Expect a big jump in gasoline prices

[Koolau]

I had a small motorcycle with a tank that held just over a gallon. I remember bragging that I could go to the most expensive gas station around (Amoco) and fill it up for a quarter.

Yes, it's funny how we remember the "low" numbers but forget what it actually cost in terms of w*rk. ca. 1972, I was running round all week on 10 gallons of $.30/gal gas. So $3/week was all it cost. BUT, IIRC, I was making perhaps $6/hr at that time. Fast Forward to today, and not much has changed. 10 gallons still costs about a half hour's w*rk, give or take, depending on miles driven and avg. salary. Point being, not too much has changed but the numbers.

I think what we always notice is any spikes or dips in prices at the time. Those are usually a factor of the inelasticity of supply/demand curves. If supply countries can hold together an agreement to withhold a little bit of supply, huge price increases can follow. Of course, the greed factor soon kicks in and the "colluders" sell out their partners in short order - in most cases. That's why I've always argued for more storage of crude preferably by oil companies, but if needed, by gummints. It's an expensive solution but would likely be effective in stabilizing prices. Most oil-rich countries depend too much on their oil revenues to hold out against a country who has a years supply of crude just sitting there waiting to be refined - especially if it's stored all over the country and not just in a few hard-to-distribute-from places. Just a thought since we're talking about big jumps in gas prices. And, of course, YMMV.

 

[braumeister]

Yes, it's funny how we remember the "low" numbers but forget what it actually cost in terms of w*rk. ca. 1972, I was running round all week on 10 gallons of $.30/gal gas. So $3/week was all it cost. BUT, IIRC, I was making perhaps $6/hr at that time.

A very good point. When I bragged about that 25¢ gallon of gas, I was making minimum wage, $1.50/hour. So today's gas price is roughly equivalent in purchasing power.

 

[SecondCor521]

gummints. It's an expensive solution but would likely be effective in stabilizing prices. Most oil-rich countries depend too much on their oil revenues to hold out against a country who has a years supply of crude just sitting there waiting to be refined - especially if it's stored all over the country and not just in a few hard-to-distribute-from places. Just a thought since we're talking about big jumps in gas prices. And, of course, YMMV.

We could call it the Strategic Petroleum Reserve.

https://en.wikipedia.org/wiki/Strategic_Petroleum_Reserve_(United_States)

 

[harley]

A very good point. When I bragged about that 25¢ gallon of gas, I was making minimum wage, $1.50/hour. So today's gas price is roughly equivalent in purchasing power.

Not me. When I was buying $.29 gas I was making $1.65. But now I'm spending almost $3/gallon, and I'm not making anything. So that means gas prices have increased by infinity.

 

[rk911]

Shouldn't that be a DWI (Donna Wants It)

FFS...fat finger syndrome. that's my story and, well, you know the rest.

 

[Time2]

When I was in HS it was $0.29/gallon. Yes, you could still occasionally get a whiff of the dinosaur it was squeezed from.

You Youngsters! I worked at a gas station when I was 16 and 17, we had gas wars and our station got down to $0.189/gallon.


One of my mental threads is, as we age, prices get crazier and crazier, we remember what things used to cost, the kids have no price memory and these prices I see as crazy, are just normal. The may be normal, but not to me! My first used car was $200, my last one was $9,000.

 

[Time2]

I remember those days. My mum would drive to the gas station and ask for “One dollar’s worth of regular, please”. It was also the expected contribution from us yutes if we were able to borrow the car for the evening.

When I was kid, my dad had a 1951 Ford pickup truck, with a broken gas gauge. Every time he drove it, he would buy $1.00 of gas. One time I was with him he stopped to get his one dollar worth and he couldn't get the whole $1 in the tank! I think that was a happy day for him.

 

[ls99]

Yeahbut, how many remmeber alternate day gas availability with a half mile long line to get to the pump. And just as pulling in, the sign going up OUT OF GAS! Thanks to Jimmy Cs policies. All the while oil tankers at anchor well off shore with helicopter delivery of food to the ship's company.

 

[Time2]

Our local Sam's club doesn't have their fuel price sign lit. It has been off for about a month.


Does anyone else's Sam's club have their fuel price sign turned off?


My wife says it is because a recently opened fuel station a 1/2 block away is beating their prices and they don't want to show that. It is beating Sam's price, but, I don't agree, that is the reason, however, I don't know why they have their sign off.

Does anyone have a Sam's Club that has the fuel price sign turned on?

 

[frayne]

Anyone here know the status of the refinery re-starts in Texas. I would think by now they should be up and running.

 

[azxracer]

The cheapest gas I ever bought was at a little independent gas station on the Chef Highway (US90) in East New Orleans, in the summer of 1968. $0.139 per gallon of regular. There's a lot more to the story and it's why I remember the price after all these years. I was driving an old Rambler with a push button automatic and seats that would recline all the way flat. A 19 year old male's dream.

 

[street]

Anyone here know the status of the refinery re-starts in Texas. I would think by now they should be up and running.

I haven't heard and I haven't been able to find any status on the refineries.

I sometime think they just shut them down when they want and start up when it is convenient for them. Lol

I drive a lot and we have to drive a lot when you live in rural areas. We don't do traveling or trips so I spend it on gas on my habits and things I enjoy doing.

 

[Out-to-Lunch]

I sometime think they just shut them down when they want and start up when it is convenient for them. Lol

I think that is called "free-market capitalism"!

 

[W2R]

$2.39/gallon for regular at our nearest Exxon station, today.

Jumped up to $2.49/gallon by today! I didn't need any gas but noticed while driving by. Maybe this is the beginning of the Big Jump in gas prices.

And now it's $2.59/gallon for regular. It's sneaking up on us.

 

[aja8888]

Yeahbut, how many remmeber alternate day gas availability with a half mile long line to get to the pump. And just as pulling in, the sign going up OUT OF GAS! Thanks to Jimmy Cs policies. All the while oil tankers at anchor well off shore with helicopter delivery of food to the ship's company.

I was there in Connecticut trying to find gas so I could go to work. Sucked.

 

[street]

$2.93 here.

 

[Koolau]

We could call it the Strategic Petroleum Reserve.

https://en.wikipedia.org/wiki/Strategic_Petroleum_Reserve_(United_States)

I'm sorry, but "The Strategic Petroleum Reserve" name has already been taken (as you point out in the wiki.) I'm pushing for "Ko'olau's Folly" if it must have a catchy name.

The SPR is primarily for geo/political gamesmanship by the gummint. It was not designed for nor could it appreciably affect the kind of price stability I was proposing. Because its located just about as far as possible (and still be in the USA) from all the real oil pressure points (upper west and and especially the upper NE.) When the petro exporting nations collude, it has been of little or no value in price stabilization. It SOUNDS good when the Pres. says "I'm releasing XXX barrels of oil from the SPR." But, if you do the math, that might be 8 hours of refined gasoline.

In reality, it only insures that in a true military crisis, the US will have a supply of oil for the military. Presidents have dipped into it from time to time in hopes of stabilizing prices, but you can't fool mother nature. If the actual country (not just the military) needs oil, the SPR is just a few gallons in the bucket. No, it's supposed to be a back-stop for the military. By the way, ITSHTF militarily, I do not want to live within 500 miles of the actual holes in the ground containing that much oil. They'd be pretty easy targets in a real conflict. Nothing like putting all (many) of your eggs in so few baskets. By the way, I'm betting the "spigot" on those storage tanks aren't big enough to empty their 34 days' worth of supply in 34 days - but I'm speculating.

No, what I was talking about might look like this (and, keep in mind, I have NO idea what I' talking about.): Each existing refinery would add (pick a number between 50 and 365) days supply of crude oil to be stored more-or-less on site (could be anywhere within a day's rail journey and still work.) When a few petro-exporting nations decide to collude, the rail cars start moving toward the refineries. We don't even announce it. We just keep producing and filling fueling stations as if nothing had happened. When the oil exporters realize nothing is happening, they will quickly relent as we can hold out longer than they can.

BUT, of course, no one ever fixes a problem before it happens, so forget I said anything. Of course, YMMV.

 

[NW-Bound]

I'm sorry, but "The Strategic Petroleum Reserve" name has already been taken (as you point out in the wiki.) I'm pushing for "Ko'olau's Folly" if it must have a catchy name.

The SPR is primarily for geo/political gamesmanship by the gummint. It was not designed for nor could it appreciably affect the kind of price stability I was proposing. Because its located just about as far as possible (and still be in the USA) from all the real oil pressure points (upper west and and especially the upper NE.) When the petro exporting nations collude, it has been of little or no value in price stabilization. It SOUNDS good when the Pres. says "I'm releasing XXX barrels of oil from the SPR." But, if you do the math, that might be 8 hours of refined gasoline.

In reality, it only insures that in a true military crisis, the US will have a supply of oil for the military. Presidents have dipped into it from time to time in hopes of stabilizing prices, but you can't fool mother nature. If the actual country (not just the military) needs oil, the SPR is just a few gallons in the bucket. No, it's supposed to be a back-stop for the military. By the way, ITSHTF militarily, I do not want to live within 500 miles of the actual holes in the ground containing that much oil. They'd be pretty easy targets in a real conflict. Nothing like putting all (many) of your eggs in so few baskets. By the way, I'm betting the "spigot" on those storage tanks aren't big enough to empty their 34 days' worth of supply in 34 days - but I'm speculating.

No, what I was talking about might look like this (and, keep in mind, I have NO idea what I' talking about.): Each existing refinery would add (pick a number between 50 and 365) days supply of crude oil to be stored more-or-less on site (could be anywhere within a day's rail journey and still work.) When a few petro-exporting nations decide to collude, the rail cars start moving toward the refineries. We don't even announce it. We just keep producing and filling fueling stations as if nothing had happened. When the oil exporters realize nothing is happening, they will quickly relent as we can hold out longer than they can.

BUT, of course, no one ever fixes a problem before it happens, so forget I said anything. Of course, YMMV.

Finding a place or containers to store enough crude oil is not easy. The US daily usage is 18 million barrels of crude oil, or 756 million gallons/day.

Do we remember that on April 20 last year, when the pandemic broke out and all travel stopped, the US was awash of oil such that when the future contract for WTI (West Texas Intermediate) oil came near, the contract holders panicked because there was no place to store the oil that they had to accept delivery, they tried to get rid of the contracts, and sold the oil at a price of -$37 per barrel.

Yes, they had to pay $37/barrel to somebody with storage facilities to accept the oil for them.

Prior to that, I remember reading many oil tankers were rented as floating containers of oil, instead of transporting it.

How large and expensive the total oil storage we would need, I don't have any idea. What kind of environmental hazard is that? Will it be a terrorist magnet? It boggles the mind.

 

[street]

Can anyone find any startup time for those refineries? All I can find is a couple of February articles saying as soon as the snow storm is over in Texas they would be back in full operation. Those couple of articles been over a month old and nothing new.

 

[Koolau]

Finding a place or containers to store enough crude oil is not easy. The US daily usage is 18 million barrels of crude oil, or 756 million gallons/day.

Do we remember that on April 20 last year, when the pandemic broke out and all travel stopped, the US was awash of oil such that when the future contract for WTI (West Texas Intermediate) oil came near, the contract holders panicked because there was no place to store the oil that they had to accept delivery, they tried to get rid of the contracts, and sold the oil at a price of -$37 per barrel.

Yes, they had to pay $37/barrel to somebody with storage facilities to accept the oil for them.

Prior to that, I remember reading many oil tankers were rented as floating containers of oil, instead of transporting it.

How large and expensive the total oil storage we would need, I don't have any idea. What kind of environmental hazard is that? Will it be a terrorist magnet? It boggles the mind.

All potentially valid reasons NOT to prepare for another "oil shock." I personally lived through two major oil shocks (mid to late 70's) and several "middling" oil shocks since. How much did THOSE downturns cost us vs the ability to store crude oil? Arguably, we fought (how many?) trillion dollar "conflicts" because of oil? The economic chaos that ensued from oil-shocks was horrendous. I'm thinking if we can put a man on the moon, we can store oil against the day when opec or a clone decides to pinch the pipe-line again. Keep in mind, "they" actually need us to need their oil. If they know we have even a month's READY supply of oil in storage, they'll think twice about twisting the valve closed.

Keep in mind we only have to store the imposed SHORTFALL - not the whole 18 million barrels. Also, now with the US as the largest net-exporter WE could pinch the pipe line. So there's that.

It's truly a hypothetical because, as you point out, there would be costs. We NEVER pay costs until we are forced to so YMMV.

 

[REWahoo]

Can anyone find any startup time for those refineries? All I can find is a couple of February articles saying as soon as the snow storm is over in Texas they would be back in full operation. Those couple of articles been over a month old and nothing new.

Here are a couple of websites with recent information:

https://www.bloomberg.com/news/arti...sights-texas-refineries-nearly-back-to-normal

https://www.hellenicshippingnews.co...margins-creep-higher-as-frozen-plants-return/

 

[street]

^ thank you very much.

 

[aja8888]

Can anyone find any startup time for those refineries? All I can find is a couple of February articles saying as soon as the snow storm is over in Texas they would be back in full operation. Those couple of articles been over a month old and nothing new.

I wouldn't worry about the refinery starts. I'd bet they are mostly back in operation around here (Texas). Nothing much in the news here either.

Besides, refinery product deliveries are generally 6 months out as there is a huge amount of finished product in storage tanks waiting for pipeline scheduling. That's worked off on demand, which has been low this last year. The refineries will catch up.

Gasoline will be going further up in price soon because of summer driving switchover from distillate production reductions and the added raw material cost of the more expensive formulations needed to meet air emission regulations in different parts of the country as summer demand picks up.

Don't forget the Saudis and Russians as they plot to keep worldwide demand to a level where they meet their profit guidelines.

 

[audreyh1]

Anyone here know the status of the refinery re-starts in Texas. I would think by now they should be up and running.

Someone here reported they were back up maybe a couple of weeks ago.

 

[NW-Bound]

All potentially valid reasons NOT to prepare for another "oil shock." I personally lived through two major oil shocks (mid to late 70's) and several "middling" oil shocks since. How much did THOSE downturns cost us vs the ability to store crude oil? Arguably, we fought (how many?) trillion dollar "conflicts" because of oil? The economic chaos that ensued from oil-shocks was horrendous. I'm thinking if we can put a man on the moon, we can store oil against the day when opec or a clone decides to pinch the pipe-line again. Keep in mind, "they" actually need us to need their oil. If they know we have even a month's READY supply of oil in storage, they'll think twice about twisting the valve closed.

Keep in mind we only have to store the imposed SHORTFALL - not the whole 18 million barrels. Also, now with the US as the largest net-exporter WE could pinch the pipe line. So there's that.

It's truly a hypothetical because, as you point out, there would be costs. We NEVER pay costs until we are forced to so YMMV.

I dunno. We cannot even stockpile enough TP for the masses to hoard, and the chintzy surgical masks that could have saved some doctors' and nurses' life at the beginning of this pandemic. There were plenty of stories about doctors having to wear the same cheap mask for 1 week. Don't forget the $1 bottles of hand sanitizer either.