Cheap Gas!!

Dr. Jones wrote:At thoughts on the cheap gas?

First off, I'm not foolish enough to praise Obama for the low prices just as I wasn't foolish enough to blame him for high prices.

I think the leading factor is the increased production that we were told democrats were hindering.  

The interesting things to me are:

#1 The fact that industry brass is holding the line on production in what appears to be an attack on some of the newer, more expensive methods of procuring oil.  Isn't capitalism a beautiful thing.  Just when a little competition starts to provide some much needed relief....

#2  Why is diesel so slow to follow suit?  Because it doesn't have ethanol to keep it in check?

Darth Cheney wrote:

Dr. Jones wrote:At thoughts on the cheap gas?

First off, I'm not foolish enough to praise Obama for the low prices just as I wasn't foolish enough to blame him for high prices.

I think the leading factor is the increased production that we were told democrats were hindering.  

The interesting things to me are:

#1 The fact that industry brass is holding the line on production in what appears to be an attack on some of the newer, more expensive methods of procuring oil.  Isn't capitalism a beautiful thing.  Just when a little competition starts to provide some much needed relief....

#2  Why is diesel so slow to follow suit?  Because it doesn't have ethanol to keep it in check?

It's wonderful you are actually tying to be educated using facts...
Obama drilled for oil at the urging of democrat congress and we are all reaping the rewards.

or

Industry brass...take off your tin foil hat dude.  The facts are the United States has become the second leading producer of crude oil in the world and Canada isn't far behind. OPEC no longer can control prices with this huge influx of crude by other suppliers. Normally, they would cut supply and price would rise. Now there only recourse is to keep pumping at lower prices below what the US and Canada can develop new oil. Eventually, if oil fields aren't continuing to be developed, OPEC will once again gain a greater share of oil sales and it will take years for the oil exploration to resume in the US and Canada to catch up.  The oil development in North Dakota isn't because of the government...it is in spite of the government. You see it is all on private land the government has zero control over which is far different than other oil rich areas within United States control.

There we agree.  No doubt about it, new competition is a real thorn in the side of the powers that be in the oil industry and, in a capitalistic nature, they will do all they can to curb competitive production.

Diesel has remained high because the demand is greater than the production.  Only a specific amount of diesel can be pulled off of crude oil, if memory serves me it is around 18%, while gasoline is a much larger percentage. Diesel usage has gone up in this country and supply hasn't remained stable. All the high mileage vehicles on the roads means less diesel, less money for roads, and more dumb asses driving 55 mph to get better mileage.

You make some excellent points.  I can't say as I completely agree with you, but excellent points none the less.  I would however like to hear you expound upon your thoughts about less money for road repairs and the "dumb asses" trying to save money by driving a little slower.  Thx.

Dr. Jones wrote:At thoughts on the cheap gas?

First off, I'm not foolish enough to praise Obama for the low prices just as I wasn't foolish enough to blame him for high prices.

BS. The increase in oil supplies from North America is due to private enterprise devising new technologies for extracting oil from sands (Canada) and shale (US). The lack of a coherent energy policy by the Obama Regime has actually hindered oil exploration by not bringing public lands into play.


I think the leading factor is the increased production that we were told democrats were hindering.  

See point 1.

The interesting things to me are:

#1 The fact that industry brass is holding the line on production in what appears to be an attack on some of the newer, more expensive methods of procuring oil.  Isn't capitalism a beautiful thing.  Just when a little competition starts to provide some much needed relief....

What the Saudis/OPEC is doing is a perversion of laizze faire capitalism called an oligopoly, a market with a few sellers. However instead of contracting production, the Saudis have turned the spigots wide open in an attempt to protect their market share. Myself I think it's a fools errand.  The existing wells in the shale fields will continue to produce and only new exploration will be hindered. Meanwhile the Saudis risk do untold damage to their economy which is solely dependent on oil.

#2  Why is diesel so slow to follow suit?  Because it doesn't have ethanol to keep it in check?

Darth is correct that there is a limited number of gallons of diesel in a barrel of oil except the number is closer to 10 gallons while gas is about 19. Also new EPA regulations have made diesel more expensive due the removal of sulphur necessitating a greater refining and increasing costs.

Diesel prices typically rise in winter due to a greater demand due to fuel oil sales, which is essentially the same as highly refined diesel.

I knew I had third point, I remember now.

#3  I read an article taking about the job cuts stemming from faltering oil prices.  How about the jobs that will be created be people who have more money to spend?

That's true to only a certain degree. Remember that the money that had been spent on gasoline was already circulating in the economy so much of the "new" consumer spending isn't new at all, it just is being shifted from one pocket to another. However if new wealth is being created by greater consumer spending the danger then becomes inflation which will diminish the value of the "new" wealth.

Darth Cheney wrote:Whatever happened to the red herring formerly known as "bio-diesel".  Given the high diesel prices and lower commodity prices you would think it would be going gang busters. What' that...government handouts ended so isn't viable and without taxpayer subsidies never was. Here is my shocked face 0^o

Dr. Jones wrote:

Darth Cheney wrote:Whatever happened to the red herring formerly known as "bio-diesel".  Given the high diesel prices and lower commodity prices you would think it would be going gang busters. What' that...government handouts ended so isn't viable and without taxpayer subsidies never was. Here is my shocked face 0^o

Soy-based biodiesel is a joke, plain and simple.  It doesn't pass the food vs. fuel litmus test like ethanol does.  

Jammer wrote:

Dr. Jones wrote:

Darth Cheney wrote:Whatever happened to the red herring formerly known as "bio-diesel".  Given the high diesel prices and lower commodity prices you would think it would be going gang busters. What' that...government handouts ended so isn't viable and without taxpayer subsidies never was. Here is my shocked face 0^o

Soy-based biodiesel is a joke, plain and simple.  It doesn't pass the food vs. fuel litmus test like ethanol does.  

Liberals are a joke, plain and simple.

Gomezz Adddams wrote:

Dr. Jones wrote:At thoughts on the cheap gas?

First off, I'm not foolish enough to praise Obama for the low prices just as I wasn't foolish enough to blame him for high prices.

BS. The increase in oil supplies from North America is due to private enterprise devising new technologies for extracting oil from sands (Canada) and shale (US). The lack of a coherent energy policy by the Obama Regime has actually hindered oil exploration by not bringing public lands into play.


How can one draw the conclusion that oil exploration is being hindered when we have a glut of the bubblin' crude?

I think the leading factor is the increased production that we were told democrats were hindering.  

See point 1.

The interesting things to me are:

#1 The fact that industry brass is holding the line on production in what appears to be an attack on some of the newer, more expensive methods of procuring oil.  Isn't capitalism a beautiful thing.  Just when a little competition starts to provide some much needed relief....

What the Saudis/OPEC is doing is a perversion of laizze faire capitalism called an oligopoly, a market with a few sellers. However instead of contracting production, the Saudis have turned the spigots wide open in an attempt to protect their market share. Myself I think it's a fools errand.  The existing wells in the shale fields will continue to produce and only new exploration will be hindered. Meanwhile the Saudis risk do untold damage to their economy which is solely dependent on oil.

Perversion?  Sorry, wrong answer. An oligopoly is the winner's circle in a purely capitalistic society.  It's interesting that you would make a petty attempt to distance yourself from the champions of the economic practices you so heartily preach.

Will it work out for OPEC, and others who more silently share their business plan?  I dunno.  I think it could certainly come down to the American people being asked to take a hand in putting a nail in the coffin of the reign of our ragheaded foes in the middle east, in the way of further oil subsidies to help weather the storm. Funny how that would bring us full circle back to the "pen is mightier than the sword" conversation in the Russia thread.


#2  Why is diesel so slow to follow suit?  Because it doesn't have ethanol to keep it in check?

Darth is correct that there is a limited number of gallons of diesel in a barrel of oil except the number is closer to 10 gallons while gas is about 19. Also new EPA regulations have made diesel more expensive due the removal of sulphur necessitating a greater refining and increasing costs.

Diesel prices typically rise in winter due to a greater demand due to fuel oil sales, which is essentially the same as highly refined diesel.

I knew I had third point, I remember now.

#3  I read an article taking about the job cuts stemming from faltering oil prices.  How about the jobs that will be created be people who have more money to spend?

That's true to only a certain degree. Remember that the money that had been spent on gasoline was already circulating in the economy so much of the "new" consumer spending isn't new at all, it just is being shifted from one pocket to another. However if new wealth is being created by greater consumer spending the danger then becomes inflation which will diminish the value of the "new" wealth.

Again we find ourselves at a bit of an impasse of the importance of the flow of money within an economy vs. money that lies stagnant in a bank account.  No surprises here.

Dr. Jones wrote:Here's an interesting read on the Green River oil you speak of.  I think a quick brushing up on the facts should be in order for you Darth.  The main problem with the Green River oil is not that it is on public land that liberals have made inaccessible, it is that they can't find a way to get it to the surface in a way that is profitable.


http://canaryusa.com/oil-production-in-colorado-skyrockets-thanks-to-fracking/

Darth Cheney wrote:

Dr. Jones wrote:Here's an interesting read on the Green River oil you speak of.  I think a quick brushing up on the facts should be in order for you Darth.  The main problem with the Green River oil is not that it is on public land that liberals have made inaccessible, it is that they can't find a way to get it to the surface in a way that is profitable.


http://canaryusa.com/oil-production-in-colorado-skyrockets-thanks-to-fracking/

Yep and shale oil in North Dakota is to difficult to get and there isn't very much there...remember that...about 5 years ago.

Dr. Jones wrote:

Gomezz Adddams wrote:

Dr. Jones wrote:At thoughts on the cheap gas?

First off, I'm not foolish enough to praise Obama for the low prices just as I wasn't foolish enough to blame him for high prices.

BS. The increase in oil supplies from North America is due to private enterprise devising new technologies for extracting oil from sands (Canada) and shale (US). The lack of a coherent energy policy by the Obama Regime has actually hindered oil exploration by not bringing public lands into play.


How can one draw the conclusion that oil exploration is being hindered when we have a glut of the bubblin' crude?

I think the leading factor is the increased production that we were told democrats were hindering.  

See point 1.

The interesting things to me are:

#1 The fact that industry brass is holding the line on production in what appears to be an attack on some of the newer, more expensive methods of procuring oil.  Isn't capitalism a beautiful thing.  Just when a little competition starts to provide some much needed relief....

What the Saudis/OPEC is doing is a perversion of laizze faire capitalism called an oligopoly, a market with a few sellers. However instead of contracting production, the Saudis have turned the spigots wide open in an attempt to protect their market share. Myself I think it's a fools errand.  The existing wells in the shale fields will continue to produce and only new exploration will be hindered. Meanwhile the Saudis risk do untold damage to their economy which is solely dependent on oil.

Perversion?  Sorry, wrong answer. An oligopoly is the winner's circle in a purely capitalistic society.  It's interesting that you would make a petty attempt to distance yourself from the champions of the economic practices you so heartily preach.

Will it work out for OPEC, and others who more silently share their business plan?  I dunno.  I think it could certainly come down to the American people being asked to take a hand in putting a nail in the coffin of the reign of our ragheaded foes in the middle east, in the way of further oil subsidies to help weather the storm.  Funny how that would bring us full circle back to the "pen is mightier than the sword" conversation in the Russia thread.  


#2  Why is diesel so slow to follow suit?  Because it doesn't have ethanol to keep it in check?

Darth is correct that there is a limited number of gallons of diesel in a barrel of oil except the number is closer to 10 gallons while gas is about 19. Also new EPA regulations have made diesel more expensive due the removal of sulphur necessitating a greater refining and increasing costs.

Diesel prices typically rise in winter due to a greater demand due to fuel oil sales, which is essentially the same as highly refined diesel.

I knew I had third point, I remember now.

#3  I read an article taking about the job cuts stemming from faltering oil prices.  How about the jobs that will be created be people who have more money to spend?

That's true to only a certain degree. Remember that the money that had been spent on gasoline was already circulating in the economy so much of the "new" consumer spending isn't new at all, it just is being shifted from one pocket to another. However if new wealth is being created by greater consumer spending the danger then becomes inflation which will diminish the value of the "new" wealth.

Again we find ourselves at a bit of an impasse of the importance of the flow of money within an economy vs. money that lies stagnant in a bank account.  No surprises here.

Another Goldman note looks at that. On the one hand, falling crude prices mean falling gas prices, which means a boost to consumer spending in other parts of the economy. On the other, shale production in the US will likely fall, reducing exports and reducing business spending in that area of the economy.

Goldman thinks that the two are probably going to roughly cancel each other out, predicting that GDP will decline just 0.1% as a result of this turn of events.

Dr. Jones wrote:Directed by members of government?  Ha!  That would imply that they had a functioning government to begin with. The same people that run the oil fields just happen to run the government as well.  

Here's an interesting read on the benefits of lower gas prices including, increased discretionary spending, job creation,  a constriction on inflation, and of course, an increased GDP.

It also address your concerns of a simple shift in revenue.

Enjoy

http://www.marketwatch.com/story/households-could-save-1100-from-falling-gas-prices-2014-12-01

Gomezz Adddams wrote:

Dr. Jones wrote:Directed by members of government?  Ha!  That would imply that they had a functioning government to begin with. The same people that run the oil fields just happen to run the government as well.  

Here's an interesting read on the benefits of lower gas prices including, increased discretionary spending, job creation,  a constriction on inflation, and of course, an increased GDP.

It also address your concerns of a simple shift in revenue.

Enjoy

http://www.marketwatch.com/story/households-could-save-1100-from-falling-gas-prices-2014-12-01

What you don't think Saudi Arabia, Iran and Kuwait have functionaing governments? Think again. Of the top 5 OPEC countries only Iraq has a government not solidly in control of it's territory. It is estimated that only 7% of the worlds oil and gas reserves are under private ownership/production. Unfortunately the people who run the governments think they can also run industry. Ahh, you just gotta love Socialism.

These oil rich countries don't have the "we the people" type of government that we are accustomed to, or that I would consider functional.  Their leadership decisions are based souly on their one and only source of income, just as any business would be.  As far as your strawman socialism deflection, it also falls victim to the same argument.

I'm always suspicious of articles that use the false analogy that compares a drop in prices to a tax cut from the government. This is not an injection of new money into the economy. There is no new wealth being created although countries that are net importers of oil will see a small increase in GDP. This effect is somewhat mitigated in the US because a stronger dollar will make our exports more expensive and a lessening impact of energy sectors on the US economy due to it making up a smaller percentage of the economy as a percentage of GDP. Again don't look for any major swings in US GDP due to the drop in gas prices. For our economy it's going to be a wash.

I like your first statement.  If that is too much for you to wrap your head around, then I would suggest you Google it and read one of several articles that says the exact same thing, but puts it in a context that is hopefully more pleasing to your palate . Of course it isn't new money.  It's a redistribution of money to those who would actually use it to help improve the economy.  I tried to find some literature to help explain your take in this and found one interesting article.  It claimed, as you do, that cheaper gas would not help the economy.  Why?  Their take on it was that the first thing people would do was replenish their savings.  Money put into savings does nothing for the economy, and they felt it would be a while before people started to spend their new found wealth.  Again proving my point about the necessity of liquidity.  I would really like to read a few articles supporting your opinion in this matter.
http://triblive.com/mobile/7212767-96/prices-gas-gasoline