Rising Oil/Gasoline prices

[atpcliff]

Hi!

I was just reading some more about it today.

BIODIESEL
Biodiesel (fuel made from plants or animal/plant waste) actually has a positive energy end result. For every unit of energy used, biodiesel has approximately 1.75 units of energy available, which, according to the source I read, is actually better than oil!

An important point to remember: If we're manufacturing biodiesel, then the tractors and combines used, the fertilizer, and the trucks to bring it to the gas stations and/or refineries should also use as much biodiesel as possible. If they use straight oil, that would defeat a lot of the purpose of biodiesel.

Alaskan National Wildlife Refuge (ANWR)
The Arctic Power lobbying group is an industy group trying to get the US government to open up the ANWR to drilling.

A 5 Jan Investers.com article stated that ConocoPhillips just dropped out of the Arctic Power lobbying group: "A ConocoPhillips (COP) spokeswoman said the company recently chose not to renew its membership in the Arctic Power lobbying group." The article went on to say that ChevronTexaco "Has not been a member of Arctic Power since 2000." It also stated: "BP (formerly 'British Petroleum'-now their slogan is 'Beyond Petroleum') dropped out of the Arctic Power lobbying group in November 2002."

So, three major oil companies BP, ConocoPhillips and ChevronTexaco all have decided that trying to drill in the ANWR is not worth the effort.

One of the reasons is that there's just not a lot of oil there. I've heard civilians off the street tell me things like, "There's 40 years of oil there," or "The ANWR will provide all the world's oil needs for decades."

They are just plain wrong. Obviously, if there was that much oil, BP, ConocoPhillips and ChevronTexaco would not have dropped out of the efforts to open ANWR to drilling.

Here's the latest from the United States Geological Survey: "They estimate that potential ANWR oil supplies range from 15.6 billion to 42.3 billion barrels. But the agency also said it believes only 37 percent of these resources are "technically recoverable," leaving only 10.4 billion barrels, or 1.4 million barrels a day, that could "technically" be brought out of the ground. The daily figure represents about 7 percent of what the United States now burns each day."

Now, 7% of our needs are not nothing, but it's just not a lot. We import 65% of our oil needs now, and drilling out the whole ANWR will just prolong the inevitable.

I believe that if we took all the capital that would have to be invested to drill out the ANWR, and instead spent in on alternative energy development, we would be well ahead.

I don't want my kids having to go to Southwest Asia to fight for oil. I already did that, and once is enough. Let's learn our lesson and not be dependent on foreign countries to support our economy.

CLiff
YIP

 

[urflyingme?!]

Cartel anyone?

 

[sqwkvfr]

I think a logical goal is to start thinking of energy in terms of portability: For example, your house does not need portable fuel, but your car does.

Hydrogen cells are thought to be the portable energy of the future....so you were certainly on to something with this post.

 

[GravityHater]

so how can we use this insider info to cash in on oil stocks/futures?

 

[STL717]

A different view

Oil, Oil, Everywhere . . .
By PETER HUBER and MARK MILLS
January 27, 2005; Page A13 WSJ

The price of oil remains high only because the cost of oil remains so low. We remain dependent on oil from the Mideast not because the planet is running out of buried hydrocarbons, but because extracting oil from the deserts of the Persian Gulf is so easy and cheap that it's risky to invest capital to extract somewhat more stubborn oil from far larger deposits in Alberta.

The market price of oil is indeed hovering up around $50-a-barrel on the spot market. But getting oil to the surface currently costs under $5 a barrel in Saudi Arabia, with the global average cost certainly under $15. And with technology already well in hand, the cost of sucking oil out of the planet we occupy simply will not rise above roughly $30 per barrel for the next 100 years at least.

The cost of oil comes down to the cost of finding, and then lifting or extracting. First, you have to decide where to dig. Exploration costs currently run under $3 per barrel in much of the Mideast, and below $7 for oil hidden deep under the ocean. But these costs have been falling, not rising, because imaging technology that lets geologists peer through miles of water and rock improves faster than supplies recede. Many lower-grade deposits require no new looking at all.

To pick just one example among many, finding costs are essentially zero for the 3.5 trillion barrels of oil that soak the clay in the Orinoco basin in Venezuela, and the Athabasca tar sands in Alberta, Canada. Yes, that's trillion -- over a century's worth of global supply, at the current 30-billion-barrel-a-year rate of consumption.

Then you have to get the oil out of the sand -- or the sand out of the oil. In the Mideast, current lifting costs run $1 to $2.50 per barrel at the very most; lifting costs in Iraq probably run closer to 50 cents, though OPEC strains not to publicize any such embarrassingly low numbers. For the most expensive offshore platforms in the North Sea, lifting costs (capital investment plus operating costs) currently run comfortably south of $15 per barrel. Tar sands, by contrast, are simply strip mined, like western coal, and that's very cheap -- but then you spend another $10, or maybe $15, separating the oil from the dirt. To do that, oil or gas extracted from the site itself is burned to heat water, which is then used to "crack" the bitumen from the clay; the bitumen is then chemically split to produce lighter petroleum.

In sum, it costs under $5 per barrel to pump oil out from under the sand in Iraq, and about $15 to melt it out of the sand in Alberta. So why don't we just learn to love hockey and shop Canadian? Conventional Canadian wells already supply us with more oil than Saudi Arabia, and the Canadian tar is now delivering, too. The $5 billion (U.S.) Athabasca Oil Sands Project that Shell and ChevronTexaco opened in Alberta last year is now pumping 155,000 barrels per day. And to our south, Venezuela's Orinoco Belt yields 500,000 barrels daily.

But here's the catch: By simply opening up its spigots for a few years, Saudi Arabia could, in short order, force a complete write-off of the huge capital investments in Athabasca and Orinoco. Investing billions in tar-sand refineries is risky not because getting oil out of Alberta is especially difficult or expensive, but because getting oil out of Arabia is so easy and cheap. Oil prices gyrate and occasionally spike -- both up and down -- not because oil is scarce, but because it's so abundant in places where good government is scarce. Investing $5 billion dollars over five years to build a new tar-sand refinery in Alberta is indeed risky when a second cousin of Osama bin Laden can knock $20 off the price of oil with an idle wave of his hand on any given day in Riyadh.

The one consolation is that Arabia faces a quandary of its own. Once the offshore platform has been deployed in the North Sea, once the humongous crock pot is up and cooking in Alberta, its cost is sunk. The original investors may never recover their capital, but after it has been written off, somebody can go ahead and produce oil very profitably going forward. And capital costs are going to keep falling, because the cost of a tar-sand refinery depends on technology, and technology costs always fall. Bacteria, for example, have already been successfully bioengineered to crack heavy oil molecules to help clean up oil spills, and to mine low-grade copper; bugs could likewise end up trampling out the vintage where the Albertan oil is stored.

In the short term anything remains possible. Demand for oil grows daily in China and India, where good government is finally taking root, while much of the earth's most accessible oil lies under land controlled by feudal theocracies, kleptocrats, and fanatics. Day by day, just as it should, the market attempts to incorporate these two antithetical realities into the spot price of crude. But to suppose that those prices foreshadow the exhaustion of the planet itself is silly.

The cost of extracting oil from the earth has not gone up over the past century, it has held remarkably steady. Going forward, over the longer term, it may rise very gradually, but certainly not fast. The earth is far bigger than people think, the untapped deposits are huge, and the technologies for separating oil from planet keep getting better. U.S. oil policy should be to promote new capital investment in the United States, Canada, and other oil-producing countries that are politically stable, and promote stable government in those that aren't.

Messrs. Huber and Mills are co-authors of "The Bottomless Well: The Twilight Of Fuel, The Virtue Of Waste, And Why We Will Never Run Out Of Energy," just out from Basic Books.

http://search.barnesandnoble.com/booksearch/isbninquiry.asp?isbn=0465031161

 

[mzaharis]

Hydrogen cells are thought to be the portable energy of the future....so you were certainly on to something with this post.

Still a lot of difficulties making them into a practical automotive power supply - see this month's Scientific American for an article on the subject. It depressed me a bit. They're still a ways from figuring out how to store enough hydrogen to power a car that has the same performance and range as contemporary cars.

 

[TurboS7]

There is so much oil out there we havn't even begun to run out. Right now the objective is to suck the MidEast oil reserves dry and eliminate that power base.

 

[FN FAL]

Hydrogen cells are thought to be the portable energy of the future....so you were certainly on to something with this post.

"What is the frequency Ken?" Bip...ooooops upside ya head! "The frequency Ken? What's the frequency?" Bip!

 

[atpcliff]

Hi!

Do We Have Lots of Cheap Oil?
Huber and Mills have their ideas, and a few people agree with them.

I think the experts at BP have a lot better understanding of the oil situation than Huber and Mills. Everyone's future at BP depends on making money from energy, and they've said they have to diversify away from oil to continue to make money in the long term. Huber and Mills can make money selling books about anything.

Here's what Tobin at Changewave has to say about the oil shale situation in Canada, for example: "Not to fear, however; ExxonMobil believes there are some 14 trillion barrels still in the ground, including non-conventional resource fields like the tar sands of Canada and petroleum-rich shale in the Western U.S.

Not so fast. First, their forecast misses a key point: it takes TRILLIONS of cubic feet of natural gas each year to get oil out of the tar sands of Calgary. Natural gas deposits are MUCH tighter in the U.S. than oil -- and the only way to get natural gas into the U.S. OTHER than a Canadian pipeline is an LNG ship.

The hitch there is that we need 25 new LNG plants to meet that demand, and we have only built five since 1972 -- and only three future plants have been approved."

Investment Ideas:
On the investment side, my wife's been up a lot in tanker stocks (the big oil tankers that move oil globally).

The oil companies are going to have to start spending massive amounts of money on finding more oil. In the past few years, oil prices have been very low, and the oil companies have been reluctant to put a lot of money into exploration and discovery. Now that the prices are up, and demand is rocketing, they have the incentive to put lots of resources into more oil production. Putting money into companies that make oil exploration/drilling equipment or services is a great bet to make a lot of money, not to mention the oil companies themselves, at least for the next 10-20 years.

Aviation:
What is going to happen when jet fuel continues on the trajectory it is on, and wholesale fuel prices go to $2, $2.50, $3+ with no end in sight?

Does anyone know about alternative fuels/engine technology for our jet airplanes?

Cliff
YIP

 

[atpcliff]

Hi!

Here is most of Tobin's opinions-from Changewave:

"> 2. THE KAHUNA'S RANT O' THE WEEK: When Will the Energy “Analysts”
> Get It? -- By Tobin Smith
>
> “U.S. crude oil futures hit a new record high of $55.70 per barrel
> on fund buying, refinery glitch.”
>
> This was the report at 1:50 p.m. today.
>
> You can bet that on the squawk boxes of Wall Street energy
> analysts, the message they are delivering sounds like this:
>
> “During the next few years, oil prices will drop to less than $30.
> History has shown us one thing: the cure for high oil prices is
> high oil prices. Those who ignore history are destined to repeat
> it.
>
> “The forces of demand destruction will take the supply/demand
> equation clearly to the supply side and just like in the past, oil
> prices will come back to the historical range of $22-$28.
>
> “This oil price bubble is simply that -- a bubble. This applies to
> natural gas prices as well.”
>
> Well, friends, as someone who has actually been RIGHT on my call
> for a secular imbalance between oil/natural gas supply and demand,
> I want to make sure I do everything possible to make you IGNORE
> this advice.
>
> Long before oil and natural gas price bugs were flashed on CNBC or
> Maria B. began breathlessly talking about oil prices, we were
> right about energy prices and energy investing.
>
> Ignoring most of the energy analysts on Wall Street has been the
> most profitable experience of my investing life. I want it to be
> for you, too.
>
> Let’s start with the blinding flash of the obvious: Until about
> three to five years ago, previous history of demand destruction
> was indeed the driver of price corrections in the oil market.
>
> Until 2000, China and India were relatively minor importers of oil
> and gas -- not enough to imbalance the excess capacity at the
> margins of demand.
>
> From about 2001 forward, that fact was NEVER true again. Since
> 2001, China and India became MAJOR energy importers, and that
> trillion-dollar ChangeQuake in the supply/demand calculus of oil
> and gas, and its resulting wave of pricing power, has changed the
> nature of energy (and basic materials) investing for the
> foreseeable future.
>
> Tobin’s Rule: Those who ignore secular transformational change in
> the underlying fundamentals of an industry or company are destined
> to be dead WRONG in their forecasting.
>
> THE GLOBAL ENERGY REALITY CHECK
> Here is the reality of the demand side of our global energy
> resources from a BusinessWeek online article in November 2004:
>
> “Today, China accounts for 12.1% of the world's energy
> consumption. That's second only to the U.S., at 24%, and up from
> 9% a decade ago. China's whole modernization strategy is based on
> access to abundant supplies of energy. Its hungry basic industries
> such as steel, aluminum and chemicals devour electricity and coal.
> A mushrooming middle class consumes growing quantities of heating
> oil and gasoline. By 2010, analysts expect some 56 million cars,
> minivans and sport-utility vehicles to be rolling on China's
> highways -- more than twice the number today. By 2020 the
> country's demand for oil will nearly double, to 11 million barrels
> a day, natural gas consumption will more than triple, to 3.6
> trillion cubic feet annually, and coal use will grow by 76%, to
> 2.4 billion tons a year, according to a U.S. Energy Dept.
> forecast.”
>
> Here is a digest of Beijing’s latest report on their energy
> consuming future:
>
> “China will see an increasing dependency on crude oil imports,
> with the amount of crude oil imported rising from 31 percent in
> 2002 to 50 percent four years later in 2007. China will import 100
> million tons of crude oil in 2005, 150 million tons in 2010 and in
> 2020 the number would soar to 300 million tons per year.”
>
> China will become the world's second biggest oil consumer
> following the United States and third largest oil importer after
> the United States and Japan, said the research report.
>
> The more than 6% annual growth of China's national economy and the
> readjustment of the economic structure are behind the country's
> higher demand for crude oil, but oil production has failed to keep
> pace with the economic growth.
>
> With oil demand growing on average 8% a year and production
> growing 1.7 percent annually, the shortage of oil supply forced
> China to become a net oil importer since 1993.
>
> The experiences of foreign developed countries proved that the oil
> consumption would increase at a LOW speed in an economy backed by
> industrial sectors and during the industrializing process.
>
> When tertiary industries become the backbone of the national
> economy, the domestic oil consumption would undergo ROCKETING
> growth, the report further explained.
>
> China will be in a vital period of industrialization from now
> until 2020, per the report, predicting that China's average annual
> consumption of crude oil would secure an increase by 4%-5% in the
> coming five to 10 years.
>
> “China's oil imports may rise at a level of around 30% for the
> next three years as domestic production increases less than 1%
> annually,” said Michael Lee, a Hong Kong-based oil and gas analyst
> at UOB-Kay Hian Ltd.
>
> Now India is joining China in a stepped-up contest for energy,
> with both economies recently booming just as their oil production
> at home has sagged. China trails only the U.S. in energy
> consumption; India has moved into fourth place, behind Russia.
>
> Only 7 in 1,000 Indian households own a motor vehicle -- only 3 in
> 1,000 Chinese own a motor vehicle. (To put this in context,
> Californians’ own 1.023 cars per each PERSON.)
>
> Thus, future oil consumption in India is expected to grow rapidly,
> to 3.1 million barrels per day by 2010, up from 1.8 million
> barrels per day in 1998.
>
> Now the problem: the world production of oil has peaked -- and
> excess capacity is down to around 1 million extra barrels per day.
> But since ANY commodity is priced based on the available supply at
> the balance point of demand and supply, excess energy production
> is growing slower than energy consumption growth.
>
> Global daily oil consumption today stands at around 82 million
> barrels, and the mega-industrialization of nations like China and
> India will take that daily consumption up to at least 120 million
> barrels a day by the year 2030.
....
> THE PEAK OIL THEORY
>
> Over the last several years, a theory known as “Peak Oil” has been
> working its way into the mainstream. The chief proponent of this
> theory is Dr. Colin Campbell, a retired oil-industry geologist now
> living in Ireland. Dr. Campbell, who has been raising warnings
> about Peak Oil for some 15 years, believes that global consumption
> of oil is surpassing not only the amount of oil being pulled from
> the groundand the amount of oil left to be found, but is also
> surpassing the ability of technology to compensate for what he
> sees as an inevitable and looming shortfall.
>
> The “peak,” Campbell believes, will come as early as next year,
> heralding a steady rise in prices and the end of cheap oil as we
> have known it, causing a seismic shock within the global economy.
> “The perception of this decline changes the entire world we know,”
> said Dr. Campbell in a September 2004 report from The Wall Street
> Journal. “Up till now we've been living in a world with the
> assumption of growth driven by oil. Now we have to face the other
> side of the mountain.”
>
> Maybe I’ll give the "peak oil" idea an upcoming rant, but let’s
just deal with reality of today.
>
> Mick Mayer of Prudential does good work on the value of
> oil-intrinsic energy companies. He figures analysts are using
> $25-$27 as their average price for the next 10 years.
>
> This thinking simply does NOT include the emergence of China and
> India as energy consumers. Unless China and India stop growing, we
> have a three- to five- year global recession that includes India
> and China, or there is a sudden and miraculous change in oil and
> gas exploration rates for the next five to 10 years, the average
> prices for light sweet crude are LOCKED into $40-$80 price swings.
>
> That means natural gas above $6 and coal prices going to $50 for
> utility coal and $150 for metallurgical coal.
>
> This is the reality of energy prices in the post India/China
> energy importation world.
>
> I pray these analysts don’t get this fundamental shift and
> continue to keep their price models 40%-50% TOO LOW.
>
> As they come to their senses, energy company valuations will
> follow.
>
> Toby"

Cliff
YIP

 

[some_dude]

Be wary of people who talk about the "changed nature... of energy investing" or "it's a new era." That is what technology investors thought five years ago, too.

As Warren Buffett wrote (I'm quoting from memory, so cut me some slack): "Be fearful when others are greedy, and greedy when others are fearful." There is a lot of greed in the energy markets right now.

 

[Corona]

Still a lot of difficulties making them into a practical automotive power supply - see this month's Scientific American for an article on the subject. It depressed me a bit. They're still a ways from figuring out how to store enough hydrogen to power a car that has the same performance and range as contemporary cars.

There was an episode of Scientific American on PBS a while back where they looked at possible storage technology for hydrogen fuel cells. I think they are closing in on some solutions.

I agree the current technology of fuel cells is depressing. But, look where automobiles were a century ago...slow, noisy and very expensive. For a while, even, it was not even clear which would be more practical; electric or gasoline cars. That changed pretty quickly.

Honda is running fuel-cell cars in a couple municipal fleets in the Southwest (gotta keep those cells warm, or they don't work!), and they have been popular.

I also keep hoping someone will make a technology breakthrough on fusion power. The estimate is still 40-50 years away for a commercial reactor. When/if those become a reality, I expect that will create a societal change on par with the Industrial Revolution.

C

 

[JonJohn82]

It seems like since oil is finite and the United States is becoming more heavily dependent on foreign oil, we should spend some time developing alternative sources of energy.

 

[mzaharis]

There was an episode of Scientific American on PBS a while back where they looked at possible storage technology for hydrogen fuel cells. I think they are closing in on some solutions.

I agree the current technology of fuel cells is depressing. But, look where automobiles were a century ago...slow, noisy and very expensive. For a while, even, it was not even clear which would be more practical; electric or gasoline cars. That changed pretty quickly.

Honda is running fuel-cell cars in a couple municipal fleets in the Southwest (gotta keep those cells warm, or they don't work!), and they have been popular.

I also keep hoping someone will make a technology breakthrough on fusion power. The estimate is still 40-50 years away for a commercial reactor. When/if those become a reality, I expect that will create a societal change on par with the Industrial Revolution.

C

[curmudgeon]
You forgot steam - I think that steam-powered cars (don't know what they burnt to make the steam - wood?)

Yeah, researchers are considering metal hydrides, but these still take maybe 660 pounds of metal to hold an amount of H2 equivalent to a regular car's tank of gasoline (6-8 pounds of hydrogen). The neatest idea is to store the hydrogen in the interstitial spaces between water molecules in ice (250 pounds for one tank of fuel equivalent), but that one is in very early stages. Current processes require pressures of 36,000 psi (not a typo), although there is a process that could possibly require only 1450 PSI. I don't know how long it takes to refuel.

This is why California's horrendous mandated targets for percentage of zero-emissions cars that companies must sell have failed miserably - it's really hard to build a car that weighs the same as a current car, that goes as far on a tank of fuel, is as temperature-insensitive, and costs the same, without the manufacturers losing their shirts on each one, using alternative power sources. Who wants to buy an electric car that goes 70 miles (if you leave the AC off), and takes 8 hours to recharge? Gasoline is a simple solution that is hard to beat from a performance-per-pound perspective. And, as you aluded, it has a 120 year head start in technology development. Although it may (and my opinion, must) eventually happen, I think it will be a while (~20 years, my mostly uninformed guess) before we see people other than Ed Begley and the Sierra Club, and short-range commercial fleets with central refuelling points, buying fuel cell cars.

I remember that there was some effort to create a fuel cell car that runs on gasoline (I know - doesn't sound right, does it?). The fuel undergoes some sort of a catalytic breakdown which frees the hydrogen, which is then used in a fuel cell. The only problem is that the remaining component of Gasoline is mostly carbon, which is vented as CO2, although, being more efficient at extracting energy, the car still released less CO2 (according to the SciAm article, gasoline cars only use 33% of their chemical energy). The main advantages were that fuel storage is easier, and you can use existing distribution infrastructure (another big stumbling block for fuel cell acceptance). Don't know whatever came of it.

What's the old saw about fusion? "It's the energy source of the future - always was, and always will be." It's funny - about 40 years ago, the estimate was that fusion was only 20 years away. Now, it's 45-50 years away. Hopefully, that trend will reverse. ;-) Agreed, though, that it will have a fundamental impact on society if/when it happens, assuming the commercial hurdles are surmountable (in the late '40s, people said that nuclear fission was going to supply electricity that was "too cheap to be worth metering").

[/curmudgeon]

 

[B-J-J Fighter]

Very good thread. I started reading about peak oil about 1yr ago when gas prices really started to climb. I just hope rising prices don't slow down current growth. I just got a job flying again and I don't want a recession to bring it to a halt.

 

[sqwkvfr]

"What is the frequency Ken?" Bip...ooooops upside ya head! "The frequency Ken? What's the frequency?" Bip!

I think that considering that 80-90% of your posts make me laugh out loud, I'd have to say that your talents are wasted on aviation.

(hey, I'm bringing a 172R up your way from PHX next week and I'm debating whether to land it on a grass runway...is that a big no-no during the winter??)

 

[FracCapt]

I used to be a big believer in BioDiesel and Ethanol until someone on this board pointed out that when you factor the amount of energy required to manufacture these two, the benefit came to zero.

I use biodiesel in my truck(usually only B20, rarely is B100 available in my area - though, there is a new supplier that is supplying ONLY B100 for 20cents less than Diesel #2) whenever I can, and it makes it run better than #2. It lubes the injectors better than #2. When ULSD(Ultra Low Sulfur Diesel) becomes the standard, we will have to either run additives to lubricate the injectors, or a biodiesel mix to do the same, or comdemn our engines to much shorter lives. ULSD is not only more expensive, but it's much more damaging to engines when run without any additives. Unfortunately, there are no plans to place any kind of additives/lubricant in ULSD because the government feels it would defeat the purpose of ULSD. I guess I'll continue to run biodiesel, and I'm now investigating WVO.

I don't know why the government is dead set on this ULSD thing when biodiesel is so much better for the environment(the reason they claim ULSD is necessary) AND it can be produced domestically. Of course, we can't produce enough biodiesel to supply the entire country with B100....but we may be able to do B20 or even B50 for the whole country in 5-10 years, which GREATLY reduces emissions.

 

[atpcliff]

Hi!

I just read that GM will have production hydrogen fuel cell cars by 2010, and you will be able to buy a hydrogen fuel-cell car off a Chevrolet lot by 2015.

Another article I read was about what I have been worried about. The American car companies have lagged far behind the Japanese since about 1975, and it continues.

As you probably know, Detroit is far behind Toyota/Honda with hybrids. Note: If you didn't know, the new Ford Escape Hybrid is using 3 year old Toyota drivetrain technology, under license.

GM's response was to put max resources into a hydrogen fuel cell car. They are planning to be #1 again in world auto production, and they think they will do it by being first with mass hydrogen fuel cell auto production.

Unfortunately, I think Detroit has fallen by the wayside again!

The 5 companies with the most hydrogen fuel cell patents in recent years are ALL Japanese, starting with Honda and then Toyota!

I would really prefer to buy a Detroit car, but I won't if I can get a better quality car from someone else.

Cliff
YIP

PS-To any auto industry people reading this (I know there may be none), we won't be buying any new cars unless the worst-case mileage (city or highway) is a MINIMUM of 45 mpg. I'm not paying $3+/gallon for gas to put into a $35K+ auto that gets crappy mileage.

 

[Sphincter Boy]

Actually, I do both. I have every where I've lived; Orlando, FL and Fairbanks, AK and quite a few places in between. If more Americans left their SUVs at home and walked or rode bikes, they might find their seats fitting better when they airline to a vacation.

Do you walk or ride your bike to work? I'm tired of people bashing SUV owners when they themselves don't take their own advice. I guess we should all go back to the horse and buggy,

 

[AcroChik]

A Touch Of Market Pragmatism

Oil will never go below "what" price again?

Such statements are fundamentally unsound about any commodity (which is what oil is), or market.

A little history:

In January of 1968 the price of gold, per ounce, was fixed at just under $40.00. In January, 2002, an ounce of gold hovered around $300.00.

During the wild ride gold prices took in a speculators' bubble between 1978 - 82, the price broke through $600.00, twice.

We'll never see prices below $550.00 again, the pundits screamed. Then $500.00, then $450.00. Then $400.00. Etc. Etc. Etc. Many people got burned when that bubble burst. There's never a shortage of irrational exuberance.

The only thing financial pundits know for sure is how to cash their checks today and that you won't remember their names when they turn out to be wrong tomorrow.

Oil and gold seem to be closely related, in investment terms. Increasing oil prices apparently drive cash out of the equities markets and into gold..., usually but not always.

A recent upward spike in oil prices "seemed" to coincide with a sharp drop in the equities markets, which have since recovered those particular losses.

Proving causality in market events is a very tricky business. Reliably predicting the future? Impossible.

Here's a link to historical gold prices for anyone interested: http://www.kitco.com/charts/historicalgold.html