies eliminating MTBE in the short-run will blend ethanol into the gasoline to help replace the octane and clean-burning properties of MTBE. The rapid switch from MTBE to ethanol could have several impacts on the market that serve to increase the potential for supply dislocations and subsequent price volatility on a local basis. These impacts stem mainly
from:
• Net loss of gasoline production capacity
• Tight ethanol market, limited in the short-run by ethanol-production capacity and transportation capability to move increased volumes to areas of demand
• Limited resources and permitting issues hampering gasoline suppliers abilities to quickly get terminal facilities in place to store and blend ethanol
• Loss of import supply sources that cannot deliver MTBE-free product, or that cannot produce the high-quality blendstock needed to combine with ethanol The different properties between MTBE and ethanol affect not only production, but distribution and storage of gasoline as well. Ethanol-blended gasoline cannot be intermingled with other gasolines during the summer months,2 and ethanol, unlike MTBE, must be transported and stored separately from the base gasoline mixture to which it is added until the last step in the distribution chain.3 Many areas of the distribution system cannot handle additional products without further investments.

A large number of changes are required to the supply and distribution system to make the transition from MTBE-blended RFG to ethanol-blended RFG: contracting for and moving more ethanol to the East Coast and Texas, converting terminal tanks from petroleum to ethanol, adding blending equipment at many terminals, and finding new sources of supply – both ethanol and RFG blending components. In general, areas on the East Coast served by imports into the Northeast and East Coast refineries will likely need
more gasoline supply from imports and from the Gulf Coast than previously used. The areas further south in Maryland, Delaware, Washington DC and Virginia will still receive the reformulated gasoline blendstocks for oxygenate blending (RBOB) for their RFG from the Gulf Coast, but ethanol must be brought in by rail car to major terminals serving those areas.

Source.

A drive from the Washington, DC area to New Jersey this past week-end provided confrimation of exactly what Caruso was referring to: in northern Virginia, regular gasoline was about $2.65/gal; on the New Jersey Turnpike, it was about $2.35/gal. The added expense of bring in the ethanol by rail to the terminals serving the DC area is substanial.
 

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--- a local radio station had a study that showed Americans are paying about $.54 per mile to drive --- (not really making a point - just thought that was interesting)

Now, might be a good time to do away with gasoline tax - we don't tax medical care or food products - since gasoline, in many cases, has become a necessity much like food & medical care --- seems logical. Over-the-counter medications should also be free of tax (IMO). I believe we used to have a cap on profit per gallon of gas (I thought I read somewhere that it was $.07 profit per gallon - could be wrong) - I know that would be regulating it but I am not toally against regulations - this just may be an issue where a government regulation could be helpful or worthy of consideration. Or, maybe an incentive to invest in E85 fuel - refineries, farms, etc...

just a few thoughts here...
 

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oldreliable67 said:
Right. Katrina left about 800,000 b/d of refining capacity out of action. In the aftermath, the sector put off much of its scheduled maintenance from last fall to try to catch up with demand, rescheduling that work for this spring.

For clarity purposes, here is a portion of the summary of the EIA presentation to the Senate on the effects of eliminating MTBE:



Source.

A drive from the Washington, DC area to New Jersey this past week-end provided confrimation of exactly what Caruso was referring to: in northern Virginia, regular gasoline was about $2.65/gal; on the New Jersey Turnpike, it was about $2.35/gal. The added expense of bring in the ethanol by rail to the terminals serving the DC area is substanial.
There's really no reason why ethanol can not be "shipped" by piplines. There is also no reason that the oil companies are not using ETBE, same property and "shippability" as MTBE, just without the watersource hazard.
 

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jfuh said:
There's really no reason why ethanol can not be "shipped" by piplines.

Haven't seen any details on why Caruso said "ethanol must be brought in by rail car to major terminals serving [certain] areas" ,Maryland, Delaware, Washington DC and Virginia, but had assumed that it is a lack of available pipeline capacity. I know there is additional capacity currently under construction into the mid-atlantic area from the Gulf Coast, which is, IIRC, expected to be online in late summer/early fall.
 

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"Wait. Stop. Don't." Willy Wonka.

Gas prices going up...? Frankly, I'm shocked.:mrgreen:

Price of gas in 1970 vs. today...
1970 - $.50 / gallon
2005 - $2.52 / gallon

Difference after adjustment for inflation = zero.
http://www.westegg.com/inflation/
 
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xshipper,

Thats a neat site, thanks for posting the link!

I get a bit of a different result than you did:

given 1970 price = $0.50 per gallon

using the westegg.com 1970 conversion factor:

$0.50 / 0.199 = $3.52

Hence, gasoline should be $3.52 per gallon to equal the rate of inflation since 1970. Consequently, using these metrics, one would conclude that at $2.52 per gallon, gasoline is incredibly cheap!

You might check me on this: have I used the westegg.com conversion factors correctly?
 

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oldreliable67 said:
xshipper,

Thats a neat site, thanks for posting the link!

I get a bit of a different result than you did:

given 1970 price = $0.50 per gallon

using the westegg.com 1970 conversion factor:

$0.50 / 0.199 = $3.52

Hence, gasoline should be $3.52 per gallon to equal the rate of inflation since 1970. Consequently, using these metrics, one would conclude that at $2.52 per gallon, gasoline is incredibly cheap!

You might check me on this: have I used the westegg.com conversion factors correctly?
THis sounds about right to me.
 
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