Will Fuel Prices cycle back to pre - 1999 "era" levels + US Strategic Petroleum Reser

[outrun]

.89$ a gallon for 87 was heaven looking back.

Or is this over optimist thinking?

Last time fuel dipped was in the aftermath of 9-11 when people were showing mercy for us.

Ideally I want to see 1.10$/gallon again.

[ March 18, 2004, 06:25 AM: Message edited by: Patman ]

 

[outrun]

2nd question:

How does the US Strategic Petroleum Reserve filling affect Oil prices?

 

[SteveD2]

If fuel drops to $1.10 a gallon I'm gonna buy a truckload of gas cans and keep them full in my garage.

Highly unlikely...

 

[sprintman]

Barrel price at a 13 year high this morning and OPEC possibly about to drop production. Don't expect to see any price drops for some time although Iraq are pumping 2 to 2.5 million barrels per day which does help.

 

[Gary Allan]

quote:

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How does the US Strategic Petroleum Reserve filling affect Oil prices?

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It really should not have any real impact. The strategic reserve, at least according to the last news clip I saw on it, is just a limit to the current supply "on hand". That is, refiners must have a certain inventory which they can't release for sale below that limit. Has this changed?? Correct me if I'm wrong here, please.

quote:

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Ideally I want to see 1.10$/gallon again.

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You and most of the motoring public

Considering that $0.45 a gallon is added in PA (combined state and federal highway taxes) ..$1.10 was a steal!

quote:

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Or is this over optimist thinking?

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Absolutely! In fact, it's "borderline" thinking

All in fun

 

[novadude]

Where does the government keep this "strategic reserve"? I assume it is stored as crude?

 

[Asinine]

1) If gas prices dropped, it would hurt U.S. oil interests, too. The current administration has no desire to hurt U.S. oil.

2) We're **** lucky OPEC hasn't tried to stick it to us already. We're not making a lot of friends in OPEC... we never have.

3) If one drives a car that gets less than 20mpg, one has no right to comlain about gas prices.

4) The U.S. strategic reserve is only going to be used in the event of a catastrophy or to win a second term in office. The first situation would be something like OPEC shutting down all pipes to the U.S. and declaring war. The second might happen in September or October to drop prices in another ploy to make us feel better in the short term, but will end up hurting us (*cough*tax cuts*cough*)

5) The U.S. is the 4th largest producer of oil, and the largest importer. This relates to #3. Even though only three countries produce more oil than we, it's still not enough to sate our appitite... not even close.

 

[Asinine]

Not to hijack your thread, but to answer your question:

We've been conditioned to believe that these prices are normal, and we've been purposefully distracted from these ourtrageous prices. This means three things:
1) We continue to pay without too much griping.
2) We fail to find ways to become less dependent on fossil fuels.
3) Prices are going to stay high.

Think about it. This administration is so bent on stopping terrorism, but they fund terrorism... WE fund terrorism! "What the **** are you talking about?" you might be thinking. I'll explain.

Every barrel of oil we buy from our "allies" the Saudis and their OPEC buddies partially goes to fund fundamentalist activites (read: Islamic extremists). So it would make perfect sense to try to overcome our dependence on foreign oil. If we stop shipping money over there, we'll have a better time fighting terror.

But still, money for federal research doesn't exist. The only thing this administration has done to facilitate energy independence has been to suggest drilling in some of the only pristine wildlife areas we have left in this country--places that don't even have the oil to sustain us for a few years if we got cut off from OPEC. In fact, money that could be used to research energy alternatives is being given to oil companies to explore drilling options.

I can't say for sure, but it makes sense to me that it's because this administration and big oil are bed fellows. If we take route 1) and find alternatives to fossil fuels, it hurts domestic oil. If we reduce dependency by drilling domestically, they get a fat paycheck. The first route leads to lower fossil fuel prices. The second route leads to stable or increased fuel prices.

 

[keith]

quote:

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Originally posted by Asinine:
But still, money for federal research doesn't exist.

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Nuclear power is a mature technology, no research required. France generates the vast majority of its electricity this way. Electric powered cars have been a huge flop, they are simply not efficient. Carrying around 500+ pounds of batteries is silly. Hybrid cars look promising, and the technology leaders are in Japan and receive zero Federal research dollars. Fuel cells are way out there. Immature technology with no fuel production or distribution network.

We have all the technology we need. Nuclear power and hybrid cars will lessen our oil usage dramatically, to the level where we need no oil from Saudi Arabia. If fuel cells, which Bush has supported with billions of your dollars, eventually come to be practical, so much the better.

Keith.

 

[jason07-1zzfe]

I used to think electric vehicles were hopeless too but then I saw a show on Science channel about development of Nuclear fission power.

Once they get that figured out...everything will be electric! But I don't know I'm not a physicist, so maybe it's just a dream. Personally I love the ICE though

[ March 18, 2004, 11:09 AM: Message edited by: Jason Troxell ]

 

[Asinine]

quote:

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We have all the technology we need

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You couldn't be more off base. If we don't continue to develop, we're going to be in bad way. And we most certainly do need improvements in nuclear techology. First, we need to modernize facilities with better monitoring and computing power. Second, we need to make them more secure to protect against terror attacks. Finally, we need to educate people about nuclear power so that there isn't resistence to new plants.

Electric cars were not a flop. They were the precursor to hybrids, which are a fantastic technology. More low-end torque plus 60+ MPG seems win/win to me.

Fuel cells still need to be developed, which contradicts your "all the tech we need" comment. New advances are getting us there... but not because Bush funded any of it. I defy you to find one bit of evidence that Bush has spent billions of dollars to fund fuel cell research. He hasn't.

And if we had federal research dollars ten years ago, and no resistence from big oil, hybrid cars would be ubiquitous today!

 

[Matt_S]

Fuel cells are a lot more mature than most people think. They've been used by NASA since the Gemini program of the early '60s. The two biggest problems are that the components are expensive and the hydrogen fuel is expensive and lacking a distribution infrastructure. It's only a matter of time, and I believe less time than most are predicting, before they become practical.

 

[Drew99GT]

quote:

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Originally posted by novadude:
Where does the government keep this "strategic reserve"? I assume it is stored as crude?

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I believe it is stored as crude oil at some large facilities on the southern Guld Coast. The resrve is indeed held by ther US Government at it's own facilites, contrary to the notion that our reserve is held with private oil companies.

On to the price thing, it seems to be the economic times! There is really no shortage what-so-ever of gasoline or crude oil in the US, so it's not a supply and demand thing for the most part (except China). BUT, OPEC is cutting production, China's demand for crude has increased dramatically recently, and the dollar is still falling dramatically. However, it has been shown time and time again, that crude prices technically do not have as big an impact on gasoline production costs, so I think were basically being taken for a ride.

 

[Drew99GT]

http://www.fe.doe.gov/programs/reserves/

 

[keith]

quote:

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Originally posted by Asinine:
... we need to educate people about nuclear power so that there isn't resistence to new plants.

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Sounds good, but pretty much a dead duck here in the US unfortunately. I would love to see President Bush push for more "newkular" power. I very much doubt any democrat in DC has the balls. The Sierra Club would send out a hit squad, LOL.

We can start building tomorrow if there was the will. France has proven that.

quote:

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Originally posted by Asinine:
Electric cars were not a flop.

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I might have seen one on the road, one time. By any measure, a flop. Slow, expensive (massive subsidies to make them affordable), short range, glorified golf carts. Consumers voted on electric cars already. Big thumbs down.

quote:

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Fuel cells still need to be developed, which contradicts your "all the tech we need" comment.

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Fuel cells are at best a future technology, if at all. They need massive infrastructure investment, which is separate from the research subject. When it makes commercial sense to have fuel cell power, it will be developed commercially. Hybrid cars have developed quite nicely because they are practical and affordable. Not one Federal dollar has hastened Toyota along.

I agree that Federal research can be a good thing, it will help to move the economy to the next boom cycle. Let's spend on getting men on the moon, biotech, nanotech, fuel cells, the whole lot. This would be a much better investment than $400B for drugs for old people who can afford them already (only 5% need assistance according to polls). But let's get back to today...

Nuclear power plants and hybrid powered cars exist today, they work today, they are affordable today. Massively reduced oil dependence is possible with todays technology.

I think we will need many more 9/11 sized disasters before nuclear power is seriously discussed. We can't even drill a hole in Alaska, LOL.

Keith.

 

[Asinine]

By not a flop, I mean they were an integral part of the evolution to hybrids.

I have heard reports that one reason for the spikes in gas prices right now is the lack of refining plants running at capacity right now, as many of them are doing bi-yearly maintenance to move from winter-grade fuel to summer fuel.

 

[wulimaster]

quote:

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Originally posted by sprintman:
Barrel price at a 13 year high this morning and OPEC possibly about to drop production. Don't expect to see any price drops for some time although Iraq are pumping 2 to 2.5 million barrels per day which does help.

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Iraq was pumping more oil before the war. We still have to get it up to that level.

 

[JohnnyO]

If memory serves, gas has been between $1.00 and $1.65 (here) for most of the last 20 years. So if you adjust for inflation, it isn't really too bad. Still, I can remember back in the 70's when I had a Firebird and crying when premium hit .65 a gallon.

 

[wulimaster]

You will be lucky to see it drop one more time to around 1.50/gal before it permanently rises above 2.00 next year.

The SPR has been quietly refilling at a rate of 100k barrels a day since about last September. Most likely preparing for a time in the not so distant future when it will be called upon to replace oil lost from Iran should a coup fail and military intervention is called upon.

I believe the rise in crude prices is being used by the oil companies to fund Iraqi oil infrastructure so that production can be brought up to 6 million bpd and also to fund startup costs on smaller oil fields off the cost of Africa so that they can be brought up to full production capabilities quickly. Once this has been done the world will be set for a couple more years of adaquate supply. After that we will be forced to do with less globaly. Prices will only go up.

For those who think the Saudis act independant of the USA's wishes, I would have to disagree. If they are cutting back on production it will only serve to keep the prices high during the summer months and allow an increase in production by Iraq to fill the shortage at high prices and high profit. Also benefits US domestic oil production which relies on high crude prices. The Saudis will be the only ones to suffer as they will be selling less oil and the price of crude will not be going up but staying stabil around 40/barrel. I expect the dollar to drop also which will decrease the earnings to the Saudis which receive their money in US dollars.

For those who talk about alternative energy sources. Worldwide there are 3 less nuclear reactors now than 3 years ago. Fuel cells are not there yet. Problems with cost of production and longevity of fuel cells. Problems with deciding what fuels to base reformers on. Currently working on methanol and gasoline reformers to take advantage of existing fossil fuels and biofuels for use in existing distribution infrastructure.

Expect electrical shortages and natural gas price hikes as we attempt to build the infrastructure to import LNG to offset lack of production capacity by North American sources. Expect higher prices for electricity and natural gas from now on. This will equate to higher costs of fertilizer, manufacturing, etc. Expect more manufacturing to move to where the natural gas resouces are plentiful and also fertilizer production to move there also.

 

[Al]

The worst possible thing for us would be for gas to go to $1.10/gallon. We seem to have the ability to guzzle every increasing amount of petroleum that exists. Personally I would like it to go to $2.50 with even more tax and use that money to subsidize dieslel fuel for trucks and also develop alternative fuel technology. But its absurd for me to think that we would be able to do something to help our future-I was just halucinating.