Click to enlarge

Source: WSJ

 

 

Interesting graphic on gas prices nationally . . .

Category: Commodities, Digital Media, Energy

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

20 Responses to “National Gas Prices”

  1. wally says:

    Demand-related? … no
    Supply-related? … no
    Seasonal changes? … no

    WTF?

  2. S Brennan says:

    Dunno Wally,

    Until this last spike it kinda made sense…making big profits in the commodity markets requires big price swings. Since most purchase of futures is now speculative and not meant to secure supply, it’s become buy low and have a manufactured crisis suddenly “erupt”, like refineries shutting for maintenance at the same time, or the Libyan bombing campaign where Al Qaeda operatives protesting Qaddafi’s harsh treatment of terrorist required immediate US intervention and the ever popular…”Will the [US/IDF] bomb Iran this week…” featuring a breathless reporter giving us the “inside scoop” on why bombing NOW makes sense.

    …I’d say seasonal, but hey the spike is too early, too high…maybe it’s competing algorithms run amok? It being an off-election year, it’s doubtful too many politicians will care about some well healed group throwing another monkey wrench in the sputtering economy.

  3. VennData says:

    Leadership. Taking on the entrenched interests.

    “…United States oil consumption in 2012 will be about 4.7 million barrels a day, or 20%, lower than it would have been, if the pre-2005 trend in oil consumption growth of 1.5% per year had continued…”

    http://www.theoildrum.com/node/9811#sthash.2Y65XMFL.dpuf.

  4. willid3 says:

    i suspect there are at least 2 causes for the high gas prices. last year the US became the leader in shipping refined products to the world. thats one reason that drill, baby, drill will never work,. since no matter how much oil you can pump, you can still ship it world wide.
    the other is that oil is a commodity and has replaced other investments. so oil and gas stopped following supply and demand a long time ago.

  5. Mike in Nola says:

    A lot of oil is being sold to Latin America from the Gulf Coast. This includes to the devil incarnate: Hugo Chavez, who subsidizes petroleum in his own country. If the oil is exported, Big Oil can get Brent Crude prices instead of having to sell it to stupid Americans at the WTI price.

    That is one of the unpublicized reasons for the big push for the Keystone pipeline. There’s a huge supply of WTI in storage up there, so why waste it on Americans when you can sell it for more overseas.

  6. S Brennan says:

    Willed3,

    I agree drill, baby, silly was/is silly. The US citizen may have to to bear the cost of acquiring the original mineral rights…and may have to to bear the cost of their subsequent extraction, but the profits are to be split between the oil patch and their lackey’s in congress, the courts and white house. Since those profits must be maximized, the US owned oil must be sold to the highest bidder on the world market…be they friend of foe. To paraphrase a book our politicians took a page from, “being a US leader means never having to say you sorry”

    but…that still doesn’t explain the steep spike…or the steep decline…does it?

  7. Mike in Nola says:

    Oh, and here’s a story on Venezuela’s import of our gasoline.
    http://blogs.ft.com/beyond-brics/2013/02/25/venezuela-an-affair-to-remember/

  8. Frilton Miedman says:

    wally Says:
    February 27th, 2013 at 3:17 pm
    Demand-related? … no
    Supply-related? … no
    Seasonal changes? … no

    WTF?

    ~~~

    Dodd-Frank CFTC position limits still held up in lobby hell by the oil & banking industry, pure coincidence?

    Notwithstanding variables such as fracking and refinery costs, but who needs to own more than a 10% in the global supply of any commodity while yet not being required to disclose that position?

  9. Mike in Nola says:

    Will: It looks like there was a big spike in gasoline imports by Venezuela following a refinery explosion. I suppose there was a lag in our prices jumping until our stockpiles were drained.

    Of course, the speculation caused by all they free money from Uncle Ben that has to be put to work somewhere doesn’t help the situation.

    I keep thinking about all those who should be first against the wall when the revolution comes. I imagine it would hurt the luxury garment industry a lot.

  10. hue says:

    it’s a flip of red and blue states.

    lots of different factors — such as regional crude, gas supplies, refinery actions yada yada yada — but the highest gas prices seem correlated to highest gas taxes. Florida, Georgia & NC pay higher gas taxes than rest of the South. N.H. & N.J. pay lower gas taxes than their neighbors in the Northeast. http://bit.ly/Winqlk

  11. chartist says:

    Saudi Arabia needs $90 per barrel to run their economy so it doesn’t matter how much extra oil we currently have at Cushing, Oklahoma, our government is going to hold oil at $90 per barrel. Also, why should Valero sell us their gas and diesel when they can just ship it to Europe?

    I always looked at it this way, the world overpaid for fuel to keep the US in cheap gas, and US citizens overpaid for prescription drugs which allowed the rest of the world to get cheap drugs.

  12. S Brennan says:

    “the world overpaid for fuel to keep the US in cheap gas”

    C’mon ever been to South America? Europe taxes the crap out it…with a good deal of public support.

    “US citizens overpaid for prescription drugs which allowed the rest of the world to get cheap drugs.”

    Pharma spends far more on marketing drugs in the US, than R&D. Now back in the 70′s, when advertising was banned and we fully funded government…but that’s 40 years ago…past glory.

  13. SecondLook says:

    Let’s keep some perspective. The only reason gasoline seems, feels, high, is that the price was incredibly, uniquely, cheap back a decade ago.

    But, relative to wages, gas is still cheap. In fact, it doesn’t cost much more now than it did back in 1960′s. I mentioned this before, worth repeating: In 1966 it took 8 minutes of average work to pay for a gallon of gas. Today it takes all of 9 minutes.

    Why we are still so inefficient when it comes to fuel economy…

  14. Mike in Nola says:

    Secondlook,

    But the price so much higher than at times in recent years even though we are producing more and driving fewer miles. It’s not about US supply and demand, but speculation by those getting cheap money from the Fed (directly or indirectly) and how much Big Oil can sneak through export restrictions to make higher profits selling overseas even though we are bearing the environmental cost and subsidizing the production with our tax dollars.

  15. JimRino says:

    Hmmm.
    Seems to be a correlation between high numbers of EV’s and Hybrids, and high gas prices.
    No, the oil industry wouldn’t punish states with high numbers of early adaptor’s.

  16. petessake says:

    RE: your excellent article and commentary on car buying.

    Just not interested until I can buy a relatively safe car that is AWD (or 4wd or with a limited slip differential), weighs about as much as a Formula One racer, reliably cruises at 90 mph, and achieves 100+ mph, with minor creature comforts like heat, air, and single cd and e-music hook up. None of this is beyond current technology; yet getting the knuckleheads running companies to offer anything that is not plug in with a pizza delivery range or hours of recharge time to bring the flexibility of liquid fluids to the market is beyond the imagination of the knuckleheads.

  17. victor says:

    The US crude oil consumption for 2012 : some 18 million barrels/day, not as Mr. VennData quotes: “Leadership. Taking on the entrenched interests” what’s that?. We still import approx. half of that.

    Net exports of refined products to Latin America and elsewhere are beneficial to the economy, everybody knows that, what’s the fuss? I say NET because we still import large quantities of refined products: gasoline, Diesel and jet fuel.

    About gas prices at the pump: US Big Oil (XOM and CVX) are price TAKERS not price MAKERS. Shell and BP are foreign corp’s, thus not US Big Oil and COP just split itself into refining and upstream, doesn’t qualify as Big Oil integrated. Big Oil is 100% out of retailing (they still use their brand names and logo’s at the pump) and they refine approx. 20% of the gasoline sold in the US. Chavez’s PDVSA, another foreign entity is a big refiner in the US about equal to Shell. For every dollar you pay at the pump, various taxes are the single largest component excluding COSTS.

    About where the REAL money is made, i.e. upstream: 90% of the conventional crude oil reserves (approx. 1 trillion barrels) are in various Sovereign hands, so is 80% of current crude production (approx. 87 million bpd). Refining (downstream segment of the industry) is much less concentrated in monopolistic entities thus the refining business has much lower margins and has many years of zero earnings. Crude production has gone up in the US due to new production (and growing via fracking, light sweet crude) from private and state acreage (not federal). Crude consumption has declined due to a combination of factors: slower economy, higher ethanol production (now you have Big Corn too) and higher efficiencies. With the advent of fracked crude and natgas, the entire world energy production/consumption space is changing with huge, positive implication for the US: less imports, cheap domestic energy, switch from coal to natgas for power generation. US CO2 emissions are already down to 1992 levels mainly due to burning cleaner fracked natgas.

  18. victor says:

    @VennData correction: you meant that 2012 consumption @18 mmbpd turned out lower than the projected 22.7 mmbpd (from 2005 @1.5%) thus by 4.7 million barrels/day, right? Causes? higher efficiencies, slower economy and increased ethanol production (Big Corn?). Too boot this difference comes out of imports.

  19. The effect of sustained high petroleum prices on the economy is quantifiable. Due to supply chain constraints, gasoline costs are not yet fully reflecting the damped crude prices over the past year. This baked-in factor trimmed 1.6% of the Real GDP growth rate in June 2008 & April 2011. This headwind finally expired in February. That said, high gasoline costs plays havoc with the auto sector whenever gas/GDP exceeds a definitive ratio represented by $3.48/gal today. The national monthly price is $3.70 today, explaining the 7-month pause in auto sales at its 15 million units/yr pace.

    If there is good news, it is that improving crude oil fundamentals should drive pump price down to $2.95 over the next 24 months … and drive auto sales to the 17 mu/yr pace.

    gasoline price components chart: http://www.trendlines.ca/free/peakoil/GasPump/GasPump.htm