The REAL reason for 3.00/gal gas...

[Hobo]

Due the EPA's Clean Air Act which requires regulation of auto emissions. Oil Refiners have been forced to install units in their refineries to reduce emissions in gasoline/diesel by the year 2007. As a engineer working for a engineering/construction firm building these projects, I know the refiners are being forced (good thing) into spending money. Lots of money. The average costs of these projects is in 200-300 million dollar range. Some are even more expensive. These projects HURT the bottom line of the refiners. They are just passing on the costs of these projects to the consumer. If it was not for the these projects they would not be spending the money to clean up the emissions. I am glad the government has forced them to clean up the air. But, someone was going to have to pay for it. It is a shame it has to be us.

See link for Clean Air Act:

<http://www.thecre.com/fedlaw/legal14air/contents.htm>

-Hobo

[YDogg]

1. And the reasons for the record profits??

[William769]

5. trust me, you won't get an answer to that one.

[BlueEyedSon]

10. Oh, as a side effect, the air scrubbers spit out hundred-dollar bills.

its not because of price gouging/fixing/collusion, i assure you

[CTyankee]

2. But didn't the sock puppet say he was suspending

environmental safeguards, knowing that Americans will be just fine with that as long as they can fill their gas guzzlers?

[librechik]

3. yes, god forbid the HUGE, HISTORIC PROFITS from last quarter

be used to pay for the upgrade to the company. That would be un-American in the corporate welfare state.

The cost of doing business in this country? Not much, and worth every penny, apparently.

[hholli11]

4. and The REAL reason for Bush's failed policies...

is the Clenis!!!!

I'm sorry, but that was the stupidest thing I've read in a long, long time.

[HereSince1628]

6. Bush says Murikans won't stand for market manipulation but doesn't

acknowledge that $15-$25 per barrel is pure nervousness due to his own saber-rattling and the geopolitical anxiety it motivates.

I've no doubt that cleaner technology costs money. I suppose the costs may even approach their CEO's retirement packages. At least as a consumer I get a benefit out of the clean air technology.

[liberal N proud]

7. The real reason for the high gas prices is because the leaders

of the country are in bed literally with the oil companies.
Both the chimp in chief and his side kick dead eye dick are oil barons. They are only helping their special interest groups.

It has nothing to do with the EPA, China consumption or any other bull shit reason the reich wing has been spewing forth through their propaganda outlets, FAUX, CNN, ABC, NBC or CBS.

GET REAL!

[Burma Jones]

8. Gee, I thought demand was the real reason

you know, the whole "China is buying up the oil, and development rights, with the money we send them" thing.

Also, it is not the EPA's Clean Air Act, it's our Clean Air Act, passed by Congress and signed by the President.

I also believe the Oil Companies knew of this for many years, even during those heady low low gas price days of the Clinton Administration. Hence these costs could/should have been spread out over decades

Oh, and I suppose the record profits completely exclude the costs of refining.

[newportdadde]

9. Exploding China and India economies are the reason.

If the price of oil was still 30 bucks a barrel around the world then perhaps I could buy your idea that is the American consumer taking on additional refinement costs. However, the entire crude trading market is up, way up.. the fact is current worldwide demand is really pushing at oil.

[Ecumenist]

11. Please, don't insult our or your intelligence

This the a talking point to try to justify their price gouging. If that were the case, why wasn't it this highly priced in the years leading up to the "administration"? Do you really think that the fact we have a oil whore in the White House is just a happy coincidence? No, I may not be an Rhodes Scholar but some things are clear as day... The oil companies are making unprecendented amounts of money and even the greedy bastards who are in bed with them are having a hard time explaining this theft...

[leveymg]

12. Here's why this is a specious argument

The world price of oil has risen @ 120-percent in the last three years, with a spike at the turn of the year and in recent weeks. U.S. retail prices have been rising, as well. Oil and gasoline are internationally traded commodities, and the rise in global prices tends to be reflected with some lags ("price stickiness") in domestic prices at the pump. U.S. Retail prices have risen forty percent in just the last four months, while global prices have gone up ten percent, exceeding their post-Katrina highs seen in October.

Most analysts admit that the leading cause in the rise in world oil prices is the Bush Administration's policies toward Iraq and renewed threats of war against Iran. Rising demand by growing Asian economies is another significant factor.

IMO, domestic environmental regulations contribute no more than ten to fifteen percent of the total rise in retail prices in recent years. The rest is BushCo politics, war-related supply interruptions, and price gouging by the oil industry.

[Champion Jack]

13. Isn't the Internet great?

anyone can say " As a engineer working for a engineering/construction firm building these projects, "
What's that old line? on the net even your dog can....

[Hobo]

14. What are you trying not to say?

-Hobo

[Solon]

15. You really should try a little better...

First, we import crude from overseas, and THAT price is already at 70 bucks a barrel, the costs you throw around, 200-300 million dollars would add about 5 cents to the price for every gallon of gas we consume, in other words, its cost could be absorbed without us even noticing. How does that explain 2 dollars or more differences between today prices and prices 6 years ago?

[HarukaTheTrophyWife]

16. Oh come on, deep inside, you know it's the Clenis at fault. nt

[Hobo]

19. Gee are you implying I am a freeper?

-Hobo

[leveymg]

21. That doesn't matter, really.

I would like you to address the issues we brought up about the other factors driving up pump prices. Your post seems to drastically overweight the cost of EPA-mandated refinery upgrades, particularly since the Bush Admin. has relaxed previous requirements for installing scrubbers as part of any plant renovation.

[lectrobyte]

17. Exxon's record 36 billion dollar profits have nothing to do with it,

I'm sure.

[fasttense]

18. Inflation is the reason for the high cost of gasoline.

It will only get worse. The dollar is down. The Feds keep pumping out more dollars which only insures that inflation will continue to rise.

Now if I am a rich Saudi oil man and I want to purchase bread in Saudi Arabia, I have to have my own currency in my own country. If you pay me in dollars and I convert those dollars to my own currency, I find that your dollars are getting me less of my own currency. In other words, I use to be able to buy two loaves of bread with a dollar and now I can only buy one. So I raise my price if you want to pay me in dollars because your dollar is worth a whole lot less.

Which means the feds are lying about the rate of inflation. They have increased the CPI numbers so under the annualized old weight inflation is really 8.7%. It was higher than that when they changed the CPI because they leave out food and energy. So the real inflation numbers are anyones guess. You will be seeing an increase in costs for just about everything.

[BeachBuckeye]

20. Please stop !!!!! Pleazzzzzzzz!

You're killin' me. Absurd? Stupid? Foolish? There aren't enough adjectives to describe this ridiculous post.

[TreasonousBastard]

22. Whoops! You dared to defy the Gods Of Oil Truth, and...

must be sent to the small room down the hall.

With all the whining going on about our "high" gas prices, I suppose it doesn't count that just about everyone in Europe is paying around 6 bucks a gallon, and even the Japanese are paying over 4. Venezuelans are paying 12 cents a gallon, but that's as phony a price as the almost 7 bucks the Dutch are paying.

http://msnbc.msn.com/id/12452503/

Most of that is taxes, of course, with the actual cost of gasoline being around $2.50 or so a gallon delivered from the refinery. Still less than a gallon of milk the last time I checked, although it is twice that of a gallon of spring water. Spring water that isn't sold in small bottles, anyway.

It makes no difference to anyone here or elsewhere around the country that crude prices are set at commodity exchanges based on traders' expectation of supplies, and the talk of Iran's possible invasion making them extremely skittish, or the rising worldwide production not increasing with rising worldwide demand. Or that no new refineries have been built here in the last 30 years and only a few new ones worldwide. Don't even get into the various grades of crude and the complexities of refining heavy, sulfur-laden oil compared to Saudi Light.

Nor do we discuss the cost of building an offshore rig and towing it from Korea to the North Sea or Gulf of Mexico, and then finding some oil to drill for.

Nor has it registered that upgrading existing refineries to increase production hasn't entirely kept up with demand, and US refineries are running at over 90% capacity, with little room for error. It hasn't registereed either that the US has managed to make itself entirely dependant on the personal car for all but around 10% of commuters, and those commuters too often have a taste for gas hogs. That's not even considering the waste in heating poorly desinged or insulated homes and buildings...

As far as oil company profits are concerned, when the price of any commodity is increased, producers of that commodity automatically see an increase in revenues. That's as true of oil as it is of winter wheat or hog bellies, and the answer is not to whine about oil companies' windfall profits, but to deal with them, possibly with a windfall profits tax, among other things.

But, hey, blame it all on the big, bad oil companies and maybe even the Clenis, and that solves the problem.

[leveymg]

23. Loud whining is a prerequisite to taxing

So, we're just doing what needs to be done. The rest is much more difficult and prohibitively expensive for most people, such as replacing that 1996 Explorer with a 2006 Prius, or investing in tens of thousands of wind turbines, or rebuilding the inter-city light rail system.

First we need the revenues that go toward these investments. I would prefer a windfall on capital gains -- let it come directly out of the pockets of large investors who hold oil industry stock, where it's more difficult to pass on to the consumer.

[MadHound]

24. So you're saying that the price increase is due to taxes?

Sorry, but that doesn't fly friend. Taxes, and the OP's original bogeyman, pollution controls, were at the same level in 2000 before this oily administration got in. Neither has changed much, if at all. But the price on the pump continues to jump.

You are correct about the refineries however. But contrary to the current spin, it isn't Democrats or enviromental regulations that are preventing the opening of new refineries, it is the oil companies themselves that are refusing to open new refineries. There was a thread yesterday detailing an internal Texaco memo to that effect.

One other factor that is being overlooked however is the supply of oil. I believe that we've reached the end of the oil that is cheap to drill and cheap to refine. Over at Ghawar, the world's largest oilfield, they are having to pump in twice the volume of seawater than what oil they get out. That is a sign of an oil field in serious decline. And Saudi Arabia is being very close mouthed about how their other oil fields are doing. Meanwhile, we haven't found a new oil field of any significance in over forty years. And oil shale is now be actively touted as a new source of oil, not a good sign either, being how expensive it is to extract the oil and then process it.

And all this while, India and especially China are expanding into an oil based economy. Higher demand, lowered supply, increase in prices.

Which is why we desperately need to transition away from oil as an energy source. Engines using biodiesel, couple with hybrid technology offers a way out, as does wind, solar and other renewables. It is time that we start switching to them before the oil train goes over that cliff up ahead.

[TreasonousBastard]

26. No, I didn't say the increase is due...

to taxes, just that the variations in prices at the pump are often due to taxes. Excise and sales taxes have been stable, but different from state to state here and between countries worldwide. And Venezuela and a few other countries heavily subsidize prices. Europeans originally set high gas taxes with the hope that they could reduce them to stabilize prices, but now find it fiscally impossible.

The lack of new refineries and drilling fields can be blamed on all of us. California has been adamant about no new refineries or offshore fields, leaving much Alaskan oil with no place to go but Asia. Florida refuses any offshore drilling in its waters, although the Gulf fields certainly extend into Florida waters. Environmental restrictions should only increase fuel costs slightly, but the constant take-no-prisoners battling on both sides has just stalled any progress in too many cases. Maybe it's just as well, if it eventually forces us to make adjustments to use less fuel and reduce our carbon footprints. Better now than when more wells run dry.

Yes, it is essentially a combination of the supply and demand curves combined with commodity traders' greed and skittishness over supply. Several years ago the Saudi's refusal to let out real reserve numbers caused a lot anxiety over the possibility that they couldn't increase pumping like they have in the past. It's entirely possible that the Saudi fields are running dry.

I remember when Exxon started building a new refinery in Thailand, but don't know of many more being built, and they were thinking of closing down the one in Singapore when the new one was ready, if ever. I also remember when we had a tanker full fo gasoline that was contaminated with seawater, and it took almost a month before we could find a refinery to handle it. It only cost a nickel a gallon to rerefine the gas, but it took all that time before a refinery in Curacao finally had the space to do it. I don't think things have changed much since.

[MadHound]

29. Yes, state taxes vary with the state,

But they too, within the state, are stable. It isn't an increase in state taxes that has jumped the price of gas up fifty cents/gal in the past couple of months. That is due to market forces.

And as far as refineries go, no, CA doesn't want any new refineries, but there are many other places that would take them. It is the unwillingness of the oil companies to build them that is indeed the real culprit here.

And frankly, as far as drilling in the Gulf and Alaska, I don't blame the residents for not wanting more oil drilling operations. Given the track record in the Gulf(which is now a dead zone much of the year) and in Alaska(Prudhoe Bay, Exxon Valdez, etc.) I wouldn't want new oil rigs there either. Kind of hard to attract tourists to Florida if the beaches are covered in crude. And Alaska is a national natural treasure, why should we pollute it?

In fact, we really don't need oil anymore at all if we would start transitioning to other clean, renewable resources. It has been shown that wind energy can supply our entire electrical needs. And by growing both algae and hemp, we can supply our fuel needs completely with biodiesel.

We're rapidly approaching a critical phase in our country's history. We're running out of oil, and our pollution levels are approaching critical. Why not kill two birds with one stone, and transition over to clean, renewable energy sources? We had better start soon though, or we're all going over that cliff.

[wtmusic]

25. Increase in revenue not the same as increase in profit

When the price of their crude is increased their costs rise. Not complex at all. Economics 101.

Ya think the talk of invading Iran has any connection to a petroleum industry president? Nah, couldn't be that. Or that specious comparisons to milk and water mean squat? How much gold can you get for a gallon of gas? Ever think of that? :silly:

[TreasonousBastard]

28. Depends on whether you're...

pumping or refining. Exxon and the other majors have to pay the high crude prices for their refineries, but the stuff they pump out of their own wells sells for the high price. So, in the end they make too much money thanks to the price per bbl at the well.

[BooScout]

27. Then why are they rising in the UK and Europe as well?

Those controls have been built into UK/Eurpoean refineries for quite a while now and is already factored in. Your reasoning is flawed for the rise in the past 2-3 years. There's only one reason.......Bush.