US$2.71 per gallon for 87 octane in Bluffton, SC.

I expect to see $3.00 within a few days.

Gas went up an average of 7 cents a gallon here today, and I am betting that there will be daily increases for a while.

Shelly

I read in the local paper today that the price is expected to jump .50 very quickly.

MSU

Gone up $.28 here in last two days. Now $2.799. First jump came before the eye of Katrina even cleared the Biloxi area. Price gouging pigs.

In this case that's not entirely true. While the oil industry has never passed up an opportunity to screw the public, this time there are good reasons for price increases. About 25% of the oil we use enters the country through the port of New Orleans and about 45% of the nations gasoline is refined there. Although the refineries have reported only minor damage, it will be weeks or longer before they have power make repairs and to get back into production.

Many of the oil rigs in the gulf have been severely damaged and some have broken away from their moorings and even floated ashore. It will be a long time before that oil again begins to flow to the refineries. There is insufficient reserve capacity in OPEC to make up that shortfall, and even if that oil was available there is no capacity to refine it.

Even before this storm I expected to see $3.00 gas by year end, I now think we will see $4.00 a gallon or higher gas this year. Don't forget this is the time of year that the refineries begin switching over to produce heating fuel. It will be a long, cold, and expensive winter for many in the north.

Shelly

I think that you are referring to the famous photo of the oil platform against a bridge. In that case, it came out of dry dock in that bay and was not in operation. The industry still doesn't know how the drilling platforms have been affected yet, but I suspect that they will by the end of Wednesday.

edit--

The updated news is bad.

• Diamond Offshore Drilling Inc. reported one missing rig. Another broke free from its moorings, but it was found about 9 miles north of its original location.

• Newfield Exploration Co. said one of its production platforms disappeared entirely.

• Rowan Cos. said it thinks a rig capsized and sank off the coast of Louisiana.

• An oil-drilling platform washed up onto Dauphin Island, a weekend retreat off the Alabama coast, but it was not known where the platform came from.

I already had that information when I wrote my post.

Shelly

>Don't forget this is the time of year that the
>refineries begin switching over to produce heating fuel.

How does a refinary switch production? Crude oil will fractionate into the same proportions of the same products everytime as I understood it. The fractional distillation process of refining means for a barrel of crude you will have a set percentage of kerosene, parafin, diesel, petrol, bitumen etc everytime. You can't decide to make more petrol or more diesel - you just refine it and tap off the fractions.

It's the blend of additives that are added to the fuel. Winter time calls for a different blend than summer so that the fuel is more reliable for cold weather. And then there are the different environmental requirements for the different regions. It takes time for the refineries to switch over.

Refineries in the path of Katrina:
http://www.msnbc.msn.com/id/9118331/

As of this morning, some production platforms are back in business, but many have not been checked out yet. One irony is that Chevron is not sure they have enough fuel to conduct fly overs of thier platforms because they move thier aircraft to another state. A few production platforms are reported missing, so that will be a long term blow to production.

The good news right now is that are no reports yet of major damage to those refineries. And, the price of oil has dropped a wee bit this morning.

>>Don't forget this is the time of year that the
>>refineries begin switching over to produce heating fuel.
>
>How does a refinary switch production? Crude oil will
>fractionate into the same proportions of the same products
>everytime as I understood it. The fractional distillation
>process of refining means for a barrel of crude you will have
>a set percentage of kerosene, parafin, diesel, petrol, bitumen
>etc everytime. You can't decide to make more petrol or more
>diesel - you just refine it and tap off the fractions.
>

It's not quite that simple. Distilling (cracking) crude is far more complex, and the distilleries are free to determine the final product produced. In addition to the distillation process the output is converted and recombined to produce the end products that are needed, or most profitable.

Here is a little more information.

http://www.eudoxus.com/mpac9612.html

Shelly

Thanks for the extra info.

I'm not saying that the price was destined to rise. My gripe is strictly that the immediate timing without even preliminary news as to what the damage extent was. That and the fact that all the oil prices from crude to refined product are now being controlled by the futures traders and their speculative "worries" not by the factual market.

We always hear that the market will eventually be self-regulating and prices for all commodities will only be what the market can demand and get. This is being completely shit-canned by letting speculators control the process.

Bob, as you said the speculators buying the futures on oil are the ones puching the price of crude up. When that happens, the increase is passed along instantly. What gripes me is that what is already in the storage facilities is cheaper than what is yet to come.

>I now think we will see $4.00 a gallon or higher gas this year.

Looks like the experts agree with you:

http://money.cnn.com/2005/08/31/news/gas_prices/index.htm?cnn=yes

For my upcoming trip Friday, I expect it to cost me about $125 in gas alone to get from Ohio to New Jersey in my van. And I'm planning a lot more driving than that. It would almost be cheaper for me to rent an economy car than to drive that beast.

I just caught a local report that people have been lining up at some gas stations trying to beat the price increases. One station was still selling at 2.49/gal and a few are dry.

Really, there's no need to panic, there's still plenty of supply. Making an effort to save a few bucks now on a fillup isn't going to make any difference in the long run.

I don't know the current average price for gas here in Houston, but I do know that we need to fill up soon. Since we drive around here in our area, maximum legal speed anywhere from 30 mph to 45 mph, we get crappy mileage. Driving from stop light to stop light running errands is not a way to get the best gas mileage!

We already save errands up and take the most economical route, so we are not backtracking, so I don't know how we can save money on gas.

marti

I saw a report not too long ago on how one of the major delivery companies saves fuel costs. They have complicated software that plans out each daily delivery route so that the driver drives as few miles as possible. That much is pretty much common sense. (Plan your trips ahead of time and plot your routes to cut down on milage.) The interesting thing was that the software was programmed to prefer right turns over left turns. The reasoning being that you can often turn right on a red light, but a red light will cause a vehicle turning left to idle for awhile before turning (thus wasting precious fuel). So plot your trips in a clockwise fashion.

I saw that also, it was UPS, and they save a ton of money on fuel with that system.

MSU

Here's a music video.

I Can\'t Afford My Gasoline

Our gas prices were at about $2.79 yesterday/this morning. I went to school to work on my classroom for a few hours. When I was driving back home I passed by several gas stations. The first nearly made me have to stop to breathe for a few minutes. It was $3.15 a gallon!!! (Darn no smiley that is tossing their cookies) Most of the other stations were at $2.99. I was lucky and went to the place where I got my car and filled up for $2.71. I'm sure it won't be there for too long. I'm really starting to wonder if it even pays for me to work.

--Beth

>(Darn no smiley that is tossing their cookies

How about this one?


"A Gallon of Gas for $3.15? *urp!*"

In the UK, it's hovering around (equivalent) $7.78 per gallon

Andy.

Putting water in an empty gin bottle, doesn't make it gin.

Price just hit $2.99pg here in Stl, Mo. Up $.57 since last night.

I talked to an IT person from Gates oil at lunch today, gas will go up at their stations 20 to 30 cents today. Their cost price just went to $2.79 a gallon for regular.

Shelly

Hi Folks, The price of fuel in UK, as previously mentioned is getting near the equivalent of $8.oo per gallon. (Our gallon is a little bit bigger than US). So much so that quite a lot of people with diesel vehicles are converting to cooking oil! We are required by law to notify the Customs, and pay some tax, but it's markedly cheaper than diesel at the pump. BTW most of the higher price we pay is tax, and diesel is dearer than gas.
Cheers,
Richard.
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I've long thought that was a good way to go. http://www.greasecar.com/ has some info on converting to used cooking oil. Just think, you could fill 'er up at McDonalds and get some fries to go. And if you're an early adopter, maybe you could work out a deal with McD's to trade ad space on your car for cooking oil. (The exhaust apparently smells like fries so it would make for a nice ad campaign.)

Don't worry..... once everything is back to how it was, the price will fall back dramatically

Andy.

Putting water in an empty gin bottle, doesn't make it gin.

Yup. It's the standard price rise-drop model. Scare hits the news, price jumps by 10-20 cents. Scare subsides, price falls by 5-15 cents. Net rise is usually 5-15 cents each scare. Over time you get used to the price increase and don't notice it as much. If you saw gas for $2 a gallon now, you'd think it was a steal. A few years back, you'd think it was highway robbery.

Yesterday I paid $1.32aud per litre for 98 octane premium for my bike.That is equivalent to $5.28aud a gallon.Or $3.96 US a gallon.
We too are getting price hikes as well, and we havent had a hurricane. Australia produces most of its own oil, but some really smart bunch of politicians joined OPEC so now we pay world prices.

In God we trust, everybody else pays cash...

I filled up yesterday in Michigan at $2.67 a gal. Today, it's $2.99 -
$3.29. And you know what? It's not going to go down again...ever. It's the Oil Barons gouging us...they're veterans at it...and each time
a newspaper or TV station predicts it might go as high as .50 more in the weeks to come...voila! gas goes up .50 a gallon. Amazing, isn't it?
(BTW, when I say "Oil Barons", I mean BUSH.) Okay, Born Agains, let me
have it...........

DavyWavy -

Don't know if I want to specifically point out Bush, but this extreme increase in the cost of gas is uncontrollable. The drastic increase of gas cost has been by far the single most crippling event in our economy right now.

Jim, I was under the impression that most of the oil we produce is not
suitable for conversion to petrol. Are you telling me it is?

Just an update, they just told us gas is going to $3.30 tonight. I'm going to gas up right now before it becomes to insane. Should have done it last night but I was so exhausted after work...

Rob,it's 3.38 over in St Charles now.I just heard Bush has released oil from the national reserves and it has already reflected in a down turn in prices.

LilJoe

I saw $4.25 in Conyers, GA. a few moments ago.

CNN, or was it Fox news... reported on TV that the price of gas in Atlanta Georgia in now $5.57/gallon.

Because of price gouging, it was over $7.00 a gallon in some Atlanta locations this morning.

On one intersection this morning there were 3 stations with 3 prices:
Crown 2.99
Sunoco 2.59
Exxon 2.79

On the way home from the Crown station I've been going to for years had 3.12.

Baltimore, Md.

Since I started this topic less than twenty-four hours ago, the price has risen at least 28 cents locally. I just filled up my wife's Town & Country at 2.99.

Rumors are spreading about impending shortages. The stations are already getting busier as more people fill up more often. All fuel must be prepaid at my local BP/Amoco due to a high percentage of drive-offs.

Here in Sun City, neighbors are beginning to form carpools for shopping, church meetings, and dinners out.

Here's another question about gasoline prices.

What is the arrangement between wholesalers and retailers that results in the almost instantaneous passing of higher prices on to the consumer? I would have thought that the thousands of gallons already in the tanks at gas stations had already been purchased at a given price, so that raising the price per gallon on that gasoline does represent a huge profit for someone, even though the next delivery would reflect the higher wholesale prices. Conversely, if the wholesale price were to fall, does the retailer sell the remaining supply in his tanks at the lower price or does he wait until the next shipment of gas at the lower price is delivered to him?

I expect the wisecrack answer here that they're all crooks, but once we get that out of the way can someone explain how it actually works.

Dave

Dell 8300 Dimension
Pentium 4
W XP Home


www.woodenpropeller.com

I think the wisecrack answer is the actual one, Dave. They'll do anything they can get away with to get more cash out of the public. There's no FIFO or LIFO inventory control, it's just charge as much as we can because the public can't do anything about it.

Normal practice is for businesses, not just oil, is to base their prices on the cost of replacing their sold inventory.

I remember back during the oil shortages in the early 1970's when there were long lines at the pumps and gas prices soared, I got my gas and had all my mechanical work done at a Mobile station in the town where I lived in Connecticut. The owner was a terrific mechanic, and did not cheat his customers. An Italian immigrant, he called his business Mafia Mobile in private. During that gas shortage he would only sell gas to his regular customers, so I never had to wait in the gas lines.

One day I was in there getting a muffler replaced and he told me he had a gas delivery that day and would have to pay the truck driver with a check for $10,000 since he was an independent owner. I guess that was standard practice in the business. So if you think you have sticker shock at the pump, think about the guy who owns the station and has to fill his tanks before he can fill your tank. It's not the stations that are getting rich.

Shelly

That is still common, the station owners have to pay the drivers on the spot, no putting it on account.

(and I'm not gonna make any cracks about you being around in 1070)

Oops, wrong year, same story.

Shelly

I had to look up FIFO and LIFO, but it does make more sense now, even though it seems like a scam to me as a consumer.

Dave

Dell 8300 Dimension
Pentium 4
W XP Home


www.woodenpropeller.com

Heard an independent dealer on the radio this AM saying he was going to have to close up because he didn't have the cash to refill his tanks. I doubt the oil companies give a damn.

Oh, and we had two more dime increases yesterday putting it from $3.00 to $3.20 per gallon depending on area you're in.

I don't hardly think any of us should be complaining about the price of gas right now, just my opinion... How can we possibly think we got it so bad?

Look around at what just happened, I think we are pretty damn fortunate to be pumping gas! After seeing what's happened down in Louisiana, Mississippi, Arkansas...I feel very blessed at the moment. It sure isn't a time that I like to hear anyone complaining.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Here ya go guys..






and another....



Hope it gives ya a chuckle.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

East Central Nevada. Went up to $3.16 regular unleaded, 36 cent jump Wed. morning.

And the question is...what are we going to do about it? And always the
answer : nothing. God! We are such sheep!!! Are you calling the
White House? Are you contacting your Congressmen? Emailing your Senators? Writing your newspaper?

DavyWavy -

"Motorists were warned last night that petrol prices seem certain to pass £1 a litre within days after Hurricane Katrina wiped out many of the oil refineries on the US Gulf coast.

As US oil companies bought up 20 shiploads of European petrol yesterday, the wholesale price of petrol on the Rotterdam spot market soared to a record of $855 a tonne (more than $100 a barrel), up more than 20% in two days and something experts said would feed through to the forecourt within days...."

http://www.guardian.co.uk/uk_news/story/0,,1561271,00.html

>And the question is...what are we going to do about it? And
>always the
>answer : nothing. God! We are such sheep!!! Are you
>calling the
>White House? Are you contacting your Congressmen? Emailing
>your Senators? Writing your newspaper?

And then what do they do about it? Are you calling them just to whine about it, or do you have a realistic plan to lower the price without causing a different problem?

We have to face the consequences of being an SUV driven country dependent on a limited supply of oil worldwide. We "sort of" learned a lesson with the oil embargo of the 70's, but then slipped back into the guzzling mode as prices stablilized over the next 20 years. Just as New Orleans needed to accept the fact that Category 5 storms really do pose a risk and levees need to be designed to withstand them, our country needs to accept the limited supply of oil and in this case the vulnerability of oil refining and delivery systems and we need to tailor our own behavior to prepare for that. It's unrealistic, IMHO, to expect our government to rescue us from our own indescretions.

Dave

Dell 8300 Dimension
Pentium 4
W XP Home


www.woodenpropeller.com

Well said Dave.

I just filled up at 11:30 am at $3.199 for regular in Buffalo area today. I know the owners and they are going to $3.349 at 1 pm so they stay a penny below all the stations in the area. They also told me about a new delivery fee that has been started by the companies delivering their fuel supplies.

For the first time I can remember, the cost of fuel on Indian Reservations around here are higher than off the Rez. They have to bring in a tanker every day where others get one or two a week, so they can't stay the 20+ cents they have always been below the outside market.

It is funny to see the SUV's and corvette's I saw sitting in yards for sale today. They will take a huge loss on their cost in todays market.

Ed W.

We can't have it both ways. There are known oil reserves off shore of Florida but we refuse to allow drilling there. There are thousands of capped wells in the US the oil companies refuse to place in production because they would have to pay royalties to the land owners. They will wait until those families are dead before they pump any oil. The oil companies have shut down refineries rather than renovate them, and have not built a new refinery in decades. Taken a look at the oil companies profits lately?

Shelly

Shelly,

This is part of the (US) master plan...... use everybody elses oil first and then when it runs out, use the untapped/capped US oil reserves

Andy.

Putting water in an empty gin bottle, doesn't make it gin.

It's no sinister master plan It's simply corporate greed.

50 years ago when I was stationed in Europe, there was a guy in my outfit who owned a farm in Kentucky that he inherited from his grandmother. He had received a letter from Standard Oil asking permission to drill a test well on his farm for oil. He authorized the test well and was notified that they had indeed struck oil. They enclosed a legal contract for him to sign so they could begin pumping oil, and offered him a one time payment of $10,000,00 or the proceeds from one barrel out of every seven barrels they pumped.

He didn't know what to do and asked me for advice. The $10K payment was obviously a pittance and I said the one barrel in seven was a better deal. He chose that option and sent back the signed contract to Standard Oil awarding them the oil rights. They immediately capped the well, and they will not pump a drop of that oil until he and all of his heirs are dead and buried. They don't care how long that takes, Standard Oil is immortal.

Shelly

Or...we could Donald Trump negotiate oil prices...the Donald sez', "I know all these Sheiks, and have dealt with them over the years, let me
negotiate the price of oil and I will have it cut in half in a week"...
(from the Imus TV show.)

Edit : Incidentally, you know who is an avid Imus fan...never misses a
show? George Herbert Bush. If he heard that comment, why
wouldn't he call Junior and tell to appoint Trump? Why? I
think we all know the answer to that one.

DavyWavy -

LUCKY YOU! in the UK we pay the equivalent of $6 a Gallon!!!

and we aren't the dearest in Europe either, from the link in my post above....

"Petrol prices in Britain are among the highest in Europe because of the duty and VAT charged on them but are still cheaper than Denmark, Norway and the Netherlands."

The Governor of Georgia announced, this evening,that the state gasoline taxes would be suspended for the month of September beginning midnight tonight. He says that this should drop the price of gasoline 15 cents per gallon.
Mardon

Not enough, the federal tax needs suspended also.

MSU

The cheapest I've seen in Moscow/Pullman is $2.95, most places are sitting right at $3.00, but I expect the prices to hit at least $3.25 by Wednesday. I'm glad I own a Geo, even if I do have to get out and push going up steep hills.

I just made the drive from Ohio to New Jersey last yesterday. The price of gas along the way was a steady $3.29/gal, with the cheapest being in Columbus at $3.09/gal.

I thought that I might have seen in driver behaviour on the freeways with people going slower to conserve fuel. At first that seemed to true until I hit the PA Turnpike. People there are still driving as fast as they can get away with, and there was just as much traffic as always.

My earlier post yesterday had it going from 3.199 to 3.349, well by 5 pm my daughter got the cheapest in Kenmore at 3.60.9 and she passed up stations at 3.99.9. It is unbelievable what is happening in one day around here.

Ed W.

Dropped .11/gal today.