$4 for gas? It could hit $5 a gallon

Some fear unrest in Middle East, demand could spike price more

Tuesday, April 5, 2011  03:07 AM

By Dan Gearino

THE COLUMBUS DISPATCH

 

After a weekend surge, $4 per gallon gasoline is within sight, and $5 gas doesn't sound nearly as far-fetched as it did a few months ago.

 

Drivers did double takes yesterday morning when they saw that the price had risen to $3.79 per gallon at many stations across central Ohio. Prices are rising because of the continued unrest in the Middle East and evidence that U.S. demand will increase because of the recovering economy, analysts say.

 

"You feel ripped off," said Donna Baker, 71, of Hilliard.

 

Read more at: http://www.dispatch.com/live/content/business/stories/2011/04/05/4-for-gas-it-could-hit-5-a-gallon.html?sid=101

http://www.aolnews.com/2011/04/06/rising-oil-prices-beginning-to-hurt-us-economy/?icid=maing-grid7|main5|dl1|sec3_lnk1|54460

 

Rising Oil Prices Beginning to Hurt US Economy

Apr 6, 2011 – 3:27 AM

 

WASHINGTON - Just when companies have finally stepped up hiring, rising oil prices are threatening to halt the U.S. economy's gains.

 

Some economists are scaling back their estimates for growth this year, in part because flat wages have left households struggling to pay higher gasoline prices.

 

Oil has topped $108 a barrel, the highest price since 2008. Regular unleaded gasoline now goes for an average $3.69 a gallon, according to AAA's daily fuel gauge survey, up 86 cents from a year ago.

 

The higher costs have been driven by unrest in Libya and other oil-producing Middle East countries, along with rising energy demand from a strengthening U.S. economy.

 

Excerpt from a related story in the Newark Advocate::

 

At the Licking County Aging Program, whose 20 vehicles travel across Licking County and beyond each week to deliver Meals on Wheels and transport elderly clients to doctor appointments, an increase in gas prices was budgeted for as the agency mapped out the upcoming year, Executive Director Dave Bibler said.

 

But the additional $20,000 can only take them so far if prices keep creeping upward.

 

"If it goes up to $5, like I'm hearing now it could possibly do, that's going to be devastating to our budget," Bibler said.

 

Read more at: http://www.newarkadvocate.com/article/20110406/NEWS01/104060310/-1/

(Dayton) Gas prices trending toward $4 mark

By Jill Kelley, Staff Writer

9:02 AM Friday, April 8, 2011

 

Gas prices hit $3.85 this morning at several Dayton-area stations, a 20-cent jump compared to what many stations advertised Thursday.

 

According to DaytonGasPrices.Com about 8:30 a.m., $3.87 was the area high at the Valero station at Miller Lane and Maxton Road and $3.61 was the low at two stations in Yellow Springs and one in Germantown.

 

Read more at: http://www.daytondailynews.com/news/dayton-news/gas-prices-trending-toward-4-mark-1131031.html

Somewhere Kasich is smoking a cigar with his speculator friends.  It's all part of the plan. Bats

Yes, it's part of the plan by the conservatives to make money. No, wait, it's part of the plan by liberals to force people out of their suburbs/cars and into cities/transit. No wait, it's part of the plan by the oil-rich Muslim countries to destroy western Christian civilization. No, wait, it's part of the plan by the Christians to justify invading more oil-rich Muslim countries. No, wait.....

 

I'm not a fan of Kasich, but he and his investor buddies aren't to blame. How about this: when America, once the world's largest oil producer, passed peak oil production in 1970 and went into irreversible decline, America didn't take the difficult steps necessary to reduce its oil appetite. Instead, it INCREASED its appetite to where American motorists consume more oil than all users in China combined. So we're increasingly relying on oil imports to where 2/3 of our oil supply comes from overseas where 60 oil-producing nations have passed their peak in oil production. And the only nations with excess oil production capacity are in politically unstable places, so the price carries a risk premium. Now nations like India and China are dramatically increasing their oil consumption -- global demand is growing faster than the supply. And there is a real risk that supply will actually start to fall in the 2012-15 period creating unprecedented shortages (ie: worse than 1973).

 

America WILL make the difficult steps to reduce its oil appetite -- either voluntarily or involuntarily. Looks like involuntary is how it will happen because, of course, cheap oil is an American birthright in America, just like having free parking, an open parking space by the front door, drive-through everyplaces and ever-wider/smoother/traffic-free roads without incurring more gas taxes.

 

BTW, oil prices are actually kept down by the fact that an oil futures contract, unlike gold, silver or platinum, is actually a delivery contract. If you are an investor, you have to sell the contract before the maturation date or you either end up with an oil tanker pulling up to your front door or you end up with a worthless piece of paper. And most oil futures investors are buying long -- like December 2019. Most sell those contracts well before they become the front-month contract price you hear on Jim Cramer on CNBC each night.

I disagree my man - there is something else going on here. How come gas is more or less as expensive now as in 2008, but oil is only about $110/barrel as opposed to $160 or so in '08. Something is rotten and it smells like speculators conspiring with political figures.

Gasoline and crude prices don't move together in lockstep. One explanation might be that the other substances produced from crude are in less demand than they were in 2008 while gasoline is in higher demand.

Here's a better explanation than mine. Our gasoline prices have moved (at least temporarily) to being heavily influenced bu the price of Brent crude ($126) rather than WTI ($110):

 

http://www.cnbc.com/id/41990167/Why_Brent_Not_US_Crude_Is_a_Better_Gauge_for_Oil_Prices

 

While US crude is usually seen as the best gauge for the direction of global oil prices, the recent tumult in the Middle East and North Africa is now making Brent a more reliable yardstick

...

Ironically, even though there's an oversupply of US oil—known as West Texas Intermediate, or WTI—problems with getting the crude refined have forced the US to import the more-expensive Brent, which is pushing up US gasoline prices.

 

So while American consumers looking to determine the direction of gas prices would normally look at US oil prices, they really should be looking at Brent.

 

    Don't forget that Hurricane Ike disrupted the industry in a big way in 2008. Some major refineries were shut down, as well as some pipelines. Atlanta was hit hard by gasoline prices due to some pipeline problems. Usually, the United States purchases crude oil from Canada, Mexico, Venezuela, and Nigeria, ships it to the Gulf Coast where it is added to the domestic stream, refines it into gasoline, and distributes it by pipeline. In 2008, the United States purchased refined gasoline from Europe, which is not common.

 

  In 2008, there were oil tankers parked offshore with no place to unload. That's why oil prices were low and gasoline was high.

 

 

Here's a better explanation than mine. Our gasoline prices have moved (at least temporarily) to being heavily influenced bu the price of Brent crude ($126) rather than WTI ($110):

 

 

Brent is a more sour crude than sweet WTI, and sour crude is more common in the world today than the good stuff (WTI).

Drivers start to cut back on gas as prices rise

Published: Monday, April 11, 2011, 9:15 AM    Updated: Monday, April 11, 2011, 10:12 AM

By Associated Press business staff The Plain Dealer

 

NEW YORK  -- With the price of gas above $3.50 a gallon in all but one state, there are signs that Americans are cutting back on driving, reversing a steady increase in demand for fuel as the economy improves.

 

Gas sales have fallen for five straight weeks, the first time that has happened since November, according to MasterCard SpendingPulse, which tracks spending at 140,000 service stations nationwide.

 

Before the decline, demand was increasing for two months. Some analysts had expected the trend to continue because the economic recovery is picking up, adding 216,000 jobs in March.

 

"More people are going to work," said John Gamel, director of gasoline research for MasterCard. "That means more people are driving and they should be buying more gas."

 

Read more at: http://www.cleveland.com/business/index.ssf/2011/04/drivers_start_to_cut_back_on_g.html

I just heard about that on CNBC. Welcome to the Queuing Theory of oil prices. These quotes are from an article I wrote in late 2008....

 

“[The] Queuing Theory predicts that queues behave in a noisy and chaotic manner when demands approach the system capacity,” wrote Kenneth Deffeyes, professor emeritus at Princeton University, in 2008. “Instead of energy prices rising to a new stable level, wild price oscillations will result from short-term changes in demand. There will be a tendency, the first time that prices go down, to announce that the crisis is over and oil and gas are now cheap and abundant again.”

 

“A false sense of smug security could set in if prices drop and stay there, and some oil-exporting nations have already announced a slacking off of investments in the oil industry, if prices continue to be depressed. So eventually when the oil demand would pick up, we would have even less oil than now,” wrote James Leigh in the Oct. 3, 2008 edition of the Energy Bulletin. Leigh is an assistant professor of cultural geography at the University of Nicosia, Cyprus.

 

“Volatility is in some ways an even worse problem than high prices, because sustained high oil prices make long-term investments in alternative energy sources and public transportation look sensible – whereas periodically collapsing oil prices discourage such investments,” wrote Richard Heinberg on July 30, 2008 for the Post Carbon Institute. Heinberg has authored eight books on oil depletion and its effects on the global economy.

This is from an All Aboard Ohio member in Meadville, PA and it shows what happens when a state supports transit with real funding. Unfortunately, I hear PA's governor is cutting transit funding in a big way....

 

----- Original Message -----

 

Ken

 

My wife and I have cut down our drivnig now that gas is $3.79 in Meadville.  We went down to one car some years ago.  Fortunately, for a city of less than 14,000 Meadville has a good bus system.  I either take the bus or, in good weather (which we get several days each year, normally in mid-July) I walk to work.  Our local bus fare is only a dollar each way and free to senior citizens.  Personally, I think that senior citizens should pay their share but I still take advantage of it! 

 

Back to the bus system, we have 5 local routes with hourly service on four and every 45 minutes on the fifth.  The service is very well run and on time, even when we had 2 feet of snow on the ground.

I can't believe that it's taking the current price of gas for people to make the slightest lifestyle change. I remember watching on the news, this couple being interviewed, talked about how they both work at Ohio State University and that they're carpooling now to save money. Well, gas has been above $3 per gallon for a while. If you both work at the same exact location and leave/get off about the same time, why the hell wouldn't you just carpool anyway? Especially if you're paying for each car to be stored in a lot/garage. Maybe it's because I've never been married and they just tend to want to get away from their spouse as much as possible and are willing to pay a price for it lol.

Motorists cutting back at pump

Recent job gains don't translate into more demand, especially as prices rise

Tuesday, April 12, 2011  03:06 AM

By Chris Kahn

ASSOCIATED PRESS

 

NEW YORK - Soaring gas prices are starting to take a toll on U.S. drivers.

 

People are pumping less into the tank, reversing what had been a steady increase in demand for fuel. For five weeks in a row, they have bought less gas than they did a year earlier.

 

Drivers bought about 2.4 million fewer gallons the week of April 1, a 3.6 percent drop from last year, said MasterCard SpendingPulse, which tracks the volume of gas sold at 140,000 service stations nationwide.

 

The last time Americans cut back so much was in December, when snowstorms forced people to stay home.

 

Read more at: http://www.dispatch.com/live/content/national_world/stories/2011/04/12/motorists-cutting-back-at-pump.html?sid=101

Have fun with this one, gang. Note that it's Dublin, GA, not Ohio... no Channel 13 in Columbus.

 

 

Dublin Group to Pray for Lower Gas Prices

 

"I believe if we come together and pray as a community we can really make something happen," says the church's pastor, Marshall Mabry.

 

Mabry says he can remember when gas jumped from under $1 to $1.50 and says, now, with prices reaching almost $4, he says he plans to ask God for help.

 

More:

http://www.13wmaz.com/news/story.aspx?storyid=124242

Good luck with that, Marsh

$4 gas is coming to your state

CNN/Money

By Ben Rooney, staff reporterApril 13, 2011: 8:03 AM ET

 

NEW YORK (CNNMoney) -- Gas prices have been spiking for weeks and $4 gas is quickly becoming a reality across the nation.

 

Illinois became the latest state to succumb, with motorist group AAA reporting Tuesday that the average price for a gallon of gas in the state had hit $4.03 a gallon. On Wednesday, the average price in Illinois nudged up to $4.04 a gallon.

 

Prices at the pump can vary widely among states due to a number of factors. More There are now four U.S. states with gas prices above what many economists consider a 'tipping point' for consumers. Prices in California, Alaska and Hawaii have been above $4 a gallon for weeks.

 

Read more at: http://money.cnn.com/2011/04/12/news/economy/gas_prices/index.htm?hpt=T2

I filled up my Subaru for $3.90/gallon yesterday in Cincinnati. We are not far behind $4/gallon, and they are predicting $5/gallon by Memorial Day.

I filled up my Subaru for $3.90/gallon yesterday in Cincinnati. We are not far behind $4/gallon, and they are predicting $5/gallon by Memorial Day.

 

I find it hard to believe that we'll hit $5 in the next 6 weeks.  I expect the gasoline market to see some resistance at $4 and more significant market resistance at $4.50.  We've already seen usage drop significantly in the month of March compared to last year.

Great, just when an HR department keeps nagging me for (finally) a decent job opportunity that would require me to commute 20 miles each way. I'm not paying $5 bucks a gallon. I'll bike to the Northwest side of the city. D@mn OPEC. D@mn you to hell.

Yeah, blame the drug dealer for the addict. Detox is a bitch.

^Some of us do this for a living, and have no other option but to drive.

Which shows the extent of the problem. At least a drug addict still has the ability to consume something other than drugs. When it comes to transportation, most of us are in the same predicament. The only thing left to eat is the drug.

 

It's why I support the expansion of third-rate transportation options like Megabus even though it troubles me to do so.

I filled up my Subaru for $3.90/gallon yesterday in Cincinnati. We are not far behind $4/gallon, and they are predicting $5/gallon by Memorial Day.

 

Yeah, I filled up the Scooby yesterday. I was practically riding on "E" which is something I hardly ever do. The station I went to had 93 octance priced at $4.05, so it was a whopping $62 to top-off my car-ouch!

I guess KJP is the expert. He enjoys Railing. Trainspotting. Spends a lot of time covering his tracks. Ha! "jk-lol". KJP that is a horrible analogy. Drug addiction is in a person's control, it just takes will power. I can't control land use patterns and expectations of an employer. In your field (journalism and research for a non-profit?) you probably rarely have to leave your home computer. You can easily just rip off the AP Wire and give them a byline or call people when you do interviews/statements or need to talk to your editor. Plus there's always e-mail. Not all jobs provide that kind of convenience and at the moment I can't even afford to move close to this job. It's not that I'm addicted to oil; personally I don't even like driving unless it's a road trip.

All true (and I do work at home but have to travel to other cities for meetings, and I don't rip-off AP stories; I also live in the most walkable, densely developed municipality in Ohio).

 

The country is the addict. It can control the things you speak of, which a few individuals cannot. But if enough of the people care to work together to urge we take steps to move away from our addiction, then we can change our surroundings. So join All Aboard Ohio today, or some other nonprofit engaged in a similar cause! :-D

I filled up in Louisville last weekend for 3.57 or 3.53.  3.50 something.  At a Marathon on the Outer Loop.

 

Back in to Dayton on Sunday eveing and see gas is already at 3.80 something.  Figure it will come after the weekend.  Instead the gas CLIMBS to the high 3.80s.  Finally found a gas station the other day that had it at 3.60-something, near UD.  (a UDF), mainly I because I had to make a quick non-bus trip to UD that evening.

 

I have to say I try not to "cheat" on my car-lite lifestyle, but do drive to Louisville and back once a month, but will be making more trips there during May.  Usually I try to avoid driving if I can, and am fortunate that the city bus is an option for most of my trips.

 

My big concern is that this will lead to higher bus fares, eventually.  So I will be paying one way or another.

If we see gas up to 3.90 by the end of April  or in early May,  I can see 4.00/gal in the summer, as the average and it going over that in spikes.

I also live in the most walkable, densely developed municipality in Ohio).

 

 

Bully for you.

I also live in the most walkable, densely developed municipality in Ohio).

 

 

Bully for you.

 

It was here, so I moved to it. End of story. There's room for more if you want to join us!

I filled up yesterday at $3.75 or thereabouts, and it cost me in the neighborhood of $50, but if the question is "how we're feeling it," I really didn't feel it all that much because I only fill up about once a month, and that only because I still make day trips to Cleveland once or twice a month, weekend trips to Columbus several times a year, and some leisure trips out into the countryside in the summer, since there are some nice wineries in northeastern Ohio that are worth the comparatively modest amount of gas it takes to get out there.  All of those are leisure trips, which means I have the flexibility to cut them if I need or want to.

 

In truth, rising prices for crude and refined oil products really don't affect me all that much and might even benefit from me.  While I wasn't quite able to make <a href="http://www.fool.com/investing/general/2011/03/04/buffetts-biggest-oil-play-ever.aspx">a $44 billion play on rising oil prices by buying my own railroad outright</a>, I've got several investments that are both directly and indirectly plays on higher oil prices, so some of the pain of higher prices as a consumer will be offset by higher gains as an investor.

 

In the meantime, I'm fairly minimally exposed even to indirect effects of higher oil costs as a consumer.  I have unlimited free shipping on an enormous range of products with Amazon Prime, which means it will be until the next time I have to renew before they can up the price of my subscription on me and make me eat some more of the costs of rising shipping costs.  I recently got a Kindle, too, though of course Amazon will ship my physical books for free, too.  I can get movies via Netflix.  I don't have any particularly energy-intensive hobbies.

 

Yes, there is a certain minimum beyond which it's impossible to shield oneself from the echoes of echoes of higher oil prices, but by far the dominant variable in how severely one feels higher fuel prices is the length of one's daily commute.  The second most important one is the fuel efficiency of the car you drive, but if your commute is under a mile, you can drive an Escalade and it will hardly matter.

^

In terms of books I get mine via Ohiolink.  Which is the cost of a community borrowers card (I have two, so can double the amount of books allowed from Ohiolink).  Ohiolink is turning out to be one of the few good things about living in Ohio since both private and public colleges are connected, even community colleges  (im suprised the political jerks in Columbus havnt defunded it yet).  I just ordered a book on "Food Justice" from the Cuyahoga Community College, to be delivered to WSU. 

 

Anyway....

 

I guess since im on foot or on the bus I "feel" gas prices only when I have to tank-up, which as with Graymare, is infrequent.  Except when I do road trips to Kentucky, where it becomes noticeable.  Before it I just grinned and bore it.  Now it's become annoying.  Its also more noticeable, since I see the spikes as more obvious or abrubt, rather than the "frog-in-a-slow boil" psychology, were people become accustomed to the rise. 

 

 

 

 

 

 

Anyway,

 

 

 

 

Oh they've tried to defund Ohiolink a couple times. The argument against ditching is pretty easily - colleges would have to spend more on duplicating purchases across the state (and so many of the academic library books are in four or five depositories that it would silly to force everyone to use ILL at this point) - there has been talk of either a minimal fee or sky-high fines for late Ohiolink books (I think the fines were once really high - mid-90s and then came down, not sure where they are today)

Gas prices could soon break July 2008 record

By Gary Strauss, USA TODAYUpdated 15h 48m ago |

 

Nationally, a gallon of regular averages $3.81 — up 10 cents in the past week and nearly 96 cents above year-ago levels. Industry experts say prices could surpass July 2008’s record $4.11 as seasonal demand, speculators and political uncertainty in Libya and the Middle East propel crude oil prices.

 

“We could easily tack on another 30 to 40 cents a gallon,” says Darin Newsom, senior analyst at energy tracker Telvent DTN.

 

In some areas, gas has already hit those levels. In Los Angeles, regular averages $4.20 a gallon. In Chicago, it’s averaging $4.17.

Read more at: http://www.usatoday.com/money/industries/energy/2011-04-14-gas-prices-near-record.htm

3.89 /gallon, Sunday, Dayton suburbs.  Wow. 

 

The jump at one station was from 3.76 to 3.89 between Saturday evening and Sunday.

 

This is pretty volatile,  no?

 

 

^If you think a 3.5% jump is volatile, then sure... it's volatile. 

 

I don't get too excited about daily changes is the price of gas.  I budget for $5.00 a gallon and let the chips fall where they may.  Nothing we can do about it!

Hey, did you all hear that the U.S. government this summer is issuing a voucher which entitles every American to purchase 1 gallon of gasoline?

 

A friend of mine at the U.S. Department of Energy just sent me a sample of that voucher.

 

This is what it looks like....

 

Posted on Sunday, 04.17.11

MIAMI-DADE

As gas costs climb, ridership on Metrorail is rising

With gas prices on the rise, indications are that more people are considering public transportation – or at least giving the Metrorail and Metromover a try.

BY FABIOLA SANTIAGO

[email protected]

 

M. Evelina Galang lives only four miles away from her job at the University of Miami campus, yet sometimes traffic is so bad during rush hour on U.S. 1 and its intersecting avenues that it takes the creative writing program director an hour to get home.

 

As she sits in traffic, she can see the Metrorail trains whizzing by, but although she has taken public transportation in every major city where she has lived – Manila, Chicago, New York, Washington D.C. – Galang had never considered it an option in South Florida until now.

 

“There’s a lack of trust,” she says. “I’ve been living here for 11/2 years and I drive everywhere. In these other cities, you know it’s [the train] coming, but here the perception is that you may be left stranded if a meeting or an event goes on too long.”

 

 

Read more: http://www.miamiherald.com/2011/04/17/2172753/as-gas-costs-climb-ridership-on.html#ixzz1JsklU5j8

I filled up my Subaru for $3.90/gallon yesterday in Cincinnati. We are not far behind $4/gallon, and they are predicting $5/gallon by Memorial Day.

 

$5/gallon for regular fuel in D.C. I sadly beat my own estimate.

http://www.upi.com/News_Photos/view/f772b5b1f31e2af83d29d52d228dd553/Gas-prices-continue-to-rise-in-Washington/

^It's still in the upper $3's in Ohio.  $3.83 in fact in Euclid.  I still don't see a path to $5/gallon in Ohio by Memorial Day.  Gas prices have risen by approximately $1 over the last year.  I find it hard to believe they will jump another dollar in the next 6 weeks.

No, I don't see it by Memorial Day either.

$5 a gallon is good for the long run bad for the short run. Europe has been paying $6+ for more than a decade. They have adjusted.  The 3c's rail would have been a bargain.

^Europes high gas prices have been largely self imposed through very high gas taxes.  Many European countries pay over 10 times more in taxes per gallon than most of us do in the US.  Source:  http://www.fhwa.dot.gov/ohim/mmfr/dec10/dec10.pdf (page 14)

 

Europe hasn't been immune to the price increase either.  The UK is now paying over $8 a gallon.  http://www.bloomberg.com/news/2011-03-04/record-gasoline-grips-europe-while-california-faces-4-a-gallon.html

 

I do agree though.  It will be interesting to watch how habits change as gas prices continue to increase.  It could be a good thing for struggling cities as people move closer to work, but the impact is still TBD. 

It's been dropping in Columbus; $3.65 now.

In response to the title of the thread, I will say that the rising fuel prices have affected my going out to restaurants, specifically in E4, Tremont and Chagrin Falls (with the occasional exception). It's just hard to warrant driving around and trying new restaurants, which tend to be a bit pricey in the first place - at least for someone who is happy with a can of tuna and maybe some veggies on the side - when I have to fill up every 4 or 5 days. It's like a psychological, perhaps even irrational, fear of driving and spending even more money if I don't really have to, at least with gas at this level, and I have been visiting restaurants far less frequently in the last few months than the last few years.

I forget who, but the PP who said they weren't affected because of amazon prime - the prices of your products are going up as well, not just shipping on products which is NA in your club. So you are feeling it as well. Unless you live completely off the grid and farm everything you eat and make all your clothes from wool you spin or something, you are feeling it. It's not as straightforward as oh, I walk or take public trans so it doesn't affect me.

It's been dropping in Columbus; $3.65 now.

 

It will go back up again soon. The wholesale price is back up to 3.28 +/- so add 60 cents or more to come up with the retail price.

It's been dropping in Columbus; $3.65 now.

 

It will go back up again soon. The wholesale price is back up to 3.28 +/- so add 60 cents or more to come up with the retail price.

 

Indeed true, KJP. That was yesterday's price. Today it is $3.89 at the same station.

It's been dropping in Columbus; $3.65 now.

 

It will go back up again soon. The wholesale price is back up to 3.28 +/- so add 60 cents or more to come up with the retail price.

 

Wholesale price as in what the gas station pays for gas or refineries or what? I thought gas stations literally made a couple pennies per gallon and really just make their money on people stopping in and buying b.s. snacks or cigs.

 

Isn't diesel just a byproduct from the process of refining oil into gasoline? It's like 4.19 a gallon here! It always seems to be higher than regular gasoline. Is there a tax on it from emiting more pollution or something?