Oil Prices Exceed $90 / bbl

I think $100/barrel is the next attention-getting milestone. After all, it's a nice round number and has not one, but two - yes, two! - zero digits in the price. </sarcasm>

It seems that oil prices have risen so fast in such a relatively short time that they've ceased to become newsworthy except at these "magic number" junctions. I remember reading articles a couple years back (or maybe it was a few months ago) in which the authors wondered how the US could possibly bear up under the unthinkable price of $70/barrel.

 

<div class='quotetop'>QUOTE(TimBikes @ Oct 31 2007, 02:30 AM) [snapback]532793[/snapback]</div>

We all care. Interesting considerations...

1. inflation remains well controlled
2. stock market/economy very strong in spite of this
3. alternate sources of oil - - transfer technologies from shale, bio sources - are now economically feasible and should remain so long enough to warrant the huge investments
4. it is a reflection on the emergence of China and to a little extend the beginnings of India entering the world markets for oil.
5. it is excellent for us in that it will employ market forces to push Americans to consider fuel economy as a larger factor in their car buying decision equation - also same push for the big auto makers to meet that demand.
6. will increase the need for nuclear power plant production - our savior

have to go

 

<div class='quotetop'>QUOTE(TonyPSchaefer @ Oct 31 2007, 06:13 AM) [snapback]532859[/snapback]</div>

It's the American way. What are you, a pinko commie or sump'in'? God HIMself gave us the right to blame everyone but ourselves. It's probably in the Bible. I'm sure if you looked hard enough you could find a verse to support it.

 

<div class='quotetop'>QUOTE(daniel @ Oct 31 2007, 09:01 AM) [snapback]532877[/snapback]</div>

Its pushed up the price of the equivalent to $9 a UK Gallon in the UK.

 

<div class='quotetop'>QUOTE(daniel @ Oct 31 2007, 10:01 AM) [snapback]532877[/snapback]</div>

I think you are being grossly unfair. I would be interested to see America's economic growth over the past 10 years and our consumption of fossil fuels, our level of CO2 gas production, and the quality of our air and water. I would bet it would be favorable.

I think your statement paints a very broad and ugly stroke across the lives of 300,000,000 million Americans who are the worlds leading contributors to charity both publicly and privately - who are there in times of disasters for others, who do by in large good work for people around the world, who improve the lives of millions, who sacrifice for others when they are unable to do so themselves...

I really think its a lousy thing to write.

 

Price per barrel does not change people's habits when the price for gasoline is relatively cheap still.

When the price for oil this summer was $50 and the price for gasoline was +$3.00 people complained. Now that oil has doubled but gasoline is less than $3.00, people do not see the impact of the increased oil prices.

Hypothetically, if the price for oil was $1,000 a barrel and gasoline was still $3.00 a barrel, people would still not care about the price of oil. $3.00 is still gonna get me gallon.

Now...if the gasoline prices increased proportionally to that of the oil prices, and say we would be paying $6.00 per gallon. I think people will make changes when the price of FOOD and other CONSUMABLES increase with the gas costs.

Now...the total disposal income pile starts to diminish quickly. People will change their driving habits or change other parts of their life style.

At $6.00 a gallon, I'd be adding a battery pack and taking the bus more. Even though our bus system here stinks (late and never predictable). At this price, I'd hope to see less cars on the road and bike riding could potentially become safe to use again.

I say let gas go up to $10 a gallon. Then we can all reduce our use of oil.

 

<div class='quotetop'>QUOTE(moxiequz @ Oct 31 2007, 03:02 AM) [snapback]532798[/snapback]</div>

I wish you were right. Unfortunately, the next eye opener will be how quickly we roll on past $200/barrel ... even as OPEC assures us there is no shortage.

 

<div class='quotetop'>QUOTE(Hard_working_student @ Oct 31 2007, 10:30 AM) [snapback]532890[/snapback]</div>

Actually i would posit that our use of oil will remain the same for a long time as "artificial" ways of producing oil from shale and bio sources become economically feasible. I like it also because it will get us off our butts and start constructing nuclear power plants and working towards improving the efficiency and cost of solar and wind technologies.

How many hundreds of years of oil is located in North American shale and bio sources?

 

Is the price really going up or is does this just reflect the fact the fact the dollar is going down relative to everything not sold in Walmart?

 

<div class='quotetop'>QUOTE(dbermanmd @ Oct 31 2007, 07:26 AM) [snapback]532888[/snapback]</div>

300,000,000 million equals 300,000,000,000,000. I see your imagination is still in high gear. I'm not sure that three hundred thousand billion people would even fit on the surface of the earth without stacking them like cord wood.

 

Okay. With three hundred thousand billion people on the Earth, a quick calculation suggests they'd each have very roughly three square feet to stand on. So it would not be necessary to stack them. But the figure is clearly in excess of the number of Americans by many orders of magnitude. Par for the course for the d-man's imagination.

 

<div class='quotetop'>QUOTE(burritos @ Oct 31 2007, 11:50 AM) [snapback]532936[/snapback]</div>

HUH?

Walmart should sell gas - maybe the states should stop taxing it so much?

<div class='quotetop'>QUOTE(daniel @ Oct 31 2007, 12:15 PM) [snapback]532955[/snapback]</div>

I was referencing 300 million americans you were disparaging.

 

It is both.
Oil is going up due to STILL rising demand as well as to the dropping dollar.
Wal-Mart has nothing to do with it, and there was no need to for Burritos to include it in his remark.
(And Wal-Mart does sell gas).

Cutting taxes on oil? Oh that's a swell idea, let's encourage MORE use of oil by lowering the cost, thereby increasing the cost further ANYWAYS, by demand further exceeding the available supply.

We need to RAISE the gas tax to encourage conservation, thereby reducing the price of oil by lowering demand. This also better prepares us for future supply limitations. Oil production peaked in 2005 and has not been able to grow larger since, despite increased investment in exploration. Yet demand has not peeked yet. Something's gotta give. Either the demand has to drop, or the supply can't keep up and crude prices accelerate even more until the demand DOES drop.

Regarding Shale...It does not matter how much is underground Dr. B. What matters is how much can be recovered and processed without using more energy then the end product would yield. The energy return on energy invested is piss poor. We will burn half the endproduct of these operations just to keep them going. And the economic cost is not cheap, nor the environmental cost. Also, the rate of production can not even come close to what we import.
You need to stop believing oil company pushed stories, designed to keep us on the profitable status quo. Short term profit motivations only leads to long term ruin for all of us. Whatever happened to the "Jack" oil find? Oh yeah, deemed too small and infeasable. ANWAR? Oh...only can produce a small % of our needs for a decade or so.

Remember folks, the more money we export in exchange for oil, the more those exporting countries' economies grow. The more they grow, the more oil they themselves use, thereby reducing the available production for them to export to us. Oil production declines might follow a nice slope down the production curve, but the exports themselves are going to drop MUCH faster due to rising internal use in the ME, Mexico, Canada, etc.

 

<div class='quotetop'>QUOTE(Darwood @ Oct 31 2007, 01:14 PM) [snapback]532985[/snapback]</div>

I was thinking that they should lower taxes specifically those states that charge it as a % of the overall price of oil - so the State does not make a windfall profit.

In another way, I think the State should lower the tax on gas to help offset the hurt many lower income americans who are forced to buy gas are feeling vs. those in the higher income brackets - but then again you could argue that would benefit the rich.... i just think we should help those who feel the pinch more than others - and yes that would benefit others - so what?

 

<div class='quotetop'>QUOTE(Darwood @ Oct 31 2007, 12:14 PM) [snapback]532985[/snapback]</div>

My quip about wal-mart is its ability to control inflation at least within their world. They continue to sell their stuff at bottom market prices because it control costs by producing more and more of its products in China(at the cost of amercian low skilled jobs).

 

<div class='quotetop'>QUOTE(Hard_working_student @ Oct 31 2007, 09:30 AM) [snapback]532890[/snapback]</div>

You want $10 a gallon? Perhaps you should consider the economic consquences of such a jump in gas prices. Such a jump would make the depression look like a birthday party. Trucking would grind to a hault, airlines would stop flying because they'd have to raise fares so high to cover the fuel costs people wouldn't fly, etc.

Just be careful what you wish for!

 

I'm no fan of Wal-Mart either, but they don't make the products. They hammer their vendors to be cheaper and cheaper, and the vendors decide to outsource, as opposed to telling Wal-Mart NO! It is the consumers at fault here for caring more about the "LOW, LOW prices" than about where and how the products are made. If consumer trends were to spend a little more for demostic products, Wal-Mart would adapt to it.

10$ a gallon would be a more desirable depression than continuing to artificially keep gas prices lower to the point that we run out and have NOTHING prepared for life after cheap oil.
Do you want an economic downturn sooner or a litle more status quo follwed by an economic CRASH and BURN later?

 

<div class='quotetop'>QUOTE(Washington1788 @ Oct 31 2007, 12:37 PM) [snapback]533003[/snapback]</div>

Washington1788,

I've vistied countries that pay $4.00 - $6.00 per gallon 3 years ago. I still saw people living "normally" and businesses cranking away. No major disruption to that I could see. So an extra $4.00 / gallon or so to that economy would make things fall to a screeching halt? I think not. Most people there don't even own cars. They take the train and electric bus. The air is clean and so is the water. Darn, that must be a bad life.

At $10 a gallon, the US economy may suffer a few sort term setbacks, but the flexibility and intelligence of the American people will prevail. I bet at this price, alternative energy will not longer be "alternative" but become mainstream. Yes, Nuclear power may be one of those alternatives. Additional dams, wind farms, etc would be a nice site. The big automakers (GM, FORD, etc..) that rely on ICE technology will be replaced (or at least lose major shares) to start-up companies who have developed alternative powertrains that do not rely on oil. Homeower associations that ban solar panels will have to rewrite their covenants to allow solar panels. Cities will have to make better use of electric transport systems (buses and trains) run off of power plants not dependant on oil or natural gas.

My point is that people will need to make some life style changes or the price of oil will help them make those decisions. They may have to start buying local. Even if it may cost 2 or 4 times more. They may not have the luxturies of an annual vacation to the tropics or the yearly ski trip to the mountains. Heck, I might even have to sell my SUV, riding lawn mower, and jetski as a trade in for simple bicycle.

In the some developing nations, the cost of 1 liter of gasoline is more that the average daily wages of the average person. This is poverty and I do not wish this upon anyone. No wonder why people in poor nations hate those that use so much oil.

I would rather be proactive as I can and make lifestyle changes to reduce or eliminate my need to burn oil.

$10 a gallon...bring it on baby. I am ready for some "positive" change.

I'm willing to pay the price for less oil dependancy.

Are you ready?

Or should I say, "ready or not here it comes!"