GOP Gas Attack
Gas price as percentage of income
inflation adjusted
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MJM Gingo – U.S. has only 19 billion bbls of proven reserves. We are far behind OPEC, and Canada, etc. Also, we already produce at a rate that will drain those reserves in 10 yrs. Where is all the oil that Gingo seems to think is there? In oil reserves, even if we would triple that amount with “drill,drill,drill” we still be pikers in the world of oil reserves. Also, Gingo doesn’t seem conscious of the costs of exploration, etc.
Re U.S. oil depletion/production decline see oil depletion
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See List of countries by proven oil reserves The US is 15th.
See The Status of Conventional Oil Reserves – Hype or Cause for Concern? published in the journal Energy Policy concludes that the age of cheap oil has now ended as demand starts to outstrip supply as we head towards the middle of the decade. The report also suggests that the current oil reserve estimates should be downgraded from between 1150-1350 billion barrels to between 850-900 billion barrels, based on recent research.
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Re state taxes, see:
http://www.scribd.com/doc/58925614/Pain-at-the-Pump-How-Illinois-Taxes-Drive-Up-the-Cost-of-Gas
This illustrates the issue for Illinois, ca 2004
Suggest gas tax moratorium
ALSO See, Survey of State and Local Gasoline Taxes, pdf saved
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2009 – QIV 2010
Oil’s Relentless March Higher
Oil prices emerged from their spider hole over two and half years ago. Having fallen from the towering heights of $148 a barrel in the summer of 2008, the early months of 2009 saw a return to prices in the $30s. Interestingly, during that great oil crash, the price of West Texas Intermediate Crude Oil (WTIC) spent only 20 trading sessions below $40. That is the exact price that most analysts only three years prior believed oil could never sustain as the world would pump “like crazy” should prices ever reach such “impossibly high levels.”
an over-confidence had developed over the decades, especially in America, and that any pressure from energy prices was ultimately solvable. And we encouraged corporate management to be more skeptical of the idea that the global oil and gas industry would be able to continue bringing to market resources that most could afford.
Read more: http://articles.businessinsider.com/2011-12-23/markets/30545776_1_oil-prices-barrel-analysts#ixzz1neLChGJU
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late August 2010 when Federal Reserve Chairman Ben Bernanke signaled that the central bank was prepared to
stimulate the economy by buying government bonds.
Nov. 2010 – tax cut extension seemed likely
China, India
demand push
Global economic rebound The Organization of Petroleum Exporting Countries is capable of raising output, if it needs to, by more than five million barrels per day. Still, Morgan Stanley estimates that the rising energy needs of China and other emerging economies will consume about half of that amount over the next two years. That could create supply pressures similar to those that preceded the price spike of 2008, when oil soared to $147 a barrel.
John Hofmeister, former president of Shell Oil and author of “Why We Hate The Oil Companies,” predicts Americans will pay $5 per gallon for gasoline by 2012. Other experts say that’s a long shot.
“That means oil close to $200” per barrel, analyst and trader Stephen Schork said. “We can see it, but we could also see a global depression, too.”
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ca. 2011
MJM: And Gingo wants 2.00/gallon oil – recall that 45 cents/gallon is state & federal tax . . . and low priced oil is not in the oil companies’ interest, nor OPEC’s [see below]
Big Oil Needs Expensive Gas to Survive: According to industry experts, the “easy” oil in the Middle East and Africa can be pumped for as little as $5 a barrel from simple surface well. Costs vary greatly for unconventional projects such as deepwater drilling and tar sands, but can easily be $40 a barrel or higher for tough to access supplies of oil. With fierce global competiton and state-run monopolies in Venezuela and China squeezing out Western energy giants, the bottom line is that cheap oil – and subsequently cheap gasoline – just doesn’t work out on the balance sheets of big oil. Call me a conspiracy theorist, but considering that Exxon Mobil (NYSE: XOM), Chevron (NYSE: CVX), BP plc (NYSE: BP), ConocoPhillips (NYSE: COP) and Royal Dutch Shell (NYSE: RDS.A) have a collective market value well over $1 trillion, it’s hard to imagine all that financial clout simply sitting by and letting oil slump back to $50 or $60 bucks a barrel where high-tech, high-cost extraction leaves them little or no profit margin.
A Healthier Economy Means More Demand: The biggest problem with $4 gas in 2008 was that it coincided with the beginnings of a recession in the U.S. as the mortgage crisis took hold. As the American economy shut down, we saw oil peak at a whopping $147.27 before flopping to $40 a barrel in early 2009. The double edged sword of economic recovery this time around is that sustained spending will add up to sustained oil prices. The bottom won’t be as likely to drop out since the economy is in much better share in the first quarter of 2011 (and beyond) than it was in the first quarter of 2009 after the mayhem of the financial crisis and the failure of GM, AIG, Lehman and others. There will of course be a tipping point, but judging from the stock market’s surge alongside oil in the last several months, we are not near that point yet.
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crude = 70% GSCI S&P
taxes – 13%
refining = 11%
Distri & marketing 9%
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crude = 70% GSCI S&P
taxes – 13%
refining = 11%
Distri & marketing 9%
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Oil and Gas prices tend to rise as spring approaches
China:
China’s demand for refined oil products will increase at an average rate of 5.5 percent annually in the five years through 2015, the Ministry of Industry and Information Technology (MIIT)said on Friday.
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Iran’s decision to cut in oil exports to Britain and France in retaliation for sanctions put in place by the EU and United States. Iran’s threat to do this has been pushing up crude oil prices for weeks.
Speculators have pushed crude oil to $105.28 per barrel, up 35 percent since September. Brent crude, Europe’s benchmark, is now $120.37 a barrel– also worrisome because many East Coast refineries use imported oil.
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more significantly any other sort of reduction in oil exports from Iran could lead to pricing in more of a security premium or an Iran premium. In the last few years, oil analysts talked about a terror premium — an extra few dollars in the oil price that was pricing in the risk that security threats might lead to a certain number of barrels coming off the market. So, for example, if there is a fear that Iran might lower production, that would be factored into the oil price.
Se here http://my.news.yahoo.com/1-china-fuel-oil-demand-seen-strong-4th-094927203.html
Also, China now accounts for 12 percent of the world’s energy demand but its rate of consumption is growing more than four times the world’s rate.
BUT – Both China and India have been warned by the International Energy Agency that they need to do something to curb their use of energy or else they will cause a number of serious problem including increased production of global warming gases and strain the global oil trade, causing shortages and price hikes. http://factsanddetails.com/china.php?itemid=324&catid=13&subcatid=85
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Iran’s decision to cut in oil exports to Britain and France in retaliation for sanctions put in place by the EU and United States. Iran’s threat to do this has been pushing up crude oil prices for weeks.
Speculators have pushed crude oil to $105.28 per barrel, up 35 percent since September. Brent crude, Europe’s benchmark, is now $120.37 a barrel– also worrisome because many East Coast refineries use imported oil.
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more significantly any other sort of reduction in oil exports from Iran could lead to pricing in more of a security premium or an Iran premium. In the last few years, oil analysts talked about a terror premium — an extra few dollars in the oil price that was pricing in the risk that security threats might lead to a certain number of barrels coming off the market. So, for example, if there is a fear that Iran might lower production, that would be factored into the oil price.
