Oilman is a crook

coolidge said:

Got pricing today for next years oil at a building we own. $3.89 gal I am thinking of the P and M Optimizer 500 to take over, just dont want to c/s that much wood. Its gonna hurt

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How many gallons of oil do you burn in a year?

That will give you a rough estimate of the amount of wood you need to process.

I used the figures(for oil= to wood) that was put out here by other members when I was looking at putting in a gasser. These guys were spot on. What i used was for every 150 gals of oil, it = 1 cord of well seasoned wood. Than I figured our regional price for wood. which was $175 per cord c/s delivered. Even though I am buying it tree length, i wanted to see some real numbers. I was using 1000 gals of oil. First year with gasser i used 6.5 cord of wood. $3500(oil) vs $1100(wood).

We are budgeting fuel oil prices at $4.49 per gallon this fall. (we're also an evil oil company) . Thats at the high end of what my boss think it will average this coming year. He's usually pretty close.

The rapists at Goldman Sachs are predicting crude oil near $135 a barrel by fall. That translates to fuel oil around $4.00+, gas and diesel in the $4.60-5.00 range depending on state taxes.
I'm thinking that this will effectively shut down any pretense of economic recovery we may have going on.

I read somewhere a week or two ago that roughly speaking, every $25 dollar increase in a barrel of crude equals another $100,000,000,000 leaving the US economy. Clearly unsustainable. Saudi Arabian prince Al Aweed who is in charge of the oil production in that country said last week they think oil should be in the $75-80 range and they feel it is overpriced at the current level of near $100.
You can't deny that part of the price issue is supply/demand but the larger issue is speculation. There is no way that the big money people and firms should be able to buy tanker loads of crude and let them sit while they drive the futures price 30-40% over where it should be.

We are not making enough of a stink to the creatures inhabiting Washington DC yet.

FWIW the oilsands are ramping up production & looking to expand once again here. Anywhere north of $50/barrel is black ink for them as a general rule. Hopefully they dont all try to expand at once again, as that really drove the price of labor up, all the trade halls were empty when they all had an expansion underway at the same time. That forced everyone to start importing foreign workers which had plenty of unintended consequences. That have just now been repaired. Just an FYI everyone is planning for long term $200+/barrel. When they sit down to discuss new plants. We will all wish we could buy diesel at $6/gal, Prob far closer to $10/gal, not sure how that $ will translate into home heating oil costs, one thing for sure it wont be fun for those still buying it to heat their homes. Nat gas, propane will follow along as their will be lots of room to increase price when oil gets that high. Sorry for the bad news. Maybe our great grand kids will have to live in the warmer zones & walk to most locations in their daily routine. Life is never boring.

The whole thought of the sky is the limit on oil prices................not sure if I agree, the world market will not support it. I am usually wrong. But the world economy will go into a depression that we have never seen on high oil prices, if they never lower the prices. It's not sustainable.

Not sure about the sky is the limit. One thing we can all count on is that they will always charge as much as the market can bear, whatever that amount is. With a few families & businesses controling most of the market they will always be in the position to contol supply & therefore price. It really is irrelevant to them whether we can easily afford their oil as long as someone somewhere in the world can afford it then the price wont be coming down.

flyingcow said:

The whole thought of the sky is the limit on oil prices................not sure if I agree, the world market will not support it. I am usually wrong. But the world economy will go into a depression that we have never seen on high oil prices, if they never lower the prices. It's not sustainable.

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I agree completly.

Honestly I hope flyingcow & woodmaster are right.
However if I were forced to bet on this one I would choose the oil co's over any country you care to name, or any group of countries for that matter.
Ahhh the real price of a global economy.
Anyone else but me think we were better of in the old trade & tariff days.
If memory serves GATT worked OK, you know when 80-90% of our goods were manufactured right here at home instead of the other way around, however I am open to correction on that one.

But the world economy will go into a depression that we have never seen on high oil prices, if they never lower the prices. It’s not sustainable.

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Three errors here. 1st, what's not sustainable is an economy based on energy derived from oil. Change to an alternative, preferably sustainable, energy source.

2nd, the oilman is a capitalist entrepreneur doing exactly what the oilman is supposed to do by adjusting price according to supply/demand. Why blame the oilman? Capitalism is not based on any short term "good" for society, but on the long term theory that supply, demand, elasticity of demand, and alternatives will produce an end result that provides greater benefit to society than other price determining systems. This also assumes, or course, that all "costs" are built into the system and that the system operates freely between willing and knowledgeable sellers and buyers, each under no compulsion to sell or buy. And also, of course, none of this is actually true.

3rd, the local oilman should not be bad-mouthed because the scumbag, greedy, exploiting, polluting, defacing, corrupting oil industry controls the world. They have the "black gold," they and their parasitic speculators can set the price, you want it, so pay through your nose and like it. And if you don't like it, change the political system which allows this to happen.

IMO, in the long term "unsustainable" oil prices are good because finally the addicted US consumer might decide to get off her daily fix of cheap energy.

"IMO, in the long term “unsustainable†oil prices are good because finally the addicted US consumer might decide to get off her daily fix of cheap energy. "

You got that right, Jim!!

My eyes were opened when I came back stateside after living in the UK for my teenage years. Small cars getting 40+ mpg, lots of bikes and mass transit were the norm over there and I'm talking many moons ago. It wasn't because they would rather drive small economical cars...it was a necessity for the average Joe or you just didn't own a car due to high fuel prices. It cracks me up when auto makers here are making a big deal about gas cars getting over 30mpg(hwy)...should have and could have been done at long time ago. Let's finally get some vehicles and more fuel efficient systems going so we can afford the inevitable higher costs of fuel and let's get off our dependance on foreign fuel already!

Seems to me we hear talk of the next great source of fuel that will change everything often over the years but it just peters out.

Get the EPA off the diesel motors and watch what happens. I see no reason we cannot put a 3 cyl diesel motor in a small sports car like a Honda Civic, Toyota mr2 , or a Pontiac Solstice and get 70 mpg. EPA sais no all the time. Can't see much CO2 from 70 mpg. This will put a dent in oil demand. All this bs of 30 mpg / flex fuel is a gimmick.
Many love these cars. You don't look like an idiot like a smart car neither.

All this bs of 30 mpg / flex fuel is a gimmick.

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Of course it's a gimmick. Big agriculture is behind the flex fuel because of ethanol and corn, raises the price of corn, and more money for big ag. That's one powerful lobby. And the trucking industry wants to keep diesel demand down to help keep diesel fuel prices low, so limit diesel for cars. And the oil industry wants to keep demand up for gasoline, and more money for oil, so force gasoline for cars.

This has little to do with the EPA but everything to do with which industries can make the most profit from the consumer. Which results in heavy political pressure on Congress and the EPA for regulations which insure the profits of big industry.

It's time for the people to really take back the power and stop succumbing to political rhetoric which protects the rich and powerful. It's time to stop being sucked into the "pro-business" propaganda, which only causes the rest of us to pay through the nose to insure the profits of the rich and powerful.

Flex fuel/ethanol is a joke.

Jim's got it pegged.

The local or even regional oil man/company is hurt just as much by high and volatile prices as you and I. L
Lot's of small 2nd and 3rd generation fuel companies have gone out of business around here in the last 10 years.

Ethanol is a total scam by the corn lobby.

In my opinion the big devils are the speculators. They get to drive the cost and that will drive supply and demand. When the price is high demand drops so they drop the price a bit and demand goes up as people start buying big SUV's again.

This will only be changed by changing our fuel hungry culture, like the folks that gather here are doing.

People blame the oil companies, I really don't think they are at the root of the problem. For example, Exxon/Mobil makes a ton of money and people get all worked up over their record profits. But, if you look at the profits they make it is always right in line with what is expected of a larger corporation, between 9 and 11 percent. They have an obligation to their stock holders to make them a profit and 9 to 10 % is reasonable for a large corp. Most entertainment companies make much more than that.

Now I'm not lobbying for the oil companies but I feel it's the speculators that are bending us over the barrel.

just my 2 cents
Eric

Should not be burning our food for fuel

flyingcow said:

Should not be burning our food for fuel

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Especially the what use to inexpensive food for developing countries. Corn at nearly $7 a bushel is leaving people hungry and the politicians fat.

EricV said:

Ethanol is a total scam by the corn lobby.

In my opinion the big devils are the speculators. They get to drive the cost and that will drive supply and demand. When the price is high demand drops so they drop the price a bit and demand goes up as people start buying big SUV's again.

This will only be changed by changing our fuel hungry culture, like the folks that gather here are doing.

People blame the oil companies, I really don't think they are at the root of the problem. For example, Exxon/Mobil makes a ton of money and people get all worked up over their record profits. But, if you look at the profits they make it is always right in line with what is expected of a larger corporation, between 9 and 11 percent. They have an obligation to their stock holders to make them a profit and 9 to 10 % is reasonable for a large corp. Most entertainment companies make much more than that.

Now I'm not lobbying for the oil companies but I feel it's the speculators that are bending us over the barrel.

just my 2 cents
Eric

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Not to mention the enormous increase in cost of finding a barrel of oil now compared to 30-40 years ago.

The "proven reserves" is the amount of oil that is KNOWN and extractable by current methods.

Something like 30 TRILLION barrels have been used in the last 20 years.

What has happened to the proven reserves since then... they have DOUBLED!

There is no shortage of oil. There is a willingness to drill issue, and a transportation issue to get the oil where we need it.

It's just a political argument. We have enough natural gas in this country to power a whole lot. It just comes down to big companies fighting for who gets to sell what energy to we consumers.

JP

JP11

Most of the figures I have seen have us at just over 2 trillion barrels of proven reserve....worldwide....that is recoverable within current price limitations ($130-180bbl) as well as other factors, regulatory etc.

Many more barrels do exist I agree but no one in their right mind is going to begin production on a field that has a delivered to market expected cost of $300/bbl (plenty of deep sea oil fits in this price catagory) until oil prices are well above their cost of production & show little to no reasonable expectation of going down. Just basic economics/good business.

Until prices get to & remain above that level we wont be seeing that oil come to market.

Most of the cheap easy stuff is going or gone. That leaves us with the hard/nasty/expensive stuff to supply future demand.

AFA consumtion goes I was under the impression that we had used a little over 1 trillion barrels worldwide to date.

By all means anyone can feel free to correct me on these figures.

EricV said:

flyingcow said:

Should not be burning our food for fuel

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Especially the what use to inexpensive food for developing countries. Corn at nearly $7 a bushel is leaving people hungry and the politicians fat.

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I know I'm from the corn belt so I have a little bias but I don't think corn ethanol was ever advertised as the total solution. It got started with a lot of subsidies when corn was $1.80 a bushel and farmers were going broke. Humans consume less than 10% of the US corn crop and that is mainly for sweetners, etc. A bushel of corn would make 69 boxes of corn flakes (ie. about 10 cents of corn per box at today's prices). How often do we eat corn flakes anyway? The bulk of it has always been to fed livestock which in turn we do eat. Even the corn exported to foreign countries is typically used to feed livestock there. I may be wrong but I think other things like rice make the best food in developing countries and that has nothing to do with growing corn here. The byproduct DDG (dried distillers grain) is now the choice cattle feed. I have family that feed out cattle for slaughter and they have replaced about 50% of the corn in their ration with wet version of DDG. DDG (dry) is usually shipped to cattle feeders in west Texas and other places by train and which costs more. The wet equivalent of DDG (can't rememer name) is cheaper because it isn't dried but you have to live pretty close to the plants to make it feasible to haul. My point is that while corn ethanol does use a lot of energy to produce the critics usually never mention the truth about how much corn humans actually eat and how the byproducts benefit the whole situation. I remember corn ethanol was always offered as a partial solution to oil dependency with the expectation that cellulose ethanol would eventually allow for replacing a far greater share of the foreign oil depency. I'm all for expanding the domestic oil production and if we were smart we could use that to control the world price of oil instead of the other way around. Canandian oil sands, the shale stuff in North Dakota, develop more in Alaska, I'm all for that. For a country that landed on the moon 41 years ago, this all should be possible to engineer without any more BP disasters or at least we should be able to minimize the risks to acceptable levels. We don't have to burn it up all at once but it would last a long time using it as leverage in the world oil market. Obama has said that he "wanted high gas prices just not so quickly". For a guy that is supposed to be so smart, he has said more dumb things lately on the world stage that would have been reason for impeachment had Bush done the same. I think it is too late now for politics to make any difference in the outcome. I believe our enormous debt has us on a collision course and it won't matter who is in charge anymore. They would have to cut annual spending by something drastic like a 1/3 to make any difference and that is never going to happen no matter which party wins the elections. The sad part is even that might not be enough to get us back on track. It kills me that people actually think the country is in a recovery or that this will pass without any major hardship or changes in their lives. We are like the people you read about that are upside down on their mortgage big time, owe $80,000 in credit card debt, and can't make the car payments but at least they know they are in deep $$$$ and headed for bankruptcy. Obama is trying to get the limits on the credit cards limits raised and still insisting that more spending will fix the problem. It's too bad we couldn't pull a handful of Hearth.com posters together (right, left, treehuggers, whatever) and have them make the big decisions in the country. It's insane when you look at how much of the money the federal government takes in is flat out wasted. A group of ordinary people could do so much more good with a lot less. Too bad it's too late.

In my neck of the woods, marcellus shale, the wells are being drilled and fracked (at least in PA) but intentionally shutin...waiting until the prices jumps to produce. So it isn't just supply and demand affecting the prices....there is also "business" that comes in to play....commonly called greed.

There's no way the demand or supply of oil is driving the price alone....there are so many other interests.

And what does the EPA do to stop the production of high efficiency diesels? I find it very hard to believe this would be the EPA's doing. Very easy to believe the oil lobby doesn't want it to happen....why would they?

And indeed, the political system must change so the" fat" and wealthy no longer are in control. What we need in this country is a third party to rise up and get things done to help and protect the middle class. People need to stop voting soley on their pet peeves, be it guns, god, or greed, and create a movement that will actually help the middle class. All of the money going straight to the top is on the backs of the middle class. Whether we pay at the pump or work 70 hours a week (on salary...no such thing as overtime or reward) to assure the top profits for the very top, we all pay to it. And since we have to feed our families, and try to enjoy life while we are here, we don't have much choice as individuals.

At least when heating fuel prices hit new highs, we will all be warm at home. For $100 in oil (gas for the saws and splitter, diesel for the tractor) we will be warm. But we won't be able to drive to work...

I like Corn Flakes but your right, I do believe the amount we eat in this country directly is fairly low.

Another foolish part of ethanol is it takes 2 qts of dino oil to make a gallon of it, it must be trucked because it is corrosive in pipe lines and has 1/3 less energy than dino gas. It should never have been made in the first place but the agri lobby is pretty strong.

We need the next step soon. I don't think it's too late but it's darn close.

AFA being too late is concerned.....well if it is cheap ie. under $150/bbl oil then yes we are far too late.

Maybe we need a good kick in the pants via high fuel prices just like europe has been living with for decades to get us thinking more about efficiency & actually put it into practice on a daily basis.

Somewhere in the range of $20/gal at the pump should do the trick. No choice but to be as efficient as possible at those prices.