increasing offshore drilling

[Dwight Schrute]

And what route did I suggest? Did I suggest a plan of action subliminally? you are waaaay better than Deanne Warwick, she charges too much

Its Dionne.

And more supply means lower prices...its that whole pesky supply and demand thing again..

[Dwight Schrute]

I was going to post just that on the electric option.

The price of electricity would go through the ROOF if you had a large number of people convert to electric motors.

Talk about complaining then. We'd switch from railing on the oil companies to the electric companies.

(Never mind the billions to make said infrastructure upgrades across the US...)



To be fair - natural gas generation is seemingly picking up across the US (not just the Gulf south) because some companies view a possible CO2 cap system in the future (and natural gas has less CO2 emissions than coal).
Oh wait - it takes drilling for natural gas. Eh, oh well.

Yeah....its another example of how people don't think things through. Instead of oil I want electric.....while not understanding that most the electric companies use coal which is 10x worse for the environment than oil...but hey, don't let those facts get in the way

[Dwight Schrute]

Ok SN, we're on page 4 now. Seriously, just say it already.

"No Oil for you!!!"

[thesinner]

Its Dionne.

And more supply means lower prices...its that whole pesky supply and demand thing again..

Worded a little funny, but I'm sure you're talking in absolutes as opposed to relatives or using the transitive property or something. Both supply and demand have actually been increasing for quite some time.

As qty supplied increases, price actually increases. The X/Y chart shows supply curve with a positive slope (Q increases with S). Of course, this is based on how much you can produce. As production increases, quality/productivity decreases, meaning that after a certain point, it costs more $$$ to produce more petrol-based goods. (jmh and I call this "3rd shift". ).

In the case with gas/oil, there's 2 factors.
-1- The supply curve is stagnant, and demand is moving to the right as we've been consuming tons more gas since the late 90's.
-2- The supply curve is moving to the left (which I think is what you were implying).

Both factors lead to an equilibrium point with a greater Y value between both curves, which means price increases. We're also neglecting the steadily weakening dollar, in which case both curves are spreading out even more.

[Dwight Schrute]

Worded a little funny, but I'm sure you're talking in absolutes as opposed to relatives or using the transitive property or something.

That's why I said the margins are dropping....and some people don't seem to understand that.

There is a reason OPEC is trying to lower the price. People think oil companies want oil at $140....when its the opposite.

The general public doesnt understand it and politicians love it.

[thesinner]

Ok. I follow you now.

I think folks also negate the weakening of the dollar. Gas prices are going up due to supply and deman, but they are also going up because the dollar is worth significantly less than say a year or two ago.

[Dwight Schrute]

Ok. I follow you now.

I think folks also negate the weakening of the dollar. Gas prices are going up due to supply and deman, but they are also going up because the dollar is worth significantly less than say a year or two ago.

Definitely. Its another reason almost all commodities are up as well....

Look at Steel, Natural Gas, Coal, etc...they are actually up more than oil but you can invest in them without worrying about the geopolitical rhetoric.

[futurepilot]

Yeah....its another example of how people don't think things through. Instead of oil I want electric.....while not understanding that most the electric companies use coal which is 10x worse for the environment than oil...but hey, don't let those facts get in the way

I may have been unclear in my earlier post. I have a solar powered generator. I dont know how much cleaner i could get than that.

[futurepilot]

That's why I said the margins are dropping....and some people don't seem to understand that.
.

retail margins may be dropping, but they're more than making up for it in with the bulk of their business, which is not retail.

[futurepilot]

"How wrong can I be" thread.

.

i may have put my foot in my mouth a few times, im not going to lie, but i still believe the base of my arguement is sound: Its not worth the possibility of some large oil find to go drilling in the gulf, or ANWR or anywhere else for that matter. There are viable options outside of oil that we could put on the fast track now with American know how, and ingenuity. I feel we could have an alternative within a few years. Look at the X prize, that worked out great.

[Dwight Schrute]

retail margins may be dropping, but they're more than making up for it in with the bulk of their business, which is not retail.

So what....thats what business's do. If you don't like it, don't buy it.


And no, they are not making it up.

[Dwight Schrute]

i may have put my foot in my mouth a few times, im not going to lie, but i still believe the base of my arguement is sound:

Yes..you we're wrong about oil supplies. You were wrong about oil shale. You were wrong about their margins. You were wrong about their stock being meaningless. You were wrong about the price in the futures market being meaningless.....but other that that, you're doing just fine.

[futurepilot]

And no, they are not making it up.

Senior, to be making making the most money they have exer made in the history of the industry they have to be getting it from somewhere, hence if their profit margins are going down in retail, which they are, they are making it up in the rest of their business ventures.

And stock, for the most part is meaningless, look at the tech bubble. Sun micro systems was once trading at $130 a share, now it trades at $10. Stock price, like i explained earlier is determined not by rational thought and analysis, its being determined by Jim Cramer, and people who watch "the street" instead of doing their own research.

It wasnt always that way, but that is the nature of the market right now.

[Hank Vangut]

for anyone who cares to view..........i'll be on cnbc tomorrow at 12:20est discussing crude oil.

[futurepilot]

for anyone who cares to view..........i'll be on cnbc tomorrow at 12:20est discussing crude oil.

Ill be flying, is there a recast? or anywhere to watch it later?

[thesinner]

I may have been unclear in my earlier post. I have a solar powered generator. I dont know how much cleaner i could get than that.

@ 3% thermal efficiency and the cost of materials for which to build one.........

[futurepilot]

@ 3% thermal efficiency and the cost of materials for which to build one.........

KS Portable Solar Powered Generator

This isnt mine, it an example of the one im going to use. At this wattage, unmodified it would take about 10 hours to charge a car. With each solar panel you add, it cuts the time in half.

Or by using a 240 volt circuit you can conceivably charge your car in 4-5 hours.

[Nabisco]

Senior, to be making making the most money they have exer made in the history of the industry they have to be getting it from somewhere, hence if their profit margins are going down in retail, which they are, they are making it up in the rest of their business ventures.

And stock, for the most part is meaningless, look at the tech bubble. Sun micro systems was once trading at $130 a share, now it trades at $10. Stock price, like i explained earlier is determined not by rational thought and analysis, its being determined by Jim Cramer, and people who watch "the street" instead of doing their own research.

It wasnt always that way, but that is the nature of the market right now.

They are making record profits because the US is consuming record amounts of gasoline. I find it incredulous that you refuse to believe jmh80 who works in a Refinery. But I'll add (since I also work with Oil and Gas Refineries) that their profit margins have decreased in the past 5-10 years. They are cutting costs left and right, running on skeleton crews, automating systems all because their margins are decreasing and they are attempting to squeeze every nickel out of their process (which is what successful companies do).

Take a look at the refining companies out there and research a little thing called "Crack spread". This is the difference between the price of crude oil and the price of the commodity made from that crude oil. You want lower gas prices. Build new refineries in the United States, but Congress won't allow that. Take a stab at a little research and find out when the last refinery was built in the US, or maybe Jmh80 will feel inclined to enlighten you.

Drilling for oil here in the US or off the coast will help alleviate the cost of your gasoline, only if we refine it in the US. Did you know Iran is a large producer of crude oil, but they have ridiculous gasoline prices? Want to know why? They have to export the crude, have someone else refine it, and import the gasoline back in.

While the US is sitting on its hands, building no new infrastructure, Saudi Arabia, Dubai and other Middle Eastern companies are spending billions of dollars upgrading their refineries to product Ultra Low Sulfur Diesel, and gasoline.

Next lets address the alternatives...

Nuclear Power is viable, but no one wants one in their backyard because of ignorant fear.

Solar Power is not viable, because the current efficiency rate of buildable and sellable units has yet to climb above 28%.

Wind Power is viable, but its expensive as hell and requires fairly high wind velocities to work, not to mention space. And the public is all for wind power as long as it's not near their home.

Corn to Ethanol as fuel, don't make me laugh. Any self-respecting chemical engineer will tell you that entire thing is a sham. South America gets away with it because they use sugar cane. There are some viable alternatives through the use of micro-algae as well, but that requires you to still drill, refine, and supply gasoline as well.

Electric Cars is not currently viable and would require a HUGE change in infrastructure to make it viable. There are other fuel cells in development that may yield results, but electric isn't the answer.

Hydroelectric has its uses, but there aren't enough rivers to make that viable.

Coal, Natural Gas, and Crude Oil are your products like it or not. For the next two decades at a minimum the world will continue to rely on those three, because technological advances don't happen over night.

Last but not least, I'm going to gently refute your comment on the market. Stocks are not meaningless. The majority of the time they are based off of P/E ratios, market cap, among other simplistic methods. Jim Cramer has ZERO effect on the market. Even with all his viewers, he can't shift a stock much beyond a percentage point or two and they always rebound back to where they were before his latest show. The tech bubble was part speculation, part everyday joe's jumping into the market without doing any research, and a large part over valuation. It was bound to return to normalcy, it is not a good reference for the stock market in general as your post suggests.

So there is another chemical engineer's "opinion" on the industry that you are currently talking about (from someone who works in said industry). You can't limit our current resources because you don't like them and you want something else. That's not the way the world works my friend. Thats like saying "No one is allowed to have any more microwave dinners, because it's getting expensive and its not good for your body's "environment". You all must change to fresh, homecooked meals because it's a better alternative". When you know very well that the microwave dinner is currently cheaper, easier, and more abundant. (perhaps not a great analogy, but I'm an engineer not an English major)

[futurepilot]

Did you know Iran is a large producer of crude oil, but they have ridiculous gasoline prices?

the prices of gas in Iran right now is about .70, your right, rediculously low.

[futurepilot]

and i dont beleive jim cramer himself controlls the market. He's just an example of one of the many talking heads who influences traders, especially those with e-trade type accounts, and they in turn influence the market.