Nymex Gasoline Plunges as U.S. Supplies Surge to 17-Month High

[swag]

http://quote.bloomberg.com/apps/news?pid=10000006&sid=aYUGjfz.nUsg&refer=home


Aug. 4 (Bloomberg) -- Gasoline futures plunged after U.S. reserves of the fuel unexpectedly increased, reaching a 17-month high and signaling ample supplies for the remainder of summer.

. . .

Reserves rose as demand slipped, imports remained high and U.S. refiners boosted gasoline production for the third week in four, government data showed. Nationwide gasoline reserves are up 4.1 percent from a year ago and up 0.3 percent from the five-year average for the week.

. . .

Retail gasoline prices that are near records may be prompting motorists to use less fuel, traders said. The U.S. retail average was about $1.89 gallon as of Monday, up 28 percent this year, after reaching a record $2.06 in late May, according to the Energy Department.

. . .

Gasoline futures, which reflect wholesale prices at the New York harbor, are still up 28 percent this year. Prices reached a record intraday high of $1.47 a gallon on May 20.

. . .

Prices also soared at the retail level as refiners passed along higher crude-oil costs. Crude makes up more than two-fifths of the retail price of gasoline in the U.S., the world's biggest market for the fuel.

[swag]

1. Note that retail gasoline prices are still up 35 - 45% year-over-year

depending upon what region of the country you live in.

I hope the snips from the article will reduce some of the confusion about crude oil prices vs. gasoline prices.

[stevedeshazer]

2. Exxon, Shell earn record profits

http://www.detnews.com/2004/business/0407/30/b03-227323.htm

DALLAS — Exxon Mobil Corp., the world’s largest publicly traded oil company, posted record profits of $5.79 billion Thursday, and the Royal Dutch/Shell Group of Cos. saw its earnings rise 54 percent, thanks to higher prices for oil and natural gas.

The sterling earnings reports, which came on top of strong results from BP and ConocoPhillips, may be small comfort to motorists paying about $2 for a gallon of regular unleaded — unless they also happen to be shareholders.

Exxon Mobil, for instance, earned a profit of more than $10 on each barrel of oil it produced, said Pat Mulva, the company’s director of investor relations.
Mark Baxter, director of an energy institute at Southern Methodist University, said pump prices should be even higher, given that crude is hovering near $43 a barrel.

“These profits probably appear gross, and consumers wonder why they’re not lowering the prices,” Baxter said. “They could do that, but the first time they did, the CEO would get fired.”

[gasperc]

3. up 12cents in 6 hours at my local pump here in the Detroit suburbs

I bought gas this morning for $1.86, I went by at lunch today and it was $1.98. Hardly a heartbeat goes by before the crude oil prices affect the gas futures before they smack us between the eyes at the pump

So I agree with the logic that high prices will affect demand making supplies surge but why do prices keep shooting up???

[maxsolomon]

4. because gasoline cost is not tied to classical supply & demand

it works like this: gouge, then back off 40% of gouge. wait till the coast is clear & everyone feels grateful the price went down, repeat ad infinitum.

is anyone trying CONSERVATION yet?

[swag]

6. I've made it a goal to either bicycle or ride the bus to work

4 days a week. It's not working too well this week because I have a lot of work-related driving obligations, but next week I'll be back to beating inflation!

[tlcandie]

7. I took a leave of absence from school and not getting out unless

I have to! Also, looking at other alternatives for fuel/car in couple of years.

THINKING hard about riding bicycle or something to the grocery stores that are about 5 mins drive time to me. It's so humid and hot here and I don't do well in the heat. I know it's a cop out, but I don't think at 48 just getting out and going for the gold is the right thing to do, so trying to make an informed and good decision for myself as well as our environment.

I answer yes to your question.

EDIT: Additionally, this is the lightning capital of the US and it rains/storms here just about every day this time of year. Many people here are struck by lightning resulting in severe personal damage or death.

[htuttle]

8. Compromise -- Get a big scooter

I started riding one at age 40. Don't have a car anymore, but rent one when I need to go out of town to visit relatives.

Can't beat 105+ MPG, and I always arrive at work with a smile! (even when it's raining or snowing, it's a lot more fun than driving a car).

Just make sure it's a 4 cycle -- you don't want to have to mix gas and oil together, and it's a lot less polluting.

My own personal favorite is this one imported from India:

http://www.bajajusa.com

The Bajaj scooters only cost about $2000-$2500 brand new, and they tend to last for years and years.

I got one when I finally came to grips with the fact that I was too lazy to ride a bicycle everywhere...

[rustydad]

14. Lazy?

I too am too old to be peddling for miles and miles. I got a GoldenEagle add on motor for my mountain bike. I have over 1000 miles on my now powered bike. It is a ten # high quality Red Max 25cc motor mounted over the rear wheel and drives the wheel with a cogged kevlar belt. I get about 250-300 mpg. Speed on flat and slight hills is 30mph or more if you have the stomach for it. I peddle a bit now and then on steeper slopes or when starting from a stop. This is the ultimate hybred machine for transportation IMO. Yesterday was a typical trip to town for me. I coast from my home at 1500 feet above sea level down to the highway at sea level. Then I start the motor and use the wide shoulder of the highway to get to town where I get on bike paths. My trip was 30 miles one way. Coming home I changed the drive pulley to a low gear and with some peddling climbed back up the 1500 feet to home. I also brought back 30# of groceries in a backpack. This 60 mile trip used less than a quart of gas. I am 62 years of age. Bob

[lfairban]

16. I got an electric assist years ago from Currie.

http://www.currietech.com/html/currieCatalog/CTI_comfortProd.html

I love it. The top speed for the electro assist is 18 mph. It is great for getting around because you don't impede traffic getting away from the stop light. It can just about beat a Harley or a car across an intersection.

I found that I could get to work faster on a bike than any other way, including a car or the bus. If I drove, I not only had to pay for parking, but I needed to walk a block or two from the lot. With a bus, the walk from the stop was about the same. With a bike, you can tie it up on the sidewalk outside the front door.

[louis-t]

9. Part deux is...

raise prices on Thursday because you know people will be filling up on Friday for weekend trips. Then, when people begin filling up on Wednesday, raise them higher on Tuesday.

[HuckleB]

10. We cycle almost everywhere, at this point in time.

The car and truck only get used for big hauls and out of town trips. It's a great way to go, as you get your exercise in while you commute, and you save a crapload of cash to spend on better things.

[HuckleB]

17. Hmm. So if we drove everywhere... instead of cycled...

that would help drive prices up and drive Bush from office, no?

Of course, it would also hurt those who must drive as well, nevermind my own wallet, so I'll just donate some more to the DNC, instead.

[74dodgedart]

5. Dick said we don't have enough refineries....

[HuckleB]

11. More... "Oil prices retreat from record highs"

http://www.sun-sentinel.com/business/local/bal-oil0804,0,6323580.story?coll=sfla-business-headlines

Though it all still doesn't bode well for what we'll be paying at the pump come September.

[puerco-bellies]

12. The September unleaded gasoline contract expires in 22 days

Another contributing factor in todays price drop. I will re-enter the market long on crude oil when/if it drops below 41bbl. I have never seen a single day unleaded pull back like we had today. The API/DOE (American Petroleum Institute, Department of Energy) numbers were slightly bearish but do not explain todays price action. The promise of Saudi increasing production should not of been that influential because it take around 90 days for oil to arrive here. I was out of the market but am still scratching my head over this.

[0007]

13. Oh don't worry the price will be toward 3/per gal before long.

The SUV crowd won't be hurt much. I'll soon be riding the bike to the doctor.

[Ouabache]

15. Saudis to Bush: We Will Pump You Up !

Just before the election.