Higher Gas Prices Coming .... if Keystone Pipe Line Get's Green Light...

phobicsquirrel

http://www.latimes.com/business/money/la-fi-mo-keystone-pipeline-20130716,0,6339875.story

So on top of the environmental dangers from this crap, now we probably will be paying more for gas.

jj20030

really??? maybe cheaper

The_Kid

I am in support of expanding North America's fossil fuel infastructructure, given it meets epa regulation

beatnic

You're stretching in squirrel.

scarlin

I don't believe this. It hardly makes sense to me. It really is making the supply greater therefore demand and price should go down if I learned anything in my 3 semesters as an economics major before switching. I think this might be on taxes to fund this more than us exporting the oil and making the supply less. I would love to see us become more dependent on less foreign nations like Venezuela and more like Canada, but I should read up on this more before I go tooting my horn even more.

webmost

"That’s because the pipeline would allow oil companies in Canada to export crude oil to a range of markets in the U.S. and abroad, leading to possible increases in the prices paid in areas that are already heavily dependent on that oil, according to the Santa Monica consumer group’s report released Tuesday."

That is a non-sequitor.

The less distance the world has to ship oil to and fro, the less it costs to use and the more there is to use.

raisindot

I don't buy the argument in the article. Given stable demand, increasing supply should lower prices in a truly competitive marketplace.

On the other hand, gas prices in the U.S. should be much lower than they are. At the moment, America is producing more domestic oil than at any time in its history (mainly because of the growing use of shale oil fields). Imported oil has dropped from 60% in 2005 to 40% in 2012 (a lot having to do with decreased demand due to the still sluggish economy and in both 2011 and 2012 the U.S. became a net EXPORTER of oil. While this may sound good, while it really means is that the oil companies can make more money exporting certain kinds of oil to China and other countries than selling it in the U.S. If these companies only supplied domestic markets gas prices would probably be a dollar or more less than they are today.

The Alberta pipeline project won't deliver any economic benefits in terms of lowering oil prices if the companies that buy it sell it overseas.

phobicsquirrel

raisindot:

I don't buy the argument in the article. Given stable demand, increasing supply should lower prices in a truly competitive marketplace.

On the other hand, gas prices in the U.S. should be much lower than they are. At the moment, America is producing more domestic oil than at any time in its history (mainly because of the growing use of shale oil fields). Imported oil has dropped from 60% in 2005 to 40% in 2012 (a lot having to do with decreased demand due to the still sluggish economy and in both 2011 and 2012 the U.S. became a net EXPORTER of oil. While this may sound good, while it really means is that the oil companies can make more money exporting certain kinds of oil to China and other countries than selling it in the U.S. If these companies only supplied domestic markets gas prices would probably be a dollar or more less than they are today.

The Alberta pipeline project won't deliver any economic benefits in terms of lowering oil prices if the companies that buy it sell it overseas.

Your getting it. It's not about economics any longer. It's about profit and the hand around the throat. Record profits for this industry and still they get tax breaks, military assistance, and basically no checks on how the prices are made. The more our environment and health suffers the money for these companies keeps coming in. Natural gas in the next one to raise if it continues to expand the way it is. Then I suppose water will be next. One thing some people have to understand that there isn't a free market anymore, the market will only help itself and by that, I mean the small amount of business's that have the money.

fla-gypsy

I wish the squirrel ran the whole damn world and we wouldn't have to go through this cycle on such predictable terms.

scarlin

phobicsquirrel:

raisindot:

I don't buy the argument in the article. Given stable demand, increasing supply should lower prices in a truly competitive marketplace.

On the other hand, gas prices in the U.S. should be much lower than they are. At the moment, America is producing more domestic oil than at any time in its history (mainly because of the growing use of shale oil fields). Imported oil has dropped from 60% in 2005 to 40% in 2012 (a lot having to do with decreased demand due to the still sluggish economy and in both 2011 and 2012 the U.S. became a net EXPORTER of oil. While this may sound good, while it really means is that the oil companies can make more money exporting certain kinds of oil to China and other countries than selling it in the U.S. If these companies only supplied domestic markets gas prices would probably be a dollar or more less than they are today.

The Alberta pipeline project won't deliver any economic benefits in terms of lowering oil prices if the companies that buy it sell it overseas.

Your getting it. It's not about economics any longer. It's about profit and the hand around the throat. Record profits for this industry and still they get tax breaks, military assistance, and basically no checks on how the prices are made. The more our environment and health suffers the money for these companies keeps coming in. Natural gas in the next one to raise if it continues to expand the way it is. Then I suppose water will be next. One thing some people have to understand that there isn't a free market anymore, the market will only help itself and by that, I mean the small amount of business's that have the money.

Soooo....Who want to go work in the oil industry with me? I think water might be bigger than natural gas because I know A LOT of cities are running dry, especially Californian coastal cities. Plus the Ogallala aquifer is gonna dry up eventually leaving the Midwest dry and that aquifer is non replenishable.

pilgrimtex

More oil here means more exporting from here. Supply and demand doesn't work when the global demand allows the oil companies to export everything they can. No increase in inventory because it all goes out means prices can stay high. When inventory outpaces demand than the price and only then will the price drop to push up demand. Besides, don't you want our gov't to get even more money on oil taxes while still taxing the crap out of us?

raisindot

pilgrimtex:

More oil here means more exporting from here. Supply and demand doesn't work when the global demand allows the oil companies to export everything they can. No increase in inventory because it all goes out means prices can stay high. When inventory outpaces demand than the price and only then will the price drop to push up demand. Besides, don't you want our gov't to get even more money on oil taxes while still taxing the crap out of us?

In a free market economy, yes, more domestic oil production means more exporting if the oil companies can get better offers outside the U.S. (which is how it is now, given China's insatiable demand). That's why our gas and heating oil prices in the U.S. are going up, rather than down. If, however, the government taxed exports of oil then producers would sell more domestically, and domestic prices for gas and oil would fall. This would free up more money for businesses to increase productivity and hire new workers and give consumers more money to spend or save, which would help boost the economy. But that would, lord forbid, cut into the oil companies' obscene profits and we wouldn't want that, would we.

pilgrimtex

If the gov't placed higher taxes on exports as to reduce the desire to export than the oil companies will just reduce the flow accordingly in my opinion. We are captives of our greed for oil and will pay what is needed. There may be a small reduction to stimulate the economy thereby allowing more oil to be sold but now we are into the law of diminishing returns instead of supply and demand. There comes a point that the volume isn't worth the lower price created and we see this not only in the oil economy but elsewhere as well. They would produce a finite amount at a finite price that best fits their profit strategies. When we can turn water into wine and oil becomes just another commodity among commodities; then the reasoning of price and demand can return. Until that time we are caught in a catch 22 situation. World demand, oil availability, refining capacities, government restrictions on refining and drilling, distribution, government taxing and on and on set the price today.