Gas Prices Redux

[jfschultz]

Gas is about $5.00 a gallon here when you do the conversion.

Consider, the price for your gas and our gas is about the same. The difference between USA, Canada, and Europe is TAXES!

 

[Virginia Marine]

Gas is about $5.00 a gallon here when you do the conversion.

Consider, the price for your gas and our gas is about the same. The difference between USA, Canada, and Europe is TAXES!

Just to make you all ill, when I was stationed in Kuwait last year I paid about $.75/gallon. Most Kuwaiti's complain about even this small price as up until a few years ago, gas was free in Kuwait...

 

[ericfromcowtown]

The last time I filled my car, it cost $1.25 / Litre, which equates to $5.68 / gallon. Rumour has it that the price is going to spike up to $1.50 / Litre at the end of the week, in time for the May long weekend.

We're (Alberta) is sitting on the second largest oil reserves in the world, after only Saudi Arabia, but you'd never know that at the pumps.

 

[Hippo]

As has been mentioned a massive influence on oil prices has been the structural weakness of the dollar and that will not change in the medium term. You really cannot blame the Saudis for wanting to preserve the purchasing power of their exports.

I do think that in five years or so we may see some hybrid form of pricing currency for oil which would be interesting in all sorts of ways.

 

[VirginiaHuguenot]

Oil was discovered in Persia (Iran) 100 years ago (May 26, 1908).

May 26, 1908: Mideast Oil Discovered -- There Will Be Blood

 

[ChristianTrader]

The Coming Collapse of Oil Prices by Dom Armentano

 

[staythecourse]

We're (Alberta) is sitting on the second largest oil reserves in the world, after only Saudi Arabia, but you'd never know that at the pumps.

That's news to me. Why aren't the wells a-pumpin'? I would think that (as happens in the Mid West when poor wells are started back up when oil prices go up) that wells would be built and started up.

 

[Reformingstudent]

It was at $3.64 here this afternoon when I went to pick up my son from school earlier today. It was JUST $3.57 here yesterday morning. I hate to see what it's going to be like tomorrow.
Been thinking about going into the rickshaw businesses if I can convince my wife to be the runner. Don't think she'll go for that idea though.

Today, 5-26-08 It's up to $3.85 here and rising with no end in sight.

 

[staythecourse]

Is this site news to you folks?

It's where people post gas prices for their area. I have used it when traveling across the state for business and filling up at cheap stations.

 

[jaybird0827]

If the price of gas goes down, it will go up.

If the price of gas goes up, it will go up again.

 

[ericfromcowtown]

That's news to me. Why aren't the wells a-pumpin'? I would think that (as happens in the Mid West when poor wells are started back up when oil prices go up) that wells would be built and started up.

The vast majority of Alberta's oil reserves are in the form of bitumen. Think hard molases that won't flow unless the viscosity is lowered. You either have to mine it, if it's close enough to the surface, or lower its viscosity insitu usually through the introduction of steam, if it isn't. In either case, it's much more expensive to produce and refine per barrell than the sweet crude flowing out of Ghawar in Saudi Arabia. At $20 or $40 oil much of the reserves were uneconomic or only marginally economic. At $135 oil, a lot of it is suddenly economic to produce and there is a boom here in Alberta of lands being leased and projects being anounced. You need a lot more lead time to develop these projects, so even though hundreds of millions of dollars have been invested in some of these projects many are still years away from producing.

V.P. Cheney was up here a few months ago to tour some of the projects, so evidently Washington also recognizes the oil sands as strategic resource for the future.

 

[staythecourse]

That's news to me. Why aren't the wells a-pumpin'? I would think that (as happens in the Mid West when poor wells are started back up when oil prices go up) that wells would be built and started up.

The vast majority of Alberta's oil reserves are in the form of bitumen. Think hard molases that won't flow unless the viscosity is lowered. You either have to mine it, if it's close enough to the surface, or lower its viscosity insitu usually through the introduction of steam, if it isn't. In either case, it's much more expensive to produce and refine per barrell than the sweet crude flowing out of Ghawar in Saudi Arabia. At $20 or $40 oil much of the reserves were uneconomic or only marginally economic. At $135 oil, a lot of it is suddenly economic to produce and there is a boom here in Alberta of lands being leased and projects being anounced. You need a lot more lead time to develop these projects, so even though hundreds of millions of dollars have been invested in some of these projects many are still years away from producing.

V.P. Cheney was up here a few months ago to tour some of the projects, so evidently Washington also recognizes the oil sands as strategic resource for the future.

Then you gotta think that as long as gas prices stay outrageously high in comparison to all other things these wells still make sense to get going. I mean if the return on investments with bitumen makes sense over all other typer of investments you'll see people waste the effort and money for a potential return.

 

[etexas]

Even if it the price of gas goes down, it doesn't matter. The value of the dollar will continue to go lower and lower and lo ...

That's not true. The dollar may have already bottomed out.

I agree, contrary to what some people think the other industrial nations do NOT want the dollar to fall too far (a little bit is fine for Europe and China and others) but for it to fall too far would be as big a financial disaster to these nations as it would be to us. (As a silly example think about NIKE, most of the shoes are made in China, however the biggest market is the USA, they do NOT want to loose their market base, I could give dozens of examples with different commodities and goods from other nations, this was just random to make the point that in this 21st Century world of international trade, many foreign nations, whether or not they like us, have in past, and will continue to pour money into the US , their own little version of Buy American, they have not much of a choice if they wish to remain viable economic powers, and they do.