[amexsbow]

HOW THINGS WORK
Having worked in the Oil and Gas industry and the Utilities industry, I would like to clear up some misconceptions. The Oil and Gas industry does not set the price of the product. That is set by the futures market. The Utility industry uses oil and gas to produce electricity. The Utilities industry does not set the price of electricity. That is set by the regulatory commissions of states or municipalities.
When the amount of a given product is restricted and the demand for that product is increasing the price of the product will increase according to demand.
So, when the price of oil and gas goes up what happens.
Transportation costs rise.
Costs rise to ship raw materials.
Manufacturing costs rise.
Distribution costs rise.
Add the rise in costs for each step of the manufacturing process from the ground to the store and the increased costs are substantial. If you are in business, which one of you is willing to reduce your income to keep costs down. How long will you stay in business?
And if someone artificially restricts the flow of energy what happens?

Wake up before it is too late!

[CoachKandSportsguy]

I have worked both industries as well. I have always played a location quiz with myself, "where would I want to live if oil hit $200 per barrel or higher?" The answer has always been where heating costs are minimized, and water, and food is grown in the area. One can survive heat with shade and water, but cold requires heat to survive. Food and protein food requires water and sunshine and the longer the growing season the better.

With capitalistic (lowest cost) optimization the colder areas, having shorter to very short growing seasons, require substantial vehicular imported food, and imported heat supply as well. These all require extra income to remain.

FL, Southern CA, HA come to mind as the best locations for these factors. Hence, a home in TV is also attractive, relative to the Northeast or other northern locations.

However, don't forget there is demand destruction as prices rise. . . demand destruction for petroleum based products will occur as prices increase. For those who have deferred big maintenance for cost, one might want to make plans to get it done sooner rather than later, especially with asphalt shingles. Maybe the ARC will become more open to longer lived metallic roofing material. If there was ever a time for the allowance, now is the time to be approving the options.

Mass generation from renewables is difficult due to the instability of production. Complimentary to petroleum based absolutely the future, but storability of electricity is difficult and somewhat dangerous, with that much energy stored in such a small space. . more research needs to be done, and there has been a lot already, which is not publicized.

So at the moment, the world could be at peak population and luxury, but the future remains uncertain. And I don't count out the creativity of humans who have exceeded the natural human capacity limits of the planet.

hopeful guy

[MartinSE]

For regional prices you may well be right, I can't say, but I can say for local prices that those are set based on local competition, and each major brand shops all the stores around it and reports current prices to headquarters who then runs the numbers and instructs the station manager what price to set for that day.

A major driving factor is also supply chain - it is "critical" that refineries be kept running a close to 100% capacity, to maximize efficiency. If the refinery is producing at 100% it has to have someplace for the output to go, tank farms, which then have to be kept "not full" by shipping the gasoline to the stations and topping them off. If the gas is not selling fast enough to keep the tank farm empty enough for the output of the refinery to keep flowing they will drop prices to stimulate buying and relieve the backup.

It's a constant balancing act to keep the gas flowing.

I worked at the retail end the pipe for 4 years.

[MartinSE]

Originally Posted by CoachKandSportsguy

I have worked both industries as well. I have always played a location quiz with myself, "where would I want to live if oil hit $200 per barrel or higher?" The answer has always been where heating costs are minimized, and water, and food is grown in the area. One can survive heat with shade and water, but cold requires heat to survive. Food and protein food requires water and sunshine and the longer the growing season the better.

With capitalistic (lowest cost) optimization the colder areas, having shorter to very short growing seasons, require substantial vehicular imported food, and imported heat supply as well. These all require extra income to remain.

FL, Southern CA, HA come to mind as the best locations for these factors. Hence, a home in TV is also attractive, relative to the Northeast or other northern locations.

However, don't forget there is demand destruction as prices rise. . . demand destruction for petroleum based products will occur as prices increase. For those who have deferred big maintenance for cost, one might want to make plans to get it done sooner rather than later, especially with asphalt shingles. Maybe the ARC will become more open to longer lived metallic roofing material. If there was ever a time for the allowance, now is the time to be approving the options.

Mass generation from renewables is difficult due to the instability of production. Complimentary to petroleum based absolutely the future, but storability of electricity is difficult and somewhat dangerous, with that much energy stored in such a small space. . more research needs to be done, and there has been a lot already, which is not publicized.

So at the moment, the world could be at peak population and luxury, but the future remains uncertain. And I don't count out the creativity of humans who have exceeded the natural human capacity limits of the planet.

hopeful guy

I agree with a lot of this. And to put a number on it, we - humans - now consume more resources than the planet can replace by July this year. The chart of this page shows that in 1970 the earth was able to completely replace all consumed resources every year. Then in 1971 we began consuming more and more each year.

This means we are running out of resources, food, oil water, wood, minerals, etc. Sort of like living beyond our income. Eventually, bad things happen.

Earth Overshoot Day - Wikipedia

[Normal]

With the stupid war going on prices are likely to go higher. The prices are already high enough that it’s worth the risk to drill and explore more places for oil.

I hope more oil pipelines open and drilling is done before the prices drive inflation up farther. I love the thought of alternative energy, but it takes more than a decade to get where other countries are (ie. Germany) and what is there number one gripe? Where will we get our oil from?

We are extremely blessed to live in a country with more than adequate resources ������

[jimbomaybe]

Originally Posted by amexsbow

HOW THINGS WORK
Having worked in the Oil and Gas industry and the Utilities industry, I would like to clear up some misconceptions. The Oil and Gas industry does not set the price of the product. That is set by the futures market. The Utility industry uses oil and gas to produce electricity. The Utilities industry does not set the price of electricity. That is set by the regulatory commissions of states or municipalities.
When the amount of a given product is restricted and the demand for that product is increasing the price of the product will increase according to demand.
So, when the price of oil and gas goes up what happens.
Transportation costs rise.
Costs rise to ship raw materials.
Manufacturing costs rise.
Distribution costs rise.
Add the rise in costs for each step of the manufacturing process from the ground to the store and the increased costs are substantial. If you are in business, which one of you is willing to reduce your income to keep costs down. How long will you stay in business?
And if someone artificially restricts the flow of energy what happens?

Wake up before it is too late!

Too much information, requires more thought than, Its the fault of------------------ insert favorite 3 word villain

[Garywt]

The Utilities industry does not set the price of electricity. That is set by the regulatory commissions of states or municipalities.

The actual companies need to submit a change or rate case to the regulatory commissions for their confederation. Many times the cost is recovered after the fact.

[Arctic Fox]

...it’s worth the risk to drill and explore more places for oil.

The number one threat to we humans is climate change. Covid comes along and diverts us, then the invasion of Ukraine, but these will pass whereas urgent action is needed now, and for the next 30+ years, to keep the Earth habitable for us, our children and others down the line. Drilling for more oil, just to keep short-term prices down, is totally the wrong way to go.

...it takes more than a decade to get where other countries are with renewable energy.

Sitting on our hands and saying "we can't do this" is hardly the American way. The USA has long coastlines with plentiful offshore wind, and huge tracts of land suitable for solar (including parking lots and on buildings). Yes, it takes time, but kicking that can down the road is not the solution.

[coralway]

Gas prices hit over $5.00 in 2008 - and yet, we survived.

And during the last quarter of 2021, Exxon Mobil, Chevron, Shell, and BP made close to $25 billion dollars in profits.

[mtdjed]

Originally Posted by Arctic Fox

...it’s worth the risk to drill and explore more places for oil.

The number one threat to we humans is climate change. Covid comes along and diverts us, then the invasion of Ukraine, but these will pass whereas urgent action is needed now, and for the next 30+ years, to keep the Earth habitable for us, our children and others down the line. Drilling for more oil, just to keep short-term prices down, is totally the wrong way to go.

...it takes more than a decade to get where other countries are with renewable energy.

Sitting on our hands and saying "we can't do this" is hardly the American way. The USA has long coastlines with plentiful offshore wind, and huge tracts of land suitable for solar (including parking lots and on buildings). Yes, it takes time, but kicking that can down the road is not the solution.

That is your opinion, and you are certainly entitled to it.

However, the current USA appetite for fossil fuels cannot be satisfied by wind, solar, hydro or tidal technology. Recall that in the 1950's and 60's, expectations were that nuclear energy would save us all. That has not gone well. We still have air travel that is totally dependent upon fossil fuels. In fact, about 80 % of all US energy is still dependent upon fossil fuels. Unless someone has an immediate solution for eliminating the need for all fossil fuels, we need to keep supplying them until they can be retired. Probably better for the US to supply its own requirements than to buy from foreign sources.

[DAVES]

Would take several books to explore the issue of energy costs. Interesting is the fact that people being people will suggest it is anyone's fault but theirs. I've done some reading on the subject.
We talk price of a BARREL OF OIL. How many know how many gallons is in a barrel and why? I had thought it would be 55 gallons the size of a chemical drum. If, I recall, I read it a long time a ago, a barrel of oil is 42 gallons and it is based on the size of a beer barrel that they used to ship oil in. Then, what do they get out of a barrel of crude? Look that one up and you will read they get more out of the 42 gallons of crude than 42 gallons. HUH?

No longer shown on the oil pump. Roughly 1/3 of what we pay for gasoline is TAX.

.I used to drive quite a bit and burn far more gasoline. I can honestly say I use about 20% of what I used to use. The TRUTH, I am no longer working and I no longer produce anything-OOPS.

Cut your fuel use by say 10%. For most truly easy. Combine trips. Pick up for others.
Take others with you-next time they should take you.

[davem4616]

IMHO, it's the middleman that makes all the money when it comes to supply and demand issues

just saying

[amexsbow]

I am glad to see I am not the only one who is cognizant of what is going on in the World. If only people would become informed they would be able to see through the misinformation generated by people who are manipulating the public for their own self interests or aggrandizement.

[Bill14564]

Originally Posted by DAVES

Would take several books to explore the issue of energy costs. Interesting is the fact that people being people will suggest it is anyone's fault but theirs. I've done some reading on the subject.
We talk price of a BARREL OF OIL. How many know how many gallons is in a barrel and why? I had thought it would be 55 gallons the size of a chemical drum. If, I recall, I read it a long time a ago, a barrel of oil is 42 gallons and it is based on the size of a beer barrel that they used to ship oil in. Then, what do they get out of a barrel of crude? Look that one up and you will read they get more out of the 42 gallons of crude than 42 gallons. HUH?

No longer shown on the oil pump. Roughly 1/3 of what we pay for gasoline is TAX.

.I used to drive quite a bit and burn far more gasoline. I can honestly say I use about 20% of what I used to use. The TRUTH, I am no longer working and I no longer produce anything-OOPS.

Cut your fuel use by say 10%. For most truly easy. Combine trips. Pick up for others.
Take others with you-next time they should take you.

I don't know. I didn't do anything special last week. In fact, I might have used less fuel than normal. Still, gas prices skyrocketed. Not sure it's my fault.

Cut back by 10%? Will only make up about half the increase in price from last week alone!

In early February oil was at $90/bbl while today oil is 28% higher at $115/bbl and gas is up to $3.99/gal. Price of oil does not seem to be driven by supply or demand since neither have changed in the last month. The only thing that seems to be driving this increase is speculation and greed and those are certainly the fault of someone other than me.

[Arctic Fox]

Originally Posted by mtdjed

The current USA appetite for fossil fuels cannot be satisfied by wind, solar, hydro or tidal technology. Recall that in the 1950's and 60's, expectations were that nuclear energy would save us all. That has not gone well. We still have air travel that is totally dependent upon fossil fuels. In fact, about 80% of all US energy is still dependent upon fossil fuels. Unless someone has an immediate solution for eliminating the need for all fossil fuels, we need to keep supplying them until they can be retired.

My point is not that the USA can become 100% non-dependent on fossil fuels overnight, but that, rather than drilling for more oil, it should be finding ways to use fossil fuels more efficiently and to focus on renewables, just as many other countries have successfully done.

The country has continually avoided doing so because the coal and oil industries have so much influence over Government officials. (Why else would SUVs be allowed to be counted as trucks in order to fudge automobile fuel economy figures?)

So many people in The Villages refuse to make any changes to their lifestyle, even though most of them have children, grandchildren and great-grandchildren who are going to be the ones bearing the brunt of our continued insistence on using huge amounts of the Earth's resources and polluting the water and air.

Stop making excuses; start taking action.