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RE: Should there be a cap on Gas prices?? - 4/21/2008 3:13:47 PM
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bob97
Posts: 1775
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From: Kansas
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quote:
Part of the problem with the high food cost is the fact that they are using food to make ethanol.
Just eliminate the $1.25 federal subsidy for each gallon of ethanol produced and the ethanol production will go away. It has a future but not in it's present form.
Bob
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RE: Should there be a cap on Gas prices?? - 4/21/2008 3:27:06 PM
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stamper_ben
Posts: 10848
Joined: 4/11/2005
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quote:
Saudi Arabia, the world’s biggest oil producer, has put on hold plans to increase long-term production capacity from its vast oil fields beyond existing proposals, its most powerful policymakers have said.
In a series of statements, including one by the king himself, the kingdom has warned consumers it does not reckon there is a need for further expansion beyond 12.5m barrels a day, an assumption disputed by the world’s biggest developed countries.
The realisation Saudi Arabia will not increase production to 15m barrels a day as quickly as important consumers and the markets had assumed could put further pressure on oil prices, which touched fresh records last week. Source
All the more reason to fully tap our own supplies.
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RE: Should there be a cap on Gas prices?? - 4/21/2008 3:33:49 PM
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mapachito13
Posts: 2235
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quote:
ORIGINAL: stamper_ben
quote:
Saudi Arabia, the world’s biggest oil producer, has put on hold plans to increase long-term production capacity from its vast oil fields beyond existing proposals, its most powerful policymakers have said.
In a series of statements, including one by the king himself, the kingdom has warned consumers it does not reckon there is a need for further expansion beyond 12.5m barrels a day, an assumption disputed by the world’s biggest developed countries.
The realisation Saudi Arabia will not increase production to 15m barrels a day as quickly as important consumers and the markets had assumed could put further pressure on oil prices, which touched fresh records last week. Source
All the more reason to fully tap our own supplies.
Just read on the AP that gas refiners in THIS country are cutting back production to post-Rita and Katrina levels.
"SAN FRANCISCO (MarketWatch) -- A production slowdown at the nation's refineries, now operating at levels last seen in the aftermath of Hurricane Katrina in 2005, couldn't come at a more troublesome time for consumers watching pump prices flirt with $4 a gallon.
Such low production rates could create a new set of problems for refiners, already operating at the brink of loss. Utilization rates at 30-month lows threaten to spark probes by lawmakers, who have been holding a series of hearings on the rampant rise in gasoline and diesel prices.
"If this operating level persists, the industry will likely see another round of intense legislative scrutiny," said John Kilduff, an analyst at futures brokerage MF Global.
U.S. refineries operated at 81.4% of their operable capacity in the week ending April 11, the Energy Department's statistical arm said last week. The last time the utilization rate fell below 80% was in October 2005 after hurricanes Rita and Katrina devastated refineries along the U.S. Gulf Coast."
Was there a hurricane that no one noticed??
Marketwatch Article
< Message edited by mapachito13 -- 4/21/2008 3:45:34 PM >
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Peace Sells....But Who's Buying!
"I would argue that the most serious threat to the United States is not someone hiding in a cave in Pakistan or Afghanistan, but our own fiscal irresponsibility."-David Walker, fmr comptroller general of the US
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RE: Should there be a cap on Gas prices?? - 4/21/2008 5:40:06 PM
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blessedinnyc
Posts: 1810
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quote:
ORIGINAL: HighPlainsDrifter
Currently, we're in a trend of taking acres normally planted to oats, wheat, potatoes, barley and all other major crops and converting them into corn acres. This will increase the base price of ALL cereal grains, all meats, and all other food-related commodities. This isn't simple inflation, this is market-enforced scarcity of food staples. There's is a glut of beef making it's way through the market right now due to reduction of herds country-wide, and once that glut is through, look for beef, chicken, and pork prices to absolutely skyrocket. This isn't going to happen in a vacuum. This is a short-term winner ethanol-producers and farmers, but a loser for everyone that happens to eat or pay taxes.
Exactly, but since the vast majority of those farmers live in the US, this is indeed a net winner for the US.
Also, this is going to encourage illegal immigrants to return to their home countries as fields reserved for labor-intensive crops make way for corn.
This is essentially the US's response to OPEC. Frankly, we should have done it 33 years ago.
quote:
It's also a net loser for anyone who thinks watershed quality and natural habitat is important as acres that have been untilled for a couple of generations go back under a plow. I spent dinner Saturday night with a friend who who studied Ag Economics alongside me in the 80's and who is also a corn farmer, who is tilling prairie right now that hasn't been used for row crops in 50 years. He's sold the cattle that used to roam there because corn is far too expensive to waste on cattle.
I guess people will have to start switching to eating more staples- like grain, rather than meat. This will help control obesity- and bring in more export revenues.
< Message edited by blessedinnyc -- 4/21/2008 5:47:56 PM >
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RE: Should there be a cap on Gas prices?? - 4/21/2008 5:59:16 PM
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HighPlainsDrifter
Posts: 1155
Joined: 9/22/2005
From: The Land Of The Burnt Thigh
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quote:
I guess people will have to start switching to eating more staples- like grain, rather than meat. This will help control obesity- and bring in more export revenues.
No, the time will shortly be upon us where ethanol is seen for the folly that it is, and will be discarded.
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RE: Should there be a cap on Gas prices?? - 4/21/2008 5:59:53 PM
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blessedinnyc
Posts: 1810
Joined: 10/12/2007
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quote:
ORIGINAL: mapachito13
quote:
ORIGINAL: stamper_ben
quote:
Saudi Arabia, the world’s biggest oil producer, has put on hold plans to increase long-term production capacity from its vast oil fields beyond existing proposals, its most powerful policymakers have said.
In a series of statements, including one by the king himself, the kingdom has warned consumers it does not reckon there is a need for further expansion beyond 12.5m barrels a day, an assumption disputed by the world’s biggest developed countries.
The realisation Saudi Arabia will not increase production to 15m barrels a day as quickly as important consumers and the markets had assumed could put further pressure on oil prices, which touched fresh records last week. Source
All the more reason to fully tap our own supplies.
Just read on the AP that gas refiners in THIS country are cutting back production to post-Rita and Katrina levels.
"SAN FRANCISCO (MarketWatch) -- A production slowdown at the nation's refineries, now operating at levels last seen in the aftermath of Hurricane Katrina in 2005, couldn't come at a more troublesome time for consumers watching pump prices flirt with $4 a gallon.
Such low production rates could create a new set of problems for refiners, already operating at the brink of loss. Utilization rates at 30-month lows threaten to spark probes by lawmakers, who have been holding a series of hearings on the rampant rise in gasoline and diesel prices.
"If this operating level persists, the industry will likely see another round of intense legislative scrutiny," said John Kilduff, an analyst at futures brokerage MF Global.
U.S. refineries operated at 81.4% of their operable capacity in the week ending April 11, the Energy Department's statistical arm said last week. The last time the utilization rate fell below 80% was in October 2005 after hurricanes Rita and Katrina devastated refineries along the U.S. Gulf Coast."
Was there a hurricane that no one noticed??
Crack spreads are down. Thus, some of the less profitable portions of the refineries aren't operating right now. On top of that, there's also a switch to summer gasoline blends underway, and this usually means that refineries can't operate above ~ 90% capacity during this time, anyways.
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RE: Should there be a cap on Gas prices?? - 4/21/2008 6:04:30 PM
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blessedinnyc
Posts: 1810
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quote:
ORIGINAL: HighPlainsDrifter
No, the time will shortly be upon us where ethanol is seen for the folly that it is, and will be discarded.
I don't think so- do you think OPEC is a folly? Do you think monopolies are follies? Monopolies and cartels are just ways of artificially reducing production. The US is doing the same thing here.
These subsidies will likely pay for themselves in terms of a stronger US dollar and higher tax revenues. Naturally, this is looking at everything from the perspective of a coldly rational economist.
In reality, I am praying for a nice harvest. My brain realizes that grain scarcity might make for better numbers in the US economy/ balance of trade, but my heart realizes that I don't want to see people starve if we can avoid it.
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RE: Should there be a cap on Gas prices?? - 4/21/2008 7:50:29 PM
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mapachito13
Posts: 2235
Joined: 10/1/2007
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quote:
ORIGINAL: blessedinnyc
Crack spreads are down. Thus, some of the less profitable portions of the refineries aren't operating right now. On top of that, there's also a switch to summer gasoline blends underway, and this usually means that refineries can't operate above ~ 90% capacity during this time, anyways.
But why has this combination of events not happened before? The timing is very suspicious to me. There is always a refinery fire or some other "industry catastrophe" that happens before summer driving season spiking gas prices another 30-40 cents a gallon. I am always waiting for some industry problem in the news during April or May.
_____________________________
Peace Sells....But Who's Buying!
"I would argue that the most serious threat to the United States is not someone hiding in a cave in Pakistan or Afghanistan, but our own fiscal irresponsibility."-David Walker, fmr comptroller general of the US
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RE: Should there be a cap on Gas prices?? - 4/21/2008 8:47:47 PM
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StephK
Posts: 1868
Joined: 4/11/2005
From: Southwest Louisiana
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When the refineries switch from winter to summer blends is the most volatile time for a refinery. I live real close to one. My brother is an engineer that works in various industrial plants. The refinery in Big Spring, TX will be offline for quite a while from what he heard from a friend of his who is working on the rebuilding.
< Message edited by StephK -- 4/21/2008 8:54:19 PM >
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Religion has accepted the monstrous heresy that noise, size, activity and bluster make a man dear to God. To a people caught in the tempest God says, `Be still, and know that I am God.' ~AW Tozer
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RE: Should there be a cap on Gas prices?? - 4/22/2008 8:09:06 AM
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stamper_ben
Posts: 10848
Joined: 4/11/2005
From: Lone Star State
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You're surely kidding, right? Corn is the answer to OPEC? No, ANWR is the answer to OPEC.
(And I had the gall to say that on Earth Day!) 
As for eating more wheat, what with this increase in corn production, for the first time ever we cannot supply our own needs and are having to import wheat. What when that dries up and there isn't enough wheat for worldwide needs? Do we then go and fix up the used tires off our cars with a tomato based marinade?
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We will be known as His by the love we show one another.
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RE: Should there be a cap on Gas prices?? - 4/22/2008 8:32:33 AM
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mapachito13
Posts: 2235
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quote:
ORIGINAL: blessedinnyc
I don't think so- do you think OPEC is a folly? Do you think monopolies are follies? Monopolies and cartels are just ways of artificially reducing production. The US is doing the same thing here.
Monopolies are ILLEGAL in the United States! The way the oil companies operate though I believe that they should make acting like a monopoly illegal too!
BTW, CNN just reported last night that we are importing wheat for the first time in US history. So much for your theory of a trade surplus to offset the trade imbalance! Clever economists and big business they end up doing the opposite of what they intended. If that was their intent to begin with.
_____________________________
Peace Sells....But Who's Buying!
"I would argue that the most serious threat to the United States is not someone hiding in a cave in Pakistan or Afghanistan, but our own fiscal irresponsibility."-David Walker, fmr comptroller general of the US
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RE: Should there be a cap on Gas prices?? - 4/22/2008 9:36:41 AM
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stamper_ben
Posts: 10848
Joined: 4/11/2005
From: Lone Star State
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quote:
ORIGINAL: iluvatar
quote:
ORIGINAL: blessedinnyc
Crack spreads are down.
This caught my eye. I don't know what a crack spread is, but all I could think of was some crack dealer manufacturing a butter substitute. 
-Dan.
I was thinking it had more to to with the plumbing industry....
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We will be known as His by the love we show one another.
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RE: Should there be a cap on Gas prices?? - 4/22/2008 10:16:17 AM
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stamper_ben
Posts: 10848
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The only future I get in a gasoline purchase is how far I'll get in the future at 16 mpg times the 24 gallon tank. I'm not very secure in that either....
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RE: Should there be a cap on Gas prices?? - 4/22/2008 10:32:30 AM
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blessedinnyc
Posts: 1810
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quote:
ORIGINAL: mapachito13
Monopolies are ILLEGAL in the United States! The way the oil companies operate though I believe that they should make acting like a monopoly illegal too!
BTW, CNN just reported last night that we are importing wheat for the first time in US history. So much for your theory of a trade surplus to offset the trade imbalance! Clever economists and big business they end up doing the opposite of what they intended. If that was their intent to begin with.
In any case, though, the US is the world's largest grower and harvester of food staples. Perhaps we import wheat (I'm sure a lot of Kansas farms are switching from wheat to corn), but we probably export a lot of other stuff- probably corn and soy.
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RE: Should there be a cap on Gas prices?? - 4/22/2008 10:34:07 AM
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blessedinnyc
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quote:
ORIGINAL: stamper_ben
The real definition:
"In commodity markets, the spread created by purchasing oil futures and offsetting the position by selling gasoline and heating oil futures. This investment alignment allows the investor to hedge against risk due to the offsetting nature of the securities."
In other words, it's how much money a refinery can make by turning a barrel of oil into stuff that people can use- like gasoline and heating oil.
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RE: Should there be a cap on Gas prices?? - 4/22/2008 10:49:46 AM
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StephK
Posts: 1868
Joined: 4/11/2005
From: Southwest Louisiana
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It's not just gasoline and heating oil but everything that has plastic in it's composition.
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Stephanie
Religion has accepted the monstrous heresy that noise, size, activity and bluster make a man dear to God. To a people caught in the tempest God says, `Be still, and know that I am God.' ~AW Tozer
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RE: Should there be a cap on Gas prices?? - 4/22/2008 11:07:11 AM
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HighPlainsDrifter
Posts: 1155
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From: The Land Of The Burnt Thigh
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quote:
In any case, though, the US is the world's largest grower and harvester of food staples. Perhaps we import wheat (I'm sure a lot of Kansas farms are switching from wheat to corn), but we probably export a lot of other stuff- probably corn and soy.
Probably? I took from your earlier analysis that you were a commodities expert. I don't feel so bad now knowing I completely disagree with you.
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''I don't regret setting bombs,'' Bill Ayers said. ''I feel we didn't do enough.''
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RE: Should there be a cap on Gas prices?? - 4/22/2008 12:16:55 PM
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blessedinnyc
Posts: 1810
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quote:
ORIGINAL: HighPlainsDrifter
Probably? I took from your earlier analysis that you were a commodities expert. I don't feel so bad now knowing I completely disagree with you.
Look, I like to couch my words- there's a chance that all the corn we were exporting a few years ago has gone into the ethanol industry and my numbers might be bad.
I'm not a commodities expert, but I do pay attention to the oil equities markets, and I've taken a course or two in college on energy policy.
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RE: Should there be a cap on Gas prices?? - 4/22/2008 12:38:06 PM
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colliefan
Posts: 2577
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From: Raleigh, NC
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quote:
and I've taken a course or two in college on energy policy.
And I am sure this course present an unbiaed view of things just as our media. NOT!
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RE: Should there be a cap on Gas prices?? - 4/22/2008 1:11:42 PM
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blessedinnyc
Posts: 1810
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quote:
ORIGINAL: colliefan
quote:
and I've taken a course or two in college on energy policy.
And I am sure this course present an unbiaed view of things just as our media. NOT!
Actually, it was taught by a nuclear engineering professor, so if anything, it was biased in favor of nuclear.
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RE: Should there be a cap on Gas prices?? - 4/22/2008 3:50:29 PM
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BlackCapnHarlock
Posts: 422
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I keep hearing the market will regulate itself, from folks who are rich. That hasn't happened yet.
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RE: Should there be a cap on Gas prices?? - 4/23/2008 5:37:38 AM
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mapachito13
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If you look at the price of oil and the price of gasoline you can see that they always rise and fall in conjunction. There is no (nor ever have been) any price controls on this most valuable commodity so the oil companies can raise the price of gas to whatever they want. This means they control the profit margin and can keep it within their acceptable percentages. This industry has never sustained a loss and the higher the price of gas goes (even with the weakening dollar) their profits go higher every year.
A company cannot claim they are barely making any money and then post a profit that was greater than any in US history at the same time. Our politicians and the oil companies that buy them (excuse me, give them large campaign contributions) really do think Americans are that dumb. Are we???
_____________________________
Peace Sells....But Who's Buying!
"I would argue that the most serious threat to the United States is not someone hiding in a cave in Pakistan or Afghanistan, but our own fiscal irresponsibility."-David Walker, fmr comptroller general of the US
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RE: Should there be a cap on Gas prices?? - 4/23/2008 5:59:34 AM
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rlj
Posts: 1947
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Stamper is right when he says we need to do more to get oil ourselves. Personnally I don't know why Saudi Arabia would even want to invest money in tapping another 2.5 million barrels per day when this will 1)cost them money and 2)lower the cost of oil. If they're selling 12,500,000 bpd at $120 they are making 1.5 billion USD per day. If they invest money into getting 15,000,000 bpd this will probably drop the cost of oil to say $100 meaning they'll still make 1.5 billion USD per day. This will cut into their profit margin. If I were them I'd leave it at 12.5 to.
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1 Thess 5:20 do not treat prophecies with contempt. 21 Test everything. Hold on to the good. (NIV)
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