Price of gasoline, petroleum.. etc.

[David Wright]

It's a well-worn cliché for Europeans to comment on this, but the first time I visited the USA I was stunned that you can't walk from one store to another at most strip malls, you really do have to get in your car and drive the 50 yards to the next store. I haven't travelled much in the USA, but I did notice that a lot of Massachusetts roads don't appear to have sidewalks. Walking isn't just unusual in America, it's an extreme sport!

The other sport or game is to keep circling the parking lot until the valuable close spots open up. Really pathetic.

For me, I live a block and a half from the shop and do the walk in most times.
Gas is not really an issue for our lifestyle but still affected by it as far as commerce goes.

 

[CanuckSigns]

The other sport or game is to keep circling the parking lot until the valuable close spots open up. Really pathetic.

I've never understood that, you are about to go into a Walmart the size of a small city and walk around aimlessly for hours, does parking 100 feet closer to the door really make a difference?

 

[WildWestDesigns]

The other sport or game is to keep circling the parking lot until the valuable close spots open up. Really pathetic.

Oh that is the favorite sport of my old college. Still widely done and if someone does any parking spot "steal", there have actually been fights (both with and without sharp weapons) break out. Very pathetic indeed.

 

[randya]

When an oil company leases an area, they hope it contains oil. After they lease it then they can begin exploration. After exploration then they drill test wells.
They may lease a 2,000 acre block and only find recoverable oil on 100 acres of that block. The rest does not contain enough oil to produce. Some of the areas in the gulf were leased for gas wells, but the price of natural gas has dropped enough to make deep water wells unprofitable unless you can get a lot of oil with the gas.
And then when the price of gasoline gets high, the government can blame the evil oil companies for not developing areas with no oil.

I understand all of that:

So are they still - Hording leases?

If they are not going to use them within a reasonable time, they should be sold to someone who will, or at least put back on the market.

Won't this drive COMPETITION to find more effective ways to develop these areas?

What is the point of issuing more leases that wont be used?
While so many millions of acres are tied up.
Perhaps the NEW areas that they WANT to add to their current assets won't have cheap oil either.

Perhaps, they DONT want the competition.
Or want to hoard all these areas, until prices are driven up enough to make it viable for THEM to profit.

And about those "evil" oil companies, they seem to be doing just fine with the current system.
http://www.nytimes.com/2011/02/01/business/01oil.html

 

[bob]

hopefully the raise in prices of fuel will make people stop and think a bit, plan their trips a bit better, I realize that some things are unavoidable, but the amount we drive is silly. We've built communities where it is impossible to walk anywhere. Everyone wants to live in subdivisions where you have to jump into your SUV and drive 10 minutes to get milk in the morning.

My wife and i just bought our first house last year, it's about 1 mile from my shop, when the weather is nice, I'll walk to work, you should see the look of horror on peoples faces when I told them I walked 1 whole mile to work, they think i'm crazy!

Nonsense.

Western civilization has evolved as it has with the burning of cheap and plentiful**hydrocarbons as a major factor in the shape of that civilization.

You cannot effectively redesign civilization by following your smarmy and rather self-righteous advice. This will not move communities closer to each other. Moreover, those that do not or never have resided in the western USA have no concept of the distances that must be dealt with daily.

**Hydrocarbons are every bit as plentiful as they have been at any point in the history of the human race. The operative word here is 'plentiful' which is not necessarily 'available'. They also remain the most efficient way of creating useful energy yet discovered. Burning hydrocarbons is more efficient, by some orders of magnitude, than any other technique extant be it green or some other color.

On the other hand the market price of hydrocarbons is a political football and is manipulated in ways that have little if anything to do with actual supply. To those bent upon their version of social engineering the market price of hydrocarbons is too ripe a fruit to leave be.

 

[SD&F]

I know when I visited England a few years back, their gas was already well over what we are paying now. I don't like it, no one does. We are having to quote signs, monuments, etc with well increased fuel costs. I hate it, because customers think that this price should be negotiable. We need to take control as a country and we need a strong government in place for the PEOPLE to do so. Until this happens nothing will change. A strong government does not mean a government in control.

 

[frontside]

At least your life expectancy is much greater than ours. Exactly how old are you? I'm picturing Grandpa Munster or something.

;-)))) funny .


TOTAL, one of the leading oil company in France and Europe has done his biggest profit ever in 2011 with 15 billions of € ....
crisis ??? who talked about crisis ?

 

[cajun312]

I understand all of that:

So are they still - Hording leases?

If they are not going to use them within a reasonable time, they should be sold to someone who will, or at least put back on the market.

Won't this drive COMPETITION to find more effective ways to develop these areas?

What is the point of issuing more leases that wont be used?
While so many millions of acres are tied up.
Perhaps, they DONT want the competition.

And about those "evil" oil companies, they seem to be doing just fine with the current system.
http://www.nytimes.com/2011/02/01/business/01oil.html

The leases go back to government after five years except for deep water leases which go back to the government after ten years if not developed.

According to the Times article, Exxons profit margin is less than 10%. Compare that to drug companies...or Apple. Or your business. Could you keep the doors open and buy new equipment, and pay for your employees health care with those margins?

 

[CanuckSigns]

Nonsense.

Western civilization has evolved as it has with the burning of cheap and plentiful**hydrocarbons as a major factor in the shape of that civilization.

You cannot effectively redesign civilization by following your smarmy and rather self-righteous advice. This will not move communities closer to each other. Moreover, those that do not or never have resided in the western USA have no concept of the distances that must be dealt with daily.

**Hydrocarbons are every bit as plentiful as they have been at any point in the history of the human race. The operative word here is 'plentiful' which is not necessarily 'available'. They also remain the most efficient way of creating useful energy yet discovered. Burning hydrocarbons is more efficient, by some orders of magnitude, than any other technique extant be it green or some other color.

On the other hand the market price of hydrocarbons is a political football and is manipulated in ways that have little if anything to do with actual supply. To those bent upon their version of social engineering the market price of hydrocarbons is too ripe a fruit to leave be.

I live in Canada, I understand the concept of large distances Bob.

I'm not suggesting that everyone put a windmill in their backyard and sing Kombya, I'm saying that the current trend of building residential housing so far away from commercial developments is doing nothing to help us use less petrol.

Setting your argument about the availability of petrol, lets just say there is an endless supply of dead dinosaur juice in the ground, why do we as a species, feel the need to use as much of it as possible? what's wrong with changing the way we build communities to minimize the amount of petrol we burn? I haven't seen a subdivision with a "corner store" in at least 15 years.

getting us walking rather than driving might have other benefits too, like decreasing the amount of morbidly obese people in our society, but that's for another thread.

 

[randya]

According to the Times article, Exxons profit margin is less than 10%. Compare that to drug companies...or Apple. Or your business. Could you keep the doors open and buy new equipment, and pay for your employees health care with those margins?

Obviously with enough subsidies and tax breaks you can, isnt that how they are doing it?

Wouldnt it be better to let the market determine the cost of 'energy'?

 

[signswi]

Saudi Arabia just announced they'll be upping their output to adjust for the market loss due to Syria, Iran, etc. It's basically what the President requested they do a couple days ago, not that it's necessarily connected but still nice to note. Stocks jumped at the news.

 

[randya]

I'm saying that the current trend of building residential housing so far away from commercial developments is doing nothing to help us use less petrol.

When the cost of petrol is subsidized, and consumers do not pay the 'true' costs up front (but instead they are hidden in taxes and wars), you get these kinds of distortions in the market place.

 

[cajun312]

Saudi Arabia just announced they'll be upping their output to adjust for the market loss due to Syria, Iran, etc. It's basically what the President requested they do a couple days ago, not that it's necessarily connected but still nice to note. Stocks jumped at the news.

Saudi announced that last month it would increase production to make up for Iran being blocked from exporting to Europe. Syria has imported more oil than it exports since 2009.

 

[signswi]

You're right the announcement was older news, the actual production step up today caused the bounce. Nice catch.

 

[cajun312]

A lot of folks here talk about the oil companies being subsidized, $4 billion last year. What subsidies are there for the oil companies? Every manufacturer in America get's a nine percent discount on profits...except for oil companies, they get 6%.
Oil companies are allowed to deduct 70% of their drilling costs. Other American businesses can deduct 100%.

Agriculture in America received $16 Billion in subsidies last year.

 

[randya]

A lot of folks here talk about the oil companies being subsidized, $4 billion last year. What subsidies are there for the oil companies? Every manufacturer in America get's a nine percent discount on profits...except for oil companies, they get 6%.
Oil companies are allowed to deduct 70% of their drilling costs. Other American businesses can deduct 100%.

Agriculture in America received $16 Billion in subsidies last year.

And so cheap hamburger, corn and sugar products.
Adding to the high cost of healthcare.

Remember we used to subsidize tobacco too?

Government picking winners and losers in what is supposed to be the 'free market'. The the 'true' cost of the products are hidden in taxes.

Distorts the market and creates additional problems, that politicians and government are all to happy to 'solve' with EVEN more government interventions.

On subsidies:

sŭb'sĭ-dē)
n., pl., -dies.
1.Monetary assistance granted by a government to a person or group in support of an enterprise regarded as being in the public interest.

Are you saying the oil companies dont get subsidies?
How DO they PROSPER so well with such a low profit margin that you stated?
What RATIONAL justification is there to give the MOST profitable companies ANY subsidy?

 

[cajun312]

Are you saying the oil companies dont get subsidies?
How DO they PROSPER so well with such a low profit margin that you stated?
What RATIONAL justification is there to give the MOST profitable companies ANY subsidy?

I'm saying the oil companies get the same or less deductions any other American business gets.
They prosper because of volume. Same reason a company like Merritt has millions a year in sales and I don't. Should Merritt have their tax deductions taken away because they are successful?
If you make more than the government thinks you should make, or the guy down the street thinks you should make, would you give up all of your tax deductions?

I believe in a clean playing field, all businesses treated the same. We all get tax deductions or none of us get them.

And gas went up a nickel while I was typing............

 

[bob]

Saudi Arabia just announced they'll be upping their output to adjust for the market loss due to Syria, Iran, etc. It's basically what the President requested they do a couple days ago, not that it's necessarily connected but still nice to note. Stocks jumped at the news.

Do you ever wonder why it might be that when our current friends in the middle east crank up oil production it's seen as a solution to the problem but when anyone suggests that we expand oil production here in the USofA the notion is always treated with scorn and a frenzy of rationalization in an attempt to convince us that it wouldn't matter.

Oil is fungible, the market doesn't care from whence it comes. If oil from location A would ease the pain then so would oil from location B. Equally so.

 

[randya]

I believe in a clean playing field, all businesses treated the same. We all get tax deductions or none of us get them.

And gas went up a nickel while I was typing............

It can't be a clean playing field with all the subsidies and tax breaks.
The more there are, the more advantage it gives to larger businesses over small and start ups.

How many lawyers and tax accountants does it take to take advantage of all these. Who can best afford not only to take advantage of current tax deductions but to LOBBY for new ones - the small guy or the large guys.
Who can best use tax laws, subsidies and special regulations to minimize their competition?

So none is the cleanest playing field for tax deductions.
Why should the government be involved?

 

[WildWestDesigns]

Oil is fungible, the market doesn't care from whence it comes. If oil from location A would ease the pain then so would oil from location B. Equally so.

Not exactly. If you had location A that had "light" oil versus location B having "heavy" oil, I would be willing to bet that location A would win out. While both might ease the pain, it wouldn't be on equal terms. If there is a difference between the two locations and the oil that is extracted.