Gas price Jan 2009

[dmano]

So how did this work out for you Obummer lovers. 

[JoeP]

Dave:  Except in a welfare state, gasoline does not deserve to be $4.00 per gallon.   It is not $8.00 only because we pay welfare to its consumers by artificially lowering the price through subsidies and tax breaks.  In this one regard, we are much closer to the Arab states and Venezuela than Capitalism.

[ccm911]

Dave, you seem to be quite a follower of the Tea Party. Now if I am not mistaken, the Tea Party espouses the "Invisible Hand" for market corrections, as opposed to Governmental Interference. Yet now you Tea Party folks are bashing O'Bama for not getting involved in trying to control these rising gas prices.

So what is it that you folks want? Free market economy with no Government intervention? Or should the Government only intervene when you personally are affected? Can't have it both ways my friend.

[dmano]

I am no Tea bagger but I do believe, we as a country, needs to re-vamp the government as we know it. Get rid of the good old boys and bring in some new blood that is not all about the kick backs.

[cjbcpa]

I felt compelled to check the gas price in January of 2009 and by golly Dave's picture is pretty accurate. I can't recall why, but the price of gasoline fell off a cliff in late 2008 reaching bottom in early 2009.

Now don't try and argue it's becuase of W's exit or O's entrance. None of the credit or blame goes to any US president for this or quite frankly any change in the economy. It's all about timing and being in the right place at the right time.

I will agree with Dave on one point, they're all politician's at heart and I for one would love a fresh start too. Keep the Constitution and Bill of Rights and let's go from there.

CB

[Terry]

Watching gas prices is interesting. First, did you ever check to see how much of it is taxes? Amazing. Second, Sunoco loses money on its Philly refineries even at these levels and is closing them. Seems inexplicable but is evidently true or they wouldn't be doing it. Third, why is diesel so high compared to gas? (Higher taxes are a big part. ) Fourth, it seems obvious that the traders are bidding it up based on fear of another war in the Middle East, and these speculative bubbles always burst at some point. Personally, I think gas prices peak just when I go to the track.

[JoeP]

The voting public is in a bad situation because we do not have the same choices as in any other marketplace.  That is, we cannot vote "None of the Above".  We are forced to pick a spoonful from either of two piles of shit.  If neither party puts up a decent candidate, vote both of them out, and leave the post vacant.  With no one to lobby, the lobbyists would starve.  It can't be worse than the current crop of thieves.

[STEVEMCMORN]

Never vote for anyone who wants to be a politician

[cjbcpa]

Terry wrote:

Watching gas prices is interesting. First, did you ever check to see how much of it is taxes? Amazing. Second, Sunoco loses money on its Philly refineries even at these levels and is closing them. Seems inexplicable but is evidently true or they wouldn't be doing it. Third, why is diesel so high compared to gas? (Higher taxes are a big part. ) Fourth, it seems obvious that the traders are bidding it up based on fear of another war in the Middle East, and these speculative bubbles always burst at some point. Personally, I think gas prices peak just when I go to the track.

I don't know much about it, but I understand refining is a very tough business and profitability is not correlated to the price of crude nor the retail price of gasoline.

Diesel is a funny animal. The taxes are higher since such a large amount of it is used by trucks that cause more roadway wear and tear. In addition, there is more energy (btu's) in a gallon of diesel fuel than a gallon of gas, so on that basis it should be higher (that's the reason my TDI can go 50 mpg versus 33 mpg for the gasoline version). On the other hand, it is easier to refine crude oil into diesel fuel than into gasoline, so you'd think that would work in favor of lower prices. Lastly, the market for diesel fuel is much smaller than that for gasoline and could partially responsible for the higher price.

Saw an interesting chart on CNBC yesterday morning. It plotted the price of crude oil futures going out 12 months. March 2013 forward price was $91/barrel so there seems to be some feeling the price will come down or is above its normalized price.

[Phokaioglaukos]

One of my college classmates wrote the following, and I thought you might be interested in seeing it--particularly how Japan and Germany are increasing demand.

Wait a moment!

Under the heading of "Energy Independence," this is wrong.

The national press is poorly informed. 

The US produces some 6 million bbls per day and still imports more than 10 million bbls per day of crude oil.

See our papers on http://www.ssrn.com, and, in particular, Crude Oil Imports and National Security (Ames, Corridore, Hirs and MacAvoy co-authors) and the citations.

See http://yaleae.org/ and come to the 4th Yale Alumni in Energy Conference which I founded and co-chair---March 23 in New Haven. We have alumni and faculty leaders in energy meeting together with students.

The United States is  now exporting roughly 3 million bbls of refined products per day (Dec data is most recent). The US demand for refined products is down almost 3 million bbls per day since 2008. The exports are because we have refineries that can handle the heavy, sour crude that comes from Venezuela, Mexico and Saudi Arabia.

The increased worldwide demand for refined products comes from the urgently placed turbine units in Japan and Germany to replace the nuclear units taken offline.

I teach the energy economics classes in Houston---undergraduate and graduate levels---at the University of Houston.