Oil Hits $80 a Barrel for First Time

[Achilles]

Link

NEW YORK (AP) -- Oil futures prices rose sharply Wednesday, briefly climbing above a record $80 a barrel after the government reported a surprisingly large drop in crude inventories and declines in gasoline supplies and refinery activity.

Get ready.

[tk102]

Thanks I needed to fill up anyway. I'll do it today rather than tomorrow. Not that my 11 gallon tank impacts my wallet significantly.

[mimartin]

This news makes me happy that I haven’t pulled the trigger on buying a new Jeep. May have to check out Honda, Nissan, Toyota or even a Schwinn.

[Achilles]

I only have to fill up about once a month (my commute is just under 2 miles, one way), but even so, I'm considering trading in my Accord for a hybrid.

 

Unfortunately, it's just too damn hot in the summer to bike to work

[mimartin]

Unfortunately, it's just too damn hot in the summer to bike to work

Heat and rain is the problem here. It is either 100 or it is pouring down rain. Plus today would not be a good day to ride a bike to work with Humberto outside my door.

[Jae Onasi]

Well, I better fill up my tank today instead of tomorrow when all the oil companies jack up the prices another dollar a gallon for gas and then play down their 20 billion dollar quarterly profits.

[Totenkopf]

As long as some of you are obsessing about corporate greed here, keep in mind that the Congress is looking to sock "Big Oil" with $16bln in taxes. Who do you think will get to pay that? And interestingly, even as oil prices on the market have gone up per barrel, gas prices have still been going down or staying somewhat static. Also, that gas prices, adjusted for inflation, are ~equal to 1972 in terms of people's budgets. If you want to alleviate some of this, tell your congressmen to back off on Anwar and offshore drilling. As long as we've got an "oil jones", we may as well try to find ways to keep the habit less expensive or at least make ourselves somewhat less vulnerable to supply disruption problems/threats.

[Web Rider]

part of the reason gas prices have been dropping is because gas companies, instead of upping the makert price of gas, have been taking it out on the people who own their businesses(the actual gas station), and they've been trying to keep the prices low(since they get all the flak first).

 

The problem, contrary to what Totenkoh suggests, is that the more we make the habit "easy" on us, the longer we're gonna stay attached to it and the less time we're gonna have to do anything about it when the proverbial poop really hits the fan.

[SilentScope001]

"$100 or bust! $100 or bust!"

 

What really is the problem is the fact that we are not the only buyers of Oil. Nations like India and China are booming and they too want oil. They can easily push the demand for Oil up, and therefore, the price.

 

I am the only person on this board backing Big Oil. If it wasn't for high oil prices, then Big Oil wouldn't sell us oil in the first place. And it is said that the higher the price, the more likely Big Oil would be interested in selling more oil (so they can make more money) and therefore flood the market, therefore leading to lower prices. OPEC doesn't want to have high oil prices too, because if oil prices become too high, then people may choose not to buy oil anymore, which would lead to a huge crash in prices and overall harm their economy.

 

Note this: America is one of the largest producers of oil in the world. But it is also consumes more oil than it produces.

[Achilles]

part of the reason gas prices have been dropping is because gas companies, instead of upping the makert price of gas, have been taking it out on the people who own their businesses(the actual gas station), and they've been trying to keep the prices low(since they get all the flak first).

Interesting. This isn't the way markets usually work though. Gas stations are intentionally reducing their profit margins in an effort to keep customers coming in for a product that they are dependent on? Do crack dealers give addicts a discount? The sole purpose of business is to maximize profit, not reduce it. Increased costs are always passed on to the customer.

 

The reason why gas has been cheaper lately is because supply has been greater than demand (a pivotal turning point in the US oil market that generally occurs every year toward the end of summer after "everyone" comes home from their summer vacations).

 

The problem, contrary to what Totenkoh suggests, is that the more we make the habit "easy" on us, the longer we're gonna stay attached to it and the less time we're gonna have to do anything about it when the proverbial poop really hits the fan.

Yes, so long as people are willing to pay for gas, oil companies will continue to produce it (for a profit). As soon as it is not longer profitable to produce gasoline, they will stop. This will happen when supply is sufficiently reduced or when demand is sufficiently reduced. We vote with our dollars.

[Totenkopf]

Yes, so long as people are willing to pay for gas, oil companies will continue to produce it at a profit. As soon as it is not longer profitable to produce gasoline, they will stop. This will happen when supply is sufficiently reduced or when demand is sufficiently reduced. We vote with our dollars.

 

That IS the way markets work, though. Nobody, except heavily subsidized industries, can produce a product for very long if they do it at a loss. Demand for gasoline will not decrease until artificially forced to do so by confiscatory pricing schemes or until all gasoline dries up. In the meantime, if someone can actually produce a better and more affordable alternative on scales of mass economy, dreams of "gas free" are just that, delusions. The best possible approach would be to ideally (think early space program) make it a national goal to create an alternative energy infrastructure that can replace the current one. Untill you accomplish that......you gotta work with what you have. Hence, let industry have access to what's available, while creating some form of national initiative to replace it with something better. Of course, then we'll only hear cries of "price gouging" when the new alternative isn't as cheap as promised/theorized.

[John Galt]

The only one who supports big oil?

 

I have no problems with the large oil companies themselves, but I think that the taxes levied on gasoline are just a way to divert flak for taxes from itself to the oil companies(who most people blame for any and all price increases), who are already a popular whipping boy for environmentalists. Their close relationship with the government also worries me somewhat, as senators and congressmen (and even presidents) who have personal stakes in certain companies, or the industry as a whole, may be likely to favor companies/industries that they are invested in.

 

However, I do think that the tax exemption codes should be reworked to give people who buy vehicles that use alternative energy sources a break, and discourage buying 2 gallon/mile gas guzzlers, instead of vice versa. In general, I think we need to rework the regulations to make it more profitable to be "energy companies" instead of "oil companies" so that the large corporations would have more incentive to foster innovative technologies.

 

America really has to get the oil monkey off its back, because the supply will most certainly not last forever given the current rate of consumption.