Gasoline prices

A friend told me the price per barrel of gasoline is under 80 dollars. He was watching a news broadcast and when the oil executive was asked why gasoline was still so high he said the oil companies were switching from winter gas to summer gas and it was expensive to do that. Has any one heard of this or saw that news broadcast? In all my years I've never heard of winter gas and summer gas. Just another ruse to pilfer from the pockets of We, the People?

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Oil is still around $101 per barrel despite going down a bit lately.  And, yes, there is a different blend of gasoline for the summer that is more expensive to produce. 

However, I do not believe either of these reasons are valid for the outrageous cost of gasoline these days.  Oil companies continue to make record profits.  I have nothing against profits for businesses, but oil companies are certainly making the best of the crisis situation that most of us find ourselves in.

I know Congress is grilling the oil execs today but I'm sure it's just for show.

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Somewhere on another thread recently there was a breakdown on oil profits.  If I remember correctly the government gets $.50+ cents per gallon of gas sold whereas the oil companies make approx. $.08 cents.  The government doesn't have to incur costs unless you factor in wars, freeways, bridges, freebees, etc.. 

Soooo, the price per barrel....natch....figures in, Class.   And, that has to do w/ supply and demand.   And, who controls the supply?

And, boys and girls, while we are at it, know that the state of Texas produced 90% of the world oil in the 1940's.   And, now we import 60%+ of the oil we use.

And, why is that? 

  

 

Gasoline 101

Most communities require lower vapor pressure in the summer to minimize emissions of raw gasoline which occurs before combustion.  It is one of the reasons the gas pumps have equipment to make a better seal with the car's fill tank and the pump nozzle.  It is also the reason for some of the auxiliary equipment around the fuel system in a car.

The reason a higher vapor pressure is required in winter is to assure easy starting in colder temperatures.  When you have stale gas (in a lawn mower for example) it has lost some of the component that lowers vapor pressure and can be hard to start, even in warm weather.

Gasoline is a mixture of hydrocarbons (plus oxygenates like ethanol and MTBE and additives) that range from butane through octane and up to hydrocarbons with 12 carbons per molecule.  Butane is blended to control vapor pressure.  Butane is worth much less to a refiner than gasoline, so the more butane they can add, the less costly the gasoline is.  Most refineries are long on butane and short on gasoline.  Summer gasoline must have a higher vapor pressure, hence lower percentage of butane, hence more expensive to produce.  Not only that, but they have more butane that must be upgraded or sold at a lower cost.  But I think the bigger cost is in reconfiguring the refinery to produce a different slate of products (gasoline blend components) so the transition costs going from summer to fall or vice versa will be higher than the straight summer cost.

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CANADA supplies us with 70% to 80% of all of our crude oil. (Due to NAFTA) They have the second largest reserves of crude close in size to Saudi Arabia.

MEXICO supplies most of the rest.

Only trickles come from other sources.

China and India are buying up every available drop since their economies are surpassing us in size.

This is the demand driving up prices.

Our gas prices would be $8.00 or more per gallon if the companies here kept it proportional to crude which they have every right to do.

Instead they are cutting their profits to the bone. Yet, to the uneducated it looks like they are raking it in. Their gross receipts are much higher but if this continues they will be non-profitable and going bankrupt.

One very bright spot, if Hillary does not wreck it, is a newfound method to extract light oil from oil sands for $10.00 per barrel.

We have enormous oil sands deposits and if we can tap them we would never again need one drop of oil from anyone. In fact we could export record amounts. THIS WOULD SEND OUR STOCK MARKET UP UP AND OFF THE CHARTS...........!!!!!!!!!!!!!!!!!!!!!!!!!!!

Hillary depends on our failure for her success because she needs to influence uneducated voters by driving them to desperation.

The sub-prime failure is a Democratic strategy to cause chaos to attract the uneducated voter. They have been plotting this by dumbing down students for years.

Today the stock market was up 350. The MSM is responsible for ALL the negative economic news and IT IS A BOLD FACED LIE.

FeedFwd, great comment.

Suzi said:

Soooo, the price per barrel....natch....figures in, Class.   And, that has to do w/ supply and demand.   And, who controls the supply?

And, boys and girls, while we are at it, know that the state of Texas produced 90% of the world oil in the 1940's.   And, now we import 60%+ of the oil we use.

And, why is that? 

  

 

Oil 101

Let's see...

Study assignment: How much gasoline is used today in Texas?  How much was used in 1940. (As a first approximation, count the number of cars and trucks on the road now vs in 1940 and conservatively estimate that gas mileage has doubled or even tripled for the average vehicle.  Further assume gasoline and diesel have remained in approximately the same ratios.)  For extra credit count the number of airplanes (Jet fuel is the cut between gasoline and diesel and was commonly known as kerosene and used in lanterns and stoves before it was used as jet fuel.) Hint: in 1940, there were no jets and I doubt any high school kids had a car of their own to drive to school.  Most families were lucky to have only one car and as others have noted, there were far fewer people and families in 1940 than today.

On the oil production side, think of an oil reservoir as a large pond.  As you drain the pond, all that's left are the alligators.  After 68 years, even with new discoveries, much of the oil in Texas has been depleted.  At various times when the oil business was less profitable, many wells were shut in because they were no longer profitable.  Once a well is shut in, it can be very expensive to get the oil flowing again.

 

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So much more reason to educate our children to go full bore on developing alternative sources of energy.  Of course as the old saying goes, "You don't butcher the dairy cow until it stops producing milk."

FeedFwd, Am I correct to say that Texas oil use today is more than it can pull out of its own wells?

This is only one state. Hmmm.

I posted the following on another thread. It needs to be here also due to this subject.

While the story below applies to Canada it can just as well happen here. We have oil sand fields here of enormous size. One field alone contains 23 TRILLION barrels.

Please realize the environmentalists are on the warpath to stop us from getting our hands on this. Included with them are the libs and all the America haters, sorry Soros not to be missed.

We have the ability to take a giant economic leap forward. Our Founding Fathers would be proud.

This kind of thing is one important piece of the formula that made us the economic envy of the World. This kind of envy is good because it is lifting the economic conditions of people all over the World.

This kind of envy drives the liberals nuts. They deserve it because they are total phonies. 

Thursday, March 27th, 2008

Dear Energy and Capital reader,

For years, most of the fortunes made from the Canadian oil sands were limited to investments in traditional big companies like Suncor, Imperial Oil and Shell Canada.

But that's all changing...

You see, as I write this, a brand-new round of wealth is rapidly spreading, thanks to the invention of Canada's first "underground refinery."

In short, this "underground refinery" now turns dirty, expensive and hard-to-get tar sands into light oil... while it's still in the ground!

Best part is... it only costs $10 a barrel!

Oilsands Review says "history is being made" with it. And Canada's largest newspaper -- The Globe and Mail -- calls it a "sea change" and "the answer for the oil sands."

The small company that controls this new refinery now has a license to print money. The report below explains exactly how you can profit from it.

Good investing,

Keith Kohl
Editor, Energy and Capital

Oilmen are calling it the single-most important breakthrough in 50 years...

Dear reader,

Seventy-four miles south of the boomtown Ft. McMurray, a small company is making oil sands history.

It has successfully built, tested, and is now operating Canada's first-ever "underground refinery."

The reason I call it an "underground refinery" will become apparent in a moment.

One thing is certain though: Oil production in Canada will never be the same.

Canada's most widely-circulated newspaper - The Globe and Mail - calls it "a sea change in how Canadian companies get oil from the ground."

Equities Magazine says… "The [underground refinery] is a ticket to bet on unlocking the vast Canadian oil sands."

And it really is.

This revolutionary new refinery can turn heavy, expensive and dirty tar sands into light, cheap oil... before it's pumped out of the ground.

But it also does more than that. The new "underground refinery" can...

• Reduce greenhouse gas emissions by 50%
  
• Double current oil production in Canada's oil sands
  
• Produce a barrel of oil for just $10

While the company is secretive about the project, insiders say the first 3 test wells are producing between 1,000 and 2,000 barrels of oil per day.

The plan is to get it up to 15,000 barrels per day... then to 100,000 barrels.

This truly is a huge technological breakthrough in the oil industry. Think about it for a second. If an oil company can double output while at the same time cutting production costs in half, it's basically sitting on a moneymaking machine.

And that's exactly what Stock Trends Reporter said about the underground refinery... "it's a license to print money."

Even the Canadian Government is backing the project. They've invested millions in the "underground refinery" and said...

"The government's investment in the 'underground refinery' has the potential to promote the kind of innovative, radical development required to move forward and succeed.

The 'underground refinery' offers a number of advantages over the current production method (SAGD)... including higher resource recovery (70-80 percent), lower production and capital costs, minimal usage of natural gas and fresh water... and significantly lower greenhouse gases."

Now that the "underground refinery" can produce oil previously considered unrecoverable, the company's oil reserve estimates have suddenly jumped in value.

Plus, the technology emits 50% less greenhouse gases than typical oil sands production methods.

http://www.energyandcapital.com/aqx_p/3545?gclid=CK6s0OG7rpICFQEGxwodtXc6Rg 

 

Greg Badger said:

Dear reader,

Seventy-four miles south of the boomtown Ft. McMurray, a small company is making oil sands history.

It has successfully built, tested, and is now operating Canada's first-ever "underground refinery."

The reason I call it an "underground refinery" will become apparent in a moment.

One thing is certain though: Oil production in Canada will never be the same.

Canada's most widely-circulated newspaper - The Globe and Mail - calls it "a sea change in how Canadian companies get oil from the ground."

Equities Magazine says… "The [underground refinery] is a ticket to bet on unlocking the vast Canadian oil sands."

And it really is.

This revolutionary new refinery can turn heavy, expensive and dirty tar sands into light, cheap oil... before it's pumped out of the ground.

But it also does more than that. The new "underground refinery" can...

• Reduce greenhouse gas emissions by 50%
  
• Double current oil production in Canada's oil sands
  
• Produce a barrel of oil for just $10

While the company is secretive about the project, insiders say the first 3 test wells are producing between 1,000 and 2,000 barrels of oil per day.

The plan is to get it up to 15,000 barrels per day... then to 100,000 barrels.

This truly is a huge technological breakthrough in the oil industry. Think about it for a second. If an oil company can double output while at the same time cutting production costs in half, it's basically sitting on a moneymaking machine.

And that's exactly what Stock Trends Reporter said about the underground refinery... "it's a license to print money."

Even the Canadian Government is backing the project. They've invested millions in the "underground refinery" and said...

"The government's investment in the 'underground refinery' has the potential to promote the kind of innovative, radical development required to move forward and succeed.

The 'underground refinery' offers a number of advantages over the current production method (SAGD)... including higher resource recovery (70-80 percent), lower production and capital costs, minimal usage of natural gas and fresh water... and significantly lower greenhouse gases."

Now that the "underground refinery" can produce oil previously considered unrecoverable, the company's oil reserve estimates have suddenly jumped in value.

Plus, the technology emits 50% less greenhouse gases than typical oil sands production methods.

http://www.energyandcapital.com/aqx_p/3545?gclid=CK6s0OG7rpICFQEGxwodtXc6Rg 

 

 

Greg,  As delicious as that reads will it indeed be a life saver for those of us that consume petroleum products?  Will we really see the price of gasoline go down dramatically or will the companies that control this process become unbelievably rich by simply keeping the prices high?  It's a different game now than what it was in the 30's - 40's.  

We will see it if people like Hillary and sorry Soros don't wreck it.

I think Jesus Christ is placing options before us to choose. He has about had it with our immorality.

Now is the time for us to make the right choices. It starts by humbling ourselves.

elaina got it right with 2 Chronicles 7:14. It all depends on our choices.

Gerald47,

We've been fighting an internal moral war for a long time. The libs are determined to take over this country from within. We've been letting them. Our apathy does not help, either.

It is encouraging to see many waking up and stepping up to the plate.

Gerald47 said: Somewhere on another thread recently there was a breakdown on oil profits. If I remember correctly the government gets $.50+ cents per gallon of gas sold whereas the oil companies make approx. $.08 cents. The government doesn't have to incur costs unless you factor in wars, freeways, bridges, freebees, etc..

 

Another thing to consider: Goldman Sachs has been talking with governors of 20 or more states regarding the sale of US infrastructure (toll roads, bridges, parking meters, etc) to private companies, often foreign companies like Cintra who has already bought the rights to the Chicago Skyway / Indiana Toll Road and aimed to control the proposed Trans Texas (so-called NAFTA) highway.

Currently the government is collecting fuel taxes to pay for road repairs, right? So if the goverment "privatizes" the roads, should they not drop the taxes, since the private companies will be collecting user fees and performing maintenance? Well, as far as the Indiana Toll road is concerned, the Tolls went up, but I  can't say I saw any tax or other costs reductions.

I don't think control of our infrastructure should be given to private companies and certainly not foreign companies over which we have no control.

 

 

 

 

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Suzi said:

Soooo, the price per barrel....natch....figures in, Class.   And, that has to do w/ supply and demand.   And, who controls the supply?

And, boys and girls, while we are at it, know that the state of Texas produced 90% of the world oil in the 1940's.   And, now we import 60%+ of the oil we use.

And, why is that? 

  

 

 

 Supply and demand do have an effect,  and the supply is being manipulated to keep up the price up.

Because we have oil in abundance--we are just not building refineries or drilling for it due to current political  policies.

There is a lot of untapped oil in the Dakotas  and Colorado areas http://www.nextenergynews.com/news1/next-energy-news2.13s.html and http://www.dailyreckoning.com/rpt/OilShale.html and http://www.rinf.com/columnists/news/the-us-governments-secret-colorado-oil-discovery and http://www.americanfreepress.net/html/u_s__has_massive_oil.html 

 

Offshore oil that could now be tapped  since we have the technology. But we are not doing it, partly because of political pressures from environmentalists such as this http://www.eia.doe.gov/pub/oil_gas/natural_gas/feature_articles/2005/offshore/offshore.pdf  and http://www.thepetitionsite.com/takeaction/981713535

Also, oil prices are  controlled because it is the global standard for our dollar, whether it is generally acknowledged or not  http://batr.org/view/040403.html

The current inflation ( ie devaluation of our dollar, is being reflected, at least in part, by the increasing price of oil.)

 

 

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Greg Badger said:

We will see it if people like Hillary and sorry Soros don't wreck it.

I think Jesus Christ is placing options before us to choose. He has about had it with our immorality.

Now is the time for us to make the right choices. It starts by humbling ourselves.

elaina got it right with 2 Chronicles 7:14. It all depends on our choices.

 

I cannot buy into that line of reasoning because of what God said before He destroyed Sodom & Gommorah, i.e., if Lot could find one, just one righteous man, He'd spare them.  We haven't fallen to that condition, which I'm sure must have been totally deplorable.  This is not an excuse for the immorality that is happening in our nation as well as worldwide.  I would hope instead that He would open doors that would allow us to regain contol of those that desire our demise and not allow greed to factor into this new oil extraction process.  At least until such time as other cleaner and better energy sources are in place.

Gerald47, I hear you about Sodom.

Our daily readings have been taking us through the parts of the OT where if only a few Jews went south the entire nation was punished.

The US is the only other country founded under God. This holds us to a higher standard. Abortion alone is drawing God's ire. Add homosexuality (many of my former business customers were $3 bills) and a little known fact about a large increase in satan worship and witchcraft. These are HUGE.

If nothing else look at Monica.

Here is a bright spot sorry Soros doesn't want you to know. My wife and I have the same kind of Bible study every morning as George and Laura Bush going back 15 years or more. We know this first hand. They are hated by the D.C. establishment for this reason with an intensity that goes right off the scale. This is why the "hate Bush" talk is nonstop. It started before his first day in office. White House staff including cabinet members hold daily Bible studies. It drives the libs crazy.

My wife and I pray diligently every day for the President and his staff that they would be filled with wisdom and make the very best decisions. We know when the truth comes out everyone will be amazed that all their ranting has been misguided. They are not perfect and make mistakes but not like the MSM would have you believe. We know staff personally and most of what you hear and see is warped.

Scripture commands us to pray for our leaders to be given wisdom.

VEeyes has been posting great stuff except one point - Supply and demand do have an effect,  and the supply is being manipulated to keep up the price up. This is not true as far as manipulation goes. Unless you look to the recently elected Democratic Congress. They desperately want us to fail so they can get more power by playing on people's fears.

The oilmen want to get our own oil - do not doubt it.

The enemy has been fighting them.

Time to crack a few skulls.

Gerald47 said: Somewhere on another thread recently there was a breakdown on oil profits.  If I remember correctly the government gets $.50+ cents per gallon of gas sold whereas the oil companies make approx. $.08 cents.  The government doesn't have to incur costs unless you factor in wars, freeways, bridges, freebees, etc.. 

Actually the federal tax on fuel is 18.4 cents per gallon of gasoline.  States add their own taxes also.

 

http://commonsensejunction.com/notes/gas-tax-rate.html

 

 

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Note: cpg = cents per gallon

Federal excise taxes are 18.4 cpg for gasoline and 24.4 cpg for diesel.

Averages of 50 States for all taxes:

Gasoline: 47.0; Diesel: 53.6 Represents volume-weighted averages.

* = Variable Tax

source  http://www.api.org/policy/tax/stateexcise/upload/December_2007_notes.pdf 

I don't know the exact numbers for how much oil is produced in Texas, how much reserves remain to be pumped, or how much petroleum is consumed in Texas.  A lot of petroleum goes into things besides fuels and the oil cuts to produce these are sold by Texas refineries to Texas chemical companies.  The ultimate plastics, solvents, etc are then sold in and out of Texas.  The accounting assumptions should be understood to know what the Texas deficit/excess is on produced petroleum vs consumption.

As for refineries underground, as I understand it, shale oil (which is like tarry sand) is converted to conventional crude oil that is lighter and sweeter and able to be extracted with less expensive and more conventional technology.  It isn't producing salable gasoline, jet fuel, or diesel.  The extracted oil would still require traditional refining, although the refinery might require less equipment to handle heavier, nastier, less valuable components in the crude.  So if I understand correctly, for a $10 premium, shale oil deposits can be produced yielding light crude.  That tells you just how much more it costs to extract and process shale oil as it exists underground, which in turn explains why most companies prefer to drill for conventional oil.

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