Gasoline Prices by Month

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Permalink Reply by Michael S. Boone on August 31, 2009 at 10:44am

The big problem is foreign oil. While we're transitioning to cleaner fuels we need to drill for more oil and dig more coal.For now we still need oil and coal until the others are developed more fully.This country can do anything it puts its mind to. We put a man on the moon in less than 10 years. I think we could easily be energy independent in that amount of time.

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Permalink Reply by david@PickensPlan on September 1, 2009 at 1:37pm

I agree, There are no limits, it only appears that there are self imposed limitations that hinder our progress.

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Permalink Reply by Jo Rudolph on December 7, 2009 at 11:13am

What is "foreign" oil? It is all foreign unless you own an oil company. They drill, drill, drill so they have the right to sell, sell, sell to the highest bidder. That's basic capitallism.

Competition is also capitallism. If what you really want is lower energy costs (and less pollution and green house gases) you have to work on the alternatives NOW. Fossil fuels will NEVER come down in price if there is no competition.

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Permalink Reply by neil cox on December 7, 2009 at 6:21pm

Hi Jo: Basic capitalism rarely happens large scale such as the oil markets. Sort of capitalism, yes. The term foreign oil usually means imported from a different country than where it is consumed. That happens in almost every country, even the few that produce more than the counties ecconomy consumes. Fossil fuels won't come down in price a lot, even if there is lots of competition from alternative energy. I agree, however that The USA needs to transition to alternatives faster than seems prudent. It is a big mistake to send lots of money to people who want us dead. Neil

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Permalink Reply by Clifford R. Pelchat on August 31, 2009 at 11:00am

"March 2003 Decreased drilling results in surging demand." This statement makes the entire chart suspect. Wouldn't a surging demand cause prices to go up and drilling to increase? How does not creating a supply of something increase the demand for it? I can believe that a short supply increases the price, but not the demand for the product.

The bottom line is we have the cheapest (non government subsidized) gasoline in the world. When the price goes down we use more and when it goes up we use less. this is why we need an energy policy that is not tied to markets if we are ever going to have anything near a sustainable energy supply and demand model.

We need to drill for more oil in this country, we need to increase the use of NG as a vehicle fuel and we need to develop the Nuclear option. Imagine if we hadn't hastily killed the Nuclear Power Industry how much less CO2 we would be emitting today because we would have dozens more Nuke plants supplying clean reliable Carbon free energy.

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Permalink Reply by David B Hack on August 31, 2009 at 12:24pm

Total graphic confusion!

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Permalink Reply by Tim Leahy on August 31, 2009 at 12:31pm

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Permalink Reply by Thomas Stoflet on August 31, 2009 at 12:41pm

Hi David:

On an excel spreadsheet, I have been tracking over the past few years the price of crude ($/bbl converted to $/gal, i.e., $/bbl/42 gal/bbl using EIA data) to the average price of regular gas ($/gal) in my area to the price of CNG ($/GGE) supplied by the lowest cost CNG station in the area where I live in Northern CA (it's the local utility-- PG&E).

And what I have found is that the price of CNG spikes when the cost of gas and oil go up, and these natural gas cost increases are almost linear to the price of gasoline. Conversely, there is a slight decrease when the price of gasoline goes down, but the costs per therm of natural gas it still too high.

Everyone talks about supply and demand driving the cost, but often the cost of natural gas, even in the very mild summers where I live there is not that much demand, and there is not that much industry in the SF bay area anymore, and yet the cost per therm is still high despite little demand. So that principle or is untrue and more voodoo economics.

The only justifiable reason for the cost of natural gas to increase is if the O&M costs to supply the gas go up. So even if the demand goes up, say in winter, for example, there is only a small cost to push the extra gas through the pipeline network, plus some extra maintenance perhaps, since there are not the many new well fields being drilled. Even if the cost for new well fields increased, given the amount of natural gas consumed in America, it will only result in a small increase I estimated in the pennies per therm.

But based upon the wide swings, I serious doubt the wide cost fluctuations support these increases from any increased O&M increases. I have seen the cost of natural gas go from $14/mmbtu or more to $4/mmbtu and back and forth, despite no rhyme or reason except the price of gas. When oil was $140/bbl and gas shoot up to $4.50/gal so did the cost of natural gas; it was over $14/mmbtu or about $1.4/therm. Even this month of August when gas in my area is over $3/gal, the cost of natural gas is close to $1/therm. So it is obvious to me that the energy commodity brokers are manipulating the price of natural gas to mirror the cost of gasoline.

So I have gone to my local federal representatives to initiate legislation to impose strict regulation on the energy commodity brokers whoever they are, or legislation to nationalize natural gas to prevent what appears to be natural gas price fixing and gouging. And I suggest every Pickens Plan member do the same.

Please let me know if you need any data.

Tom,

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Permalink Reply by david@PickensPlan on September 1, 2009 at 2:00pm

This fantastic insight. The relation of CNG prices to the rise of oil prices surprises me. I was under the assumption that this would be the opposite. It would be interesting to see the above graph as it relates to CNG prices.

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Permalink Reply by Jeff Grant on September 3, 2009 at 8:18am

In reference to the price of CNG:
Tom, have you considered that the big electricity generators use CNG as a back-up fuel. They have steam generators which use either CNG or OIL. Whichever is cheaper, that drives them!
So, CNG price is raised to maintain the differential to OIL. It is not pegged to the cost of gas. However, the cost of gas is impacted by the cost of OIL.

Also, there is NO large market influence based on supply & demand. That was tossed out quite a few years ago. It is now manipulated by big oil companies, aided by big government policies.

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Permalink Reply by James Tracy on September 3, 2009 at 8:27am

But, if NG prices raise as a fuel, heating cost will raise too. As will as restaurant prices too.

I agree "It is now manipulated by big oil companies, aided by big government policies."

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Permalink Reply by Maggie on August 31, 2009 at 1:21pm

I saw a PBS show Nova Science Now! it talked-about a Navy program that shows evidence of cold fusion--Holy Grail of Energy Research--does anybody know anything about this? but in the meantime we
need to begin massive work on the smart grid and wind/ solar farms

but the higher the price of gasoline the faster the transition to higher mpg cars and the faster the transition to renewable energy--no more drilling no more adding to the carbon in the atmosphere

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