The Gasoline Blues

[Jim Alfredson]

$3.89 in Lansing today. It was $3.49 yesterday. 40 cents in one day. Hey, why not!?

[Jazzmoose]

That's unbelievable!

I guess our $3.69 isn't too bad after all...

[RDK]

Paid $3.99 today - a new high for me. But I know someone who paid $4.79 in Beverly Hills.

[BERIGAN]

Paid $3.99 today - a new high for me. But I know someone who paid $4.79 in Beverly Hills.

Screw them rich folks, make 'em pay even more!

[Soulstation1]

anyone run out of gas?

good thing the shit happened at work

$5 worth of gas doesn't even get me above the E line

[Jim Alfredson]

Paid $4.16 coming back from South Bend to Lansing on Sunday. SWEET!

[The Magnificent Goldberg]

Fuel duty convoy to jam the capital

Press Assoc. - 2 hours 24 minutes agoLorry drivers are to pour into London for what organisers hope will be the largest-ever fuel duty protest in the capital.

(Advertisement)

Hauliers are angry at soaring fuel prices which have resulted in the average cost of diesel passing far beyond the 120p-a-litre mark.

Led by lorry drivers from Kent, the protest is expected to attract hundreds of hauliers from all around the UK.

The convoy will make its way to central London, parking close to Marble Arch.

Transport for London said the A40 will be closed between White City and Edgware Road, west London, from 10am until 3pm so that demonstrators can park their lorries.

The westbound carriageway of the A40, going out of London, will remain open.

A delegation from the demonstrators will hand a letter to 10 Downing Street demanding the immediate introduction of an essential user rebate which would allow HGV operators to claim some of the fuel duty back.

Mike Presneill, a leading member of Transaction 2007, who is helping to organise the protest, said: "Fuel is rocketing. The Government has the power to act but appears not to be listening. Hundreds of UK transport firms are being driven to the wall. Thousands of UK jobs are being lost.

"Foreign hauliers are entering the UK with cheaper fuel purchased abroad. They contribute nothing to our economy."

Kent-based haulier Peter Knight said: "This is the economics of the mad house. If we are wiped out, the work will be done by foreign hauliers who pay nothing to the UK in tax."

http://uk.news.yahoo.com/pressass/20080526...al-6323e80.html

MG

[sidewinder]

Led by lorry drivers from Kent

Didn't the Peasants' Revolt start from there too?

I guess we can all look forward to another 'Winter of Discontent' this year..

[Tim McG]

$4.35 a gallon here.

This after an $18 Billion dollar quarterly profit recently reported by the oil companies.

Supply and demand my butt.

Edited May 26, 2008 by GoodSpeak

[makpjazz57]

I have a 2000 Maxima requiring premium gas. I just filled it from about 1/2 a tank at $4.12/gallon. I'm driving to NYC (from Boston area) next week; I better plan on at least $125 for fuel expense (not to mention the $40/day parking fee to keep my car in a parking garage)!

Marla

[Shawn]

When I went to work yesterday morning at 9:30am the gas station across the street was selling it at $3.64 a gallon. When I got off work at 7:30pm the same gas station was $3.75 a gallon. That's more than a 1 cent per hour increase....fucking insane.

[John Tapscott]

$5.77 per Imperial gallon (equivalent to $4.61 for a U.S. gallon) here in Canada. It's ridiculous, though Canada benefits in some ways from high oil prices. On the other hand, it kills our tourism industry - what American is their right mind is going to drive up here this summer? But as far as Krugman's article goes, I don't think he places enough emphasis on #1 - the speculators. I am more and more convinced they are driving this thing (and food prices, too). I am looking forward to the days these bastards (sorry!) get burned! It happened in the 80's and it will happen again.

[Tom 1960]

I was fortunate enough to get regular unleaded for 3.99/gal yesterday considering right down the street it costs 4.05 and 4.07/gal. Interesting sidenote, there are 2 local gas stations right across the street from one another. The Mobil sells gas at 4.05/gal and the Citgo next door 4.17/gal. You'd be amazed the cars I see everyday pumping gas at Citgo. Fools. It must be nice to be rich and not have a care in the world.

[Jim Alfredson]

The supply and demand argument is bullshit. If demand is so high and we supposedly don't have enough refineries, why is there no gas shortage?

[Joe G]

The supply and demand argument is bullshit. If demand is so high and we supposedly don't have enough refineries, why is there no gas shortage?

There are shortages, just not where we live. Richer countries can still afford to buy oil at the current price, but poorer countries are being bid out of the market.

But, if we have passed peak production worldwide (2006 being the high water mark so far, I understand), then there is still a lot of oil coming out of the ground. Peak means peak. The concern is that from here on out, we begin the downward production slide, which will almost certainly mean higher prices and shortages. And not just of gas. Hang on to your butts.

http://www.google.com/search?q=gas+shortag...amp;startPage=1

[BERIGAN]

An interesting response to a later Krugman piece in the times....

Raymond J. Learsy

Paul Krugman and the New York Times' Pious Pontifications at the Pump

Posted May 16, 2008 | 05:46 AM (EST)

On May 12, upon reading Paul Krugman's bizarre Op-Ed "The So-Called Oil Bubble," they must have been popping champagne corks at the American Petroleum Institute. The New York Times, consistently off-base when reporting on oil markets and their construct (please see "The New York Times' Hidden Hand on Oil's Agenda", 04.25 08) permitted their resident economic guru to hit one out of the "Alice in Wonderland" ballpark.

In an extraordinary piece of jejune analysis Mr. Krugman instructs us that the rise in oil prices isn't the result of runaway speculation but rather "of fundamental factors," and then repeats the standard oil patch saws citing growing needs of emerging economies, difficulty in finding oil, etc. Therefore "there's no good evidence that prices have gotten out of line." There, words coming from the hallowed pages of the New York Times. An oil flack's dream come true!

The nonsense continues. Speculation in oil markets is dismissed. According to Krugman, higher prices due to excessive speculation would result in a situation "in which supply exceeded demand. This excess supply would, in turn, drive prices back down." So according to Krugman, in that this hasn't happened, the vertiginously high oil prices as we now know them are a legitimate reflection of market forces. Simple as that. Economics 101. Oh, for the good old days.

That trading markets can be successfully manipulated is dismissed. Think Enron and California utilities. Think CFTC investigation of BP's alleged manipulation in crude oil trading. Look at India suspending futures trading in foodstuffs markets because of the distortions that have resulted. Think of the fire power inherent in Middle East sovereign wealth funds, giving the capability to move oil and energy markets if they chose to do so (are they, aren't they? an open question).

Then Mr. Kugman continues as though he had landed on this planet from some outer celestial body made of blue cheese. Not a single mention, not one, of the oil cartel, the Organization of Petroleum Exporting Countries who control 40 percent of the world's oil supply and willfully and collusively keep millions of barrels of supply off the market each day- and no comment on what that has done to distort oil markets.

In repeating the oil industry mantra about the "difficulty in finding oil" comes no coherent examination whatsoever of the veracity nor accuracy of that statement considering the development and exploration work being done around the world from offshore Brazil, to the South China Sea and on.

He goes on to piously inform us that "France consumes only half as

much oil per capita as America" and voila, the last time he turned his gaze toward, "Paris wasn't a howling wasteland." What our good instructor overlooked

in his lesson is that in France, over 80 percent of its power grid is

sourced by nuclear energy. Ah details, and the good editors of the Times

dare not contest the anointed wisdom of their economics professor.

Then finally, and most dangerously, a baleful whitewash of high oil prices.

High oil prices are OK because "energy conservation becomes increasingly

important, in which many people may even -- gasp -- take public

transportation." That is the extent of discomfiture to the nation's citizenry

cited by Mr. Krugman. Certainly no heads-up from Krugman that the issue

here is not energy conservation, which is essential and must be acted upon

with or without high prices. The issue here is the price of oil and his

whitewash of a corrupted market (our OPEC friends, were they American or

chargeable under American law, would all be sitting in jail as massive

violators of anti-trust laws). What Krugman has done is

given legitimacy to a massive heist of billions out of our pocketbooks

into the voracious treasuries of the oil industry and the transfer of our

nation's wealth to malign regimes who are a danger to our values and future.

Mr. Krugman, you should be ashamed of yourself.

http://www.huffingtonpost.com/raymond-j-le...s_b_102046.html

[Guy Berger]

The supply and demand argument is bullshit. If demand is so high and we supposedly don't have enough refineries, why is there no gas shortage?

Because prices are rising to adjust. That's the point of supply and demand -- when supply decreases or demand increases, prices go up.

Guy

[Chuck Nessa]

The supply and demand argument is bullshit. If demand is so high and we supposedly don't have enough refineries, why is there no gas shortage?

Because prices are rising to adjust. That's the point of supply and demand -- when supply decreases or demand increases, prices go up.

Guy

'cept that ain't the result. Demand has not fallen to keep the supply up. Back to the classroom.

[Guy Berger]

Krugman may or may not be right on oil prices currently experiencing a speculative bubble. (Which can largely be boiled down to the idea that the actual price of crude oil has diverged from its "fundamental value".) However, he is 100% right that the fundamental value of oil (and other forms of energy) IS increasing, due to rapid growth in India, China and other developing countries.

It's a little late here for me to dissect the article posted by Berigan, but it strikes me that this is largely a mishmash of accusation and doesn't contain many serious arguments.

I would like to say that:

(A) "Speculation" (as commonly understood) is not the same as a "speculative asset bubble". Plenty of speculation can happen in situations where assets trade close to their fundamental values.

(B) "Market manipulation" is different from "speculation" or "speculative asset bubbles". The latter two can happen without any market manipulation whatsoever.

An interesting response to a later Krugman piece in the times....

Raymond J. Learsy

Paul Krugman and the New York Times' Pious Pontifications at the Pump

Posted May 16, 2008 | 05:46 AM (EST)

On May 12, upon reading Paul Krugman's bizarre Op-Ed "The So-Called Oil Bubble," they must have been popping champagne corks at the American Petroleum Institute. The New York Times, consistently off-base when reporting on oil markets and their construct (please see "The New York Times' Hidden Hand on Oil's Agenda", 04.25 08) permitted their resident economic guru to hit one out of the "Alice in Wonderland" ballpark.

In an extraordinary piece of jejune analysis Mr. Krugman instructs us that the rise in oil prices isn't the result of runaway speculation but rather "of fundamental factors," and then repeats the standard oil patch saws citing growing needs of emerging economies, difficulty in finding oil, etc. Therefore "there's no good evidence that prices have gotten out of line." There, words coming from the hallowed pages of the New York Times. An oil flack's dream come true!

The nonsense continues. Speculation in oil markets is dismissed. According to Krugman, higher prices due to excessive speculation would result in a situation "in which supply exceeded demand. This excess supply would, in turn, drive prices back down." So according to Krugman, in that this hasn't happened, the vertiginously high oil prices as we now know them are a legitimate reflection of market forces. Simple as that. Economics 101. Oh, for the good old days.

That trading markets can be successfully manipulated is dismissed. Think Enron and California utilities. Think CFTC investigation of BP's alleged manipulation in crude oil trading. Look at India suspending futures trading in foodstuffs markets because of the distortions that have resulted. Think of the fire power inherent in Middle East sovereign wealth funds, giving the capability to move oil and energy markets if they chose to do so (are they, aren't they? an open question).

Then Mr. Kugman continues as though he had landed on this planet from some outer celestial body made of blue cheese. Not a single mention, not one, of the oil cartel, the Organization of Petroleum Exporting Countries who control 40 percent of the world's oil supply and willfully and collusively keep millions of barrels of supply off the market each day- and no comment on what that has done to distort oil markets.

In repeating the oil industry mantra about the "difficulty in finding oil" comes no coherent examination whatsoever of the veracity nor accuracy of that statement considering the development and exploration work being done around the world from offshore Brazil, to the South China Sea and on.

He goes on to piously inform us that "France consumes only half as

much oil per capita as America" and voila, the last time he turned his gaze toward, "Paris wasn't a howling wasteland." What our good instructor overlooked

in his lesson is that in France, over 80 percent of its power grid is

sourced by nuclear energy. Ah details, and the good editors of the Times

dare not contest the anointed wisdom of their economics professor.

Then finally, and most dangerously, a baleful whitewash of high oil prices.

High oil prices are OK because "energy conservation becomes increasingly

important, in which many people may even -- gasp -- take public

transportation." That is the extent of discomfiture to the nation's citizenry

cited by Mr. Krugman. Certainly no heads-up from Krugman that the issue

here is not energy conservation, which is essential and must be acted upon

with or without high prices. The issue here is the price of oil and his

whitewash of a corrupted market (our OPEC friends, were they American or

chargeable under American law, would all be sitting in jail as massive

violators of anti-trust laws). What Krugman has done is

given legitimacy to a massive heist of billions out of our pocketbooks

into the voracious treasuries of the oil industry and the transfer of our

nation's wealth to malign regimes who are a danger to our values and future.

Mr. Krugman, you should be ashamed of yourself.

http://www.huffingtonpost.com/raymond-j-le...s_b_102046.html

[Guy Berger]

The supply and demand argument is bullshit. If demand is so high and we supposedly don't have enough refineries, why is there no gas shortage?

Because prices are rising to adjust. That's the point of supply and demand -- when supply decreases or demand increases, prices go up.

Guy

'cept that ain't the result. Demand has not fallen to keep the supply up. Back to the classroom.

I'm not sure what you are saying here. My sole point was responding to Jim's argument that a supply-demand framework requires shortages. It doesn't - prices adjust.

As far as the US, recent data suggests that gasoline consumption is in fact decreasing.

Finally, rising prices don't necessarily imply a fall in quantity demanded if other factors are driving an increase in demand. China and India have a rapidly growing need for energy due to industrialization, hence the quantity of oil they consume is increasing even as the price goes up.

Guy

[Tim McG]

The supply and demand argument is bullshit. If demand is so high and we supposedly don't have enough refineries, why is there no gas shortage?

Exactly my point.

The oil companies boasted an $18 Billion dollar profit [that's billion with a B and it is free and clear money after everything has been paid for] and their hue and cry is supply and demand?

Bullshit.

These bastards get government tax breaks and subsidies, too. Can you believe the arrogance?

It is all about the greed and artificially forcing the prices up so we will cave in to their demands to drill in the Alaska Wilderness.

I say, "Eat shit and die!"

Oil company Sons of Bitches.

Edited May 27, 2008 by GoodSpeak

[Joe G]

I don't think it's as simple as us poor innocents getting screwed by The Man, though I have no doubt there are some major league shennanigans taking place. How any one entity could manipulate a world-wide system right down to what we pay at the pump is a little beyond me.

It is a fact, is it not, that several of the oil fields which were major producers in the 1980's and '90's are now crashing, such as Mexico's Canterall (sp?), and the North Sea field. As far as I know, no discoveries have been made that can fill the gap. The recent find off the coast of Brazil, I've read, presents extremely difficult obstacles due to the crushing depths and very high temperatures at the site. So don't bank on that one. Elsewhere, the people who live on top of the oil are either in turmoil or don't like us very much. Also, countries like Mexico are likely to begin keeping more of what they have left for themselves and putting less on the world market.

Why wouldn't all of that drive the price up?

[Tim McG]

I don't think it's as simple as us poor innocents getting screwed by The Man, though I have no doubt there are some major league shennanigans taking place. How any one entity could manipulate a world-wide system right down to what we pay at the pump is a little beyond me.

It is a fact, is it not, that several of the oil fields which were major producers in the 1980's and '90's are now crashing, such as Mexico's Canterall (sp?), and the North Sea field. As far as I know, no discoveries have been made that can fill the gap. The recent find off the coast of Brazil, I've read, presents extremely difficult obstacles due to the crushing depths and very high temperatures at the site. So don't bank on that one. Elsewhere, the people who live on top of the oil are either in turmoil or don't like us very much. Also, countries like Mexico are likely to begin keeping more of what they have left for themselves and putting less on the world market.

Why wouldn't all of that drive the price up?

Then how do you account for the $18 Billion dollar free-and-clear profit, then?

At what point do we allow ourselves to see a clear and present indication of price gouging in an effort to move people to allow the oil greed-heads to drill in Alaska?

Suppy and demand does not equal abusive profiteering. I'm sorry...it just doesn't.

[Tim McG]

The so-called "invisible hand of the marketplace" is morally corrupt and ethically bankrupt.

Bank on it.

[Joe G]

Then how do you account for the $18 Billion dollar free-and-clear profit, then?

Those would be the above-mentioned shennanigans, I guess. Or, how much oil did the world consume last quarter? If organissimo sold 18 BILLION copies of our CDs, I would expect a similar level of income. :rsmile:

I don't think there's actually a huge incentive to drill in Anwar, from what I've read. The oil that's there would meet our needs for about 3 months. What oil company is going to think that's a good investment? It's mostly political posturing, I'd guess. No real will for re-arranging the way we live life here in the states.