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#4529046 - 09/29/17 06:14 AM Post-Hurricane Prices
ArcticDriver Offline


Registered: 01/27/17
Posts: 1139
Loc: USA
We often think of price "gouging" as occurring at the time of an emergency but its been 5 weeks since Hurricane Harvey made landfall in TX and fuel prices are still not dropping here in FL and according to Gas Buddy, they remain elevated throughout much of the US while crude oil prices have dropped.

Our diesel prices have not dropped one cent since they rose in reaction to Harvey.

Is this "gouging" ?

Or worse, it was reported exports of refined products increased when domestic demand dropped, are we now seeing a "new normal" domestically as a result of more lucrative export markets? Which always seems inevitable regardless the assurances by Big Oil when they lobbied our lawmakers for the legislation.

Why aren't fuel prices dropping?
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#4529095 - 09/29/17 07:25 AM Re: Post-Hurricane Prices [Re: ArcticDriver]
Rolla07 Offline


Registered: 11/05/11
Posts: 4732
Loc: MTL, CANADA
Its not gouging. Its just how the oil companies operate. They need to end up with record profit after dealing with the costs associated of Harvey.
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#4529098 - 09/29/17 07:30 AM Re: Post-Hurricane Prices [Re: Rolla07]
4WD Offline


Registered: 09/21/10
Posts: 6363
Loc: Texas
Do tell who has record profits? And 4 years ago does not count in a business with giant commodity swings.
It never was ROCE - just large numbers in a capital intensive sector.

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#4529110 - 09/29/17 07:50 AM Re: Post-Hurricane Prices [Re: ArcticDriver]
AZjeff Offline


Registered: 01/14/11
Posts: 2630
Loc: PV Az
Gouging is when fuel prices jump 20 cents a gallon within 3 days of landfall in Texas 1200 miles away in Arizona and as you note stay there. One can fully understand raising prices as the price goes up in the coming tanker loads but the gas in the ground now? Profiteering. Not likely to change. Had a good friend who owned an independent gas station for years and he just wouldn't talk about it.
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#4529115 - 09/29/17 08:00 AM Re: Post-Hurricane Prices [Re: 4WD]
ArcticDriver Offline


Registered: 01/27/17
Posts: 1139
Loc: USA
Originally Posted By: 4WD
Do tell who has record profits? And 4 years ago does not count in a business with giant commodity swings.
It never was ROCE - just large numbers in a capital intensive sector.



I have spent 25 years in the O&G sector so I am always interested in your macro view but right now on this thread I am curious about the specific topic of fuel prices right now which jumped 15%-20% as a direct result of Harvey.

I would be very interested in your opinion.
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#4529123 - 09/29/17 08:05 AM Re: Post-Hurricane Prices [Re: AZjeff]
ArcticDriver Offline


Registered: 01/27/17
Posts: 1139
Loc: USA
Originally Posted By: AZjeff
Gouging is when fuel prices jump 20 cents a gallon within 3 days of landfall in Texas 1200 miles away in Arizona and as you note stay there. One can fully understand raising prices as the price goes up in the coming tanker loads but the gas in the ground now? Profiteering. Not likely to change. Had a good friend who owned an independent gas station for years and he just wouldn't talk about it.


But thats the thing...crude prices dropped as these tankers started amassing in the Gulf.

Their cargoes dropped in value.

The rise in pump prices was more a factor of limited supply of finished products and those factors have now returned to pre-Harvey levels from what I have read...but perhaps someone knows better.
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#4529125 - 09/29/17 08:06 AM Re: Post-Hurricane Prices [Re: ArcticDriver]
fdcg27 Offline


Registered: 09/25/09
Posts: 15687
Loc: OH
I paid $2.119 Tuesday morning for E10 RUG, which seemed pretty reasonable.
The peak pump prices I saw a few weeks back in this area were $2.519.
Fuel prices do appear to be dropping, but areas like the eastern TX Gulf coast as well as much of FL are probably suffering from as yet unrestored infrastructure and so may see higher than typical prices for some weeks and months.
Diesel prices will probably decline more slowly since most users of these middle distillates are commercial and are not able to cut back on consumption in the short run in response to higher prices caused by tight supplies of delivered fuel.
Trucks gotta roll and airliners gotta fly while most of us can reduce our personal miles driven to maintain our comfort level with what we're spending on fuel.
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#4529136 - 09/29/17 08:17 AM Re: Post-Hurricane Prices [Re: ArcticDriver]
AZjeff Offline


Registered: 01/14/11
Posts: 2630
Loc: PV Az
Regular 87 went from $2.30 to $2.50 in days and is still there. Any perceived disruption causes an immediate spike followed by a gentle float back down. Since the price of the crude dropped and no shortages were apparent (here anyway) can we safely call it gouging?
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#4529146 - 09/29/17 08:22 AM Re: Post-Hurricane Prices [Re: ArcticDriver]
4WD Offline


Registered: 09/21/10
Posts: 6363
Loc: Texas
To me - gasoline prices stay under the microscope all of the time - it's often said here bottles of water or fountain drinks are where the money is. (gas pumping investors, come inside) - or Costco on grander scale.
American drivers have choices to make in transportation and the private sector keeps up with demand for fuel. If the EV is really "game on" - the most interesting pursuit may be that of the tax man - that's the guy making some good money at the pump.
How will he track this tax money down on EV or ADV drivers?

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#4529194 - 09/29/17 09:09 AM Re: Post-Hurricane Prices [Re: AZjeff]
bubbatime Offline


Registered: 03/18/08
Posts: 5622
Loc: South Florida
Originally Posted By: AZjeff
Regular 87 went from $2.30 to $2.50 in days and is still there. Any perceived disruption causes an immediate spike followed by a gentle float back down. Since the price of the crude dropped and no shortages were apparent (here anyway) can we safely call it gouging?


No, we cannot safely call that gouging. That's not even close to gouging. When its $5.50 a gallon in Arizona, then you might have an argument.
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#4529202 - 09/29/17 09:16 AM Re: Post-Hurricane Prices [Re: bubbatime]
ArcticDriver Offline


Registered: 01/27/17
Posts: 1139
Loc: USA
Originally Posted By: bubbatime
Originally Posted By: AZjeff
Regular 87 went from $2.30 to $2.50 in days and is still there. Any perceived disruption causes an immediate spike followed by a gentle float back down. Since the price of the crude dropped and no shortages were apparent (here anyway) can we safely call it gouging?


No, we cannot safely call that gouging. That's not even close to gouging. When its $5.50 a gallon in Arizona, then you might have an argument.


$5.50 (200% increase) for a few days is gouging,,,but a 20% increase over 30 days for no apparent reason is not gouging.
Thats sorta the point of the thread.

Its interesting but I see some guys possibly coming to the defense of Big Oil.
I have been employed in O&G for 25+ years minus 1 or 2 years of the Bust cycle.
I used to feel a need to defend my chosen employ but I gave that up a long time ago.
The years have shown me that Big Oil is not my friend no matter how much I used to try and please it. grin
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#4529239 - 09/29/17 10:05 AM Re: Post-Hurricane Prices [Re: ArcticDriver]
2015_PSD Offline


Registered: 09/26/10
Posts: 7233
Loc: SE Texas
Prices notwithstanding, diesel is still not as available in my area as it was pre-Harvey. Still have several stations with bags over the diesel pumps.
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#4529309 - 09/29/17 11:05 AM Re: Post-Hurricane Prices [Re: bubbatime]
AZjeff Offline


Registered: 01/14/11
Posts: 2630
Loc: PV Az
Originally Posted By: bubbatime
Originally Posted By: AZjeff
Regular 87 went from $2.30 to $2.50 in days and is still there. Any perceived disruption causes an immediate spike followed by a gentle float back down. Since the price of the crude dropped and no shortages were apparent (here anyway) can we safely call it gouging?


No, we cannot safely call that gouging. That's not even close to gouging. When its $5.50 a gallon in Arizona, then you might have an argument.


You're correct. Taking advantage of an opportunity to increase profit. To be expected with Big Oil. Somewhat disappointing when the local guy does it with his customers.
_________________________
86 Samurai 1.3 leftovers
14 RAV4 2.5 5W-20 PP *gasp*
16 Silverado 1500 4.3 Ecotec3, DI, AFM 5W-30 PP

Why know when you can guess?!


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#4529361 - 09/29/17 12:02 PM Re: Post-Hurricane Prices [Re: 2015_PSD]
ArcticDriver Offline


Registered: 01/27/17
Posts: 1139
Loc: USA
Originally Posted By: 2015_PSD
Prices notwithstanding, diesel is still not as available in my area as it was pre-Harvey. Still have several stations with bags over the diesel pumps.


This helps explain it.
Thanks for the insight.
Tampa region stations all back online with all grades of fuel.
Interestingly, the diesel was typically available after gas supplies had run out here with Irma.
But some of that ULSD was real [censored].
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Multiple Diesel and Gasoline vehicles

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#4529378 - 09/29/17 12:25 PM Re: Post-Hurricane Prices [Re: ArcticDriver]
Mr Nice Offline


Registered: 09/12/04
Posts: 21178
Loc: Orlando, FL
What ever price gasoline is, you have no choice but to pay the price (no pun intended).

It doesn't pay to drive around to save 10 cents per gallon.

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