oil price differential

[deereman64]

An interesting article on Reuters, on a subject that I think we will hear a lot more on over the next few months. Unfortunately I think it will mean more confusion and frustration for the consumer.

Weak WTI a sign of big shifts in U.S. crude market | Reuters

 

[Bytesmiths]

Any reduction in price is only temporary. It's all downhill from here for fossil fuels!

 

[cowpie1]

Any reduction in price is only temporary. It's all downhill from here for fossil fuels!

Only if you believe they are FOSSIL fuels. There is a lot of interested developing that oil is a natural earth process. Don't know. Just reflecting that.

One thing I do know is that coal liquification is a technique that can take care of us for a long time. Germany perfected it in WWII. We have enough coal in N.A. to get off of import oil completely. Add that to oil sands and oil shale out west and Canada. At the current market prices for crude, all of this is feasible. Just getting the investment and production up and running is the problem. If crude goes below $45, then forget it.

Yes, the supply would be a heavy or sour crude, but Valero has pretty much got a handle on refining heavy crude. Too bad the Houston refinery will not get 100% up this year after the big fire.

I am a market kinda guy. There will be a consistent supply one way or the other if the free market is allowed to play out. As long as Governments play games, we will be in a strangle hold.

we'll see.......

 

[Bytesmiths]

I am a market kinda guy. There will be a consistent supply one way or the other if the free market is allowed to play out.

A "free market guy" is someone who believes if you show up at the cashier with enough paper IOUs, God will put more oil in the ground. China is holding many of those IOUs -- how do you think they feel about it? Or will the government just print some more?

I see that "market myth" over and over. Fiat currency that is not backed by some resource is useless as a way to regulate finite markets. Oil should be priced in energy units, not paper IOUs. An oil field is considered "pumped out" when you only get two units of energy out for every one you put in. The tar sands give you 1.3 out for every 1 invested. Ethanol is even worse!

No matter how much money the government prints, if it costs nearly as much energy to get a unit energy, you're only digging yourself into "energy debt" faster.

As long as Governments play games, we will be in a strangle hold.

If by "games" you mean subsidies for ethanol and conventional oil, and a no-fee dumping ground for CO2 and other waste products, then I agree.

If it weren't for government "games," gasoline would cost $10 a gallon now, and no one would be able to afford cheap plastic crap from China.

Things are going to change, folks.

 

[MikePA]

Things are going to change, folks.

See Paul Ehrlich's population bomb predictions from the 70s. Every generation has it's own Chicken Little.

70s - Population Explosion, we'll never be able to feed everyone, then it was the coming ice age, now it's global warming.

 

[KICK]

the sky is falling.

 

[joerocker]

But the population has doubled since the 50s, most people in the world are poor, and many are starving. Almost the entire continent of Africa is in trouble, politically, population wise, or by lack of food. How long can runaway population growth continue? I'm almost 50 and I've personally seen the bad effects of population. The country/world has too many people. It IS a problem and it's going to get worse.

Islam is expanding and is actively working to "take back" land that was once its.

The Mexicans are also actively taking back land in the SW U.S. that they believe is rightfully theirs. Spanish may become a standard second language in the U.S. in the not too distant future.

China wants to be the next U.S. and is racing through resources at an unsustainable rate.

The earth IS warming, it's undeniable. Glaciers ARE melting, the sea level IS rising. Weather patterns ARE changing. Whether it's entirely because of our burning a few million barrels of oil EVERY DAY or not, it IS happening. So, what do we do about it? What CAN we do about it?

The price of oil IS rising and that cost WILL trickle down to EVERYTHING because everything relies on oil. Can we afford a doubling of prices every few years? Out of control oil prices WILL produce hyperinflation which is NOT a good thing.

Things ARE going to change! And I'm afraid not for the better...

 

[KICK]

WE ARE ALL GOING TO DIE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

 

[cowpie1]

I think a few here need to rethink what it means to be free market.

It has nothing to do with "fiat" currency. That is put into place by governments. A free market may be based on precious metals, paper currency, or barter. It is "free" when it is not tightly controlled by governments.

Whether metals, paper, or any other form, it is only worth what two people think it is. If you were using corvettes as an exchange, I would give you a gallon of milk for it. But someone else might trade you his Hummer H2.

It is governments that screw things up. That is why I admire the founders of the U.S. for making such a spirited attempt to limit governement power in the constitution.

By "games" governements play I meant regulation and taxation. These control the natural flow of a market and makes it not free. It has nothing to do with alternative fuels. If government regulation had not interferred, we might be using hydrogen as a internal combustion engine fuel by now. Popular Mechanics showed it was feasible in 1973.

The government won't allow known reserves to be tapped and want to regulate the snot out of anything that might compete.

You must confuse me with a Karl Rove type republican? Sorry, I am a Jefferson Libertarian. Nice try!

 

[Bytesmiths]

I think a few here need to rethink what it means to be free market.

Before you start, I should warn you that I have had upper division college credits in Economics. If it don't agree with my textbooks, it's just "your opinion," I'm afraid!

Whether metals, paper, or any other form, it is only worth what two people think it is.

And only if all the costs are "internalized" in the transaction.

Fossil fuel is a good example of a commodity with expensive "externalities" that are not represented in the transaction. People die every day because of unburned hydrocarbons, NOX, particulates, and other fossil fuel pollution. The logging and fishing industries of the Northeast US have been destroyed by acid rain from coal burning in the Midwest US. Someone's grandchildren will have to deal with the mess left behind by our putting fossil carbon in the atmosphere. None of these costs are covered in the purchase price of fossil fuel.

You seem to doubt that whole concept. Google "Stern Report" for some grim news from the normally staid, stodgy, conservative World Bank.

By "games" governements play I meant regulation and taxation.

How about subsidies? The petroleum industry receives BILLIONS of taxpayer money every year! And that's not even including the current "subsidy" of asthma, heart disease, and other problems caused by fossil fuels's waste products, not to mention the future "subsidy" that your grandchildren will pay when global warming takes off.

If government regulation had not interferred, we might be using hydrogen as a internal combustion engine fuel by now. Popular Mechanics showed it was feasible in 1973.

You've not only bought the "hydrogen lie" but think the government is suppressing it? I think I've got to unsubscribe now; there's no common ground that we can discuss further.

am a Jefferson Libertarian.

I sympathize with the basic tenants of Libertarianism: that you are left alone to do your thing, as long as it harms no others. But most so-called "Libertarians" conveniently neglect the "harm no others" part and just want the freedom to let their dog **** in their neighbor's yard. In your case, that includes denying that your dog even *****!