Why is gas so cheap?
- Thread starter joegreen
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Just look at what is happening in Russia. This is a way for the US to take away some of Putin's revenue because embargos don't have the normal effect on Russia as they do on much smaller countries. Nothing to do with supply/demand or OPEC.
$2.51 a gallon here in Northern VA. I'll take that all day long!!
Originally Posted By: Burt
Originally Posted By: Joel_MD
87 octane is around $2.79 around me. Diesel is about $3.29.
I understand that domestic oil output has been slowly increasing from the Bakken oil field in North Dakota and all the fracking operations in Pennsylvania. The higher quantity of oil production puts a downward pressure on prices. The volatility in prices is partially due to the futures market, in which speculators can push the prices either up or down. When the prices are increasing people complain about the evil speculators, but you don't hear any praise from those same people when prices get pushed down by speculators piling on.
Wrong. Saudi is currently manipulating the oil market. In the short run, Saudi can make the price anything they want it to be. Speculators are reduced to simply betting on the Saudi's next move.
They're manipulating the price downward to compete! They can't make the price whatever they want any longer. Finally OPEC is busted thanks to north American resources.
The biggest driver currently of oil prices downward is the surge in the US dollar. Light sweet crude effectively topped around June 15th and Saudi Arabia responded last week with a price cut for oil shipped to the US. Saudi Arabia is responding to the oil market, not vice versa.
http://www.telegraph.co.uk/finance/newsb...-price-war.html
Originally Posted By: Joel_MD
87 octane is around $2.79 around me. Diesel is about $3.29.
I understand that domestic oil output has been slowly increasing from the Bakken oil field in North Dakota and all the fracking operations in Pennsylvania. The higher quantity of oil production puts a downward pressure on prices. The volatility in prices is partially due to the futures market, in which speculators can push the prices either up or down. When the prices are increasing people complain about the evil speculators, but you don't hear any praise from those same people when prices get pushed down by speculators piling on.
Wrong. Saudi is currently manipulating the oil market. In the short run, Saudi can make the price anything they want it to be. Speculators are reduced to simply betting on the Saudi's next move.
They're manipulating the price downward to compete! They can't make the price whatever they want any longer. Finally OPEC is busted thanks to north American resources.
The biggest driver currently of oil prices downward is the surge in the US dollar. Light sweet crude effectively topped around June 15th and Saudi Arabia responded last week with a price cut for oil shipped to the US. Saudi Arabia is responding to the oil market, not vice versa.
http://www.telegraph.co.uk/finance/newsb...-price-war.html
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Originally Posted By: zzyzzx
It's not cheap, you are just accustomed to paying too much.
And what do you feel would be an appropriate price?
I would say it is as cheap today as it was when I was a kid, and it cost under $.30 a gallon, compared to the price of everything else.
It's not cheap, you are just accustomed to paying too much.
And what do you feel would be an appropriate price?
I would say it is as cheap today as it was when I was a kid, and it cost under $.30 a gallon, compared to the price of everything else.
In California Cap & Trade will continue to raise the price of gasoline. The hit started at 7 cents a gallon with no future cap. It's an effort to reduce emissions by issuing certificates. If a corporation wants to pollute the atmosphere it's okay as long as the pay the state for the certificates or they trade with other corporations that have too many certificates. Then the governor spends that money from the certificates and the gas tax on things like balancing the budget or the high speed train that would otherwise not be built because no community in the state wants any part of it. On January 1, 2015 when new provisions go into effect like they will every year it's predicted the price will start going up again beyond the normal increases. Once the state got access to the billions of dollars this system generates there was no turning back. The theory is that this is a good revenue stream because vehicles moving on the highways represent a part of the economy that is working and producing revenue therefore able to pay additional taxes. California will probably never see under 3 dollar a gallon gas again.
Shale oil is increasing greatly. Make sure to encourage your local representatives not be anti shale. This is a byproduct of energy independence. Lets hope for more.
Originally Posted By: supton
I have vague memories of gas being under a buck per gallon...
I remember it being 38 cents a gallon and they'd give you a free Hot Wheels car with each fill-up.
I have vague memories of gas being under a buck per gallon...
I remember it being 38 cents a gallon and they'd give you a free Hot Wheels car with each fill-up.
Originally Posted By: Guitarmageddon
Shale oil is increasing greatly. Make sure to encourage your local representatives not be anti shale. This is a byproduct of energy independence. Lets hope for more.
Not energy independence. Just a lesser degree of energy dependence.
Energy independence would mean uncoupling ourselves from global oil prices, which would mean having little or no domestic demand. Until then, domestic supply is good, but ultimately just an anaesthetic.
Shale oil is increasing greatly. Make sure to encourage your local representatives not be anti shale. This is a byproduct of energy independence. Lets hope for more.
Not energy independence. Just a lesser degree of energy dependence.
Energy independence would mean uncoupling ourselves from global oil prices, which would mean having little or no domestic demand. Until then, domestic supply is good, but ultimately just an anaesthetic.
Right around me in western NY it's about $3.40 a gallon... it's been coming down but ever so slowly as is always the case over here. They have no problem shooting up 20 cents a day, but coming down with the price? not here! I need to move lol
When I was a teen driver the price of gas was .35-.40 gallon and minimum wage in the US was $1.67/hr. Gas has gone up 10-12x in price and minimum wage would have to be at 16.70-20.04 to have kept pace. Gas is definitely more expensive these days for average folks earning average wages.
Originally Posted By: cashmoney
Supply of oil and gas is increasing and demand is not keeping pace. Economic law of supply and demand - prices will go down until current demand exactly matches current supply. This is a very fluid situation and supply and demand for gasoline can vary quite a bit from month to month. Don't get used to current prices.
Unless there is huge breakthrough in green technology over time scarce natural resources like oil will become scarcer and with world population increasing the demand for fossil fuels will almost certainly go way up over time. Same thing will happen to water. I'd be way more likely to find a way to store and stockpile drinkable water than gas which goes bad fairly quickly.
WHY IS GAS SO CHEAP?
About 6 months ago a barrel of oil was $106.00. Today about $78.
The Saudis are dumping huge amounts of their oil on the market to:
1. Hurt the Iranian economy. The hate the Iranians and are afar aid that Iran is close to becoming a nuclear power.
2. The Russian economy is also being harmed further by the drop in oil prices.
The positive is that the US economy is being enhanced by lower gas prices which puts more $$$ in the hands of the average Joe, and provides more profit for business to expand.
As of today, its about $78 a barrel. IMO, if it goes below $70 a barrel, it will have a negative effect on future drilling and exploration.
Supply of oil and gas is increasing and demand is not keeping pace. Economic law of supply and demand - prices will go down until current demand exactly matches current supply. This is a very fluid situation and supply and demand for gasoline can vary quite a bit from month to month. Don't get used to current prices.
Unless there is huge breakthrough in green technology over time scarce natural resources like oil will become scarcer and with world population increasing the demand for fossil fuels will almost certainly go way up over time. Same thing will happen to water. I'd be way more likely to find a way to store and stockpile drinkable water than gas which goes bad fairly quickly.
WHY IS GAS SO CHEAP?
About 6 months ago a barrel of oil was $106.00. Today about $78.
The Saudis are dumping huge amounts of their oil on the market to:
1. Hurt the Iranian economy. The hate the Iranians and are afar aid that Iran is close to becoming a nuclear power.
2. The Russian economy is also being harmed further by the drop in oil prices.
The positive is that the US economy is being enhanced by lower gas prices which puts more $$$ in the hands of the average Joe, and provides more profit for business to expand.
As of today, its about $78 a barrel. IMO, if it goes below $70 a barrel, it will have a negative effect on future drilling and exploration.
Originally Posted By: Merkava_4
Originally Posted By: supton
I have vague memories of gas being under a buck per gallon...
I remember it being 38 cents a gallon and they'd give you a free Hot Wheels car with each fill-up.
You're almost as old as me! I remember buying gas for 25 cents/gallon and getting a tiger tail for my gas tank!
Whimsey
Originally Posted By: supton
I have vague memories of gas being under a buck per gallon...
I remember it being 38 cents a gallon and they'd give you a free Hot Wheels car with each fill-up.
You're almost as old as me! I remember buying gas for 25 cents/gallon and getting a tiger tail for my gas tank!
Whimsey
Originally Posted By: Drew99GT
Originally Posted By: Burt
Originally Posted By: Joel_MD
87 octane is around $2.79 around me. Diesel is about $3.29.
I understand that domestic oil output has been slowly increasing from the Bakken oil field in North Dakota and all the fracking operations in Pennsylvania. The higher quantity of oil production puts a downward pressure on prices. The volatility in prices is partially due to the futures market, in which speculators can push the prices either up or down. When the prices are increasing people complain about the evil speculators, but you don't hear any praise from those same people when prices get pushed down by speculators piling on.
Wrong. Saudi is currently manipulating the oil market. In the short run, Saudi can make the price anything they want it to be. Speculators are reduced to simply betting on the Saudi's next move.
They're manipulating the price downward to compete! They can't make the price whatever they want any longer. Finally OPEC is busted thanks to north American resources.
The biggest driver currently of oil prices downward is the surge in the US dollar. Light sweet crude effectively topped around June 15th and Saudi Arabia responded last week with a price cut for oil shipped to the US. Saudi Arabia is responding to the oil market, not vice versa.
http://www.telegraph.co.uk/finance/newsb...-price-war.html
Originally Posted By: Drew99GT
Originally Posted By: Burt
Originally Posted By: Joel_MD
87 octane is around $2.79 around me. Diesel is about $3.29.
I understand that domestic oil output has been slowly increasing from the Bakken oil field in North Dakota and all the fracking operations in Pennsylvania. The higher quantity of oil production puts a downward pressure on prices. The volatility in prices is partially due to the futures market, in which speculators can push the prices either up or down. When the prices are increasing people complain about the evil speculators, but you don't hear any praise from those same people when prices get pushed down by speculators piling on.
Wrong. Saudi is currently manipulating the oil market. In the short run, Saudi can make the price anything they want it to be. Speculators are reduced to simply betting on the Saudi's next move.
They're manipulating the price downward to compete! They can't make the price whatever they want any longer. Finally OPEC is busted thanks to north American resources.
The biggest driver currently of oil prices downward is the surge in the US dollar. Light sweet crude effectively topped around June 15th and Saudi Arabia responded last week with a price cut for oil shipped to the US. Saudi Arabia is responding to the oil market, not vice versa.
http://www.telegraph.co.uk/finance/newsb...-price-war.html
Yes I agree it's all inter-related and Saudi is responding to a long term trend. But my points were that (1) speculators are not the causing the current price decline and (2) Saudi is choosing by its short term actions to influence the price. They could have decided otherwise, but evidently feel it is not in their interest. If they want the world price next month to be $60 or a $120, they can make it happen. Nobody else can do that by opening and closing valves.
Originally Posted By: Burt
Originally Posted By: Joel_MD
87 octane is around $2.79 around me. Diesel is about $3.29.
I understand that domestic oil output has been slowly increasing from the Bakken oil field in North Dakota and all the fracking operations in Pennsylvania. The higher quantity of oil production puts a downward pressure on prices. The volatility in prices is partially due to the futures market, in which speculators can push the prices either up or down. When the prices are increasing people complain about the evil speculators, but you don't hear any praise from those same people when prices get pushed down by speculators piling on.
Wrong. Saudi is currently manipulating the oil market. In the short run, Saudi can make the price anything they want it to be. Speculators are reduced to simply betting on the Saudi's next move.
They're manipulating the price downward to compete! They can't make the price whatever they want any longer. Finally OPEC is busted thanks to north American resources.
The biggest driver currently of oil prices downward is the surge in the US dollar. Light sweet crude effectively topped around June 15th and Saudi Arabia responded last week with a price cut for oil shipped to the US. Saudi Arabia is responding to the oil market, not vice versa.
http://www.telegraph.co.uk/finance/newsb...-price-war.html
Originally Posted By: Drew99GT
Originally Posted By: Burt
Originally Posted By: Joel_MD
87 octane is around $2.79 around me. Diesel is about $3.29.
I understand that domestic oil output has been slowly increasing from the Bakken oil field in North Dakota and all the fracking operations in Pennsylvania. The higher quantity of oil production puts a downward pressure on prices. The volatility in prices is partially due to the futures market, in which speculators can push the prices either up or down. When the prices are increasing people complain about the evil speculators, but you don't hear any praise from those same people when prices get pushed down by speculators piling on.
Wrong. Saudi is currently manipulating the oil market. In the short run, Saudi can make the price anything they want it to be. Speculators are reduced to simply betting on the Saudi's next move.
They're manipulating the price downward to compete! They can't make the price whatever they want any longer. Finally OPEC is busted thanks to north American resources.
The biggest driver currently of oil prices downward is the surge in the US dollar. Light sweet crude effectively topped around June 15th and Saudi Arabia responded last week with a price cut for oil shipped to the US. Saudi Arabia is responding to the oil market, not vice versa.
http://www.telegraph.co.uk/finance/newsb...-price-war.html
Yes I agree it's all inter-related and Saudi is responding to a long term trend. But my points were that (1) speculators are not the causing the current price decline and (2) Saudi is choosing by its short term actions to influence the price. They could have decided otherwise, but evidently feel it is not in their interest. If they want the world price next month to be $60 or a $120, they can make it happen. Nobody else can do that by opening and closing valves.
you guys are luck its still over 3 bucks a gallon here.
think its 3.07 right now.
but i expect it to skyrocket again soon
think its 3.07 right now.
but i expect it to skyrocket again soon
Fracking. Good for gas prices, not so good for the environment.
$2.55 and YES once again!
Supply is outpacing demand. China's rocket-like accelerating demand has hit a ceiling for some reason. No evil intentions or conspiracies here. OPEC is trying to operate in harmony and cut production so that oil will hit the magic number that makes U.S. fracking unprofitable. They don't seem to have great success operating in harmony.
Enjoy it while it lasts and don't go buying gas guzzlers to celebrate.
Enjoy it while it lasts and don't go buying gas guzzlers to celebrate.
Originally Posted By: Rolla07
Fracking. Good for gas prices, not so good for the environment.
prove it please
Fracking. Good for gas prices, not so good for the environment.
prove it please
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