Are you willing to pay $6.00 for a gallon of gas?

[Danny]

That will be the prediction economists said. So the national average for a gallon of gas in $3.85. In Chicagoland Area, a gallon of gas is hitting $4.55 and some parts in Northern California and other western states. A gallon of gas has reached $5.15. This is effect on the cost of food, products and services. Summer vacations may have been cut short, [[As in no more trips to Disneyworld). People are finding ways to get to work without relying on their cars. Carpooling and chipping in gas money may the norm this year. Public bus transportation and commuter trains may get crowded or its fares being increased.



Critics said the blame on the rising cost of fuel is on the Libyan Civil War and the lost value of the U.S. Dollar. Other people said that its government and corporate conspiracy to get people to buy fuel efficient cars like the Chevy Volt. What do you think about this matter, any thoughts?

[East Detroit]

I know the current explanation that the oil price from Texas versus the gas price are an "outdated comparison measurement" sounds like complete bullshit, especially when it wasnt outdated a couple years ago.

So, Texas oil is cheaper, due to other oil being available? Then buy Texas oil.

But don't worry... the government is keeping their eye open to prices.... but no action until election time.

[Detroitej72]

Oil is traded as a commodity, and the price is based on speculation. Since the oil companies are turning record profits, one can conclude they will continue to "speculate" that there is a shortage. Therefore, expect the price of gas to continue to rise so that maximum profits can be obtained.

[wolverine]

Already seeing the effects in monthly rentals. Originally the cost per hour, with "free gas", parking, and insurance included is $6/hour. The price jumped to $7.50 now because of gas prices

[jcole]

Willing or not, I guess we're going to pay it

[Danny]

I would not pay $10.00 for a gallon for gas.

[Jimaz]

DetroitGasPrices.com has a "Heat Map" feature that shows Illinois to be unusually red [[high prices) right now. Part of their problem might be a refinery in northern Indiana that was partially shutdown for maintenance.

Oklahoma oil inventory is at a record high.

Big banks are investing in commodities [[like oil & gas) instead of lending. That's driving prices higher.

[Danny]

Looks like gas is very high in all of California, Illinois and Connecticut came in second.

[Jimaz]

California's always red. I'm not sure what Connecticut's problem is.

Another cause of high prices is when refineries switch over to their "summer blend."

[oladub]

Jimaz, Your second link in your post #7 was interesting. Basically, the Fed is printing money which Federal Reserve banks give to themselves but instead of loaning the money out they are investing it in commodities since the effect of money printing is to increase the supply of money relative to the more fixed supply of commodities. It's a no brainer.

One thing I thought of the author doesn't mention is that with only 6% of the world's population and a declining percentage of the world's wealth, I think the author has exaggerated the effects of US banks investing in oil futures has on the worldwide prices of oil.

Semi-related: This is a graph comparing the price of oil futures with the price of gold, silver, and the Standard and Poor 500. Over a period of five years the S&P has increased about the same as oil futures.

http://finance.yahoo.com/q/bc?s=USO&...Cslv%2C%5EGSPC

[3WC]

Gasoline is higher in CA and IL for several reasons but the main one is that laws in those states mandate certain gasoline formulation designed to save the planet which greatly escalate the cost of refining the crude into gas, and therefore the price of gasoline.

It has been the policy of the Obama administration, as evidenced by Pelosi's and Geithner's many comments on the subject, that gasoline in this country should be the same as Europe's. Prices are high in Europe because of taxes, a politically unacceptable method of increasing gas prices here. So, they have adopted a policy of restricting production here whenever possible. Obama has done that by virtually preventing all offshore drilling in U.S. waters [[deep) and most Federal lands, including ANWR. The reason for this policy is that it will force people to buy smaller, fuel efficient cars and support the development of alternative energy. They simply want to save the planet. They are stupid. I love them. [[I produce oil and gas, by the way, and while their policies are terrible for this country, they are very, very good for me.)

[Wingnatic]

Well I'm glad to hear there is someone happy with rising gas prices . It adds up to be the legal fleecing of Americans by manipulating Big oil companies . Here's a breakdown of where we import our oil , someone is pulling our strings .

The top five exporting countries accounted for 70 percent of United States crude oil imports in January while the top ten sources accounted for approximately 89 percent of all U.S. crude oil imports.
Here

[Jimaz]

Heh. Searched that for Libya. No matches found. LOL! Where did that excuse come from?

[3WC]

Wing, you state: "It adds up to the legal fleecing of Americans by manipulating Big oil companies."

Did you not understand, or possibly you do not believe my statements, that it's primarily the government's fault crude prices [[and therefore gasoline prices) are so high.

Roughly 50% of a barel of crude oil may be refined into gasoline. "Big Oil" companies, which produce a very small percentage of the world's oil [[most is produce by nations which own the vast amount of the world's oil resources), have to buy crude at current world prices and because their costs are up their profits don't appreciably increase from high gas prices.

There is speculation in the world oil market. It is legal and a very necessary function. Speculators are primarily airlines and other major consumers of petroleum which seek to hedge their costs from the geopolitical risks [[which boost futures prices) and the falling U.S. dollar, one of the primary causes of high crude prices. [[oil is traded worldwide in dollars. when the buying power of the dollar decreases, oil producing countries decrease production, thereby raising the price of crude, and maintaining their purchasing power.) There has been talk for a couple of years about pricing crude in Euros, which if that were to occur, would increase the price of crude by about 45% based on current ratio of the Euro to the dollar.

I know that may people on this forum are incapable of criticizing Obama's policies, probably because they don't understand all of their consequences, unintended and otherwise, but he is a utopian socialist and if left unchecked they will really bankrupt the country. Oh well.

[[We buy billions of gallons of bottled water at costs generally far higher per gallon than gasoline. Why don't you people bitch about that?)

[mjs]

Because a gallon of water lasts alot longer than a gallon of gas. Wait, that's an efficiency argument. 100 mpg it is.

[3WC]

Surely you can come up with a better so-called response than that.

Detroit water is supposedly the highest quality municipal water in the country. Yet, I'll bet most everyone on this forum [[just a guess) drinks gallons of bottled water every week at a price per gallon much higher than gasoline. That water has no nutritional value whatsoever and provides no benefits that one can't get by drinking city water. Why is that? Gasoline at least provides a substantial benefit insofar as it assists in the transportation of the user to school, work, shopping and play.

Why not respond to the substantive issues discussed on the forum.

Why are gasoline prices so high [[relative to long term historical U.S. prices, but still half as expensive as European prices?)

Let's hear some intelligent, well thought out, and researched responses to the question if one can find any that don't blame in large part the Adminstration's energy policy, or lack of one?

What good is this forum without intelligent discourse?

[Vic_doucette]

I would not pay $10.00 for a gallon for gas.

What kind of a car do you drive, Danny?

[epiphany]

Well, the high insurance rates in the area have already prevented me from buying a car. I will be content to continue riding the bus and my bike. With all of this money I am saving from not buying gas, maybe I can buy an even better bike. I even got one of those manual mowers. It is just as easy to use as the gas powered ones, and I am not really sure about why people don't use them more often. Driving really is overrated, although it is convenient at times.

[Wingnatic]

Who are these '' speculators '' that set the price for oil and how long have they been speculating ? lol
I'm betting they have speculators for printing ink , because if I had to buy a gallon of ink for my printer it would be something like $2000 a gallon lol I hope this speculating thing doesn't catch on , or alot of us will be speculated into the poor house [[ some of us are already there )

[Big Dog]

I've read and heard somewhere, that Libya only supplies 2% of the WORLDS oil. As far as paying six dollars a gallon, we can expect to pay more than that, in the future. I've got to tune up my bicycle now. I'm going to need it for short trips, instead of driving.

[3WC]

"Speculation" frequently has a bad connotation. However, all commodity markets are based on speculation: corn, pork bellies, wheat, cotton, meals such as copper, silver and gold, and of course silver. Heating oil, gasoline, natural gas are big ones. Commodities are traded on the Chicago Board of Trade and petroleum is traded on the New York Merchantile Exchange [[NYMEX.) Speculators/traders maintain markets in these commodities and buy and sell for a wide range of end users who wish to stabilize the prices of the good they use, and for non-users who merely wish to gamble on what the prices will be. Both are very necessary to a stable marketplace for these goods. Both exchanges, and many regional ones have been in business for a couple of hundred years. Every one of us speculates every day and every time we make a decision to buy or sell something at that time rather than waiting for a better price, or defer buying while waiting for a better price.

[Big Dog]

3WC, That was a nice analogy on speculating.

[Detroitej72]

Wing, you state: "It adds up to the legal fleecing of Americans by manipulating Big oil companies."

Did you not understand, or possibly you do not believe my statements, that it's primarily the government's fault crude prices [[and therefore gasoline prices) are so high.

Then why did BP and Exxon/Mobil have record profits last year?

know that may people on this forum are incapable of criticizing Obama's policies, probably because they don't understand all of their consequences, unintended and otherwise, but he is a utopian socialist and if left unchecked they will really bankrupt the country.

You loose credibility with your argument when you revert to the right wing talking points and call Obama a "Utopian socialist". There is little difference between Obama's policies and that of Bush, they are both corporatist's and in the pockets of big, international corporations.

[oladub]

My numbers only work out to a 14% decline in the purchasing of the dollar since July but...

"Countries in the Middle East are paid for their oil with USD. The more Bennie prints, the less valuable they become. Therefore, the oil producers require more USD just to stay even. The USD has fallen 16% versus a basket of world currencies since June of 2010. You can conclude that at least half of the rise in gas prices is directly related to Ben Bernanke’s printing press."
http://www.theburningplatform.com/?p=14941

[jiminnm]

"Then why did BP and Exxon/Mobil have record profits last year?"

Because they sold more product in 2010 than in 2009, when oils sales were down. Exxon reported net earnings of $14.85 per barrel of oil equivalent energy [[they also sell a lot of natural gas and energy related technology). If you turned Exxon into a nonprofit, that profit amount would equate to about 35c/gallon.