How Gas Prices Work

[fistfullofsteel]

http://money.howstuffworks.com/gas-price.htm

Historical Gas Prices
(Adjusted for inflation)

Year Price Per Gallon
1950 $1.91
1955 $1.85
1960 $1.79
1965 $1.68
1970 $1.59
1975 $1.80
1980 $2.59
1985 $1.90
1990 $1.51
1995 $1.28
2001 $1.66
2002 $1.31
2003 $1.52
2004 $1.79
2005 $2.28
2006 (so far) $2.68
Source: U.S. DOE



Let's look at where your money goes when you pay for gas:

Taxes: 20%
Distribution and Marketing: 11%
Refining: 10%
Crude oil: 59%


Out of Gas
If gas prices are influenced by the world supply of oil, what will happen when we run out of oil? The surprising answer is, we probably won't. That doesn't mean that the rampant use of fossil fuels isn't a concern -- they are very harmful to the environment, and dwindling supplies will still cause massive changes in our economy -- but oil will get too expensive to use long before we run out.

The world oil supply acts like an asymptotic value, which is just a mathematical term for a value that gets closer and closer to another value, but never actually gets there. In this case, the "other value" is zero, or no oil left anywhere. Why would we never get there? Oil companies start out with the easiest (and cheapest) oil to find and bring to the surface. Once that runs out, they have to find more oil, which might be harder to harvest. As time goes on and the oil supply dwindles, it will get harder and harder (and more and more expensive) to find what's left. Eventually, it will get so expensive to find and harvest the remaining oil that no one will be able to afford it. The rising costs will force us to develop other energy sources.

 

[juiceddreadlocks]

You're betting on the markets to fix this? Marion Hubbert is turning in his grave. Exploration costs will rise with crude price, and make it cost prohibitive to explore other things.

 

[fistfullofsteel]

You're betting on the markets to fix this? Marion Hubbert is turning in his grave.

no, i'm hoping the necessity is the mother of all inventions law kicks in and we find an alternative fuels for the entire world to run on and the middle east chokes on the big one.

 

[juiceddreadlocks]

no, i'm hoping the necessity is the mother of all inventions law kicks in and we find an alternative fuels for the entire world to run on and the middle east chokes on the big one.

God, me too... Not looking good. (note my recent posts/threads regarding making sustainable/renewable power at my parents farm)

 

[fistfullofsteel]

God, me too... Not looking good. (note my recent posts/threads regarding making sustainable/renewable power at my parents farm)

http://money.cnn.com/pf/features/lists/global_gasprices/

Gas prices around the world

Think you pay a lot for gas? Perhaps you'd prefer to live in Venezuela.

NEW YORK (CNN/Money) – Gasoline prices in the United States, which have recently hit record highs, are actually much lower than in many countries. Drivers in some European cities, like Amsterdam and Oslo, are paying nearly 3 times more than those in the U.S.

The main factor in price disparities between countries is government policy, according to AirInc, a company that tracks the cost of living in various places around the world. Many European nations tax gasoline heavily, with taxes making up as much as 75 percent of the cost of a gallon of gasoline, said a spokesperson for AirInc.

In a few Latin America and Middle-East nations, such as Venezuela and Saudi Arabia, oil is produced by a government-owned company and local gasoline prices are kept low as a benefit to the nation's citizens, he said. All prices updated March, 2005.

Nation City Price in USD Regular/Gallon

Netherlands Amsterdam $6.48
Norway Oslo $6.27
Italy Milan $5.96
Denmark Copenhagen $5.93
Belgium Brussels $5.91
Sweden Stockholm $5.80
United Kingdom London $5.79
Germany Frankfurt $5.57
France Paris $5.54
Portugal Lisbon $5.35
Hungary Budapest $4.94
Luxembourg $4.82
Croatia Zagreb $4.81
Ireland Dublin $4.78
Switzerland Geneva $4.74
Spain Madrid $4.55
Japan Tokyo $4.24
Czech Republic Prague $4.19
Romania Bucharest $4.09
Andorra $4.08
Estonia Tallinn $3.62
Bulgaria Sofia $3.52
Brazil Brasilia $3.12
Cuba Havana $3.03
Taiwan Taipei $2.84
Lebanon Beirut $2.63
South Africa Johannesburg $2.62
Nicaragua Managua $2.61
Panama Panama City $2.19
Russia Moscow $2.10
Puerto Rico San Juan $1.74
Saudi Arabia Riyadh $0.91
Kuwait Kuwait City $0.78
Egypt Cairo $0.65
Nigeria Lagos $0.38
Venezuela Caracas $0.12


I guess you can call me deranged, but I would like to see gas hit $10-$15 a gallon. I think that might be the breaking point. If it hovers around $3-$4 a gallon people will find a way to manage, so that will not do. Go $300 a barrell. Muuuwahahahaaaaaaaaaaa, muwahaaaaaaaaaa. Let's see the mettle of the American people.

 

[Lao Tzu]

I guess you can call me deranged, but I would like to see gas hit $10-$15 a gallon. I think that might be the breaking point. If it hovers around $3-$4 a gallon people will find a way to manage, so that will not do. Go $300 a barrell. Muuuwahahahaaaaaaaaaaa, muwahaaaaaaaaaa. Let's see the mettle of the American people.

Agricultural biomass isn't going to work due to land constraints. However biomass like algae that is grown in vats using CO2 and sunlight may eventually prove feasable & economical.

I'd guess plug in hybrids will be the big tech as you get 120 miles per gallon of gasoline. But with oil at $4/gallon its still not economical. I think it costs about 7k more to make a plug in hybrid than a regular car with modern tech. However the energy equivalent of a gallon of gasoline is only 75 cents. So assuming 300 gallons/year that is only about 1k a year, barely enough to break even.

 

[fistfullofsteel]

http://money.cnn.com/2006/07/19/news/international/bc.energy.opec.president.reut/index.htm

OPEC 'uncomfortable' with oil prices
Climb past mid-$70s seen as threat to global economy, petrol industry's health.
July 19 2006: 10:39 AM EDT


ABUJA, Nigeria (Reuters) -- The latest spike in oil prices to near $80 a barrel is "very uncomfortable" and is hurting the world economy, the president of the Organization of the Petroleum Exporting Countries (OPEC) said on Wednesday.

Edmund Daukoru, who is also Nigerian Minister of State for Petroleum, said the conflict between Israel and Hezbollah was responsible for the latest jump, which saw U.S. crude oil futures hit a record $78.40 a barrel last week.

"If it would have stabilized around the mid-60s, I don't think people would complain too much. We are getting used to that, but the latest shootup to the mid-70s and above is very uncomfortable," Daukoru told Reuters on the sidelines of a conference in the Nigerian capital.

"Clearly the latest flare-up between Israel and Hezbollah is really the reason for the latest spike," he said. "It is always unfortunate if we have to address issues outside the power of OPEC."

High prices bring more revenue to OPEC in the short term, but exporters worry that sustained price increases dent global economic growth and encourage consuming nations to divert investment away from oil to alternative energy.

Asked if current prices were hurting the economy, he said: "At such high prices it must have an impact."

Oil prices dipped after Daukoru's comments, with U.S. futures down 64 cents at $72.90 a barrel.

Capacity not an issue

Asked whether OPEC could make up for any possible reduction in oil exports from Iran because of the Israel-Hezbollah conflict, Daukoru said the organization had plenty of spare production capacity.

"We should have even more than 2 million barrels per day available, so whether the disruption comes as a result of Iran or some other cause, we will be able to put on the extra capacity provided there are refineries to take it," he said.

Daukoru said he will travel to the Middle East Gulf next week to address some internal OPEC issues such as a forthcoming summit, and would take advantage of the trip to discuss the oil market situation.

"We do our best to moderate the market, but with the current level of volatility one only can take short-term decisions. We tend to react at three-monthly intervals," he said.

Aides said Daukoru wants to resolve a long-standing row between Iran and Kuwait over which country's candidate should be appointed OPEC secretary-general, the administrative head who represents the cartel and helps coordinate policy talks.

OPEC has been unable to reach agreement on the post since December 2003, and the selection process has exposed political differences between OPEC's core Gulf members.

The other contentious matter was that both Libya and Saudi Arabia want to host a meeting of OPEC heads of state and government, an aide said.

 

[fistfullofsteel]

Agricultural biomass isn't going to work due to land constraints. However biomass like algae that is grown in vats using CO2 and sunlight may eventually prove feasable & economical.

I'd guess plug in hybrids will be the big tech as you get 120 miles per gallon of gasoline. But with oil at $4/gallon its still not economical. I think it costs about 7k more to make a plug in hybrid than a regular car with modern tech. However the energy equivalent of a gallon of gasoline is only 75 cents. So assuming 300 gallons/year that is only about 1k a year, barely enough to break even.

o well, then just suffer and buy yourself a real comfortable pair of sneakers. http://images.usatoday.com/money/_photos/2006/01/18/inside-nike-shoe.jpg

 

[juiceddreadlocks]

do either of you realize that there hasnt ever been a problem in human history like what we're about to face? There's no alternative that can come close to making a dent in our energy useage.

It's time to power down.

 

[fistfullofsteel]

do either of you realize that there hasnt ever been a problem in human history like what we're about to face? There's no alternative that can come close to making a dent in our energy useage.

It's time to power down.

NOooooo, don't power down! That wouldn't be fun. Like I posted before, "Let's see the mettle of the American people." Can't wait to see the thread of Tiger88 selling his M3.