[DomusAlbion]

$this->bbcode_second_pass_quote('Cashmere', 'S')FU - we've got it figured out here, no worries.

...


By the way, you're missing a "T" in your letters.

[mrobert]

All the economic fixing of this issue, is what got us here. And continuing to adopt solutions such as: "Let's tax the oil company and use the money to subsidise the gas price" will do nothing then speed up.

Who do you think own oil companies? Ever bothered to look at the amount of free-float stocks which belong to 'nobodies' ?

This is a very SIMPLE equation.
10 people need 1 barel of oil each. There are only 8 available.
How do you decide which 2 people won't get their oil? IMPOSE it?
Or start raising the price until 2 of them quit voluntarely. It's nothing but natural selection.

Offcourse, every 8 smuck thinks that other 2 should be denied the privilege, just because ... and keep the price unchanged.
This is the fastest way to hell, really.

Let me tell you something even simpler. When the prices go up, the first to go down are the inefficient ones (companies or people).
If you control the price, shortages will appear ... and RANDOM ones will go down (companies or people).

Which is better?
Natural selection never went wrong ... and it will never go wrong ... it has been like this since life exists. It doesn't matter that is a fight for food settled in a forest thousands of years ago, or a fight for oil settled on modern markets.

[vision-master]

$this->bbcode_second_pass_quote('', 'I')n a nutshell, for people who don't understand much about economics and business, I decided to write this 5 page document summing up reasons why the price of gas is so high, its affect on the economy, and a decent yet ambitious way to fix it.

[Jack]

$this->bbcode_second_pass_quote('Homesteader', 'T')hanks for the heads-up. If shown to be true would that be grounds for banning?

[SFU2236]

$this->bbcode_second_pass_quote('Jack', 'F')olks - beware.

This is a download, apparently of a Word document.

It may have malicious macros embedded. It may have images or links that facilitate tracking who and where you are.

SFU2236, I invite you to tell us why you created such a document instead of providing a web page.

[Jack]

$this->bbcode_second_pass_quote('SFU2236', 'I')t has no malicious material of any kind. It's a simple word .doc, and if anyone has User Account Control turned on then it shouldn't do any damage even if it was.

I didn't make a website because I don't have the capacity to make a website.

[mrobert]

@SFU2236: You think gas is expensive? The rest of the world pays more then double and most of the time earn less. And yet everything is fine.

Where I live, somebody who makes $1000 a month is considered to be very well paid. This morning, a gallon of gas was $6.5
And everything is just fine.

As mentioned on a another thread, if demand grows by 1%, price rises by 20%. What if demand would drop 20%? This is easily doable. Without affecting your current lifestyle. Stop wasting resources and start using cars with decent engine sizes ...

Continuing to point fingers at oil companies, the arabs, and whatever else ... will do nothing. Look into a mirror and point the finger at yourself.

At least 25% of the oil we use, is WASTED. And by waste I don't mean joyrides or anything similar. Simply doing things which we could do with less energy, in the same maner.

Instead of driving with a Hummer for icecream, try driving with a 1.7 liter diesel engine which is common here in Europe. You would be using at least 5 times less fuel, end up with the same result ... and effect of gas prices on your money ... would be just like in the old times of $0.9 a gallon.

No need for word documents or long debates.

[HEADER_RACK]

SFU Where are you getting your dinformation from?!?!?
please provide sources.

[basil_hayden]

$this->bbcode_second_pass_quote('SFU2236', ' ')

Also, you guys say oil is peaked. Why is it then in 2006 that Saudi Arabia said a barrel of oil (42 gallons per barrel) cost them $4 to produce?

[ROCKMAN]

basil...stop picking on SFU..I would miss his/her posts.

Here's a thought I would like the group to analyze for flaws/agreements:

Accept for the moment the simplistic economic model offered. The consuming world is asking the producers to flow their wells at a higher rate. Given that there is a finite demand for crude on any given month, once those crude buyers have been satisfied, any additional production must go into storage. At a later time this storage could be used to satisfy demand but that volume untilized would reduce the production requirement to satisfy demand by an equal amount. Let's ignore volumes in transport and all the little pieces for the moment.

Correct me if I've missed the headline, but has any crude purchaser claimed they have been unable to acquire what they want to buy on any given month? If not, then there is no "need" for additional production from the KSA or anyone else. When there is a call for the KSA to produce more they cannot unless they have additional buyers. And we all know how you get market share in the commodity biz: you sell your product for less than your competitors. The KSA knows this biz plan quit well: that's how oil got down to $10/bbl in 1986. They were continuing to loose market share as other OPEC members kept reducing their bids. When the KSA got tied of maintaining oil prices by reducing their delivery to the market they opened their wells up and we all went out and bought big SUV's and pickups.

Thus it's not important what the KSA's deliverability is at the moment. Down the road, of course, when we reach the point where supply demands are not being meet, then it becomes very critical. Are we not asking the KSA to undercut the prices of other producers so as to take their market share away? The KSA need not produce one more barrel of oil to accomplish this. All they need do is offer their existing production at a price below the other producers. Who would continue buying oil from Nigeria at $130/bbl when they can buy it from the KSA at, let's say, $120/bbl? Very simply, if the KSA put 5 million bbl/day of oil on the market next month would the consumers purchase an additional 5 million bbls/day? I think they would buy the same amount as they had forecast need for. Thus someone would have to shutin 5 millions bbl/day....or quickly build some very big storage tanks.

I've been a petroleum geologist for over 30 years. I know well the relationship between buyer and seller: you pay me what I want (to buy or sell) or I'll go to someone who gives me a better deal. Those who understand the diamond biz get my point for sure: if the diamond exchange in Brussels were to put their surplus inventory out into the market tomorrow wedding rings would drop to $100/carat.

I assume the KSA is watching how the world economy is responding to the new price levels. The high oil prices of the late 70's lead to a worldwide recession that dropped demand and led directly to $10 oil in 1986. I just hope all those Swiss economists on the KSA payroll are watching very closely.

[ohcomeon]

$this->bbcode_second_pass_quote('SFU2236', '')$this->bbcode_second_pass_quote('Jack', 'F')olks - beware.

This is a download, apparently of a Word document.

It may have malicious macros embedded. It may have images or links that facilitate tracking who and where you are.

SFU2236, I invite you to tell us why you created such a document instead of providing a web page.

[MrBill]

Wow, I cannot believe I missed S(T)FU's inaugral post. This is classic stuff. "Any serious economist will tell you the same"? (snicker)

The more I read of ROCKMAN's stuff the more I appreciate his insight and input. Thanks! ; - ))

[ROCKMAN]

Thanks Mr. Bill.

As I've told others: we all have our own little piece of the puzzel to add to the picture. I, for one, appreciate all the economic angles you and others bring to the table. Researching that crap bores the hell out of me...not enough coffee in the world to keep my eyes open. I really only enjoy the stuff I can break open with a rock hammer or shoot holes in to produce oil.

Yes...we geologist are a simple lot easily amused...much like puppies I've been told.

[Homesteader]

$this->bbcode_second_pass_quote('MrBill', ' ')

The more I read of ROCKMAN's stuff the more I appreciate his insight and input. Thanks! ; - ))

[Toyota]

What about the dollar have fallen alot in recent years!

The oil is bound to the dollar, so no surprice that when the dollar falls, the price of oil rise! Simpel as that!

But i will blame speculators

The fallen dollar

And many problems in the middle east!

And why should saudi arabia supply more oil, when america dont want to drill for there own oil!

There is alot of oil in america, but the democrats doesn't allow for drilling

[Ludi]

$this->bbcode_second_pass_quote('Toyota', '
')There is alot of oil in america, but the democrats doesn't allow for drilling

[ROCKMAN]

Hell Ludi...I was about to say the same thing about those damn Republicans.

Wait...I know...let's blame those damn Canadian. Even if they get mad at us all they'll do is give us a dirty look.

On a serious note I'd like to ask the group a quick poll:

1)How soon would expect to see oil/gas leases offered of the east coast in the Atlantic?

2)How many fields have been discovered already in this trend?

[mrobert]

Those politicos ... denying people their birthright.

[MrBill]

Careful Rockman those pesky Canucks might just have to burn down Washington for a third time! ; - ))

Those damn speculators! Arriving at the finish line ahead of the market. They should be called off-side!!

No, they should be forced to buy government bonds denominated in US dollars, so that inflation and US dollar depreciation means their stored wealth turns into a state subsidy for Bubba's birthright. That'll teach 'em!

[mrobert]

$this->bbcode_second_pass_quote('MrBill', 'N')o, they should be forced to buy government bonds denominated in US dollars, so that inflation and US dollar depreciation means their stored wealth turns into a state subsidy for Bubba's birthright. That'll teach 'em!