Fuel Prices - Jan 2016

[cdrazic93]

do we have any economists on here that could tell us when we could see gas back to its "normal" price again?

[p1l0t]

Originally Posted by cdrazic93

do we have any economists on here that could tell us when we could see gas back to its "normal" price again?

I'm not an "economist" but once we eat up the supply glut it should stabilize around $60/barrel. How soon we eat it up depends on the world consuption versus supply. Right now there little except talk of cutting production and consumption is less than supply so the glut is still growing... Here in the US we could go a month with ZERO supplies but we get more than half of our oil from Mexico, Canada, and our own drilling. Even if some OPEC guys do end up cutting some production someone else may just fill the gap and take away their market share. Cheap oil is here to stay for a little while unless something changes.

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[cdrazic93]

what kind of impact do these fluxuating oil prices have on alternative fuel research? its definitely had a steady growth these past few years, but wheres that alternative industrial revolution?

[p1l0t]

Originally Posted by cdrazic93

what kind of impact do these fluxuating oil prices have on alternative fuel research? its definitely had a steady growth these past few years, but wheres that alternative industrial revolution?

Solar Power is making leaps and bounds, but I wouldn't be surprised if anything else that isn't already sitting on a pile of govt grants is dead in the water.

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[gravitylover]

From everything I'm reading global supply is growing between 1-1.5% faster than demand and will most likely continue doing so through at leas the end of this year. Crude inventory dipped a hair last month but gasoline increased. Chances are retail gas prices will drop for at least a few more months. I'd love to see ethanol subsidies end so we could start to drain some of the excess inventory but instead it's going the other way. Ethanol content percentages are set to increase this year

[WolfpackS2k]

Saudi Arabia is trying to put the US shale oil industry out of business, that's a large part of the reason that oil is currently low. Another factor is China's faltering economy, since they're such a large consumer of oil. Additionally, most countries' economies (exception being the US) are in a lull right now as well. Finally, a lot of Iran's oil is hitting the global market now since their sanctions have been somewhat lifted.

US production of shale oil is only economically feasible when a barrel of oil is above $40 (I'm roughly estimating). Thus it's in Saudi Arabia's best interest to keep oil at or below that amount. The technology we now have makes the US a much bigger player in the world oil market. Someone correct me if I'm wrong here, but I'm pretty sure I've read that we could sustain ourselves entirely without importing oil at the moment.

Barring any sort of severe international conflict (esp in the Middle East) or economic turmoil it's safe to assume that oil (and thus gasoline) will be reasonably priced for the next 5-7, maybe 10 years. And by reasonably priced I mean less than $2.50/gallon.

[gravitylover]

Today SA said they won't cut production (again) and for a while Iran, Iraq and Libya have been ramping up. US production is finally starting to slip a little bit but there is new production coming on line from three spots in Africa that will be more than what's being lost here. Demand in China is apparently still rising but slowly and they seem to be developing more of their own in country resources so they aren't having much effect (if any) on global supply anymore.

[p1l0t]

Originally Posted by gravitylover

Today SA said they won't cut production (again) and for a while Iran, Iraq and Libya have been ramping up. US production is finally starting to slip a little bit but there is new production coming on line from three spots in Africa that will be more than what's being lost here. Demand in China is apparently still rising but slowly and they seem to be developing more of their own in country resources so they aren't having much effect (if any) on global supply anymore.

Oh wow they did give up on that completely http://www.theglobeandmail.com/repor...ticle28846990/ yeah it's going to keep declining then for the next few months at least.

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[Tcoat]

I want it to go up and soon! It is knocking the crap out of Canada's economy and is a major reason why the exchange rate sucks so bad (here). The sooner it goes back up the sooner I can start to order stuff from the US again.

[p1l0t]

Another thing to note is that 2013 was the momentous year we started producing more than we import. That was a major game changer. It's pushed our proven reserves way up. Even our actual Crude Oil Stocks are over 2 million thousand barrels or 2 billion barrels. The U.S. consumes 20 million barrels a day. We are down to 7 million barrels a day that is actually imported and half of that comes from Canada and Mexico! We are only importing 3 million barrels a day from OPEC countries. This is why they can't even cut production anymore because they will just loose what little market share they have left! Their hail mary is to just flood the market with cheap oil to try and curb domestic production. Even if that is eventually successful, and who knows how long it will take, as soon as the price comes back up we will just start drilling again at home. So long story short is that cheap oil is here to stay in the near term, and even in the medium to long term oil should stay resonable ($60/barrel at most maybe $2 at the pump for 87 in USD for US gallons).

[gravitylover]

There is some good info in this newsletter - http://oilprice.com/newsletters/free/opintel2302016

Keep in perspective that this a free newsletter so you get what you pay for...

[p1l0t]

Aparently California is paying over $2.50 a US Gallon for 87 LOL http://www.latimes.com/business/la-f...225-story.html Connecticut is a relatively expensive state and we are a full dollar less than that!

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[MisterSheep]

Originally Posted by p1l0t

Aparently California is paying over $2.50 a US Gallon for 87 LOL http://www.latimes.com/business/la-f...225-story.html Connecticut is a relatively expensive state and we are a full dollar less than that!

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depends on where you get the gas. Like just the other day I filled up at chevron by my house because the light came on. I paid 2.76 a gallon for 91. Now just driving during my lunch break. Near where I work theres a gas station selling 87 for 1.95 a gallon. I was in Lincoln, CA about 3 weeks ago and it was down to 1.50 for 87 there.

[Packofcrows]

$2.87-$2.95 for 91.

Wish it was $2.00