WOW the $5 gas is really here to stay it looks like......😳

[Bikeman315]

Aren't there different grades of crude and wasn't that pipeline meant to mostly send low grade crude to be for export? And isn't that why we import higher grade crude? Kind of like bituminous vs. anthracite coal? No expert here and maybe I get my info from the wrong sources.

Read the article I just posted. There is so much bad Information about this project that it boggles the mind.

Sponsored

 

[shogun32]

Aren't there different grades of crude and wasn't that pipeline meant to mostly send low grade crude to be for export? And isn't that why we import higher grade crude? Kind of like bituminous vs. anthracite coal? No expert here and maybe I get my info from the wrong sources.

no you're right Texas light sweet != that heavy sour shit from the Tar sands.

But we have the facilities to process sour, where many other countries don't. It is cheaper to refine light crude. Even though we may have been planning to export the refined output of Canadian sour (we used to refine Venezuela's sour until that country went to hell) we can just as well use the output domestically.

When Russian supply disappeared and the pipeline was on it's way to being completed we could have easily replaced the shortfall and no major gyrations in price necessary. And the price moves are all fake. Only the contracts that are owned at expiry and stand for delivery are 'real'. I was looking for the paper to physical ratio for oil futures but I couldn't find it.

 

[shogun32]

You lay no blame for this situation at the feet of the oil companies. Really tells us where your head is at.

you really think the oil execs sit around the mahogany table tenting their fingers saying "muaha ha ha, the world is in turmoil, let double the price we charge for our product and spread it out over 3 months because (evil laugh) we can".

 

[shogun32]

Read the article I just posted. There is so much bad Information about this project that it boggles the mind.

written by a greenie with an anti-oil agenda. I'm all for making sure you construct a pipeline responsibly and not cut corners that lead to perfectly avoidable ecologic damage.

And we have Russian oil cargoes inbound as recently as last week.

 

[Bikeman315]

no you're right Texas light sweet != that heavy sour shit from the Tar sands.

But we have the facilities to process sour, where many other countries don't. It is cheaper to refine light crude. Even though we may have been planning to export the refined output of Canadian sour (we used to refine Venezuela's sour until that country went to hell) we can just as well use the output domestically.

When Russian supply disappeared and the pipeline was on it's way to being completed we could have easily replaced the shortfall and no major gyrations in price necessary. And the price moves are all fake. Only the contracts that are owned at expiry and stand for delivery are 'real'. I was looking for the paper to physical ratio for oil futures but I couldn't find it.

Maybe I missed something but are you running out of gas in Virginia? I know I’m not in South Carolina. There is plentiful gas available all across the US. Yes, demand is up but no one is saying we are running out of gas tomorrow. If this were really about supply all we would need to do is increase production to 2019 levels and all would be good.

No, this is and always will be about money. Greed and profit. Sure the banks, Wall St., and the government have their greasy little paws in the pie too (when do they not?). But at the end of the day It’s all about the big boys.

 

[Bikeman315]

you really think the oil execs sit around the mahogany table tenting their fingers saying "muaha ha ha, the world is in turmoil, let double the price we charge for our product and spread it out over 3 months because (evil laugh) we can".

That is exactly what they are doing. And do not think for a second that a big chunk of those profit dollars are going to these CEO’s political cronies. You may be right, it is Washington, just not the side you think!

 

[Bikeman315]

written by a greenie with an anti-oil agenda. I'm all for making sure you construct a pipeline responsibly and not cut corners that lead to perfectly avoidable ecologic damage.

And we have Russian oil cargoes inbound as recently as last week.

OK, maybe this one will be more to your liking. Written in 2014. The writer believes the pipeline should be built and explains why. What is interesting is that back then no one really thought this small pipeline extension was all that much to write home about. Except the conservationists. In todays hyper-political climate it is the downfall of humanity as we know it

https://www.forbes.com/sites/mikepa...out-the-keystone-xl-pipeline/?sh=60e179c569b7

 

[shogun32]

Maryland And Georgia Suspend Gas Taxes As Democrats Ironically Embrace Similar Federal Cuts

Seems it would be a lot simpler to besiege the central offices of the oil majors instead and point a gun to their head and demand they lower prices... Or is this just a give-away to the oil execs because now they can hike the price even further and grab the equivalent of the tax amounts for themselves?

oil price at the pump is influenced by FUTURE expected prices (front month, 2nd month), not spot and not the price of the previous close. In other words, if a barrel is $100 in the front month but it closed at 80 last month, even though the physical liquid being dispensed into your tank right now today was refined from the $80/barrel drum or even better the $60/barrel from 2 months ago, it's price all along the supply chain is influenced as if it was refined from the $100/barrel which hasn't even been delivered yet from the well head.

Your local bakery does the same thing or skims the extra profits when the price of flower and natgas (oven) go in their favor. Ie. if the price of a loaf is $4 at the storefront and under "average" conditions the cost to deliver to the store is $2, they made $2. But say the world price of wheat gets cut to half because of a bumper crop. They are unlikely to change the $4 price, and just pocket the extra. But if the price of natgas or diesel goes up wildly the price may need to be $5 just to cover the hike in inputs. Are you going to stand in front of your baker and hold a gun to their head and demand they only charge you $4 like they did just last week?

And as of this morning a nice chunk of refining capacity just went offline.
"Largest California Refinery Hit With Strike Amid Record-High Gas Prices"

Hundreds of Chevron Corp. refinery workers in the San Francisco Bay Area went on strike Monday following a breakdown in talks between the oil major and the United Steelworkers (USW) union on a contract agreement.

Hey if oil execs are evil masterminds, the people of California should be out in force, rounding up all these GD union employees at bayonet-point and forcing them to go back to work. No? When piddly-ass 500 entitled union workers strike, ALL (how many millions?) Californians suffer at the gas pump. How DARE THEY!

Why are they striking? Cost of living in San Fran and a 23% hike in healthcare insurance premiums... Now why would Kaiser be hiking prices big time? Are they also part of the evil cabal sitting around the mahogany table with tented fingers?

 

[Bikeman315]

And as of this morning a nice chunk of refining capacity just went offline.
"Largest California Refinery Hit With Strike Amid Record-High Gas Prices"

Hey if oil execs are evil masterminds, the people of California should be out in force, rounding up all these GD union employees at bayonet-point and forcing them to go back to work. No? When piddly-ass 500 entitled union workers strike, ALL (how many millions?) Californians suffer at the gas pump. How DARE THEY!

Just FYI, The refinery is not offline.

https://www.reuters.com/business/en...further-raise-fuel-prices-analyst-2022-03-21/

 

[shogun32]

Just FYI, The refinery is not offline.

yet. but oil prices will move nonetheless.

 

[ctandc72]

For anyone who truly believes gas prices are high because of oil companies....seriously do some research beyond the media. Futures / commodities effect oil prices. There is a lag when the price drops - that's not new. But there are multiple factors in play now and Ukraine / Russia was just an extra pile on.

The current admin paused Federal land oil / gas leases the first week they took office. Then the court cases about changing the carbon penalty per ton. If you've never researched how Federal Oil leases work - it's not simple, it's not cheap, it's not fast and it's not easy.

This Admin was the first in twenty years to go over an entire year without selling a single onshore oil lease on Federal lands. That's a fact. Not an opinion.

Regulations and bills passed - not to mention political rhetoric coming out of the White House - have in fact SHARPLY curtailed investment in oil / gas projects. Why would someone invest millions of dollars in an industry that is constantly being heralded as a thing of the past?

Most people, including the White House Press sec, have ZERO clue how oil / gas leases on Federal lands work. A SIMPLIFIED version:

- Fed land parcel is approved to go up for auction for oil / gas lease
- Winning bid (there is a min) gets the lease
- Pays a bond up front
- Also pays 'rent' on the lease UP FRONT (by the acre)

Then the company has to pay for a study to see if there's even the high enough possibility for there to be enough gas /oil avail to try and extract. Then they have to pay for environmental impact study of the land. Then they have to deal with right of way and other legal issues - mainly with surrounding land owners (Right of way, impact studies etc etc). Okay so all that's done (still paying rent on the lease the entire time) so know you have to get all the resources in place to drill.

- Roads
- Infrastructure

Then personnel and supplies. Good luck finding well casing, or as the case may be - sand for fraccing. You think companies pay people to just sit around and wait for the drilling to start, when many times it takes more than a COUPLE OF YEARS to get to that point? That's of course if you don't do all that and then the govt 'pauses' leases (like the current admin did).

It's not an on / off switch. It never has been.

People saying "the Keystone Pipeline XL permit cancellation has no effect on gas prices" are right AND wrong. WORLD wide oil supplies directly effect oil prices. Crude oil prices make up roughly 60% of gas prices. TAXES (local, state, fed) make up the next biggest chunk.

Did cancelling the pipeline extension cause the high gas prices we're seeing now? Not directly, but they IMPACTED perceived worldwide supply. Oil is a publicly traded commodity. It works both way BTW - oil producers had TO PAY to get rid of excess supplies back in Spring '20 when oil prices were trading BELOW $0.

Besides the U.S. didn't own the pipeline, but taxpayers will likely be footing the bill for $15 BILLION or so, since this admin violated NAFTA and the Canadian company behind the Keystone is suing for damages.

The bigger impact is the message it sent to investors. Why risk capital on the oil business when this admin has made it clear they are "moving away from fossil fuels" (When is ridiculous when you consider the U.S. use of coal ROSE (for the 1st time in a DECADE) for electricity generation in 2021 because the restriction of already approved (then cancelled) Natural Gas export facilities and the pause on oil / gas leases caused the price of natural gas to spike.

So when this happens what happens to all the smaller companies YOU HAVE TO HAVE to drill and produce oil domestically? The equipment manufacturers, the maintenance companies, the field workers, etc etc etc............you think companies don't get rid of employees when they see LESS money being invested in the oil / gas business? You think these workers (who can't just sit around not being paid) are just waiting for a call to go back to work? Good luck with that.

This administration made some decisions that they KNEW would negatively effect oil production in the U.S. That was their goal. They have repeated it over and over - they want to "move away from oil". Hell, a sitting official of this admin straight up said that higher gas prices were going to happen regardless....

It's a cascading dynamic. Drastically higher fuel prices effect EVERYTHING. Think it's bad now? Wait until the fuel costs are reflected in the price (Already well on its way) to plant corn or wheat. Already Natural Gas costs and export restrictions from other companies have spike fertilizer prices to unseen levels. It's all interconnected. That's NOT new.

Hell, weather forecasts of hurricane hitting Houston / Louisiana (refineries) effect gas / oil prices. You think a general downturn in investment in oil production domestically doesn't effect price? A downturn that started 2 years ago?

Believe what you want to believe. It won't change reality.

 

[ice445]

For anyone who truly believes gas prices are high because of oil companies....seriously do some research beyond the media. Futures / commodities effect oil prices. There is a lag when the price drops - that's not new. But there are multiple factors in play now and Ukraine / Russia was just an extra pile on.

The current admin paused Federal land oil / gas leases the first week they took office. Then the court cases about changing the carbon penalty per ton. If you've never researched how Federal Oil leases work - it's not simple, it's not cheap, it's not fast and it's not easy.

This Admin was the first in twenty years to go over an entire year without selling a single onshore oil lease on Federal lands. That's a fact. Not an opinion.

Regulations and bills passed - not to mention political rhetoric coming out of the White House - have in fact SHARPLY curtailed investment in oil / gas projects. Why would someone invest millions of dollars in an industry that is constantly being heralded as a thing of the past?

Most people, including the White House Press sec, have ZERO clue how oil / gas leases on Federal lands work. A SIMPLIFIED version:

- Fed land parcel is approved to go up for auction for oil / gas lease
- Winning bid (there is a min) gets the lease
- Pays a bond up front
- Also pays 'rent' on the lease UP FRONT (by the acre)

Then the company has to pay for a study to see if there's even the high enough possibility for there to be enough gas /oil avail to try and extract. Then they have to pay for environmental impact study of the land. Then they have to deal with right of way and other legal issues - mainly with surrounding land owners (Right of way, impact studies etc etc). Okay so all that's done (still paying rent on the lease the entire time) so know you have to get all the resources in place to drill.

- Roads
- Infrastructure

Then personnel and supplies. Good luck finding well casing, or as the case may be - sand for fraccing. You think companies pay people to just sit around and wait for the drilling to start, when many times it takes more than a COUPLE OF YEARS to get to that point? That's of course if you don't do all that and then the govt 'pauses' leases (like the current admin did).

It's not an on / off switch. It never has been.

People saying "the Keystone Pipeline XL permit cancellation has no effect on gas prices" are right AND wrong. WORLD wide oil supplies directly effect oil prices. Crude oil prices make up roughly 60% of gas prices. TAXES (local, state, fed) make up the next biggest chunk.

Did cancelling the pipeline extension cause the high gas prices we're seeing now? Not directly, but they IMPACTED perceived worldwide supply. Oil is a publicly traded commodity. It works both way BTW - oil producers had TO PAY to get rid of excess supplies back in Spring '20 when oil prices were trading BELOW $0.

Besides the U.S. didn't own the pipeline, but taxpayers will likely be footing the bill for $15 BILLION or so, since this admin violated NAFTA and the Canadian company behind the Keystone is suing for damages.

The bigger impact is the message it sent to investors. Why risk capital on the oil business when this admin has made it clear they are "moving away from fossil fuels" (When is ridiculous when you consider the U.S. use of coal ROSE (for the 1st time in a DECADE) for electricity generation in 2021 because the restriction of already approved (then cancelled) Natural Gas export facilities and the pause on oil / gas leases caused the price of natural gas to spike.

So when this happens what happens to all the smaller companies YOU HAVE TO HAVE to drill and produce oil domestically? The equipment manufacturers, the maintenance companies, the field workers, etc etc etc............you think companies don't get rid of employees when they see LESS money being invested in the oil / gas business? You think these workers (who can't just sit around not being paid) are just waiting for a call to go back to work? Good luck with that.

This administration made some decisions that they KNEW would negatively effect oil production in the U.S. That was their goal. They have repeated it over and over - they want to "move away from oil". Hell, a sitting official of this admin straight up said that higher gas prices were going to happen regardless....

It's a cascading dynamic. Drastically higher fuel prices effect EVERYTHING. Think it's bad now? Wait until the fuel costs are reflected in the price (Already well on its way) to plant corn or wheat. Already Natural Gas costs and export restrictions from other companies have spike fertilizer prices to unseen levels. It's all interconnected. That's NOT new.

Hell, weather forecasts of hurricane hitting Houston / Louisiana (refineries) effect gas / oil prices. You think a general downturn in investment in oil production domestically doesn't effect price? A downturn that started 2 years ago?

Believe what you want to believe. It won't change reality.

It's funny that we have this grand dream to move away from oil when we're not even remotely ready to do so. EV's are like an incomplete homework assignment during the first class of a master's degree. It's something, but it sure isn't getting you to the finish line by itself.

Gas here is $4.39 for regular, lmao. Can't wait to pay even more for shipping, food, etc.

 

[IceAge]

It's funny that we have this grand dream to move away from oil when we're not even remotely ready to do so. EV's are like an incomplete homework assignment during the first class of a master's degree. It's something, but it sure isn't getting you to the finish line by itself.

Gas here is $4.39 for regular, lmao. Can't wait to pay even more for shipping, food, etc.

Nailed it and yep the user end of everything will rise accordingly as time continues. Interesting Times has been my saying lately and even for me I am surprised the Barrel of oil is still holding over $100. But and a huge butt economic uncertainties and possible recession is playing out. And even the Fed has acknowledged the Rate Increases will continue to tamper things down with the risk of a Recession.

 

[ctandc72]

Most people don't have a clue how much "oil" plays a part in their every day life. I personally know people who bought EVs - and that's perfectly fine their money (besides subsidies which I'm against regardless who its for) their choice. But then they brag about not having to buy gas. Then they start harping about 'saving the planet'. One day I'd had enough, so I asked two co-workers (they are essentially Tweedle dee and Tweedle dum - they do everything together) where they lived. When they told me, I let them know that the electricity charging their EVs to "save the planet" was actually coming from a coal-fired power plant.

They searched on their phones for 5 minutes and realized I was right. The look on their faces made me feel bad - almost.

Most people don't even understand WHY the world uses gasoline. They don't understand that it was, and is a BY PRODUCT of refining crude oil for other uses. Hell, it used to be dumped in holding ponds on rig sites 100 years ago.

But from 1920 to now, right at 100 years, we've got mass-produced cars right now that have 200HP and get 42+ mpg that are affordable and have 100K powertrain warranties. Where as a Model T had 20HP and got 15mpg if that.

Current gen EVs have A LOT of issues that most people either don't know about or simply don't want to talk about.

- Electric Power infrastructure. Look at CA - the leader in "Green" electricity production (which in and of itself is total crap - they IMPORT the electricity needed to mostly keep up with current demand) they were literally issuing "flex alerts" urging customers to "voluntarily" restrict use of certain electric appliances, adjust thermostat settings and urging EV owners to charge their vehicles BEFORE a "Flex Alert" was issued. If HALF of all the ICE powered vehicles in CA were replaced by EV there is NO way CA's power grid could even attempt to keep up - even with greatly increasing the already high percentage of electricity they import. They imported 70% of their electricity in 2019. You think that number is going down?

- Storage / Battery tech - while tech is rapidly expanding / improving there are outside factors that are already influencing these advancements. One of the organizations that is involved with expanding EV battery tech and admitted that with the large auto manufacturers rushing to jump on the EV bandwagon (which they applauded) they also admitted that supplies of needed materials to build batteries could in no way keep up with this demand. You have major auto manufacturers spending hundreds of millions on start ups and small companies working on advanced EV tech and while a lot of these advancements are GREAT - what good does it to when there is no realistic way for widescale production / implentation?

- There are certain earth minerals that you have to have to build a modern EV battery. The vast majority of these materials are imported. Ironically, the U.S. HAS resources of most of these minerals in its own borders, but industry knows there is no way that the EPA and other government regulatory agencies (With current 'carbon emission' policies and regulatory policies) would never allow them to mine for these minerals. But we're perfectly fine importing them from other countries who could give a shit less about carbon emissions.

- Wind and Solar power - they are really good options in certain parts of the country. But they aren't magic. How much OIL is needed to make ONE wind turbine? What about the oil that's used INSIDE the turbine? Even better is solar. Who makes the majority of solar panels in the world? Solar panels are made using silica....sand. So you need A LOT of energy to make silicone ingots from sand and even more to convert that to the silicone needed for panel construction. The plants that make the majority of these - in that unnamed country (hint: rhymes with China) they are powered by what? (Hint: rhymes with coal).

I'm not saying the technology won't grow. I'm not saying it won't get better and better.

I am saying that the current political rhetoric - that is frighteningly becoming energy 'policy' - is akin to jumping out of aircraft without an "old" parachute and hoping the 'new' and 'improved' parachute tech is ready to go and use - before you smash into the ground at terminal velocity.

And I wont' even talk about nuclear power. If nuclear power production in the U.S. doesn't start becoming okay to talk about - if the government agencies don't start making realistic changes to policy to help nuclear power production expansion - and current energy 'policy' stays the same, there's only two choices.....either it gets REALLY bad, especially for those people who can't afford the price of electricity, gasoline, natural gas and heating oil increasing (like it has and will continue if no drastic changes are made) OR oil / gas / coal production RAPIDLY increases in the U.S.

 

[IceAge]

Most people don't have a clue how much "oil" plays a part in their every day life. I personally know people who bought EVs - and that's perfectly fine their money (besides subsidies which I'm against regardless who its for) their choice. But then they brag about not having to buy gas. Then they start harping about 'saving the planet'. One day I'd had enough, so I asked two co-workers (they are essentially Tweedle dee and Tweedle dum - they do everything together) where they lived. When they told me, I let them know that the electricity charging their EVs to "save the planet" was actually coming from a coal-fired power plant.

They searched on their phones for 5 minutes and realized I was right. The look on their faces made me feel bad - almost.

Most people don't even understand WHY the world uses gasoline. They don't understand that it was, and is a BY PRODUCT of refining crude oil for other uses. Hell, it used to be dumped in holding ponds on rig sites 100 years ago.

But from 1920 to now, right at 100 years, we've got mass-produced cars right now that have 200HP and get 42+ mpg that are affordable and have 100K powertrain warranties. Where as a Model T had 20HP and got 15mpg if that.

Current gen EVs have A LOT of issues that most people either don't know about or simply don't want to talk about.

- Electric Power infrastructure. Look at CA - the leader in "Green" electricity production (which in and of itself is total crap - they IMPORT the electricity needed to mostly keep up with current demand) they were literally issuing "flex alerts" urging customers to "voluntarily" restrict use of certain electric appliances, adjust thermostat settings and urging EV owners to charge their vehicles BEFORE a "Flex Alert" was issued. If HALF of all the ICE powered vehicles in CA were replaced by EV there is NO way CA's power grid could even attempt to keep up - even with greatly increasing the already high percentage of electricity they import. They imported 70% of their electricity in 2019. You think that number is going down?

- Storage / Battery tech - while tech is rapidly expanding / improving there are outside factors that are already influencing these advancements. One of the organizations that is involved with expanding EV battery tech and admitted that with the large auto manufacturers rushing to jump on the EV bandwagon (which they applauded) they also admitted that supplies of needed materials to build batteries could in no way keep up with this demand. You have major auto manufacturers spending hundreds of millions on start ups and small companies working on advanced EV tech and while a lot of these advancements are GREAT - what good does it to when there is no realistic way for widescale production / implentation?

- There are certain earth minerals that you have to have to build a modern EV battery. The vast majority of these materials are imported. Ironically, the U.S. HAS resources of most of these minerals in its own borders, but industry knows there is no way that the EPA and other government regulatory agencies (With current 'carbon emission' policies and regulatory policies) would never allow them to mine for these minerals. But we're perfectly fine importing them from other countries who could give a shit less about carbon emissions.

- Wind and Solar power - they are really good options in certain parts of the country. But they aren't magic. How much OIL is needed to make ONE wind turbine? What about the oil that's used INSIDE the turbine? Even better is solar. Who makes the majority of solar panels in the world? Solar panels are made using silica....sand. So you need A LOT of energy to make silicone ingots from sand and even more to convert that to the silicone needed for panel construction. The plants that make the majority of these - in that unnamed country (hint: rhymes with China) they are powered by what? (Hint: rhymes with coal).

I'm not saying the technology won't grow. I'm not saying it won't get better and better.

I am saying that the current political rhetoric - that is frighteningly becoming energy 'policy' - is akin to jumping out of aircraft without an "old" parachute and hoping the 'new' and 'improved' parachute tech is ready to go and use - before you smash into the ground at terminal velocity.

And I wont' even talk about nuclear power. If nuclear power production in the U.S. doesn't start becoming okay to talk about - if the government agencies don't start making realistic changes to policy to help nuclear power production expansion - and current energy 'policy' stays the same, there's only two choices.....either it gets REALLY bad, especially for those people who can't afford the price of electricity, gasoline, natural gas and heating oil increasing (like it has and will continue if no drastic changes are made) OR oil / gas / coal production RAPIDLY increases in the U.S.

Great info and thanks for sharing.

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