Diesel today

[Flogger]

In 1970, I delivered diesel for $.12 a gallon, regular gas for $,24 a gallon. Are these or were those "the good ole days"?

I remember when a gallon of gas was the same price as a can of Skoal………25 cents!

 

[jyoutz]

I remember when a gallon of gas was the same price as a can of Skoal………25 cents!

And annual income was $5,000 at that time.

 

[Flogger]

It’s connected. The industry doesn’t make profits at $40/barrel.

Around here we didn’t see the full impact of low prices. Producers have debt as a rule so as long as the well would run it pumped. When repairs were needed they shut it down. Caused a huge boom in the pulling unit business when prices went back up.

 

[5030]

The shale oil frackers say that they cannot economically operate when the crude price per barrel is less than $58. And the largest oil field (Permian Basin) is shale bedrock. Producers are not going to increase production to the extent that it drives crude prices below profitability.

Of course not it is business after all. Businesses are in business to make a profit last time I checked...

 

[paulsharvey]

I remember when a gallon of gas was the same price as a can of Skoal………25 cents!

That would be close to $11/gal now...

 

[paulsharvey]

You don't really want $2/gal gad, as a country. We need a stable full price, that businesses can factor in, while making oil companies enough profit to continue drilling/pumping/exploring/investing. Honestly, I think stable $2.75-3.25/gal is about what the market likes.

 

[jyoutz]

Of course not it is business after all. Businesses are in business to make a profit last time I checked...

Yes. That’s my point. Some people are saying that the industry will continue to increase production and prices will continue to fall. The industry isn’t going to glut the market such that crude prices fall below profitability. Current production is about where they want the profit margins.

 

[5030]

I have no issue with fuel prices, either diesel or gasoline actually. Human nature is to pay less if available but the bottom line is fuel is a necessity for most, not a luxury. I've never been happy with corn alcohol laced gas at all but that is a different subject for a different thread. I am just glad my farm diesel is a tax write off, not something that most users can do.

 

[5030]

Despite what the incoming administration alludes to, I agree. the retail price of motor fuel may come down a bit but only to the point where it's still profitable to produce it and no more.

The 'drill baby drill' mantra is just that, hype and nothing more.

I will say that refiners need to upgrade or build additional refineries just in case one goes off line for whatever reason. But increasing production and lowering prices, ain't gonna happen. It sounds good but in reality, it don't work in the grand scheme of things.

I have no issue with us going back the a net exporter of petroleum products, in fact we should be, but domestically, I don't see the price falling much at the pump. Besides, in the grand scheme of things, we have the cheapest retail cost of petrochemicals of any civilized country except maybe the middle east but then their per unit cost is 100% set by their governments.

Something I do find somewhat arcane and that is very late model vehicles (EV's excluded) get poor fuel mileage. I don't get that at all.

 

[CliffordK]

We have issues that they apparently regularly shut down a couple of major west coast refineries for routine maintenance at the same time, and suddenly fuel prices spike. Rather than somehow scheduling to stagger the outages. Part of the issue has to do with seasonal changes in fuel blends.