Toledo Talk

Gas Prices - again

So, if this is true: http://www.marketwatch.com/story/oil-prices-edge-lower-as-china-devalues-yuan-2015-08-11 and it is, what's the justification for a $0.40/gallon hike last week and another $0.25/gal today?

Its great that the local TV media tells us gas prices are lower/higher compared to last week/yesterday/last year but how about doing a little digging and tell us why?

created by Foodie on Aug 11, 2015 at 01:27:26 pm     Business     Comments: 20

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I heard an analyst on Fox Business this morning say there is already a 3 year supply of oil processed. Seems like a lot - but I don't know the industry.

posted by Molsonator on Aug 11, 2015 at 02:15:41 pm     #  

Prices move up and down depending on local and regional conditions as much as they do on international factors.

Last week (with a Kroger discount) I paid $1.29 a gallon (it was $1.79 w/o the discount). The next day the pump price was $2.49:

posted by historymike on Aug 11, 2015 at 02:17:21 pm     #  

That's my point - I'd like to hear what those factors are so I can judge for myself if they sound plausible or more like bovine scathology.

posted by Foodie on Aug 11, 2015 at 02:43:16 pm     #  

More information:

Business Insider

N.A.C.S.

posted by historymike on Aug 11, 2015 at 05:04:25 pm     #  

best "shell" game ever....
http://www.ttnews.com/articles/basetemplate.aspx?storyid=39134

posted by justareviewer on Aug 11, 2015 at 06:30:23 pm     #  

I saw gas for $2.15 last night, about 9 pm.

Passed the same gas station today at 3:30 pm, and it was $2.54.

(Circle K on Tremainsville)

posted by mom2 on Aug 11, 2015 at 09:26:39 pm     #  

Things are getting interesting for sure. Regardless of this big spike locally for some stupid reason, oil is dropping pretty fast thanks to Iran, the Saudis, and China. Listening to people back in Oklahoma, they are a little scared since we could see sub $30 oil again until we start going back up next year. Of course I'm sure the rest of us across the country would love to finally have sustained lower fuel prices to help the economy, but the half dozen oil states are definitely starting to feel the pinch. They have had a great ride as of late of record job growth, lots unemployment, and tons of new development. Time to share the wealth a bit.

It will be interesting to see if oil does fall that low to start getting us below $1.50/gal for the first time in years.

posted by JustaSooner on Aug 12, 2015 at 09:01:23 am     #  

JustaSooner posted at 09:01:23 AM on Aug 12, 2015:

Things are getting interesting for sure. Regardless of this big spike locally for some stupid reason, oil is dropping pretty fast thanks to Iran, the Saudis, and China. Listening to people back in Oklahoma, they are a little scared since we could see sub $30 oil again until we start going back up next year. Of course I'm sure the rest of us across the country would love to finally have sustained lower fuel prices to help the economy, but the half dozen oil states are definitely starting to feel the pinch. They have had a great ride as of late of record job growth, lots unemployment, and tons of new development. Time to share the wealth a bit.

It will be interesting to see if oil does fall that low to start getting us below $1.50/gal for the first time in years.

Good point, JustaSooner. I was recently on a search committee for a university position, and one of the applicants was recently laid off from a teaching job in Alaska. To meet the budget shortfalls due to the decline in oil prices, state funding for education got slashed, so he was on the job market after a nice run of five years up there.

State revenue in Alaska from oil production taxes has dropped by over 50 percent since 2012. In addition, when factoring in tax cuts and subsidies to producers, Alaska will be paying out more in corporate welfare subsidies and tax cuts than it takes in from oil tax revenue.

posted by historymike on Aug 12, 2015 at 12:38:34 pm     #  

I dont think OPEC can continue to drive down the price of oil for much longer.

posted by MIJeff on Aug 12, 2015 at 02:47:34 pm     #  

And the cycle continues:
Indiana refinery woes may hike gas prices by 30 cents - $1

posted by daddyg on Aug 12, 2015 at 02:49:26 pm     #  

historymike posted at 12:38:34 PM on Aug 12, 2015:
JustaSooner posted at 09:01:23 AM on Aug 12, 2015:

Things are getting interesting for sure. Regardless of this big spike locally for some stupid reason, oil is dropping pretty fast thanks to Iran, the Saudis, and China. Listening to people back in Oklahoma, they are a little scared since we could see sub $30 oil again until we start going back up next year. Of course I'm sure the rest of us across the country would love to finally have sustained lower fuel prices to help the economy, but the half dozen oil states are definitely starting to feel the pinch. They have had a great ride as of late of record job growth, lots unemployment, and tons of new development. Time to share the wealth a bit.

It will be interesting to see if oil does fall that low to start getting us below $1.50/gal for the first time in years.

Good point, JustaSooner. I was recently on a search committee for a university position, and one of the applicants was recently laid off from a teaching job in Alaska. To meet the budget shortfalls due to the decline in oil prices, state funding for education got slashed, so he was on the job market after a nice run of five years up there.

State revenue in Alaska from oil production taxes has dropped by over 50 percent since 2012. In addition, when factoring in tax cuts and subsidies to producers, Alaska will be paying out more in corporate welfare subsidies and tax cuts than it takes in from oil tax revenue.

Oklahoma much the same. The air head governor, and I'm being kind for Mattress Mary, is doing everything she can to keep slashing the state's income tax even though they are seeing budget shortfalls around $600 million. They naturally are slashing budgets for education (they have the lowest paid teachers in that region averaging around $30k), law enforcement/prisons (they have one of the overall highest incarceration rates in the nation, and highest for women), and infrastructure.

It really isn't much unlike the BS that goes around here. The states start seeing additional income from new/growing streams, but then don't plan for those revenues being only temporary. So they sit there and start overspending or cutting income in other areas with no backup plan. They started a lottery down there about 10 years ago only to use that revenue to replace original education revenue streams - ooops. Lottery revenue took a nose dive and never hit expectations. Then of course their corporate welfare is nearly criminal. They give out so many tax breaks and then allow those tax breaks to be bought and sold by the companies that own them. They are normally tied to jobs programs with businesses promising to create so many jobs only to do a fraction, take the free millions in tax money, and then bolt.

People up here complain about the liberals, but Oklahoma is as red as you can get with hard evangelical conversations and they are just as bad if not more. Back on topic some what, they recently pushed through tax reform for O&G companies to ensure they aren't taxed more than 2%...when you have states like North Dakota at around 12% and growing fairly well. Oklahoma and Oil...Toledo and Jeep. All the leaders are same and just as stupid.

posted by JustaSooner on Aug 12, 2015 at 04:18:03 pm     #  

I have to take exception to people equating tax breaks with actual tax money. Sure in the end they end up the same usually but its not like those companies were actually handed money taken from tax payers. The other thing that kinda irks me is people bitching about tax breaks for oil companies exploratory operations. They are getting a break on what they spend to search for more oil so that they don't bite it in the ass if they find anything it incentivizes them to actually look for oil in whatever territory gives them a tax break. You say so what, why should they who seem to earn so much not have to pay taxes? I would remind you that when they do find oil, even if they don't start pumping it out of the ground the very next day it is a proven technology that will with existing technology produce products we all use everyday. Now why do I even bother to mention this? Because for as much as those companies receive these tax breaks, you have solar, wind, alternative fuels, alcohol and other weirder experimental technologies all receiving not only tax breaks, but actual tax dollars from our government to experiment with only a miniscule chance of ever producing a single KWH or erg of energy to show for it. Solar = extremely expensive and inefficient, limited to daytime production of any noticeable amount of energy. Wind = killing wildlife, extremely expensive and constant maintenance headache to operate, also inefficient and reliant on the wind to blow, as long as it doesn't blow to hard. Alcohol = already proven to not live up to the hype Al Gore claimed and several studies show it takes more energy to produce than is gotten from it, destroys older automotive fleets fuel systems, does not reduce pollution as was touted for adopting its use. Some weird mystery fuel producing a oil substitute for the Navy that costs 159 dollars per gallon that the liberal executive branch is forcing them to buy from a company who heavily donated to the same group forcing the navy to buy their fuel. Coal = in 1978 we pumped a ton of crap into the air from coal plants in the last 30 years the industry has been force to reduce emissions of sulphur to stop acid rain, along with mercury and anything going up the chimney, they have at great expense installed scrubbers on those stacks and reduced emissions to basically what a human would exhale everyday, carbon dioxide. This is our largest source of mass energy production in our country and has been since forever, some companies forewent the heavy duty scrubbers and switched to natural gas as its cost became extremely cheap from fracking on private lands. Natural will be the next target you watch. Needless to say power companies have spent mass fortunes cleaning up and lowering their pollution at great cost only now to be told co2 which still hasn't been proven to be causing earths warming is not a pollutant and they have to stop making it or store it or shut down. As 0bama said before elected electricity prices with necessarily sky rocket under his plan, which was cap and trade, he couldn't get it passed in congress so he took executive action and had his EPA declare it a pollutant and now under EPA regulations. Just his decision to do so, your representatives had no say in it, therefore you had no say in it. he even put his own constituents out of business to do that last bit, ask the coal miners unions if they would still vote for 0bama and the Democrats, I bet the unions leaders might but doubt the rank and file would. Natural gas = sure its the pretty girl at the party now but its a result of something left and 0bama have already targeted, fracking, they have done everything they can to stop any national production of energy from drilling and then claim any progress made on [private] lands as a sign of their success [what a joke], dont get comfortable with natural gas they will shut that down too as soon as they can find a way to take ownership of private land rights to do so.
Well i wont go on any further you can see my point I'm sure, last thought is why are we giving actual billions of dollars to research unproven and unmarketable ideas and forcing people into extremely expensive options where after all the money is spent even if they do discover a new algae that when dying produces a fraction of a picoliter of some oil substitute when we can not tax the money a oil company actually spends to find a proven energy source? There are plenty of examples of failures on the lefts agenda Solydra, couple other solar companies, some battery companies, cost estimates of windmills (noise generators). lots of select cronyism to companies owned by big democratic donors.

Oh well got that off my chest.

posted by MIJeff on Aug 12, 2015 at 06:28:51 pm     #  

Got gas for 1.99 last Tuesday. Today is $2.89. Stupid.

posted by bolt98 on Aug 12, 2015 at 08:53:31 pm     #  

MIJeff - I don't disagree with your points entirely. However, I've seen how they structure these deals in Oklahoma and it is insane. They monetize the tax breaks they given to the point that they can be bought and sold between companies. Then the end buyers can cash them in at any point for a refund of dollars being pulled out of the budget. So there is an actual loss to the state. Also these tax rates of 2% I'm talking about at on in production operations, not exploratory operations in the shale finds there.

If we were talking subsidies for discovery that is one thing, since various "green" energies get breaks as well. Oklahoma is also extremely large in wind generation as well. So they aren't totally O&G. Now if you have your own wind or solar power generator, and are connected to the grid to sell back, you are now billed a hefty fee each month by the utility on how much you are selling back.

It's all a mess. We have to stay fair though and acknowledge that we are in a country now where the two classes are those fighting to get by and the elite class sucking on the teet of corporate welfare being supported by BOTH parties.

posted by JustaSooner on Aug 12, 2015 at 09:35:18 pm     #  

JustaSooner posted at 09:01:23 AM on Aug 12, 2015:

Things are getting interesting for sure. Regardless of this big spike locally for some stupid reason, oil is dropping pretty fast thanks to Iran, the Saudis, and China. Listening to people back in Oklahoma, they are a little scared since we could see sub $30 oil again until we start going back up next year. Of course I'm sure the rest of us across the country would love to finally have sustained lower fuel prices to help the economy, but the half dozen oil states are definitely starting to feel the pinch. They have had a great ride as of late of record job growth, lots unemployment, and tons of new development. Time to share the wealth a bit.

It will be interesting to see if oil does fall that low to start getting us below $1.50/gal for the first time in years.

Oil prices that low will affect other states because of fracking - when oil is that low, it is not worth the cost to recover oil through more expensive methods. In other words, Ohio will be affected by this as well. Certainly not as much as some states.

posted by MsArcher on Aug 12, 2015 at 11:05:33 pm     #  

MrsArcher posted at 11:05:33 PM on Aug 12, 2015:
JustaSooner posted at 09:01:23 AM on Aug 12, 2015:

Things are getting interesting for sure. Regardless of this big spike locally for some stupid reason, oil is dropping pretty fast thanks to Iran, the Saudis, and China. Listening to people back in Oklahoma, they are a little scared since we could see sub $30 oil again until we start going back up next year. Of course I'm sure the rest of us across the country would love to finally have sustained lower fuel prices to help the economy, but the half dozen oil states are definitely starting to feel the pinch. They have had a great ride as of late of record job growth, lots unemployment, and tons of new development. Time to share the wealth a bit.

It will be interesting to see if oil does fall that low to start getting us below $1.50/gal for the first time in years.

Oil prices that low will affect other states because of fracking - when oil is that low, it is not worth the cost to recover oil through more expensive methods. In other words, Ohio will be affected by this as well. Certainly not as much as some states.

Yeah...from what I've been told so far, most fracking operations have it to where they can be profitably down to about $40/bbl and still working to reduce costs. So things are definitely moving in the right direction.

I think the biggest change domestically would be in the direction of more natural gas usage. Oklahoma of course being one of the epicenters of it (no pun intended, given they are now the highest seismically active state in the union) is huge in pushing towards CNG vehicles. They have around 300-400 CNG stations across the state and most state/local gov't vehicles are CNG. Many consumers are going to CNG. I would have entertained it if it weren't moving away and knowing CNG station coverage is abysmal outside of OK. NG is also a good product from hydraulic fracturing, so the supply can be pretty abundant. Now it is just making sure wastewater injection sites don't bring a location down due to increased earthquake activity. :)

posted by JustaSooner on Aug 12, 2015 at 11:27:38 pm     #  

They were talking Tuesday night on the radio John Bachelor show <spelling> about oil production and the gues was saying right now they can get by with a very minimal profit at 32 gal a barrel in some of the oil fields, think they were talking North Dakota and maybe Oklahoma. They said that if they can get production costs they might still be able to turn a very very minimal profit at 30 bucks a barrel. I don't see OPEC hanging tough there much longer, even Saudi's have got to be running into problems soon. Europe will definately pay a lot more than 40 bucks a barrel if they have to, I am not sure about lifting the restriction on selling local domestic oil, on one hand it would cripple OPEC which I think is a good thing, on the other I think we might ship more out that process locally and raise cost, of course if it gets too cheap they might stop drilling for it here, if you cant make a profit on it there is no reason to continue drilling for it. That is the reason OPEN has lowered they prices anyways to try to cripple our own drilling industry and for a while it looked like it was working, work in North Dakota was really starting to slack off from what I heard.

posted by MIJeff on Aug 13, 2015 at 01:47:27 am     #  

JustaSooner posted at 09:35:18 PM on Aug 12, 2015:

MIJeff - I don't disagree with your points entirely. However, I've seen how they structure these deals in Oklahoma and it is insane. They monetize the tax breaks they given to the point that they can be bought and sold between companies. Then the end buyers can cash them in at any point for a refund of dollars being pulled out of the budget. So there is an actual loss to the state. Also these tax rates of 2% I'm talking about at on in production operations, not exploratory operations in the shale finds there.

If we were talking subsidies for discovery that is one thing, since various "green" energies get breaks as well. Oklahoma is also extremely large in wind generation as well. So they aren't totally O&G. Now if you have your own wind or solar power generator, and are connected to the grid to sell back, you are now billed a hefty fee each month by the utility on how much you are selling back.

It's all a mess. We have to stay fair though and acknowledge that we are in a country now where the two classes are those fighting to get by and the elite class sucking on the teet of corporate welfare being supported by BOTH parties.

Yeah well that sort of situation is wrong, but losing what hasn't been paid is sort of like red light camera revenue, depending on actions of others is sort of a chancy business model in the first place. The only thing I would have to say is that at least the cronyism from the right generally did provide good paying jobs in the defense industry, where as the left it seems only the rich got richer. Solyndra didn't stick around long enough for those regular employees to even put money into a 401k. The executive at the top took some pretty nice hefty money from the company before they shut it down.
But all in all all that cronyism needs to be rooted out, along with the exemption from insider trading laws for congress. All those bastards do when they get to DC is learn how to earn cash and go through the motions of enacting more laws an regulations for things that are already on the books, 10 new gun laws or rules against stealing don't do anything that shouldn't already be against the law. About the only thing those idiots do is making stupid laws that have some serious unintended consequences. Or give out money for stupid things like studies on why Chinese hookers have drinking issues or why are most lesbians overweight, My all time favorite is the shrimp on treadmills though.

posted by MIJeff on Aug 13, 2015 at 01:58:20 am     #  

I see they raised diesel, just to even things out.

posted by justread on Aug 15, 2015 at 06:17:29 am     #   1 person liked this

Drove to Tennessee this week. Gas was 2.99 in SW Ohio, and then 2.33 in Lexington, KY.

posted by JohnnyMac on Aug 15, 2015 at 08:02:58 am     #