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Gasoline Rip-off Continues: Lower Oil Prices/Higher Price At Pump

AP
Crude oil is getting cheaper -- so why isn't gas?
Sunday February 15, 12:30 pm ET
By Chris Kahn and John Porretto, AP Energy Writers
The price of crude oil falls to yearly low, but gas goes ever higher -- what gives?

NEW YORK (AP) -- Crude oil prices have fallen to new lows for this year. So you'd think gas prices would sink right along with them.

Not so.

On Thursday, for example, crude oil closed just under $34 a barrel, its lowest point for 2009. But the national average price of a gallon of gas rose to $1.95 on the same day, its peak for the year. On Friday gas went a penny higher.

To drivers once again grimacing as they tank up, it sounds like a conspiracy. But it has more to do with an energy market turned upside-down that has left gas cut off from its usual economic moorings.

The price of gas is indeed tied to oil. It's just a matter of which oil.

The benchmark for crude oil prices is West Texas Intermediate, drilled exactly where you would imagine. That's the price, set at the New York Mercantile Exchange, that you see quoted on business channels and in the morning paper.

Right now, in an unusual market trend, West Texas crude is selling for much less than inferior grades of crude from other places around the world. A severe economic downturn has left U.S. storage facilities brimming with it, sending prices for the premium crude to five-year lows.

But it is the overseas crude that goes into most of the gas made in the United States. So prices at the pump will probably keep going up no matter what happens to the benchmark price of crude oil.

"We're going definitely over $2, and I bet we'll hit $2.50 before spring," said Tom Kloza, publisher and chief oil analyst at Oil Price Information Service. "This is going to be an unusual year."

More Here:
http://biz.yahoo.com/ap/090215/gas_prices_unhinged.html




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manas petroleum

The petroleum industry includes the global processes of exploration, extraction, refining, transporting (often by oil tankers and pipelines), and marketing petroleum products...
manas petroleum

hiilc89

The reality, folks

When oil prices climbed above $140 / barrel gasolline prices went up but not by the same percentage as the petroleum price. The result is that refiners actually lost money at a time of record high gasoline prices. That is why their stock prices halved even before the September - November crash. As I recall when petroleum prices tripled nobody complained that their gasoline prices only doubled, rather than triple too. Well now we have the reverse process, and refiners are finally able to make a little money again, but only because gasoline is not going down by the same percentage as petroleum.

Sorry, Bob

but I don't buy that. I think it's more likely that the stock market caused a bubble to burst, much the same as the one in real estate.

~ Love is a powerful force
for good. May the force be
with you.~

. @ @ . Power to the People!
@ O @ -----> PEOPLE
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Petroleum vs. gasoline

Whether or not you accept my reasoning about the causes of the changes in the stock prices of the refiners, the fact remains that most lost money in the first half of 2008 when petroleum was at record heights, because gasoline had not gone up as much as petroleum had. Now that petroleum has gone down faster than gasoline the refiners are starting to make money again. I see nothing wicked with that, and you shouldn't either, unless you believe they should never be allowed to make a profit.

OPEC has lowered our supply

OPEC has lowered our supply so that the law of supply and demand can raise the price. Ain't greed grand!!?! Maybe Obama can somehow deregulate OPEC??!? But what do I know?

~ Love is a powerful force
for good. May the force be
with you.~

. @ @ . Power to the People!
@ O @ -----> PEOPLE
. @ @ . NOT Corporate Entities!

SteveMT's picture

C3: Nuclear is the way to go to by-pass all of this crap.

France is 85% nuclear. A nuclear air-craft carrier 900 feet long can go 30 years without refueling. We are idiots in this country.

Maybe so, Steve,

but nuclear kind of scares me: the possibility of human error alone sends chills up my spine, and with our infrastructure in the antiquated stage it's in, those nuclear stacks may be outdated by now, as well. I really don't know, but it seems to me that methane may be the better way to go.

~ Love is a powerful force
for good. May the force be
with you.~

. @ @ . Power to the People!
@ O @ -----> PEOPLE
. @ @ . NOT Corporate Entities!

SteveMT's picture

I know your concerns. Remember that Nuclear Power supplies..

15+% of California's energy. The two nuclear reactors at Diablo Canyon should be four and was approved for these 4 reactors 20 years ago. Building the other two at the same location would not require as much as building in a completely new area. Most of the 110 nuclear power plants in this country were designed for more reactors than they currently have in operation. With more nuclear reactors on line, more methane would then be available for just what you are proposing. In fact, all of the federal vehicles could be converted now to methane. Imagine the signal that would send to the Arabs combined with increasing the number of nuclear reactors to our existing facilities.

More Here:
http://www.powerforcalifornia.com/

Right!

Deregulating OPEC would send them a signal, too, if that's possible...

~ Love is a powerful force
for good. May the force be
with you.~

. @ @ . Power to the People!
@ O @ -----> PEOPLE
. @ @ . NOT Corporate Entities!

bump

for more ideas!

~ Love is a powerful force
for good. May the force be
with you.~

. @ @ . Power to the People!
@ O @ -----> PEOPLE
. @ @ . NOT Corporate Entities!

I think natural gas and bio-diesel are good..

..Both will run vehicles, so they have a lot of potential. Both will also run generators.

Regarding nuclear, I agree with Steve. But I can understand the NIMBY (Not In My BackYard) principle with nuclear plants. Who would want to live downwind of one?

But there's a solution for this, if anyone else ever thinks of it: Put the plants offshore in drilling rig regions of the coast. No one would see them. Only sea life would be threatened by any nuclear accidents--and oceans absorb radioactive contamination, when it occurs, much better than dry land. Put them offshore, and cable the power in 50 miles to the mainland.

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SUPPORT OUR FOUNDERS' AMERICA
Support the Constitution of the United States

That does seem like a good idea!

Maybe you could get the idea "out there" in one (or more) of your wonderful cartoons...

~ Love is a powerful force
for good. May the force be
with you.~

. @ @ . Power to the People!
@ O @ -----> PEOPLE
. @ @ . NOT Corporate Entities!