Obama: Don’t like gas prices? Just buy a new car! [Reader Post]

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The man who made clear that he wanted gas prices to be higher has made good on his promises.

[youtube]http://www.youtube.com/watch?v=t4Tmi_fpUHs[/youtube]

Gas prices have doubled under Barack Obama. The pain visited by the higher prices will not be felt only at the pump. It will felt in many areas.

1. Transportation of Goods – While rising gas prices often lead to higher prices for a gas tank of fuel, the cost of oil is built into the price of anything. Oranges, for example, may travel several hundred or even thousands of miles from Florida. All that travel time means burning fuel, and later higher costs for oranges, even though oranges aren’t directly tied to oil. So, basically everything rises in cost after oil does.

2. Export Economies – These higher oil costs often mean economic softening in areas that are dependent on foreign purchases of goods. Take, for example, China and Vietnam which each produce a large amount of consumer products for export to the United States. Due to the distance these goods have to travel, they become more costly in foreign markets against local competitors with lower exposure to oil. Thus, exports usually decline.

3. Consumer Spending – Higher gas prices mean that shoppers are either 1) valuing more the small amount of extra money they have to spend or 2) seeing a general decline in the amount of money they can afford to spend.

4. Rising Derivative Costs – Oil may help us get from A to B in the form of gasoline, but it is also very important in making plastics and polymers, two very important materials that are used in just about everything. Higher prices for oil means higher prices for plastic and ultimately higher prices for transporting the plastics from one place to another.

And of course, home heating oil.

Barack Obama’s answer to the high cost of home heating oil?

Just buy a new car!

Obama needled one questioner who asked about gas prices, now averaging close to $3.70 a gallon nationwide, and suggested that the gentleman consider getting rid of his gas-guzzling vehicle.

“If you’re complaining about the price of gas and you’re only getting 8 miles a gallon, you know,” Obama said laughingly. “You might want to think about a trade-in.”

[youtube]http://www.youtube.com/watch?v=1RV8aIXm4DY&feature=player_embedded[/youtube]

When an audience member commented that he had a family of ten kids, Obama replied:

“Well, you definitely need a hybrid van then.”

Hilarious.

Except, where is one to get a hybrid van? Let’s start with mini-vans.

How about a Toyota Sienna hybrid? Not available. Gas mileage: 19/24

How about a Nissan Quest hybrid? Not available. Gas mileage 19/24

How about a Ford Flex hybrid? Nope. Gas mileage 17/24

How about an E-series For van or wagon? Nope. Gas mileage 13/17

Now let’s go to Obama Motors.

How about a Town and Country hybrid? Nope. Gas mileage 17/25

(Chrysler did at one time have the Aspen hybrid. Cost: $45,000)

Buick Enclave? No hybrid. Gas mileage 14/24

Chevrolet Tahoe hybrid? YES! Mileage 20/23
(Cost: starts at $51,000. There is no Suburban hybrid.)

Edmunds shows 5 hybrid vehicles in the $15-25,000 range; Honda Civic hybrid, Honda CRZ, Honda Insight Toyota Prius and Smartfortwo.

None will hold ten kids unless they’re really tiny kids. Obama’s flippant answer provided no solution to the dilemma his high gas prices create. There are no hybrid vans. Perhaps Obama was referring to new Chevrolet Unicorn hybrid.

The other alternative offered by Obama is go to coal-fired (i.e. electric) vehicles.

Whoops! That’s going to cost you a small fortune as well since Obama intends to make your electric bills skyrocket!

[youtube]http://www.youtube.com/watch?v=HlTxGHn4sH4[/youtube]

Obama has ordered government agencies to buy “eco-friendly” vehicles. And what of Obama’s limos? Obama’s limousines are exempt from the new “green” rules. He exempted them.

WASHINGTON, April 3 (UPI) — While President Obama has ordered U.S. agencies to buy eco-friendly vehicles, many Secret Service vehicles and Obama’s limo are exempt, a spokesman said.

You need not worry about the impact of gas prices on Back Obama. He’s worth at least $5 million and will be far more wealthy once he leaves the Presidency. So none of this willl hurt him one bit!

Finally, to show you he isn’t out of touch, Obama claimed that he remembered what it was like to pump gas.

[youtube]http://www.youtube.com/watch?v=oIGa7iYcMlI&feature=player_embedded[/youtube]

That’s total crap. I pumped gas for eight years. I think what Obama meant to say is that he pimped gas for eight years.

There, now that make sense.

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I live in an area with hard winters. I got crushed with fuel oul prices near $4.00 a gallon and it hurt. It hure real bad!I have kids to feed, elders to take care of, mortgage payments, revolving debt, and POTUS Obama has the audacity to ridicule a man for having ten kids and driving a van?! With his current energy policies in place for the next year and a half, also in conjunction with his fomenting instability in the Middle east, we are sure to have to pay $5,$6, or even $8.00 a gallon in 2012. He is toast in 2012! The 22% of this nation who are hard core liberal/ left wing will not float his boat in Nov. 2012. I can’t wait to hear it! “President Obama, your fired!”

Don’t worry. Odumbo wants you to stop buying heating oil and heat your place with wind turbine electricity. Only 20 to 30 cents per kWh depending on where you live.

Your car a guzzler? Buy a cheap ass Volt or Prius. Nevermind that these cars have as much kinetic power as a floating turd.

Me, I’m going to save gas money by purchasing a $120,000 Tesla. Neener.

Our inflation numbers exclude both gas and food.
Gee, what is left for poor people?
Not too much.
***
And one thing you might notice, if you are into shopping; product producers are removing water from their products to save transportation costs.

So, you have 2, 3 and even 4X concentrated liquid detergents.
(Doctors will tell you they are seeing more chemical burns as a result.)
There are always unintended consequences to every ”solution.”
If you like to scrub your collar with a dab of your detergent before you wash your shirt….wear gloves.

If gas prices hurt, buy a dispossable car that might not be worth scrap price before it’s paid for; after all, some sucker has to buy the junk. Typical Obama Economic advice: if you are going broke, spend more money and go broke sooner.

Try and hold on people, until we can get rid of this Marxist buffoon in the White House.

Since US domestic oil drilling has actually increased since Obama took office, to a greater extent than US consumption, kindly explain how Obama’s policies have led to a doubling in the world’s oil prices, realizing that US produced oil is always sold at world oil prices.

The country actually does have problems, which will never be solved without some intellectual honesty concerning causes and effects.

– Larry Weisenthal/Huntington Beach, CA

The price of gas will rise and fall on its way to an inevitable figure of over 5 bucks a gallon. Nothing can be done to prevent it. That’s because world demand has been rising and will continue to rise faster than world supply. If anything, we’re in a lull before the storm owing to a temporary reduction in global demand because of a depressed world economy. As the world economy improves global demand will go up.

We can either recognize the facts and make intelligent and adaptive changes, or pretend that supplies can somehow be expanded indefinitely while promoting a continuation of our long-standing dysfunctional behavior. The choices are there, on both the level of national energy policy and personal behavior.

What car you drive is only a part of how high gas prices affect you.
You also still have to eat.
For one example:
The Wisconsin Farm Bureau shows food prices are up 5 percent this year.

The bureau’s ‘Marketbasket’ survey totals the cost of 16 food items.
In the first three months of 2011, the total was $48.
That is up $2.39 from December’s price for the same items.

Topping the survey’s list

Apples increased 24 cents (18 percent) to $1.52 per pound.
A gallon of whole milk increased 50 cents (17 percent) to $3.41 per gallon.
One pound of bagged salad increased 33 cents (15 percent) to $2.48.
A five-pound bag of flour increased 25 cents (12 percent) to $2.34.
One pound of ground chuck climbed 32 cents (10 percent) to $3.41.

However the study shows Wisconsin’s price is more than $1 less than the national survey of the same 16 food items.

Prices are rising at the gas pump as well.

http://www.fox11online.com/dpp/news/Food-and-gas-prices-on-the-rise

Obama has already ruined the economy to where 1 out of every 7 Americans are using Food Stamps.
What is next?

I haven’t seen 8 mph since the 1960’s!

Obama doesn’t care about your suffering. It’s for the good of the world.

Larry, how about YOU displaying some “intellectual honesty”? We addressed your claims before and they were found lacking. Stop repeating the same disproven garbage over and over. Same with you Greg.

Now how about you lefties comment on the flippant way he addressed the concerns of those people?

@Hard Right, #9:

Now how about you lefties comment on the flippant way he addressed the concerns of those people?

Perhaps if we’re worried about the rising cost of gasoline, it isn’t altogether flippant to suggest that our next vehicle purchase might take fuel efficiency into consideration. Feel free to buy the gas guzzler of your choice in protest. That would fall under the category of personal choices.

Gas prices have doubled under Barack Obama.

BTW, in the middle of GWB’s final year in office the average U.S. price for regular gas reached $4.12 per gallon. The price suddenly and rather mysteriously declined again shortly before the election. I guess we’ve forgotten all about that.

Doncha love how the Lefties REGULATE children into ”back seats” then act holier-than-thou when you complain that there are no economical cars that carry that all your children?
Not everyone has ten children, but I know a lot of folks with just three who are forced into SUV’s by the REGULATIONS that means a child cannot be up front.
Now, locally, the solution I see all of the time, is the illegal carrying at least one child in the front seat and more children in the back seat than are seat belts.
Hey, I live in a ”culturally diverse,” neighborhood.

http://www.hybridcenter.org/hybrid-timeline.html

List of all hybrid vans and SUVs

See any American ones ready for trade in?

Obama is full of ..it.

@Greg:

Ummm Greg, where does it say the guy was driving a gas guzzler? Can you prove he is? Instead of actually dealing with the question obama constructs a straw man and basically insults the guy. A man with a large family points out he needs a large vehicle and obama in his ignorance (or outright dishonesty) claims he needs a hybrid mini-van….which doesn’t exist. Of course you are perfectly fine with this since a dem is the one doing it.
Nice little conspiracy claim in your next post too. You really are a socialist tool.

@hard:

We addressed your claims before and they were found lacking. Stop repeating the same disproven garbage over and over.

I respectfully deny that my “claims” that domestic drilling has no significant effect on the price of gasoline at the pump were ever “disproven” or “found lacking.” Kindly explain how it is that Germany, which has no domestic drilling, pays the same price for gasoline at the pump (pre-tax) that we here in the USA pay, even though we produce 40% of the oil we burn and Germany produces 0%. Let’s say that we increase production by 25%. That will take many years and it will increase world oil supply by 2.25% and, in theory, increase our domestically produced share of oil from 40% to 50% of our needs. So we pay the same price for gasoline as Germany, while we produce 40% of our needs and Germany produces 0% of their needs. Now our production increases to 50% of our needs from 40% of our needs. But that extra 10% is still going to be sold to us at the same world market rates which Germany pays. So whatever minuscule price reduction we see (as a result of increasing world oil supply by 2.25%) is going to flow equally to Germany (and China) as it flows to us.

With regard to Obama’s flippant remark. I agree that it was flippant and ill advised. Bill Clinton never would have said that. Bill had a knack for having people believe that he really did feel their pain. I think that Bill Clinton has a lot more genuine empathy than Obama has and that this is a flaw and political disadvantage for Obama. But that doesn’t make Obama’s message wrong — it just makes it insensitively harsh and politically stupid.

– Larry Weisenthal/Huntington Beach, CA

Skookum writes: “buy a dispossable car…”

That’s exactly right, economically speaking. If you need a vehicle, buy and old junker gas hog for ten cents on the dollar. The money you’ll save on the car will pay for a lot of $5 gas.

I had a fighter pilot friend who, when his buddies were coming to Phoenix for the weekend, would buy an old junker at “Miracle Motors” on Grand Avenue (If it runs, it’s a miracle) for his buddies to drive. He’d spend ~$150 on the car which was cheaper than renting one. In AZ back in the 70s, one was on one’s own recognizance to register the car with the DMV. My buddy never did that and when his friends left, they just took the car back to Miracle Motors or left it alongside the road somewhere.

kind of a “let them eat cake” statement isn’t it?

@Greg:

That would fall under the category of personal choices.

The problem with that sentence, when discussing true economic freedom of choice, is that the government, under Obama, has artificially tilted the scale in favor of the really, really small, but really expensive, higher MPG vehicles. In effect, he has limited the choices a person can make for themselves if that person was taking lifetime vehicular cost considerations into effect.

And before you start repeating what Larry talked about, as far as increased domestic production is concerned, under Obama the US oil production in 2010 fell far short of the 2007 estimated production for 2010. Basically, Obama’s policies, from moratoriums in the gulf, to lack of progress on Atlantic coast wells, to virtually no movement on public land within the continental U.S., have failed to deliver the production many people and regions were counting on.

And Larry can claim all he wants that increased U.S. production won’t see our fuel prices at the pump fall, but he is selling you false words. No conservative here is claiming that increased U.S. production will drop gas prices back to $2.00/gallon, or even less. We are simply asserting that the economic law of supply and demand, with increased supply, will affect the gas prices we see at the pump, and in our favor. What’s more, the increased domestic spending on oil, and products from that oil, will only help the economy, including in several depressed areas within the U.S.

@John: You don’t need to buy an old junker gas hog; you can buy an old junker Ford Fiesta or Toyota Carolla. Right now, I’ve got an old junker Toyota cargo van (1985), which seats 7 (all with seat belts) which runs good but needs a rebuilt alternator, which I’d be happy to sell for $500. Gets over 20 MPG.

@john:

And Larry can claim all he wants that increased U.S. production won’t see our fuel prices at the pump fall, but he is selling you false words. No conservative here is claiming that increased U.S. production will drop gas prices back to $2.00/gallon, or even less. We are simply asserting that the economic law of supply and demand, with increased supply, will affect the gas prices we see at the pump, and in our favor. What’s more, the increased domestic spending on oil, and products from that oil, will only help the economy, including in several depressed areas within the U.S.

#1: US-drilled oil is sold to us for the exact same price as World/Saudi, etc. oil (grade for grade, transport cost differences being trivial).
#2. World oil price is determined by supply and demand.
#3. We supply 9% of world oil. If we increase production by 25%, this will take many years and increase world oil supply by 2.25%, which will have a trivial affect on world oil prices, a trivial effect on world gasoline prices, and will provide the same (minuscule) advantage to China as it provides to the USA.

– Larry Weisenthal/Huntington Beach, CA

Larry, Mata and others addressed your question on a previous thread.

As for your comment on what obama said, your honesty is appreciated.

@openid.aol.com/runnswim:

One thing you do not address is the increased supply on the world market and how that affects prices.

You also fail to address the benefit of increased domestic spending on crude oil on our economy.

Also, who cares if the rest of the world sees the same benefit, price-wise, that we could realize at the pump. That is absolutely no reason to limit oil domestic oil production. On the contrary, increased economic boons to other countries can only help our own economy.

But that doesn’t make Obama’s message wrong — it just makes it insensitively harsh and politically stupid.

Your right, what you discussed doesn’t make Obama’s message wrong. What makes it wrong is that his policies are the cause of limited choices for consumers. He isn’t necessarily wrong about what he told the guy, but it needs to be said that the why of his response is his own doing.

@John: I’ve stated, many times, that I agree there are certain benefits to increased domestic drilling (balance of payments, royalties to Alaskans, jobs for oil industry workers, profits to shareholders, increased federal taxes), but that “drill baby drill” is not being sold to voters on these issues but rather on the false claim that this will decrease the price that we pay for gasoline and heating oil. No, it won’t. Gasoline costs are tied to oil costs. Oil costs are tied directly to world market levels. World market levels are world supply and demand. Increasing US production by 25% would only increase world supply by 2.25% and this would have a trivial effect on gasoline prices and, as stated, the benefit would flow equally to China as to the USA. We are already pumping at twice the rate, relative to our reserves, as the rest of the world.

– Larry Weisenthal/Huntington Beach, CA

Larry: but that “drill baby drill” is not being sold to voters on these issues but rather on the false claim that this will decrease the price that we pay for gasoline and heating oil.

Don’t know what news sources Larry is looking at, but I’ve always seen it tied to reducing dependence upon foreign oil sources…. which is true. But I guess it’s what ever talking points someone prefers to hear, eh?

@openid.aol.com/runnswim:

#1: US-drilled oil is sold to us for the exact same price as World/Saudi, etc. oil (grade for grade, transport cost differences being trivial).

Transport costs are hardly trivial.
http://www.petrostrategies.org/Learning_Center/oil_transportation.htm

Worldwide, shipping costs of oil contribute approximately $0.03/gallon of fuel at the pump. The U.S. used roughly 65Billion gallons of fuel in 2008. That means that roughly $2 Billion was spent on shipping costs alone. Assuming we could increase our own production by 50%(a fav figure of yours, I would assume more possible), that would be around 2.5million barrels/day, or, a 27.8% reduction in imported oil. Going further, we could see a decrease in dollars spent for shipping costs, of $556 Million a year.

#3. We supply 9% of world oil. If we increase production by 25%, this will take many years and increase world oil supply by 2.25%, which will have a trivial affect on world oil prices, a trivial effect on world gasoline prices, and will provide the same (minuscule) advantage to China as it provides to the USA.

As I said above, who cares if other countries see the advantage too. A burgeoning world economy can only help out our own economy

@Greg: The price of gas will rise and fall on its way to an inevitable figure of over 5 bucks a gallon. Nothing can be done to prevent it. That’s because world demand has been rising and will continue to rise faster than world supply.

ah… popping in for a brief visit and I still see the same ol’ same ol’.

Not true, Greg. Prices are up, but we have no supply problem and demand is down. As far as the US goes, the demand for finished motor gasolene (refined) has been going down since after 2006.

Above is from the EIA US stats on Petroleum products site.

As a direct link, pump prices are linked to refining capability first. Market crude prices second, only because there is not enough oil produced domestically to supply the nation’s needs. And while Larry tut tutted the price of transportation, that increases the price to the purchaser.

Our current refinery yield is not much above what it was in 1994.

Tho there has been a couple of refineries opened (under Bush permitting, of course), those that were closed still result in a net loss of refining capability. And Obama’s EPA continued to retract permits for refineries.

So Obama, riding the coat tails of the previous admin’s efforts to release the US from the clutches of OPEC and other unfriendly suppliers in his first two years, has managed to effectively reverse it all by banning US companies from drilling, but allowing Brazil to dril in our GOM. And slashing of refinery capability.

Speculators pick up the slack based on the haps….

@Greg: BTW, in the middle of GWB’s final year in office the average U.S. price for regular gas reached $4.12 per gallon. The price suddenly and rather mysteriously declined again shortly before the election. I guess we’ve forgotten all about that.

Is this a have cake/eat it too moment, Greg? Are you suggesting that the abnormal rise in prices that Freeman thinks may have been an orchestrated financial terrorist attack is Bush’s fault, and simultanously give your boy a pass?

Neither Obama, nor Bush, have the power to impact gasoline prices so immediately. Altho it can be noted that both POTUS had different aims. Bush’s was to try and increase US domestic production and refining, and thereby attempt to keep them lower. Obama has stated he wants higher prices to effect behavioral societal change.

A POTUS can, however, increase refinery and production capabilities that will have an effect for future. Bush did so, and it worked… as Obama now delights that Larry is proclaiming his “increased production” glory… heh. No doubt, if a GOP POTUS takes over with Obama’s reversal trends, it will be his fault, and not the policies of this POTUS. That’s the way it works, right? Seize Bush’s accomplishments as his own, and leave a pile of manure for the ensuing POTUS and generations?

This guy’s gotta go. And now Hillary’s blown all her credibility as an alternative for a CiC. For domestic policies, she blew it with her Hillary’care under her hubby’s’ watchful eye. Now we’ve watched her prod the CiC into a never ending quagmire “non war” in Libya. Cool move….

@ Greg

The choices are there, on both the level of national energy policy and personal behavior.

Guess I need to tell all the guys that work from me to start loading their tools, ladders, surveying equipment and test equipment into one of Larry’s Toyota Corollas. What a bunch of idiots we are.
I see where you’re going Greg, you just hate the working man….and the rich.

Not true, Greg. Prices are up, but we have no supply problem and demand is down. As far as the US goes, the demand for finished motor gasolene (refined) has been going down since after 2006.

True. That’s because price of gasoline at the pump is related to the price of oil on the world market. Pump prices are much more closely related to world oil prices than to refining capacity. That’s why we virtually always have the same price of gasoline at the pump as Germany (pre-tax). That’s because both American gasoline prices and German gasoline prices are tied to world oil prices. And US oil production is only 9% of world oil production; so raising US production by 25% (which would take years and which would be a big stretch) would only raise world supply by 2.25%. Tanker costs are 4 cents a gallon of gasoline and, anyway, North Slope oil comes to refineries by tanker. It’s peanuts. And increased US oil production would have a peanuts effect on the price we pay at the pump.

When people see $4 a gallon gas, they want to be paying less then $3 and not $3.98 (transportation difference between US oil and Middle East oil). And if we increase production by 25%, increasing world supply by 2.25%, we are talking about 9 cents a gallon at the pump — balanced against the fact that we are already depleting our oil reserves at more than double the rate as the rest of the world.

I wrote earlier, it’s a personal philosophy difference which can’t be bridged. Some people think it’s OK to exhaust the nation’s oil reserves as quickly as possible, for the modest economic benefit it confers. Others think that we do owe it to future generations to save some for future generations to use for producing petrochemicals.

What I object to is simply implying that Obama’s policies are the cause of $4 per oil gasoline and that drill baby drill is the way to bring down prices to the levels of the good old days, with two SUVs in every garage.

And you can “decrease dependence on foreign oil” through a number of different approaches. I don’t think that the average voter is moved very much by the “dependence on foreign oil” argument. That argument is used by pro-drillers and environmentalists alike, during high gasoline price eras and during low gasoline price eras. What gets voters’ attention is the price they are paying for gasoline at the pump. And this is what is being exploited with such intellectual dishonesty today.

: With regard to the working man with his tools to haul around: Obama actually had a suggestion which will help that working man: next time you buy a truck, buy one with better fuel efficiency. This will actually lower his fuel costs. Drilling more North Slope oil won’t help him enough to even notice.

: Increasing US oil production by 25% would only increase world oil production by 2.25%. This will quickly be absorbed into world oil pricing. Middle East unrest (source of 64% of the world’s oil supply, compared to our 9%) is the uncertainty which rocks the oil futures markets. Right now, they don’t know if Libyan unrest will spread to Saudi Arabia. That’s the uncertainty elephant in the room.

– Larry Weisenthal/Huntington Beach, CA

Larry: True. That’s because price of gasoline at the pump is related to the price of oil on the world market. Pump prices are much more closely related to world oil prices than to refining capacity.

You must be reading in Mandarin,… sorry, meant Hebrew… Larry. Backwards. Pump prices are first and foremost related to refining capacity, and crude prices second. Otherwise we would not see the fluctuations in prices during the seasons of switching over to the various state formulas at different points of the year. Also, refineries near the domestic sources, as well as transportation pipelines would reduce costs related to transportation that are passed on post refinement. i.e. there is no way to get the shale crude to the coast refineries, so the cost of trucking it there is high. Transportation costs are not limited to the added expense of VLCCs, rounding Cape Horn.

As far as world crude prices, the more competition there is for production, the better the pricing is. Right now, despite the fact there are non OPEC nations, they hold the monopoly of deciding both production and pricing by their performance, much as the diamond market controls pricing by mine production.

“exhaust the nation’s oil reserves as quickly as possible“…. LOL The earths renewable crude is so vast, it’s beyond our capacity to contemplate “exhausting” it all. What you confuse is what is obtainable, vs what is there. Because we are advancing techniques in E&P daily, more and more of those previously untappable reserves can indeed be tapped. When it comes to oil E&P, you think with a mind that lives in finite technological advances. You wouldn’t get very far in your own business if you did the same.

@openid.aol.com/runnswim:

RE: the fact that we are already depleting our oil reserves at more than double the rate as the rest of the world.

No, Larry, not true.
All that has been done is that we have legislated and regulated so much of our own known reserves off the table that it LOOKS like we are depleting our oil reserves faster than other places.

Remember, oil reserves, in the USA is defined POLITICALLY, not scientifically.
When it is not economically feasible to draw certain oil out…..that oil is taken off the USA’s oil reserves list.
When it is not politically possible to draw certain oil out…..that oil is taken off the USA’s oil reserves list.
When excess regulations or freezes occur regarding oil…..that oil is taken off the USA’s oil reserves list.

That is why our ”oil reserves” do not even count all our oil in the Gulf, in ANWR and locked in shale.

@Nan. “Officially,” we have 2.4% of the world’s reserves. In reality, we are pumping 9% of the world’s oil supply. Let’s say that the “true” reserves we have are TWICE the “official” reserves. That means that we’ve got 4.8% of the world’s oil and are depleting our reserves, already, at nearly double the rate of the rest of the world. So now we proceed to increase production by 25% (which will have a truly negligible effect on the price we pay at the pump for gasoline). Then we’ll be depleting our reserves are more than double the rate of the rest of the world.

I just don’t see that as a “conservative” way to manage this particular natural resource.

– Larry Weisenthal/Huntington Beach, CA

@openid.aol.com/runnswim:
Larry, it is more like 10 or more times that 2.4%.
(Obama said it was only 2%, btw.)
But if we could access every bit of it, and if we keep finding more, as we have in recent decades, we will never run out.
There is such a thing as ”Enlightened Self Interest.”
Allow people the freedom to buy an SUV if they need one and many will still chose to buy more economical cars because they don’t need an sUV.
A few years ago we sold our 1967 Mustang.
It was well beyond being forced to pass a smog test.
But it did so.
It also was getting ~ 21 MPG at the time.
Replaced it with a Mini Cooper.

@Nan. It’s Friday afternoon — almost TGIF time and I’m tired of arguing. Let me simply tell you what an awesome vehicle you’ve got in your Mini 🙂

@mata: You are talking microeconomics and seasonal variation and small differences and short term fluctuations and regional differences in pump prices with your refinery stuff. It’s not germane to the macro relationships between US drilling and cost of gasoline at the pump. The wild gyrations in oil prices over the past 40 years (since the first Arab oil embargo in the early 1970s) were responsible for the wild gyrations in the price of gasoline at the pump – NOT differences in refining capacity! That’s why German gasoline (in a country which produces no oil) costs the same (pre-tax) as US gasoline (in a country which produces 9% of the world’s total supply).

– Larry Weisenthal/Huntington Beach, CA

Larry: You are talking microeconomics and seasonal variation and small differences and short term fluctuations and regional differences in pump prices with your refinery stuff. It’s not germane to the macro relationships between US drilling and cost of gasoline at the pump.

Really? Tell that to the American Institute of Professional Geologists, who note that the EIA says that relationship not to be a neglible as you portray.

Data and analysis from the Energy Information Administration (EIA) at the Department of Energy provides at least two important pieces of information needed to assess the relationship between the price of gas and the nation’s refining capacity. First, EIA reports that the refining process accounts for about 21 percent of the pump price of gas (June 2004), although the figure varies. The percentage of pump price attributable to the refining process has fluctuated between 7.8 and 31.6 since January 2000. It can rise and fall by over 10 percentage points in a month without necessarily having a direct correlation to pump prices. Lowering the cost of this part of the industry that processes crude oil into a form useful in vehicles may or may not significantly lower gas prices.

I don’t consider that process, averaging 21% accountability of the pump prices, as being as unimportant as you claim. When you consider making refining convenient to domestic sources (i.e. shale in the west) to eliminate transportation costs, and producing more domestically to lessen the dependence upon oil imports and their added costs, it all points to lessening the price at the pump.

Don’t care about Germany. I don’t live in Germany.

Let me anticipate Larry’s reply… if he does, that is. Because he may misconstrue my statement of the refineries impact as the largest factor for pump prices.

If the world price is $100 per barrel, that is only the price to the refinery… despite retooling for different formulas seasonally, and the transportation costs which are passed along to the consumers at the pump. It is not that world prices have the first or the only impact. They are piled on by additional costs of lack of refineries to serve the needs of demand, and the additional costs.

With all things being equal in crude prices year round, the refining process impacts the pumps for these additional reasons first… the world pricing second.

@Mata: Here’s the part of your quote that you didn’t bold:

It can rise and fall by over 10 percentage points in a month without necessarily having a direct correlation to pump prices. Lowering the cost of this part of the industry that processes crude oil into a form useful in vehicles may or may not significantly lower gas prices.

As I said, the main driver between the big time gyrations of price of gasoline at the pump is price of oil on the world market…which is influenced to a negligible degree by the amount of oil pumped out of territory owned by the USA.

The reason you should care about Germany is that if you understand the relationships between the pre-tax prices of gasoline in the USA and the pre-tax prices of gasoline in Germany (virtually always virtually the same) and relate those to the prices of world oil (which are the same prices as US oil, as US oil prices are tied to world prices), then you’ll have more realistic expectations of the ability of a drill baby drill policy to improve the lot of the worker with tools to haul in his truck and his weekly struggles with $4 a gallon gas.

P.S. Regarding refining being 21% of the price of gasoline… That was from an article written in 2004. In 2004, gasoline was selling for $2 per gallon.

http://money.cnn.com/2004/05/18/pf/autos/gas_prices/

Today, it is selling for $4 per gallon. 21% of $2 is 42 cents. Gasoline prices have gone up 200 cents. So you are saying that refining costs have gone up 5-fold since 2004? I don’t think so.

As I said, the number one driver of price of gasoline at the pump is world price of oil, which is negligibly affected by US oil production.

– Larry Weisenthal/Huntington Beach, CA

Larry, the impact at the pump is definitively stated as 21% by the EIA. THe fluctuation is neglible following that. As I said in my comment above, I knew you’d misconstrue that impact as being the largest amount, or as you now put it, the “main driver”. I never said that world prices didn’t affect pump prices. I merely said it is impacted FIRST by refinery costs, and secondly by world prices. As I point out, were crude at $100 per bbl all year round, the prices at the pump would still fluctuate due to different transportation costs, seasonal retooling, and the lack of capacity to fulfil the nation’s needs.

In that aspect, the world price of crude being consistent and predictable all year round is not reflected when you fill your tank because of the other factors… factors that we could indeed remedy, and should. But it won’t happen under this POTUS.

@Mata. OK. I agree with your last comment.

Oil formations in North Dakota alone contain enough crude to raise that state to the status of one of “the 13 or 14 largest producing countries [in the world].”

The amount of oil lying in Alaska’s outer continental shelf (OCS) is so great that tapping into it “would make Alaska the eighth largest oil province in the world – ahead of Nigeria, Libya, Russia, and Norway.” [PDF]

Cuba is slated to start drilling in the Gulf of Mexico soon.
That’s oil we could be getting.

None of this oil is counted as part of the USA’s ”oil reserves.”

What percentage of the price of crude is attributable to OPEC’s whims and greed. That percentage will be discounted considerably when the US elects a president with balls that isn’t afraid of the enviro whackos and begins drilling and refining.

Again it is the Ultra Rich Elites who want to destroy the middle class so that their millions will be worth even more, especially, without pesky interlopers from the lower socio-economuic classes, who plug up the roads and the parks with hoi polloi mobs. This country belongs to the wealthy and their Useful Idiots; at least, that is the way the Soros types see it. One of the best ways to strangle the incentive is by creating a Welfare State and by increasing the cost of living through higher and higher energy costs until they are defeated like whipped dogs.

Al Cooper: I consider the new hybrids to be disposable cars. Their technology will be obsolete before they are paid for.

I drive old Mercedes cars myself, drive in luxury with lots of room getting 22 to 24 mph. Do I need a new Obama Car? Hell NO! Case in point my most recent acquistion, 91 SEL 104,000 miles, originally a $78,000 car. I paid $2500 and put 40,000 miles on it in eight months. New front brakes, new tires, new spark plugs and no payments. My banker said it was amazing to see 4 of these cars on my balance sheet with no payments. I drive 60,000 miles a year. An Obama Car wouldn’t make it two years. Buy yhe Obama union junk if you must, I’ll stick with German engineering and buy Ford pick ups for the rest of my life and never ever pay a car payment. Do I want to drive a tomato can to get thirty mph, no thank you. I ride in the safest cars and get at least 22 mph in style and comfort and pay almost nothing to do it. Stick with Obama and go broke as fast as you can. I’ll be riding with the seat all the way back with the air on full power.

Oh, I usually get 600,00 miles on them before I retire them to the parts bin to keep my next purchase running.

@openid.aol.com/runnswim, after a month of so of not quite airing dirty laundry attitudes, that’s actually refreshing to hear. However I will still take issue with one statement with caveats.

@openid.aol.com/runnswim: P.S. Regarding refining being 21% of the price of gasoline… That was from an article written in 2004. In 2004, gasoline was selling for $2 per gallon.

http://money.cnn.com/2004/05/18/pf/autos/gas_prices/

Today, it is selling for $4 per gallon. 21% of $2 is 42 cents. Gasoline prices have gone up 200 cents. So you are saying that refining costs have gone up 5-fold since 2004? I don’t think so.

You don’t think so? Do you think that perhaps the cost of running that refinery’s overhead has gone up? Has their costs of transportion for the crude gone up? Has any unions affected their overhead? Health insurance costs maybe?

Maybe you don’t “think” coherently when you compare what was almost a 1/4 of the price determination then may be even more today with inflation. Tell me, Larry… do you think their overhead went down proportionately? If so how? I’m sure every business owner in the nation will be hanging on your words of wisdom.

Or doesn’t that count in the percentage of price at the pump? The percentage wasn’t dealing with overhead percentages, but only with cost of crude percentages. One didn’t go up, and the other remain stagnant, ya know.

@Skookum 2, INRE your destroying the middle class comment…. a grin and silver lining for you, from Mike Keefe.

Looks like we can kill two birds with one stone, eh?

@Nan G, you are overlooking, to me, the most important permit issued last month in the GOM. To Brazil. The ability to drill not only in the GOM, but also pull several GOM rigs off to develop the two largest field finds in the past three decades off of Brazil makes me wonder if Obama was in Rio on vacation, or establishing residency for a future Brazilian presidential run, and purchasing real estate there. They will be the new oil giants in the future.

@openid.aol.com/runnswim: Kindly explain how it is that Germany, which has no domestic drilling, pays the same price for gasoline at the pump (pre-tax) that we here in the USA pay, even though we produce 40% of the oil we burn and Germany produces 0%.

Simple… can you say “Druzhba pipeline” from Russia (as well as other pipelines…)? Cheap transportation, and supplies 20% of their national needs. Manages to get crude to the nation’s refineries for a minimal of cost. And they, of course, pay the world crude price for that.

On the flip side, how many of the US urban centers are near a pipeline or other inexpensive oil transport system outside of the Alaskan pipeline?

Thus my argument about transport costs to the refinery, and the amount of refineries to process crude since it’s cheaper to move crude than finished refined product to the consumer.

They (Germany) are totally dependent upon other nations (bad bad for national security….), yet because of cheap transport, get it to their rebuilt and plethora of strategically located refineries in the nation. The only thing in our favor is that we do produce domestically and have some cheap delivery to *some* areas. Most of our refineries are located on the Gulf Coast. From there, the transport costs to stations gets added on…. Otherwise we wouldn’t be competitive in your example.

Oh, but then, transportation doesn’t enter into the equation. yuh… But ask, and you shall receive. (Note, also, the same profile on US energy, with a decline of refinery capacities over the past 30 years….)

As far as their price at the pump, I’m not aware of… or care… about their different tax structure. Perhaps you can tell us if the German government is more, or less, money grabbing than our Congress.

Last time I was in Germany, Larry, they paid the same amount per liter of gasoline as we paid per gallon.

@Mata

Larry uses Germany as an example because they are closest to the U.S. in terms of pre-tax cost of gasoline. The list I looked at, that Larry linked at one point, showed pretax costs ranging from $1.40 or so to up in the low $2 range. It isn’t as clear cut as Larry claims, that everyone pays virtually the same for oil, and subsequently, gasoline. There are too many factors that go into the pricing of fuel to claim a correlation between what a country pays for a barrel of oil compared to a gallon of fuel, and then justify that two countries paying the same pretax for a gallon of fuel have paid the same price for the barrel of oil. Larry, as a business man, should understand this, but he has overlooked it. The wages we pay are different than Germany, as are the costs to the refinery due to regulatory costs, as are the formulations(which you mentioned), as are the shipping costs, etc., etc.

And I am sick of seeing the numbers Larry uses for the U.S. oil reserves. Time and time again, we’ve pointed out that his 2% number is way off, yet he insists on using it. He knows better, it’s just that the rhetoric he repeats sounds better with that 2% number.

Larry, the ocean naturally releases gas and oil. With the ban on offshore drilling in California it is starting to have an impact on the beaches. Even surfers in Santa Barbara are starting to complain. The Santa Barbara channel produces about 150 barrels a day, but it all goes to beaches because there are onl 27 oil platorms in California. You can read it yourself: http://www.soscalifornia.org/problem.html
So, should we just let it wash ashore, or should we drill for it and use it? And if we can get it, how do we refine it when congress won’t permit new, up-to-date refineries?

@Aqua:
Larry lives close enough to our beaches to know this from personal experience.
One of my favorite beaches is Cabrillo, not too far from the Korean Peace Bell.
But the globs of tar-like oil on all of the beach makes it hard to get cleaned up afterward, if you walk at the shore.
Locals there do claim more drilling would clean up the mess.
I guess I don’t see how, but, hey, it is worth a try.
I am a supporter of the feral cat arrangement at Long Beach that helps keep our rat population down.
The vet I take them to says the biggest danger to them is poisoning when they try to clean off those globs of tarry oil that get onto their fur.

Getting into this conversation a bit late due to computer problems.

@Larry: You said:

Since US domestic oil drilling has actually increased since Obama took office, to a greater extent than US consumption, kindly explain how Obama’s policies have led to a doubling in the world’s oil prices, realizing that US produced oil is always sold at world oil prices.

Um, hold on there, Larry. You are wrong on this one.

From Human Events:

Obama has shut down, shut off, and canceled more oil drilling than any President since Carter.

After the BP oil spill last year, Obama shut down all offshore oil drilling in the Gulf of Mexico, idling 78,000 jobs and cutting off billions of dollars of tax revenue to state and local governments in the Gulf Coast region.
——————————-
Record drilling under Obama?

Domestic oil production increased until the BP spill because of Bush’s pro-drilling policy. In 2011, the Energy Information Administration estimates, the U.S. has seen a decline in production of 220,000 barrels a day, and it projects a reduction of 150 million barrels in 2012 from the Gulf.

Two per cent of the world’s oil?

The figure comes from an Energy Information Administration estimate of world proven reserves already being drilled. The 2% statement ignores federal estimates of likely reserves in the U.S. (placed off limits by Obama) that total more than three times Saudi Arabia’s reserves.

Oil companies sitting on existing leases?

If oil companies are not drilling on federal leases for which they have already paid a fortune, it’s because exploratory wells have not hit oil, or because they have and it has taken years to get a federal permit for production wells.

Obama’s proposed tax on leases “where they aren’t producing a thing” would tax companies for not using a lease the feds have not yet allowed them to use. – Source

@Greg: You said:

BTW, in the middle of GWB’s final year in office the average U.S. price for regular gas reached $4.12 per gallon. The price suddenly and rather mysteriously declined again shortly before the election. I guess we’ve forgotten all about that.

Yes, the prices did fall. Right after Bush lifted the ban on drilling in the Gulf.

Thanks for the ‘car’toon Mata. It would really be funny if the reality of the toon wasn’t just beyond the horizon.

What a jack ass.

Obviously, this jack ass does not have to transport kids in the mandatory car seats. These car seats do not fit in the “smart cars”.

Obviously, this jack ass is not 6’7″ or taller.

Obviously, this jack ass does not have to sell a car or trade it in to get another one, and possibly lose money while doing that.

Obviously, this jack ass does not need to drive a truck with his/her tools and/or trailer a boat or equipment. He does not work on a farm

Obviously, this jack ass did not grow up in America or ever hold a job or he would understand that we need to drive the car that we have (and may be paying on) to get to work.

Obviously, this jack ass does not understand the “working class.”

Obviously, this jack ass does not understand that the USA is spread out. We do not live cheek to jowl like Europeans.

I am glad that The Donald hired a private investigators to find the birth certificate of this jack ass. The Donald will probably discover that this jack ass grew up on another planet.

In Maryland our gas prices just shot up .11$ per gallon because we are required to use “oxygenated” gas from April through October. A rousing round of applause to our legislature.

In Maryland our gas prices just shot up .11$ per gallon because we are required to use “oxygenated” gas from April through October. A rousing round of applause to our legislature.

We have the same thing here in California. We have the most expensive gas in the USA, because of all the anti-smog regulations. We also have the toughest emissions inspection regimes. I’ve got to pay a couple of hundred extra bucks a year on tune ups and new oxygen sensors and what not to pass my smog tests. But you know what, when I first moved here (from Rockville/Bethesda, Maryland) in 1979, the air was filthy — particularly in the summer. Now the air is usually at least halfway decent. Official measurements confirm what is obvious to the senses. All those lib Dem environmental regulations have paid off handsomely. I doubt seriously whether our friendly neighborhood GOPers would go back to the bad old air days for the sake of saving even hundreds of dollars per year.

When I lived Rockville, circa 1977-79, the air in the summer was — even then — pretty bad on some days. I imagine that there is a darned good reason for switching to the oxygenated gasoline and that most Marylanders are happy to pay a little extra at the pump, for the sake of their lungs.

– Larry Weisenthal/Huntington Beach, CA

@openid.aol.com/runnswim:

But you know what, when I first moved here (from Rockville/Bethesda, Maryland) in 1979, the air was filthy – particularly in the summer

Hey Larry– I remember being in LA in 1971 while thumbing around not long after I got out of the Navy. I was somewhere in the big building part of the city, standing on a sidwalk, looking up road as it receded along a long slowly rising slope. Never did get to see the top of that hill due to a VERY pronounced greenish smog that hid everything after a while. Later that night, somewhere that I was crashing, I saw on TV a report about the resultant smog alert. As I recall, they said that the pollutants combined in the atmosphere to make a soup with a high level of HydroChloric Acid which casued the strong green tint. I had never lived anywhere and I have never been anywhere since that had conditions near as bad. I believe (in large part to NOAAs conclusions) that the average temp of the world is indeed rising and I would suspect that saying that here will give me a worse rep than a serial necrophile. I have not been sold however on the causes of it but see the various ever increasing energy consumption/byproduct discharge to be alarming at the least. When I discuss this issue with conservatives, I always relate the green air day I saw in LA and how people were identically set against automobile pollution devices with no agenda to convert them. I ALWAYS get a snort of derision in reply as people use their disdain for Al Gore to justify their blindness. Incidentally, I came to this site following a link to that european professor giving his lecture on his theories on Global Warming and I watched the whole thing. But it still did not convince me that the causes are what he claims either.