Will Iowans See $5 A Gallon Gas This Summer?

[4dsc]

If Iowans were shocked by the overnight gas price hike of 12 cents on Wednesday, they will want to brace for summer when demand for gas is at its highest. Gasbuddy.com is predicting $4-$5 per gallon gas in many cities. It predicts Chicago will have $4.95 per gallon gas by Memorial Day.

Read more: http://www.kcci.com/news/30355364/detail.html#ixzz1lEF1Qtxg


I'm sure this could apply to any state. So what are you going to do about it? Drive less perhaps? I know I will be taking my bike to work much more often this summer.

[Suji to Seoul]

1. They did this in the opposite direction in 2004 and 2006. . .lowered the prices in an elections year

The GOP used it as a platform plank. . .see, we got lower gas prices.

The day after the election, the prices skyrocketed back up.

This time they will raise the prices to hurt the Democrats. Gas pump warfare.

[progressoid]

2. What is gasbuddy.com basing their prediction on?

Here is their forecast: http://www.scribd.com/doc/78052696/Gasoline-Forecast-Media

2012’s Iran situation isn’t 2011’s Libya situation- not by any means- it’s far worse. Consumers who think the Iran situation is over-hyped clearly don’t understand the high stakes behind not only the Strait of Hormuz, but behind the Iran’s feud with the West,” said Patrick DeHaan,Senior Petroleum Analyst. “Motorists who drive a SUV may want to consider calling their banking institution and obtain a credit limit increase so they can afford this summer’s fuel expenses,” saidPatrick DeHaan, Senior Petroleum Analyst."The data in these projections, specifically those price levels that are specific to the top 20 metro markets in thecountry, illustrate well where fuel price trends can be expected to hit hardest. But more importantly, it offers a narrative that explains these numbers,”said GreggLaskoski, Senior Petroleum Analyst.

2012 Memorial Day Forecast(Selected Major Cities)

Atlanta $4.25-$4.60**
Boston $4.10-$4.35**
Charlotte $4.00-$4.35**
Chicago $4.60-$4.95**
Columbus $4.20-$4.55**
Dallas $3.80-$4.15**
Denver $3.85-$4.05
Detroit $4.15-$4.50**
Houston $3.95-$4.25**
Indianapolis $3.90-$4.25
Jacksonville $3.95-$4.20**
Los Angeles $4.45-$4.70
Memphis $3.95-$4.30**
Miami $4.05-$4.40**
Minneapolis $4.15-$4.45**
New York City $4.30-$4.55**
Philadelphia $4.15-$4.40**
Phoenix $3.90-$4.20
San Francisco $4.50-$4.85**
Seattle $4.40-$4.65**

Averages expected for regular unleaded gasoline.
** Prices would represent new all time records

[glowing]

3. I would say President Obama should use this spike in gas as a sounding board for

getting off of an oil based society... He should be running around saying "if you send me back to the White House and give me a House majority and a 60+ Senate, we will be able to take the subsidies that the oil and gas co's take and we will put American's back to work creating a society that cannot be manipulated or ruined because of a finite resource. We can combine the future of transportation two-fold: 1. by modernizing our outdated public transit. We will have high speed rail and in-city transit that is user friendly and creates smart growth initiatives; and 2. by moving ourselves off of the need for gas in cars. We will throw our weight and money behind creating an electric car that is able to go the distance and will have the support to re-charge easily. And we will also spend our time and resources creating a modern electric grid, where we use a combination of solar and wind; even if it means re-fitting roofs in the South east/ west to pull in the sun for charging the grid batteries, even if it means having multiple turbines on farms. We will begin to create a modern, resource independent manner of creating energy. AND we will do it as a nation as a Patriotic source of pride and determination. If we could get a man on the moon, we can do this for our people at this time. All hands on deck. We are going to build an America that can last and will not be held economically dependent upon dictators in far away deserts who decide our fate and keep our armed service people on constant notice to police the middle east."

Now, if he would say these things, and American's knew that it meant building America from within and it means jobs and it means a brighter future, then they would be on board with this. No more commodity manipulation of the market price on oil because of "fear for war with Iran" is increasing the prices, especially, when we are using less and less oil every year. I know I read recently that we are actually, for the first time, exporting more oil than we are taking in. So, this price manipulation is totally about engineering the public mind-set to "drill baby drill", blame the President, and push people into accepting that horrible pipeline from Canada because people cannot afford $5.00 gas... the economy that is just barely starting to move again, would be thrown into reverse and we could very well crash and burn again.

[cstanleytech]

10. Thats a nice idea about getting us off oil but how many years would it take if its even possible?

I mean sure there are other sources of energy but most of our cars run on gas and thats millions and millions of vehicles so it would take alot of time and money to convert just those ones to alternate fuels assuming its even possible.
About the only real way I can see to solve the transportation issue really is with a massive rail buildup connecting the suburbs and smaller towns to the larger cities and I dont think we will see that happen any time soon because the republicans have an interest in keeping us on being dependent on gas for as long as possible.

[glowing]

16. I'm thinking people have begun to wake up enough and we need a different mode of

operating world-wide, and can seems possible.

Can't never did a damn thing. Its not going to be them that push for this, it would be us... And if it took the govt, in combination with manufacturing, to take everyone off of old clunkers and into modern transit over the next 10 yrs, I think we could feasibly find the solution... Our planet really doesn't give 2 shits what is politically possible.. we need solutions now, and it just might not actually create anyone any wealth or revenue... I mean really, what is money in the context of the climate change or clean air or clean water... Priorities need a total shift...

[Moostache]

15. I agree with the sentiment 100%, but...

THAT is what he already said in 2007-2008 campaign! Obama talked about "Green Energy Jobs" a lot on the campaign trail, in fact one of the more important aspect of my initial support for the president was in his energy proposals and campaign promises...well, those went south in a hurry after January 2009 and its now 4 years later and the progress we have made is laughable.

I am not buying a single goddamn word from ANY politician on this issue. They are ALL tarred and feathered with oil company money...just watch, the XL pipeline will be approved and 10 years from now, when it breaks open and poisons the water table and ruins millions of acres of farmland everyone involved will say how "unforeseen and unknowable" the risks were for this abomination.

Its the same old story...Obama wants to don his white campaign hat and ignore his black hat record of inaction and capitulation on just about every major issue. The corporations own his ass just as much as any other politician. Second verse....same as the first.

[cstanleytech]

25. Moostache you do realize that the presidents powers are not like that of a king, right?

Last edited Sat Feb 4, 2012, 04:17 AM - Edit history (1)

By that I mean he cannot issue a decree on how much to spend, where to spend or when to spend, thats congress.
He can ask them of course but if they behave like this congress has then his hands are largely for the most part tied so just try to keep things in perspective thats all I ask ya.

[INdemo]

4. I cant help but think these high gas prices are purposely driven up to discredit Obama

and give the Repukes and the corporate media another talking point..Remember in 2004 how they drove the gas price down during election season to try an give Bush an edge?

[TBF]

6. That's part of it - the other part would likely be to pressure him on the pipeline.

The oil companies want it and they will get it.

[INdemo]

12. They have to sell the idea to those citizens in the area that will be effected the

most and I dont think those constituents (Republican or Democrat) wnat this going through their state..This could be a very big issue for Nebraska voters when they choose their new Senator and Congressman

[AngryAmish]

19. And prices spiked under Bush to pay off his oil buddies!

[Firebrand Gary]

5. I am going to FIRE the oil companies.

And purchase an electric car this year. Its considered a done deal this summer!

[Snake Alchemist]

13. Go coal! nt

[dmallind]

17. Only 45% (down 15% in a decade) - you include upstream energy consumption in your mpg too, right?

and coal is almost entirely domestic - you want US miners out of work?

[Snake Alchemist]

18. Coal. Made in America. Love it. nt

[dmallind]

22. Rather have less efficient OPEC oil would you? Weird.

[rurallib]

7. Big Oil hates Obama. Big Oil can manipulate prices with impunity.

Nothing would kill a weak recovery quicker than $5/gal. gas.
Nothing would make Obama look weaker than Big Oil screwing over America for its own purpose.
Sure the price of gas will go up.

[MarkCharles]

8. You are right on target!!!

That is what is motivating price speculation and predictions here.

Somehow we got used to gas at $3 a gallon, now it's closer to $4 again, where it was at the highest when Obama took office.

In 2003, gas was mostly under $2 a gallon, I recall, and in the year 2000, $.99 a gallon was common.

Meanwhile, the costs of drilling, transport, refinement, and delivery have not changed more than at the rate of inflation. Worldwide demand has increased, but so has worldwide production, for the most part, with few periodic exceptions, each of which forced the price of gasoline up another 25 to 75 cents on average.

How times change!

[INdemo]

14. 2001 changed everything because oil companies had an excuse..and thats

all they was an excuse...There was no oil shortage...but they made everyone believe there was an oil crisis....politicians will probably never do anything about the false excuses to raise oil price becasue in all probability they are racking in the dough on blind trust commodites profits.

[jpak]

9. + 1000000000

yup

[Blue_Tires]

11. +1

[freshwest]

20. Already been through that during the Oily Bush tour. This is Big Oil's attack for the 2012 election.

They should call on Santorum to help, since they want him for POTUS.

Okay, not all of them.

But it'll be interesting to see who wins in Iowa in November.

[happyslug]

21. Talked about last week on DU, the problem is HOW this was calculated.

In any January to June period, the price of Gasoline goes up, generally by a set percentage. The reason for this is simple, people buy they last winter heating oil in March or April and with that purchase the oil companies covert from concentrating on making Home Heating Oil to Gasoline.

Now, when oil is refined, so much becomes gasoline, so much diesel and home hearing oil (And so much other types of oil not relevant here). Oil refineries can and do shift how much of each is produced out of any one barrel of Crude oil. After April the switch is from Home Heating oil to Gasoline (After September it is from Gasoline back to Home Heating oil, but given the longer lag time, most people do NOT buy their first oil for the season till November the drop in price of gasoline is slower but just as large).

The Five Dollar a Gallon calculation is based on the present price of Gasoline increased by the normal percentage increase of the price of gasoline from January to June. This would be accurate EXCEPT the price of gasoline has been going up since NOVEMBER do to the fears of a war with Iran. Thus the price of gasoline is ALREADY higher then it should be this time of year.

Now, I expect Gasoline to reach $4 a gallon, but then stall UNLESS one of two things occur, a Major war (such as a War with Iran) involving a major oil producer OR a natural disaster that affects oil production or refining (For example if the West Antarctic Ice Sheet should collapse, production of oil would be minimally affected, mostly off shore production, but given the vast majority of oil refineries worldwide are within the area that would be flooded by such a release of Ice into the ocean, the ability to REFINE the oil would be cut drastically. i.e. $10-20 a gallon for one to three years till we get those refineries re-opened).

Just a Comment on WHY the price of oil will increase and WHY everyone is mentioning $5 a gallon. Please note even the expert who did the calculation did NOT think the price of gasoline will go to $5 a gallon, for the simple reason people will stop buying as the price gets to high, thus he was looking at $4 plus, but if the normal percentage increase between January and June occurs, then it should hit $5 a gallon (and then drop).

Please note another factor the Expert did NOT take into consideration is how mild the winter has been so far, thus the conversion to Gasoline can occur earlier and thus would lead to increase pressure to keep the price of Gasoline DOWN. Even the Expert who did the calculation seems to have understood not only the problem of starting with to high a base price, but with increase gasoline stocks do to earlier conversion to gasoline production.

[RobertEarl]

23. Thanks

That is a good explanation of the situation.

And isn't Obama about to stop that pipeline?
If he stops it and gas goes higher then they can say it was because we don't have the pipeline.

[happyslug]

24. A pipeline to the Texas Refineries along the coast.

A war would NOT affect such oil for no one is talking of a US-Canadian War, on the other hand the West Antarctic Ice Sheet Collapse would make the pipeline moot i.e. No refineries for the oil to go to, to be refined. I bring up the West Antarctic Ice Sheet for it is viewed as unstable and if it should collapse world wide sea levels go up 20 feet overnight. If such a collapse should occur it will be in March or early April, when the Antarctic Ice Shelves are at their minimal size. By April 15th, the Antarctic Ice Sheet would be expanding do to the onset of the Southern Winter and no worry about it till next Spring. I bring it up as the worse probable natural disaster that would affect oil production and distribution.

The Texas Refineries are the destination of the Alberta oil for the Texas Oil Refineries can handle "Sour" oil i.e. Oil with a Sulfur content over 5%, most other refineries can only handle "Sweet" Oil i.e. Crude oil with less then 5% sulfur>

More on "Sour" Oil:
http://en.wikipedia.org/wiki/Sour_crude_oil

The Oil from Pennsylvania and the Eastern US, West Texas, North Dakota and Montana, Oklahoma, Louisiana (But NOT off Shore) tend to be "Sweet" Oil and thus need less refining to produce gasoline, Diesel and other oil products. Do to the fact most of these fields are pass their peak production, an increasing share of US Oil Production is "Sour" oil and the Texas refineries have converted to refine such "sour" oil more then refineries elsewhere in the world (Mexican and Venezuelan oil tends to to "Sour" and most are refined in Texas refineries).

More on "Sweet" oil
http://en.wikipedia.org/wiki/Sweet_crude_oil

Thus the purpose of the pipeline was to get the oil to the refineries that can handle what Alberta is producing and right now that is the Oil refineries on the Texas Coast from Corpus Christi, to Houston, Galveston, Beaumont and extending to New Orleans Louisiana.

[cstanleytech]

26. If its an issue of lack of refineries then why are we exporting gas?

Or did I misread that on the DU about 3 - 4 weeks ago?

[happyslug]

27. We have ALWAYS exported Gasoline

The issue is NOT the exporting of Gasoline, but are we importing more or less then we are exporting. In that report the issue was we exported MORE gasoline then we imported, even as we imported even more crude oil.

When you refine crude oil, you get both Gasoline and Diesel/Home heating oil. You can vary on how much out of each barrel of Crude, but you will always have both, just the ratio of one to the other varies. During winter months, most refineries emphasis Diesel/Home heating oil, in Summer Gasoline. Right now the emphasis is on Diesel/Home Heating oil, gasoline is a "by-product" that the refineries have to "get rid of".

Thus I suspect that Libya oil, one of the "Sweetest" oil (easest to convert to Gasoline) lead to less gasoline being produced in Europe. Europe, uses more Diesel then we do, so over most winters, Europe export their excess Gasoline to the US. Thus the reduction of access to Libyan oil lead to less gasoline exports to the US while the world needed gasoline to replace the missing Libyan oil. The US refineries then increased their gasoline production. Given these events, less gasoline exports from Europe, more gasoline exports from the US, the US became a net GASOLINE EXPORTER for the first time in years (if not decades).

Notice, the issue is GASOLINE, not OIL, The Gasoline we exported was from Oil we imported in first. In the calculation of GASOLINE exports, that imported crude oil is NOT counted (it is counted as imported oil, but we are talking GASOLINE not Crude oil). Thus we exported more Gasoline then we imported, for most Gasoline is refined in the US is used in the US. The GASOLINE exports used imported crude oil as a base, but in the article you read, was NOT counted for the issue was restricted to GASOLINE not oil.

[cstanleytech]

28. Thanks, now my head hurts though.