What has to happen to lower OIL...
 

Time for a bit of a rant, hold on tight...
#1 United States: 20,730,000 bbl/day
#2 China: 6,534,000 bbl/day
#3 Japan: 5,578,000 bbl/day
#4 Germany: 2,650,000 bbl/day
#5 Russia: 2,500,000 bbl/day
http://www.nationmaster.com/graph/en...il-consumption

This is what we have in reserves.

STRATEGIC PETROLEUM RESERVE INVENTORY

CURRENT SPR INVENTORY AS OF June 06, 2008
SWEET SOUR TOTAL
281.1 million bbls 423.1 million bbls * 704.2

http://www.spr.doe.gov/dir/dir.html

704.2/20.7=34 days worth of Oil. Now we don't want to tap all of it and the US doesn't want to change anything, so how about tapping 1/2. Thus, building up the supply and drive prices down. I know this thought is a pipe dream seeing that China has 1.3 billion people and
According to the U.S. Bureau of the Census, the resident population of the United States, projected to 06/06/08 at 19:32 GMT (EST+5) is
304,269,221. So, how can we be using almost 3 times the amount of Petro.
Nonetheless, something needs to be done to prevent all of us from getting canned.

I don't think you can say by buying gas today I support oil at 140 a barrel. What is water worth? What is air worth? Face it, in 98 percent of the US, people need to drive. Maybe in ten years they'll replace the street cars that were torn up in Ft. Worth 50 years ago but today, next week and next year, folks have to drive. So they cut back on other stuff.

I think drawing out of the SPR is the same as the gas tax holiday. Seventeen days later you're in the same situation with only half the emergency reserve. We can't just postpone the problem, we have to change the way we've lived since the end of World War 2.

Need to increase supply, even though the supply/demand fundamentals do not support the current oil levels (Weak USD, and speculation is driving current pricing levels).

Drill off the coasts, every coast (CA and FL are not immune. . .), Drill in the mid-west, and drill anywhere else we can - including going into ANWR.

Opening up the strategic oil will not lower the price of oil. As you mentioned, the US consumes 20 million barrels of oil a day. There are only 700 million barrels in the strategic reserves. And the world consumes about 80 million barrels a day. Say we were to release 1 million barrels of oil per day for 90 days. We increase the world supply by 1%. The price of gas will probably go down by a nickel. After 90 days, the price of gas will still be high and we will have lost 90 million barrels (15%) of our strategic reserve. It would be like putting a bandaid on a gushing wound. It is a short term solution (is it even a solution if it only lowers gas 5 cents per gallon??). It is a short term solution to a long term problem. I kind of would not mind seeing this happen because it would show people that drilling in ANWR will not solve our energy crisis (ANWR could produce 1 million barrels a day for 10 years) Thankfully, both presidential candidates (yes, even McCain) are against drilling in ANWR.

The strategic oil reserves are there for a purpose. They should not be used unless absolutely necessary. We are not even close to that point yet. Over the long term, the price of oil is only going to go up and up and up.


If you really want to know how to reduce the price of oil, I just need to quote you one fact. Out of the 20 million barrels of oil the US consumes, 11 million barrels are used for car gasoline. We have the technology TODAY to drive cars that use NO gasoline at all.

Most cars are the road are entirely gas powered. Why is this? Everyone knows that with gas prices as high as they are today (just wait until they are $6-$7/gallon in 1 or 2 years), hybrid cars are cheaper than gas powered cars. Why is there not a hybrid model of every car produced? Why isn't every car purchased a hybrid? How about a plug in hybrid where electricity from the grid can charge the battery in addition to the gas engine? If you could buy gas for 60 cents per gallon, would you? Well that is about how much electricity for a plug in hybrid or all electric car costs to go the equivalent distance of 1 gallon of gas. If we have all electric cars that can go 100mph, 200 miles on a charge, recharge in 10 minutes, and electricity that is 1/7 to 1/10 the price of gasoline, why doesn't everyone buy an all electric car? The cost of gasoline will more than make up for the slightly higher purchase price in just a few years. The only market segment where it does not make as much sense to have a hybrid/plug in hybrid/all electric car is used cars. And that will change as soon as there are more used hybrid/plug in hybrid/all electric cars on the used market.

The technology is there to make the US energy independent tomorrow. And we can do it with the 5 million barrels of oil we produce today. That would really lower the price of oil.

Yes its an option but FAR from being realized on a scale where we are down to 5 million barrels per day. Let us not forget that the electricity used to recharge these batteries come from plugs that are supplied by coal or nuclear powered electric plants. The environmentalists would have a fit if they saw more coal being burned or more nuke stacks being erected. Its definitely an option WAY down the road but right now its limited. There is no one fix-all for the oil problem in this country. Too many variables to pin your hopes on one idea.

Anwar is part of the key to ending the high prices, however the Chicago Board of Trade(CBOT) needs over sight!!!! In the past when investors ran to CBOT to avoid losses at NYSE the buy was Bonds and commodities. But you tell me that in the last year that OIL is this much better an investment? The speculation is way overboard and the cry wolf is criminal at this point. Bush can declare by presidential privalige to drill. Why not more refinery capacity?
ANd finally where do you think the environmentalists are keeping their money?
They are laughing all the way to the bank!

Just remember a gallon of gas is still cheaper than a bottle water!!!! (And, studies show most of that water comes from a tap, and not a "spring").

1 US fluid ounce = 0.0078125 US gallons

So a 16 ounce of bottled water = $1.25
Roughly (8) 16-ounce bottles of water = 1 gallon
1 Gallon of bottle water = $10.00/gallon

Now just figure out how much your coffee from Starbucks would cost on a per gallon figure!!!!!!

Or good whiskey on a per gallon basis!!!! Oh wait, I do........

I'll tell you what, it's them speculators, they're driving up the price of water too!

[quote=INAV8OR;

704.2/20.7=34 days worth of Oil. Now we don't want to tap all of it and the US doesn't want to change anything, so how about tapping 1/2. Thus, building up the supply and drive prices down. I know this thought is a pipe dream seeing that China has 1.3 billion people and
According to the U.S. Bureau of the Census, the resident population of the United States, projected to 06/06/08 at 19:32 GMT (EST+5) is
304,269,221. So, how can we be using almost 3 times the amount of Petro.
Nonetheless, something needs to be done to prevent all of us from getting canned.[/quote]

It is a strategic reserve not a "break glass in case of expensive oil reserve" besides, you think oil is expensive now - what do you think those friendly OPEC boys would do to the price if we didn't have a reserve?
Thirdly it wouldn't do didly squat, and lastly maybe peoples behavior will actually change ie. stop driving their SUV's as everyday cars, and eventually US demand will drop and prices will stabilize. As far as airlines go - its too late, Darwinism is about to kick in. :(

Scoop

You know, I'm not really concerned about the price of gas at the pump. $4, $10, its the cost of doing business. I don't care. I would love a hybrid, as long as it was affordable and has power to tow my boat. I like my toyota tacoma pickup, going to hate to change it in. However, I don't want a hybrid because of the fuel price, its environmental. I'm concerned up how much it costs of filling the plane up. Thats what keeps me up at night. They need an alternative jet fuel ASAP.

Speculators makes sense.

It kind of reminds me of the current housing 'crisis'. It's not really a crisis for me as I didn't buy a house at an over inflated price. I wonder how many of those geniuses are currently buying vastly over inflated oil futures. At some point they are going to have to sell them, or buck up for the $140 and have those barrels dropped at their front door. As it looks now, with all the airlines parking planes and the market for large vehicles drying up, they just might not have the buyers. No buyers and the price drops. More positions out there, the harder it is to sell them, the price drops further, those geniuses have to cover their positions so start buying cheaper to cover themselves, etc. etc. and down it goes; much like it has in the past.

Everybody should take a little read of how the commodities market, and specifically the trade of oil and oil based products works; in particular those smart guy's buying futures, probably with someone else's money (again). Likely the same guy's sitting on over valued property, also paid for with someone else's money.

All this said, personally I see the whole thing as natural selection at work in human society, and since I work for an airline that still makes money I can only hope that the price stays up long enough to cull the herd a bit more. In the mean time people driving gas hungry cars can go ahead and halve their fuel cost by getting into a smaller, cheaper to by and cheaper to run car.

I need to become president of the world. That would fix everything. Trust me. :cool:

Dude,

I just bought a gallon of spring water: $ 0.99

Unfortunately futures traders make their money on the way up, then turn around and make it on the way down. They might be creeps for keeping all of us in the lurch but they are smart creeps, VERY smart creeps.

Ok I understand that most pilots are extreme financial experts and we sit in on strategic oil meetings with world leaders at least once a week. OR is it that we just let the media tell us what they heard and think and then tell us what WE should think. What ever it is I myself really haven't a clue what is going on and to be perfectly honest with you I highly doubt all of what I hear is what is ACTUALLY going on with fuel, reserves and the economy. Now this might sound stupid but I have a question about a barrel of fuel. It costs the US currently around 120-130 per barrel which results in around 4 bucks a gallon for us and I think it's a little cheaper per gallon for JP. So my point is that I have been to Europe and other parts of the world and for many many years they have been paying more than our current fuel prices for a gallon or equivalent of gasoline. And when you go to those countries they use those smart cars, everyone and their grandmother rides a scooter and many of their cars run on diesel. And when I'm there it seems that no one really complains all that much about "The Fuel Prices". And you never hear on the news about the dilemma in other parts of the world about rising gas prices. Now I could totally be way off but if they have been doing it for many years, why the heck can't we? And I was also wondering about aviation around the world. If they are paying and have been paying what we now pay for fuel for many years, what are they doing to keep the costs down so that we don't hear about all the turmoil in foreign airlines? Hopefully I did not offend anyone. Just a little something that I had bottling up.

hybrid and pure electric cars aren't cheap.

GM says the Chevy Volt will retail for around $50,000 and have a range of about 600 miles. They're pushing for a $10,000 tax credit from the feds, they think they need that much to sell enough units.

$50,000 is cheap?

All these alternative fuels are just that, alternatives. They're the alternatives cuz they cost more than cheap oil. Until oil is more expensive than the alternatives (permanently), consumers will not pay the premium for alternative (expensive) fuels.

No kidding, I'm not sure what he's referring to. Of course we have the technology to make cars that do what he (Aerospacepilot) says, but he doesn't ever mention the cost. The Telsa sports car will go what, 200 miles on a charge, but even then it costs over $100k. That's just "slightly" out of the realm of the majority of people buying cars. I can go get a late model 40 mpg Saturn for $3k on craiglist in my area, $97k (difference in cost) buys a LOT of gas, even at $7/gal. Over 550,000 miles worth of gas in fact. No to mention the opportunity cost of financing the $100k. For me and my driving habits that's about 180 years worth of gasoline. No way would I spend even $20k on a hybrid at this point. I'd rather go diesel and burn biodiesel. A small diesel in a small car will get 60-80 mpg highway. Then make synthetic diesel out of algae or coal and presto, problem solved with no major infrastructure changes.

The prices I have read on the VOLT said they were trying hard to get it under 30 grand. And the first generation of Tesla cars were engineered for the rich so they could get enough money to come out with a mass market car. Even with an electric or plug-in hybrid you don't need a major infrastructure change. The proponents of these types of cars are touting the energy independence of these cars - meaning the power can come from a little gas burning generator on the car, a solar panel, a nuclear plant somewhere, a windmill somewhere or a coal burning plant. If you believe the efficiency numbers they publish, it is much more efficient to burn gas in an on-board generator to generate electricity than burning gas in an internal combustion engine. I don't know if the technology is there yet or the price of gas is high enough yet - maybe someday.

Also this was posted earlier on alternate jet-fuel options:

http://www.vnunet.com/business-green...s-launch-algae

Lets hope they figure out a way to mass produce this stuff for cheap in the near future. The sun will burn for a long time.

A simple analysis goes a long way...

www.phoenixmotorcars.com
100mph
150 mile range
10 minute recharge
Extremely long battery life (the batteries will still be alive when the car becomes junk)

$44,000 for an all electric SUV
Lets say a typical SUV costs $30,000
=$14,000 extra to own an all electric vehicle.

The average American drives 12,000 miles per year.
Say you own the car for 8 years.
Say the average gas SUV gets 20mpg.

You will burn 4800 gallons of gas over 8 years.
At $4/gallon, that is = $19,200 in gas.
YOU ARE CRAZY if you think gas will be $4/gallon over the next 8 years.
More realistic numbers are $5 (low) - $7 per gallon.
At $5/gallon, you will spend $24,000 on gas.
At $7/gallon, you will spend $33,600 on gas.

How about the all electric car?

National average for electricity is 9 cents per KWH. If you plug in at night, the rates are usually much cheaper (5 cents per KWH). Some cities even have special rates for electric cars (2.5 cents per KWH). But lets use the 9 cent average.

This car has a 35KWH battery. That means it costs $3.15 to charge the battery for a 150 mile trip. 96000 miles / 150 miles per charge = 640 charges * $3.15 per charge = $2,016 worth of electricity.

Cost of ownership of gas powered SUV for 8 years (average 12k per year)
$30,000 purchase + ($24,000 to $33,600 on gas) = $54,000 to $66,600

Cost of ownership of electric powered SUV for 8 years (average 12k per year)
$44,000 purchase +$2,016 on electricity - $46,016

And of course, the price of oil is only going to go up and up and up long term. So the price of electric cars will continue to come down, while the price of owning a gas powered car will continue to go up. So these numbers will only get more favorable as time goes on.

Of course you should adjust the numbers for your driving habits, but unless you drive some small amount (like less than 5,000 miles per year), you will save a lot of money owning an all electric car.


The two largest developers of hybrid cars have been Toyota and Honda. The two most successful car companies over recent years have been Toyota and Honda. There is obviously a correlation here. The big three have done little to nothing towards the development of plug in hybrids/all electric cars. I really hope the Volt is successful. Now lets see Ford and Chrysler step up to the plate. People wonder why they are losing billions of dollars and laying off tens of thousands of employees. Design a successful plug in hybrid or all electric car, and you will see these automakers doing better.

Europe has incredibly high taxes on gas. We are rapidly heading that direction

I think your "analysis" on this point is off base.

Toyota and Honda are successful because they make good quality cars, not because they make hybrid cars.

Interestingly enough, the multi billion dollar bottled water industry is a complete waste of money, resources, and the environment. Most of the bottles can't be recycled. It also pushes up demand for oil contributing to the current oil crisis.

I just drank some filtered water from the my fridge. It's just as good and it didn't have to be trucked across the country to get here.

AL

The three most efficient automobile plants in the world are all in Japan and all owned by Toyota. Unfortunately, NO US manufacturers even come close.

AL

In other parts of the world the gov. subsidizes fuel.

http://www.iht.com/articles/2005/09/.../sxsubsidy.php

Also our transportation systems in the US were designed around the automobile. Our neighborhoods are built around the automobile (suburbs). In most parts of the world you don't drive 40 mins to work each day in a car, by yourself. If you have that long of a commute you take a train or a bus. This crisis is uniquely american.

Oil is simply not worth 140/barrel! There has been demand destruction all over the market in this country, and it is visible everywhere. People are trading in their SUV´s for much more fuel efficient cars, we are driving now when we HAVE to, not when we WANT to. We had a decrease in demand over the Memorial Day holiday.....A DECREASE!!! Airlines are rapidly reducing routes, thereby using less oil! If it was worth 140, or 130, or even 120, we would not see all of these things.

Oil is where it is right now because of speculation. Two days ago oil was down over 10%, then some big mouth(who probably owns millions in oil futures) at Morgan Stanley gives his prediction that oil will hit 150 by July 4. Result....$11 gain in one day!!! This is the type of behavior that needs to be stopped. It is intentional and in my opinion criminal. If the government made it less attractive to buy oil futures as a safety net against everything you would see oil tumble and settle at around 80/barrel, which is where it belongs IMHO.

Heyas,

And that water is arguably better for you and your family. There is no testing or quality control required for bottled water, yet your tap water has to meet fairly strict water quality guidelines.

In some cases, like where I live, the water has a slight tinge to it because of harmless iron content, and it is easily fixed by a 10 year old charcoal filter.

I live next to a dentist. He tells me there has been a HUGE spike in dental problems with kids...in quantities that haven't been seen since the 50's, which, co-incidently, is when they started adding flouride to muni water systems.

One day, I will learn to stop underestimating the power of stupidity in the masses, and learn to profit from it.

Nu

Agreed!!!!

10 minutes, wow is that at 13,000 VAC input or higher?

The Japanese goverment kicked in yens (over 18 billion $ US).

Saturn/GM had an electric car over ten years ago...

Spot on. The price of oil is driven by people investing in speculation of what the price will do in the future. The supply and demand curve for oil is mostly inelastic, meaning as price goes up, people still buy just as much. But there is a breaking point. Eventually people will say "enough is enough." Demand will go down, futures investors will realize this, pull their money out and find something else to speculate on. Maybe coal will be the next big thing since by then we'll all buy hybrid cars and need to charge the batteries with electricity. So the price per KWH will go through the roof, and people will be complaining about having big 60" plasma TVs. Eventually, oil will hit a peak and come down. If I knew the when/where/why, I wouldn't be posting here, I'd be making billions. The only reason I know it'll come down eventually is b/c the economy has a pattern. In the 90s, it was tech stocks. A few years ago is was the housing market and insane loans to people who couldn't afford them. Today it's oil. I'm hopeful that the bubble will pop soon. There was a DECREASE in demand over Memorial Day weekend, which is unprecedented. And overall, there has been a decrease in demand for oil since then. People are driving less, and the airlines are downsizing. I think that the only thing that'll get investors to pull their money out of speculating on oil is demand must decrease.

What has to happen to lower OIL...


A president who is an oil man and a VP that was the head of Haliburton, and a non-existant energy policy to reduce oil prices.

jmho,

Oil prices have been on the rise for seven years, demand for oil has been going on for 100 years. I'm not sure anyone has seen or can justify an increase from roughly $18 bbl to $135 bbl. or an increase of 650% if my math is correct, If not, blame it on the tequilla, but the point is, supply has not skyrocketed hundreds of multiples. The Chinese have had cars for 60 years, we have had gas hog cars for 80+ years, just makes no sense.

Yes I was on the grassy knoll, but this defies supply and demand theories.

JMHO,
FF

There are some tell-tale signs that supply-demand issues are causing some big players to resort to desperate measures to try and rectify the current oil situation.

2 weeks ago the 5 largest oil consuming nations (U.S., China, India, Japan, and South Korea) urged the oil producing nations of the world to boost their output to offset cost. Perhaps they do not understand the nature of the problem, but their actions seem to suggest that supply, not speculation, is the root cause of price.

Now, the G8 is making waves and is asking for increased production from Saudi Arabia, others. Again, production seems to be the central theme here. The timing couldn't be worse in that worldwide production of oil has been flat for the last 3 years @ 85 million/bbls per day. The Saudis are unlikey to be able to sustain an increased output of 500,000 bbls/oil per day. The Russians are reporting that for the first time in a long while, their oil/natural gas production actually declined this last year.

In taking a balanced approach here, I do think speculation has a bit to do, but not much to do w/ current prices. I don't think oil prices will come down much for 2 very basic reasons: 1.) The obvious driving force behind the rise in oil prices are basic supply concerns. Supply issues will continue into the future, unabated. Global demand will stay strong despite strides made in our country to curtail use. 2.) The future of the American dollar does not look good. If there is some truth to speculation and that the weak dollar is driving this speculation, then the prognosis is not good as most analysts, including Warren Buffet, are banking on the dollar's continued weakening.

The most realistic outcome that could result in oil prices falling dramatically will me a massive worldwide recession or depression. This event would significantly curtail worldwide demand and would obviously put some downward pressure on prices. Of course, oil prices in this situation would probably be the least of our concerns.

As far as the ailines are concerned, you either learn to adapt to the prices, or you don't. I wouldn't want to be working for an airline w/ a management team that was banking on the price of oil coming down significantly.

DEJA VU= Boring