Yahoo headline just posted- with rising diesel costs, truckers see the end of the road

[Anonymous]

I saw they want to raise it a $1.00 a gallon smog tax. I watch alot of C-SPAN waiting to get called to work.

World Oil Production has peaked, plan on the worst. One plan is to raise the price even more to get people to use less and plan better when they use there cars. Theres not a single thing we do as americans that doesnt tie into oil. GET READY

You are right, raising gas prices to get people to conserve has been a preferred approach by many.  They tend to lecture us on how good we have it compared to Europe.  However, most of the people who prefer this rationing-by-high-cost approach want the price to be high because of added taxes.  They don't want high prices if it is going to oil producer income.

Personally, I do not believe oil has peaked.  There are agenda driven reasons that people declare that oil has peaked.  One of those reasons is to promote public sector funding in the name of searching for alternative fuels.  The people who don't like oil would like to convince us we are running out of it.

I must say that I don't quite understand why you have no problem seing a couple of bucks per gallon of your gas purchases going to places like Dubai where UAE builds such modern conveniences as indoor facilities for snow skiing, high rise buildings for multi-million dollar apartments, or man made islands for single family housing starting in the seven figures and golf courses with green fees that are out of the reach of most of the members of this forum.

Then on the other hand, you constantly complain about any of your money for gasoline going for a tax that pays for the US highway system that is vital to our national economy and our personal well being. 

May I assume that you have no problem with your money going into the coffers of countries with governments that don't like us very much?

I don't have a problem with you having decided to go with the experts who argue that oil production hasn't peaked.  But one thing has to be abundantly clear and that is oil production is not increasing as fast as worldwide demand for petroleum products.  No doubt the higher prices for crude is going to promote some increase in production, but even if environmentalists lose their effort to block exploitation of oil deposits in sensitive areas, it is not likely that production will catch up with demand anytime soon.  Until it does, 4 dollars a gallon of gas might become something of a fond memory of the past rather than a grim portend of the future.

By the way, I should note that higher gas prices for any reason don't put me in any special financial bind.  The office for my business is within an easy walk of my house, I have the time to travel by train, or I can drive a fairily short distance to an airport if I am in a rush, and I can also spend enough less on discretionary items to offset increased prices due to higher freight costs.

Unfortunately, most Americans aren't in my position.

 

I have no problem with spending tax money on roads.  In fact, I wish it would increase.  However, a lot of the gas tax gets spent on things other than roads, while road construction and maintenance falls behind.

Spending the gas tax on roads is one thing, but ladling on excess gas tax to raise the price in order to discourage use is quite another thing, especially if the excess tax is spent frivolously on things other than roads.  It is the recipients of that inflated tax who are the most motivated to falsely tell us we are running out of oil because the concept of resource depletion is their pretext for rationing it by price.  This is about the best illustration I can think to be suspicious of proclamations about the peak oil milestone being at hand.

My objections to the government overtaxing road fuel and driving up the price by over regulating big oil does not mean that I am in favor of being gouged by oil producing countries or enriching countries who are unfriendly to us.  I object to both problems.  I also object to the slanted way TV media news largely ignores those two sources of the problem, and instead, constantly blames big oil and their profit.   

I agree with your assessment that it is abundantly clear that oil production is not increasing as it pertains to U.S. oil production.  In some areas of the world, it is increasing.  I believe there is plenty of oil out there to get, even in the U.S., but it is regulated out of reach by the very ones who would like to tax it, ration it, and tell us we don't have much.  It is pretty obvious where the problem lies and how to solve it.

Probably the focal point of lagging U.S. production is the debate of whether to drill in ANWR.  The people who want to stabilize the price of fuel tell us that ANWR production would be a substantial help.  The people who tell us fuel should be rationed by high taxes tell us that the addition of ANWR production would hardly be measurable, and that it would destroy pristine wilderness.  I can see why they say that, and the reason why they say that is the reason that I don't believe them.  World oil prices would begin to drop today if the U.S. congress approved drilling in ANWR today, even if the first drop of oil were not recovered for another five years.  Just our intentions alone affect the world oil market.

[vsmith]

The ANWR aurgument is a red herring, even if it was opened to drilling today it would be up to  10 years before any meaningful production could begin, and then, where are they going to refine it? Crude avalability is high worldwide, its refining capacity thats been the bottleneck binding supply, particularly here in the US. High demand for refined products worldwide, coupled with nervous speculators driving price per barrel up. Bush said recently that new refineries are required, with record windfall profits wheres the incentive for oil companies to sink millions into strangling the golden goose of profit? If Bush truely thinks new refineries are needed the only likely way he's likely to get one will be for the Guv'ment itself to build it bypassing the oil companies. Likely to happen? yeah right, face it, we're in for it for the next few years anyway you slice it.

May soon come to be when its time to turn that Hummer into a chicken coop and resurrect plans for those 60's bubblecars...what else could we make...

Enclosed Motor Scooters?

Electric skateboards?

The way I see it, we're all going to be paying alot more for basics, those diesel fuel costs (truck and rail) will get passed onto all of us.

[Anonymous]

The ANWR aurgument is a red herring, even if it was opened to drilling today it would be up to  10 years before any meaningful production could begin, and then, where are they going to refine it? Crude avalability is high worldwide, its refining capacity thats been the bottleneck binding supply, particularly here in the US. High demand for refined products worldwide, coupled with nervous speculators driving price per barrel up. Bush said recently that new refineries are required, with record windfall profits wheres the incentive for oil companies to sink millions into strangling the golden goose of profit? If Bush truely thinks new refineries are needed the only likely way he's likely to get one will be for the Guv'ment itself to build it bypassing the oil companies.

You suggest the government should bypass the oil companies and build the refineries that are needed.  Do you believe the oil companies are not building new refineries because they don't want to?  They want to drill in ANWR.  So I would think that if they needed new refineries for ANWR oil, they would want to build them.  Why would they want to drill for oil if they can't refine it?

[vsmith]

The ANWR aurgument is a red herring, even if it was opened to drilling today it would be up to  10 years before any meaningful production could begin, and then, where are they going to refine it? Crude avalability is high worldwide, its refining capacity thats been the bottleneck binding supply, particularly here in the US. High demand for refined products worldwide, coupled with nervous speculators driving price per barrel up. Bush said recently that new refineries are required, with record windfall profits wheres the incentive for oil companies to sink millions into strangling the golden goose of profit? If Bush truely thinks new refineries are needed the only likely way he's likely to get one will be for the Guv'ment itself to build it bypassing the oil companies.

You suggest the government should bypass the oil companies and build the refineries that are needed.  Do you believe the oil companies are not building new refineries because they don't want to?  They want to drill in ANWR.  So I would think that if they needed new refineries for ANWR oil, they would want to build them.  Why would they want to drill for oil if they can't refine it?

I beleive the oil companies dont want to invest a penny more than they feel is absolutly necessary, no drill in ANWR means no necessary increase in proceesing the crude oil it would produce, hence no incentive to a build any new refinery. Seems to me they are perfectly happy with their current production levels, and their current profit level. Why invest in something that would in the end hurt your profit margin by increasing current supply and in doing so suppressing prices, thats just plain bad capitalism. I honestly think that even if ANWR was opened that the oil companies would simply process it thru the existing infrastructure, that way they still maximize their profit while accessing a source in a decidely less hostile part of the world, Elk dont drive carbombs, well, not yet anyways.

[Anonymous]

The ANWR aurgument is a red herring, even if it was opened to drilling today it would be up to  10 years before any meaningful production could begin, and then, where are they going to refine it? Crude avalability is high worldwide, its refining capacity thats been the bottleneck binding supply, particularly here in the US. High demand for refined products worldwide, coupled with nervous speculators driving price per barrel up. Bush said recently that new refineries are required, with record windfall profits wheres the incentive for oil companies to sink millions into strangling the golden goose of profit? If Bush truely thinks new refineries are needed the only likely way he's likely to get one will be for the Guv'ment itself to build it bypassing the oil companies.

You suggest the government should bypass the oil companies and build the refineries that are needed.  Do you believe the oil companies are not building new refineries because they don't want to?  They want to drill in ANWR.  So I would think that if they needed new refineries for ANWR oil, they would want to build them.  Why would they want to drill for oil if they can't refine it?

I beleive the oil companies dont want to invest a penny more than they feel is absolutly necessary, no drill in ANWR means no necessary increase in proceesing the crude oil it would produce, hence no incentive to a build any new refinery. Seems to me they are perfectly happy with their current production levels, and their current profit level. Why invest in something that would in the end hurt your profit margin by increasing current supply and in doing so suppressing prices, thats just plain bad capitalism. I honestly think that even if ANWR was opened that the oil companies would simply process it thru the existing infrastructure, that way they still maximize their profit while accessing a source in a decidely less hostile part of the world, Elk dont drive carbombs, well, not yet anyways.

So if congress authorized drilling in ANWR to increase the supply of oil, do you believe there would be no takers because the oil companies do not want to increase the supply?

[vsmith]

The ANWR aurgument is a red herring, even if it was opened to drilling today it would be up to  10 years before any meaningful production could begin, and then, where are they going to refine it? Crude avalability is high worldwide, its refining capacity thats been the bottleneck binding supply, particularly here in the US. High demand for refined products worldwide, coupled with nervous speculators driving price per barrel up. Bush said recently that new refineries are required, with record windfall profits wheres the incentive for oil companies to sink millions into strangling the golden goose of profit? If Bush truely thinks new refineries are needed the only likely way he's likely to get one will be for the Guv'ment itself to build it bypassing the oil companies.

You suggest the government should bypass the oil companies and build the refineries that are needed.  Do you believe the oil companies are not building new refineries because they don't want to?  They want to drill in ANWR.  So I would think that if they needed new refineries for ANWR oil, they would want to build them.  Why would they want to drill for oil if they can't refine it?

I beleive the oil companies dont want to invest a penny more than they feel is absolutly necessary, no drill in ANWR means no necessary increase in proceesing the crude oil it would produce, hence no incentive to a build any new refinery. Seems to me they are perfectly happy with their current production levels, and their current profit level. Why invest in something that would in the end hurt your profit margin by increasing current supply and in doing so suppressing prices, thats just plain bad capitalism. I honestly think that even if ANWR was opened that the oil companies would simply process it thru the existing infrastructure, that way they still maximize their profit while accessing a source in a decidely less hostile part of the world, Elk dont drive carbombs, well, not yet anyways.

So if congress authorized drilling in ANWR to increase the supply of oil, do you believe there would be no takers because the oil companies do not want to increase the supply?

No there would definelty be takers, the question is who has the deep pockets to explore such a remote region? Some companies  have already stated getting the oil out of ANWR overland or by sea is problematic at best. But I'm not going to speculate on whether or not it will ever get opened, too big a hot potato politically, even with the sky high oil prices.

[daveklepper]

Usual non-expert outside advice by someone who has not explored the problem in any kind of depth or experience.

[Anonymous]

The ANWR aurgument is a red herring, even if it was opened to drilling today it would be up to  10 years before any meaningful production could begin, and then, where are they going to refine it? Crude avalability is high worldwide, its refining capacity thats been the bottleneck binding supply, particularly here in the US. High demand for refined products worldwide, coupled with nervous speculators driving price per barrel up. Bush said recently that new refineries are required, with record windfall profits wheres the incentive for oil companies to sink millions into strangling the golden goose of profit? If Bush truely thinks new refineries are needed the only likely way he's likely to get one will be for the Guv'ment itself to build it bypassing the oil companies.

You suggest the government should bypass the oil companies and build the refineries that are needed.  Do you believe the oil companies are not building new refineries because they don't want to?  They want to drill in ANWR.  So I would think that if they needed new refineries for ANWR oil, they would want to build them.  Why would they want to drill for oil if they can't refine it?

I beleive the oil companies dont want to invest a penny more than they feel is absolutly necessary, no drill in ANWR means no necessary increase in proceesing the crude oil it would produce, hence no incentive to a build any new refinery. Seems to me they are perfectly happy with their current production levels, and their current profit level. Why invest in something that would in the end hurt your profit margin by increasing current supply and in doing so suppressing prices, thats just plain bad capitalism. I honestly think that even if ANWR was opened that the oil companies would simply process it thru the existing infrastructure, that way they still maximize their profit while accessing a source in a decidely less hostile part of the world, Elk dont drive carbombs, well, not yet anyways.

So if congress authorized drilling in ANWR to increase the supply of oil, do you believe there would be no takers because the oil companies do not want to increase the supply?

No there would definelty be takers, the question is who has the deep pockets to explore such a remote region? Some companies  have already stated getting the oil out of ANWR overland or by sea is problematic at best. But I'm not going to speculate on whether or not it will ever get opened, too big a hot potato politically, even with the sky high oil prices.

I guess I'm not sure what you are saying about oil companies and ANWR.  You said ANWR was a red herring because the oil companies either could not, or would not go after the oil.  Then you said they would go after it, but you asked from where would they get the capital to go after it, suggesting that they don't have sufficient capital to put ANWR into production. 

Everything that I have ever heard suggests that the only thing that prevents ANWR from going into production is the U.S. congress.  Also, from what I have heard, the alleged excess profits made by the oil companies is not a result of high crude prices on the world market, but rather, from the processing and marketing of that crude.  Rising crude prices dampen demand, so it is entirely possible that lower crude prices resulting from new supply sources would actually increase oil company profits, not lower them as you suggest.  So I am skeptical when you say the oil companies would not want to develop ANWR because it would not be in their financial interest.  I think that's the red herring you mentioned concerning ANWR. 

Also, as I previously mentioned, if congress approved ANWR development today, the world price would drop the instant the news is received.  This silly notion that ANWR is just a drop in the bucket, too little, and too far off in the future to matter is transparent propaganda put out by the same interests who want us to believe we are running out of oil, and we had better stop using it. 

[vsmith]

When I said ANWR was a red herring I ment that on the political front, not on the oil companies. It is being pitched by some our leaders to the public as a fix to the current problems, open it today and have lower prices tommorow, at least thats the way I read the spin. The fact that years of development would be necessary never enters that debate. Congress has been the roadblock, no one wants to stick their political neck on the block, not even some republicans, to approve opening it. But given the rocketing gas prices I wonder how much longer their going to hold out before public pressure for lower gas prices wins out over the desire to preserve wilderness areas, I give it a year, 2 tops before its opened, for good or for bad, but I see it as inevitable, even if it will take years to get to market.

Also I did not mean to say it would not be in the oil companies interest to develop ANWR, I ment it would be problematic given the logistics to get there, and get the oil out, but thats never stopped any of the larger companies from trying. Some of the smaller companies might opt out, but the large companies like Exxon would certainly have the resources, experience, and the will to go in.

I also agree that once opened prices would drop as you said, but only for the short term, as soon as everyone realized any oil from ANWR was years away from market, it would creep right back up to where it was before.

I think if we sat down face to face and discussed it, I think we would find more in agreement than in disagreement, its just the different way we view the subject. Anyway thats all I've got left to say on the subject.

Given we could discuss our personal veiwpoints on this topic till the end of time - or ANWR is opened to exploration whichever comes first, but I dont want this to become another Steam -vs- Diesel topic here and have the discussion become 20 pages of us repeating ourselves.

I think we've pretty much beaten the horse to death, and then turned the horsemeat into little horse meatballs, all that will soon be left is the horseraddish.

So for the sake of the forum discussion, you win.

Lets find something else to haggle over, I'd rather discuss the market for electric commuter skateboards