The reason behind high Oil

[BamaGrad03 0]

This is what I've been saying for 3 years. From an article on CNN.com this morning:

"Apart from speculative funds pursuing technical targets, we find that the overall picture still fails to properly define the rationale for the continuation of the rally to new record highs," said Olivier Jakob, of Petromatrix in Switzerland.

It's not the President. It's not Congress. The onus is on the AMERICAN CONSUMER to alter demand. Oil speculation got wise about 5 years ago that the demand for oil was far ahead of it's market price. The speculation market has used EVERY little thing as justification for moving the price UP not down. The adjustments down (after a hurricane doesn't wipe out oil production) has NEVER been commensurate with the adjustments UPWARD in preparation for the major events.

Basically all they are doing is trying to find that tipping point where the price of oil/gas gets to the point where it affects demand and purchase volume from the American consumer. And for all of the bitching about how the price at the pump is killing the consumer, it isn't enough to alter driving habits.

Speculators see demand and usage at an all time high, the price continues to go up. There's no shortage. And no other fundamentals behind the high price. Demand and speculaiton is driving the market. Not the middle east, not inventory reports, or lack of congressional action...and not even OPEC.

Remember during Katrina...the price of oil and gas SHOT UP due to a temporary distrobution channel disruption? Well, prices are higher NOW than they were during the catastrophe. There's no other explanation than the fact that they are going to charge what the consumer will allow.

[otterinbham 0]

This is what I've been saying for 3 years. From an article on CNN.com this morning:

"Apart from speculative funds pursuing technical targets, we find that the overall picture still fails to properly define the rationale for the continuation of the rally to new record highs," said Olivier Jakob, of Petromatrix in Switzerland.

It's not the President. It's not Congress. The onus is on the AMERICAN CONSUMER to alter demand. Oil speculation got wise about 5 years ago that the demand for oil was far ahead of it's market price. The speculation market has used EVERY little thing as justification for moving the price UP not down. The adjustments down (after a hurricane doesn't wipe out oil production) has NEVER been commensurate with the adjustments UPWARD in preparation for the major events.

Basically all they are doing is trying to find that tipping point where the price of oil/gas gets to the point where it affects demand and purchase volume from the American consumer. And for all of the bitching about how the price at the pump is killing the consumer, it isn't enough to alter driving habits.

Speculators see demand and usage at an all time high, the price continues to go up. There's no shortage. And no other fundamentals behind the high price. Demand and speculaiton is driving the market. Not the middle east, not inventory reports, or lack of congressional action...and not even OPEC.

Remember during Katrina...the price of oil and gas SHOT UP due to a temporary distrobution channel disruption? Well, prices are higher NOW than they were during the catastrophe. There's no other explanation than the fact that they are going to charge what the consumer will allow.

Yep. I'm amazed at how many people are still driving land barges around with gas at $3.15 a gallon.

We're just skinflints. So we've gotten to the point where, we ask if each trip is worth it.

[autigeremt 6,711]

Otter......here's my counter to the "land barge" remark (I do own a Ford Focus (35mpg), and there's no Suburban in my drive).

If you have a family of four, and you need to have something that seats 6 (kids have friends), name me a vehicle that can seat 6 and get 25 or more miles per gallon. Also, name me a pickup that can get that and still tow a boat, pull a tractor to the job site, or haul a load of lumber?

I agree with Bama on this (we need to conserve and drive the cost down from the pump) post, but in America most of us do not have a public transportation system to jump on or the ability to drive a civic when we have a family or a job that demands a truck. It would help if all of us owned at least one gas saver, but we have choices and many are not willing to give up their freedom just yet. I hate the fact that I do not have an F-150 4x4 to drive every day. But I chose not to and stick with the Focus. A lot of people will not make that choice.

[BZ770 2]

Z71 Chevy Truck V8

78 El Camino SS 12mpg

I and would never drive a Focus. I'll pay4 dollars a gallon to still look Cool.

[bojack34 2]

I recently went from driving a Mazda pickup to a Z-71 4x4 extended cab because I needed the room and horsepower. Because of this It now cost me $10 a day to go to work as compared to $5 a day with the Mazda. Yes I do regret it as far as gas mileage goes but I did trade my wifes van in and got her a little Chevy Cobalt that gets 35 mpg so I don't feel as guilty. lol

[TitanTiger 20,511]

Otter......here's my counter to the "land barge" remark (I do own a Ford Focus (35mpg), and there's no Suburban in my drive).

If you have a family of four, and you need to have something that seats 6 (kids have friends), name me a vehicle that can seat 6 and get 25 or more miles per gallon.

People tend to be vain.

2000 Honda Odyssey Minivan: 18/19 mpg in town, 27/28 mpg on the highway. Seats seven with captain's chairs in the middle, eight with a bench.

Might not be 25 all the time, but it beats the hell out of 12-15 mpg.

And BZ770, the only issue I have with your desire to look cool is that it ends up costing me more in gas too. All the folks that drive a gas guzzler for no other reason than to "look cool" drive up demand and unfortunately, they don't determine what to charge you for a gallon of gas based on the gas mileage of the car you drive. But hey, if you're willing to pay $4 a gallon, maybe they should start so the rest of us don't have to suffer as much.

[BamaGrad03 0]

No offense, but since when is driving an El Camino considered "looking cool"?

[AURaptor 1,126]

Yep. I'm amazed at how many people are still driving land barges around with gas at $3.15 a gallon.

We're just skinflints. So we've gotten to the point where, we ask if each trip is worth it.

Add 'marketing' to the list of reasons. Auto manufactuers justify making bigger and bigger SUV's by stressing 'safety'. Well, of course your family will be safer in a larger car if most of the other cars are the old style sedans and compacts which actually get decent milage. I drive a '04 Dodge Dakota, a decent mid-sized truck, and I just have to chuckle when I'm on the road and a little house frau drives up in her macked out escalade or navigator, and is sitting up higher than me in her seat ! And being in Atlanta, if she's not toting a load of groceries from Publix, she's likely on the way to tennis practice, or on her way to pick up/drop off little jenny or bobby at the soccer field.

[auwallace 6]

Just sold my 13mpg city Durango cause the future wifey has a grand cherokee. we're gonna buy an altima or an accord so we're not wasting gas. How much do you think the people of this country would save if every family had a situational vehicle? You know an suv when you need to tow or pack heavy (if needed), and a car for back and forth and long trips.

[TitanTiger 20,511]

I think this is exactly the approach. I don't begrudge people having a large vehicle if it's appropriate for their needs. My best friend has 4 kids and since they are Catholic, there's likely more coming. They have a Suburban to tote the fam around. He drives a smaller sedan that gets 25-30 mpg back and forth to work. It's the couple with no kids that insists on owning a Hummer or Yukon Denali just to feel tough that drives me nuts.

[Tiger Al 0]

Just sold my 13mpg city Durango cause the future wifey has a grand cherokee. we're gonna buy an altima or an accord so we're not wasting gas. How much do you think the people of this country would save if every family had a situational vehicle? You know an suv when you need to tow or pack heavy (if needed), and a car for back and forth and long trips.

Get yourself a hybrid like Civic, Accord, Camry or Prius and waste even less. Use a bicycle to commute to work and for those 'back and forths' and use even less gas and get some exercise to boot.

[channonc 466]

In America most of us do not have a public transportation system to jump on

This is another fundamental problem. Our federal, state and local governments have not been investing what they should in infrastructure, particularly in growing urban areas (Atlanta, Birmingham, etc.). I think that you should be able to get to work and back without HAVING to own a car. What frustrates me the most is that politicians rarely talk about transportation policy because it is simply not glamorous.

[CCTAU 3,345]

In America most of us do not have a public transportation system to jump on

This is another fundamental problem. Our federal, state and local governments have not been investing what they should in infrastructure, particularly in growing urban areas (Atlanta, Birmingham, etc.). I think that you should be able to get to work and back without HAVING to own a car. What frustrates me the most is that politicians rarely talk about transportation policy because it is simply not glamorous.

MARTA is great in Atlanta. The only problem is NOBODY wants to live in Atlanta. We all want to live in the burbs where crime is not as rampant. But no matter where you go, the illegals will find you. They are starting to hang out in the burbs now. And most Atlantans have realized that if they bring MARTA to the burbs, crime goes through the roof. Just ask Gwinnett county.

We live in America, not Europe and not NYC. Americans like their space. It's what we have over Europeans. If you have space, you have to drive. For all the talk about getting a smaller car, we see no one talking about how the government did not ease ANY restrictions regarding diesel engines. Many engines could have brought from Europe and installed in the same cars here in order to get huge numbers in the fuel mileage category. Trucks and SUVs could get from 25 to 31 MPG earlier if they didn't have to contend with the emissions. And I'm not talking about black smoke blowing engines. The European models just barely miss our limit. But a lot of that has to do with them running 2 PPM sulfur and we are still at 15 PPM sulfur (better than the 500 PPM we had 2 years ago). Ford is coming out with an F150 diesel that will be using the engine that has been in the land rover in europe. It gets 31 mpg in the land rover. They could have been using this for 2 years now if not for the stringent rules on diesels.

But even running a diesel, we have to contend with the oil companies raping us. This is one area where they do make more profit. Diesel takes less to refine but they charge more for it at the pump. Why? Because who uses diesel? The truckers. And nobody really cares about the truckers cause we here in this country do not seem to understand that the price is just passed to us.

Even so, I drive a diesel and love it. I get the towing power I need and still get about 17 in the city and 21 on the road. 17 when towing up to 10,000 lbs. So thats where I see my savings. I only put about 10,000 miles a year on my truck, so I'm not on the road a lot. If I had to be on the road a lot, I would probably get a small car just for commuting.

I WOULD NOT GET A HYBRID. In the end, they contaminate the environment worse than a normal car. It's very toxic to dispose of the batteries these things use.

Until we come up with an alternative method of generating power, we will contend with these problems. But until then, we could be drilling our own oil and creating a couple of new refineries. This combined effect of more oil combined with an overstock of fuel would slow the demand for world oil. In turn the price of oil would drop.

Or we could just tell the oil producing countries that we protect, for no reward at all, that they are on their own unless the price drops. We will not run out of oil in our lifetime. You would think that would be long enough to figure something out. Knee jerk legislation and the false religion of global warming will only produce false hopes. We need a long term solution that includes drilling our own oil.

[channonc 466]

There should still be mass transit options for those that live in the suburbs. It just makes sense.

[CCTAU 3,345]

There should still be mass transit options for those that live in the suburbs. It just makes sense.

OK. I'll paraphrase above. The folks in the Atlanta suburbs do not want mass transit. It does not take them into work, it brings the crime to their house. Do you know anyone who has lived in Gwinnett before and after MARTA came? They will attest to this. So if you build this option and it doesn't get used, who pays for it. There are many ride share programs that take place in a private manner. They run wit a profit and run efficiently without bringing crime to the burbs. I know many folks who park and get on a bus to and from the city of Atlanta every day. And if you have paid attention to MARTA the last several years, they are not getting enough riders to make money. Folks just don't use it. The one's who do are not the ones you want to spend an hour of your day with.

So the answer of throwing more money into mass transportation has been tried here in Atlanta. The answer is not always more government money and more government regulation.

[otterinbham 0]

Otter......here's my counter to the "land barge" remark (I do own a Ford Focus (35mpg), and there's no Suburban in my drive).

If you have a family of four, and you need to have something that seats 6 (kids have friends), name me a vehicle that can seat 6 and get 25 or more miles per gallon. Also, name me a pickup that can get that and still tow a boat, pull a tractor to the job site, or haul a load of lumber?

I agree with Bama on this (we need to conserve and drive the cost down from the pump) post, but in America most of us do not have a public transportation system to jump on or the ability to drive a civic when we have a family or a job that demands a truck. It would help if all of us owned at least one gas saver, but we have choices and many are not willing to give up their freedom just yet. I hate the fact that I do not have an F-150 4x4 to drive every day. But I chose not to and stick with the Focus. A lot of people will not make that choice.

Hey, you're talking to a man with 3 kids, all of whom are in sports, music, Boy Scouts, you name it. But there's a huge difference between a Minivan or a station wagon, or a Denali or Yukon. My Ford Freestyle gets 19 in the city, 24 on the highway. My neighbor's suburban gets 11 in the city and 15 on the highway--a 60-72% spread. Meanwhile, my wife's Odyssey gets 20 mpg.

At the same time, I respect the needs of those who truly need a big honking SUV or a pickup. I have a friend who specializes in wilderness photography. He has to haul tons of equipment down terrible roads. A guy who works in construction? No question. But really. How many actually fit into that category? The truth is, the bulk of those people who buy those monsters need them as much as a fish needs a bicycle. Not that I'm a closet socialist ready to deny them their choices. However, if you buy a truck like that for frivolous reasons, don't be complaining at the pump.

The other factor is that people aren't really paying attention to how much they drive. Do you really need to go to the store THIS INSTANT, or can you wait until the kids have to go to baseball practice? Even better, can you take an extra 10 minutes taking inventory of your refrigerator and pantry so you can do the week's or month's shopping all at once? Can your kids walk to a friend's house, rather than be driven? For so much of the fuel consumption in this country is driven by lifestyle, not necessity. And we are paying for the economic and geopolitical consequences as a result.

[channonc 466]

There should still be mass transit options for those that live in the suburbs. It just makes sense.

OK. I'll paraphrase above. The folks in the Atlanta suburbs do not want mass transit. It does not take them into work, it brings the crime to their house. Do you know anyone who has lived in Gwinnett before and after MARTA came? They will attest to this. So if you build this option and it doesn't get used, who pays for it. There are many ride share programs that take place in a private manner. They run wit a profit and run efficiently without bringing crime to the burbs. I know many folks who park and get on a bus to and from the city of Atlanta every day. And if you have paid attention to MARTA the last several years, they are not getting enough riders to make money. Folks just don't use it. The one's who do are not the ones you want to spend an hour of your day with.

So the answer of throwing more money into mass transportation has been tried here in Atlanta. The answer is not always more government money and more government regulation.

While I did mention Atlanta, they are not the only ones with this problem. Many other cities do not provide viable transportation options, and I think that is a major problem. Carpool lots, buses, commuter train systems (not just everyday subway systems) would help. I am not saying we should take away your right to drive, but adding more lanes to the interstates is not the only answer to congestion problems.

[TitanTiger 20,511]

I WOULD NOT GET A HYBRID. In the end, they contaminate the environment worse than a normal car. It's very toxic to dispose of the batteries these things use.

Not if you recycle them, which is what they do when you have to replace them after 100,000 miles or so. It's really no different than what they do when you get a new car battery or get your oil changed. They are required to recycle them.

[Tigermike 3,053]

There should still be mass transit options for those that live in the suburbs. It just makes sense.

OK. I'll paraphrase above. The folks in the Atlanta suburbs do not want mass transit. It does not take them into work, it brings the crime to their house. Do you know anyone who has lived in Gwinnett before and after MARTA came? They will attest to this. So if you build this option and it doesn't get used, who pays for it. There are many ride share programs that take place in a private manner. They run wit a profit and run efficiently without bringing crime to the burbs. I know many folks who park and get on a bus to and from the city of Atlanta every day. And if you have paid attention to MARTA the last several years, they are not getting enough riders to make money. Folks just don't use it. The one's who do are not the ones you want to spend an hour of your day with.

So the answer of throwing more money into mass transportation has been tried here in Atlanta. The answer is not always more government money and more government regulation.

While I did mention Atlanta, they are not the only ones with this problem. Many other cities do not provide viable transportation options, and I think that is a major problem. Carpool lots, buses, commuter train systems (not just everyday subway systems) would help. I am not saying we should take away your right to drive, but adding more lanes to the interstates is not the only answer to congestion problems.

A mandate that all cities synchronize their street lights would be a big help. Drive through Birmingham and there are times and streets where you will have to stop at every intersection. I would hazard to guess there are many other cities with the same problem. It's not much but all that gas sitting at every light adds up, on the whole in general.

[channonc 466]

There should still be mass transit options for those that live in the suburbs. It just makes sense.

OK. I'll paraphrase above. The folks in the Atlanta suburbs do not want mass transit. It does not take them into work, it brings the crime to their house. Do you know anyone who has lived in Gwinnett before and after MARTA came? They will attest to this. So if you build this option and it doesn't get used, who pays for it. There are many ride share programs that take place in a private manner. They run wit a profit and run efficiently without bringing crime to the burbs. I know many folks who park and get on a bus to and from the city of Atlanta every day. And if you have paid attention to MARTA the last several years, they are not getting enough riders to make money. Folks just don't use it. The one's who do are not the ones you want to spend an hour of your day with.

So the answer of throwing more money into mass transportation has been tried here in Atlanta. The answer is not always more government money and more government regulation.

While I did mention Atlanta, they are not the only ones with this problem. Many other cities do not provide viable transportation options, and I think that is a major problem. Carpool lots, buses, commuter train systems (not just everyday subway systems) would help. I am not saying we should take away your right to drive, but adding more lanes to the interstates is not the only answer to congestion problems.

A mandate that all cities synchronize their street lights would be a big help. Drive through Birmingham and there are times and streets where you will have to stop at every intersection. I would hazard to guess there are many other cities with the same problem. It's not much but all that gas sitting at every light adds up, on the whole in general.

Totally agree. Most of the lights in DC are synced with the speed limit. So if you are driving the speed limit, you shouldn't have to stop at all of the lights.

My point above was I think there are several things that when combined could lessen our dependence on oil. Not to mention, dependence on one form of transportation isn't practical. Look at MN, if a bridge of that size went out in other cities, you would just be forced to have other congested routes even more congested. If there are mass transit options, you could get some of those people off the road.