Gas prices are... um well, wait a minute

[fintstone]

Originally Posted by Shaun @ Tru6

You don't understand how oil in general, and types of oil is priced, bought and sold.

US leads global oil production for sixth straight year- EIA

By Reuters
March 11, 202412:16 PM EDTUpdated 3 months ago

March 11 (Reuters) - U.S. crude oil production lead global oil production for a sixth straight year, with a record breaking average production of 12.9 million barrels per day (bpd), the Energy Information Administration (EIA) said in a release on Monday.

In December, U.S. crude oil production hit a new monthly record high of over 13.3 million bpd, the agency said.

"The United States produced more crude oil than any nation at any time, according to our International Energy Statistics, for the past six years in a row," the EIA added.

The EIA says it is unlikely that the record will be broken by another country in the near term.

Elsewhere, Saudi Arabia's government in January ordered Aramco to halt its oil expansion plan and to target a maximum sustained production capacity of 12 million barrels per day (bpd), one million bpd below a target announced in 2020.

Global benchmark Brent fell on Monday, dipping below $82 a barrel, as persistent geopolitical concerns in the Middle East and Russia collide with jitters about softening demand in China.

Of course I do. You just believe what you are told to believe. While we may be producing a record amount, it is obviously not enough to drive prices down or keep the world from being a hostage to OPEC+. We could produce a lot more. We could also make it a lot easier/cheaper to transport (by not stopping needed pipeline construction). We could control prices if we chose instead of OPEC+...many which are not our friends.

[Shaun @ Tru6]

No, really, you need to do some research. I know SoL has explained the oil market to the Board many times, perhaps you haven't seen his posts but you would do well to look them up and educate yourself.

[fintstone]

Originally Posted by Shaun @ Tru6

No, really, you need to do some research. I know SoL has explained the oil market to the Board many times, perhaps you haven't seen his posts but you would do well to look them up and educate yourself.

I have done plenty of research...and oil is just like any commodity.

I know that there are folks that post here that invest in the oil industry and high gasoline prices benefit them. They can "explain" the market all they want. It is not really convincing. An MBA, experience investing in commodities, and actually partial ownership in an oil/gas well (and the development of it to production) makes me as well qualified to discuss this as you or SOL. People explained the cool collar ad nauseum here as well. As an engineer that generally fixes his own things himself...I did not buy one of those either.

Folks also told me inflation was transitory...and was not occurring in places like the Boston area for some reason (and food was actually cheaper now) ...and that crime is down. I do not buy that either.

[Shaun @ Tru6]

Here's a quick google search for you to start learning about how oil is sold.

how is oil sold

[Paul T]

Originally Posted by fintstone

Of course I do. You just believe what you are told to believe. While we may be producing a record amount, it is obviously not enough to drive prices down or keep the world from being a hostage to OPEC+. We could produce a lot more. We could also make it a lot easier/cheaper to transport (by not stopping needed pipeline construction). We could control prices if we chose instead of OPEC+...many which are not our friends.

Not really. No single producer in the US can alter supply at a level that can meaningfully impact the global market. US oil producers make their own production decisions independently based on the economics of the company in question. There is no single entity producer in the US like OPEC that can make huge changes in production at will, and have markets respond accordingly. The US govt has very, very little control over the global price of crude. It goes way beyond just “producing” as well….you have to have the refinery capacity for the type of crude we are producing. Much of our refining is set up for heavy crude, while much of the new production in recent years has been light crude which we do not have the capacity to refine - hence the importing/exporting. It’s a lot more complicated than just “drill baby drill”.

[Shaun @ Tru6]

^^^ good stuff. Wait until he finds out Saudi Arabia can pump and deliver a barrel of oil cheaper than the US can just pump it.

[speeder]

Well, he brought the cool collar into a discussion, so I at least give him forum props for that.

[fintstone]

Originally Posted by Paul T

Not really. No single producer in the US can alter supply at a level that can meaningfully impact the global market. US oil producers make their own production decisions independently based on the economics of the company in question. There is no single entity producer in the US like OPEC that can make huge changes in production at will, and have markets respond accordingly. The US govt has very, very little control over the global price of crude. It goes way beyond just “producing” as well….you have to have the refinery capacity for the type of crude we are producing. Much of our refining is set up for heavy crude, while much of the new production in recent years has been light crude which we do not have the capacity to refine - hence the importing/exporting. It’s a lot more complicated than just “drill baby drill”.

I can buy your assertion that no single producer can currently produce enough oil in the US to meaningfully impact the market...but they certainly could easily do so combined (and competing for market share) ...as the US has far more than other countries. Not price fixing like OPEC+...but just massive production and competition. The US government has tremendous influence on the price of oil...and the ability for drillers to drill/produce and refiners to add capacity (or not). As the US produces more and the excess drive prices down, folks like the House of Saud produce less to try to keep prices up (as noted in Shaun's post above). Also noted in Shaun's post above, OPEC only produces about 5.7% of global demand. So, what happens id=f the US increases production an equivalent of 10-15% of global demand? Suddenly OPEC has almost zero leverage.

There is only so much that they can do reduce global production (to inflate prices) if the US produce two barrels for every one OPEC chooses not to produce. Eventually, there is true competition worldwide as other oil producers will not hold the line like the wealthy Saudis (and they will produce above the OPEC agreements) or starve.

[Shaun @ Tru6]

^^^your continued socialist tendencies of forcing oil companies to make less money so the masses can enjoy cheap gas are always entertaining.

[fintstone]

Originally Posted by Shaun @ Tru6

^^^ good stuff. Wait until he finds out Saudi Arabia can pump and deliver a barrel of oil cheaper than the US can just pump it.

What is your point? You just made the argument that OPEC+ was reducing production to raise prices. Why should anyone care how cheaply OPEC+ can produce their 5.7% of global demand if they restrict production to increase prices? It is not like they are selling it at cost.

[fintstone]

Originally Posted by Shaun @ Tru6

^^^your continued socialist tendencies of forcing oil companies to make less money so the masses can enjoy cheap gas are always entertaining.

Your continued communist tendencies to call for government control of oil production is telling. All I suggested was to reduce government interference in production (as oil producers have done) ...as was done just a few years ago (when gas was half the price it is now). More production does not necessarily equal less profit. While the commodity can be sold for less, a larger quantity can mean more profit. A win-win (for consumers and producers) and basic math (multiplication).

[Shaun @ Tru6]

Originally Posted by fintstone

What is your point? You just made the argument that OPEC+ was reducing production to raise prices. Why should anyone care how cheaply OPEC+ can produce their 5.7% of global demand if they restrict production to increase prices? It is not like they are selling it at cost.

Again, learn how oil is bought and sold.

[Shaun @ Tru6]

Originally Posted by fintstone

Your continued communist tendencies to call for government control of oil production is telling. All I suggested was to reduce government interference in production (as oil producers have done) ...as was done just a few years ago (when gas was half the price it is now). More production does not necessarily equal less profit. While the commodity can be sold for less, a larger quantity can mean more profit. A win-win (for consumers and producers) and basic math (multiplication).

I am for market capitalism, which is how oil is bought and sold. Please learn how oil is bought and sold.

[Rawknees'Turbo]

Long lost Cabmandone asked me to tell you bisches (that was my editorial addition - he actually said "guys") to " . . . focus! This is a diesel thread". Yer welcome!

[fintstone]

Originally Posted by fintstone

I have done plenty of research...and oil is just like any commodity....

Originally Posted by Shaun @ Tru6

Here's a quick google search for you to start learning about how oil is sold.

how is oil sold

You realize that the first result of your search was:

"Crude oil is traded in the futures markets. A futures contract is a standard contract to buy or sell a specific commodity of standardized quality at a certain date in the future..."

You did realize that commodity trading I referred to was "the futures market"...??? If you read what your Google search turned up, I would not have to explain this to you.

[Shaun @ Tru6]

OK so you've realized you don't know how oil is bought and sold.

But you are learning.

That's a good first step.

Keep reading.

[fintstone]

Originally Posted by Rawknees'Turbo

Long lost Cabmandone asked me to tell you bisches (that was my editorial addition - he actually said "guys") to " . . . focus! This is a diesel thread". Yer welcome!

Tell him that nothing has changed. Prices ranged between $2 and $3 from 2014 to 2021...under multiple Presidents and multiple economies (much like inflation which was relatively benign). It only changed abruptly when how the nation approached oil and gas changed.

[fintstone]

Originally Posted by Shaun @ Tru6

OK so you've realized you don't know how oil is bought and sold.

But you are learning.

That's a good first step.

Keep reading.

Yep. Reminds me of the recent thread where you claimed there was no inflation. Seriously?

[Shaun @ Tru6]

Originally Posted by fintstone

Yep. Reminds me of the recent thread where you claimed there was no inflation. Seriously?

Admitting defeat is fine, you are on your way to discovery, Bravo. You're like a moth just emerging from a chrysalis. Spread your wings and explore the world. When you can get to intelligently discussing OPEC+ and market manipulation as a threat to our national security, to say nothing of bad actor influencers like Putin and Xi, let me know next January or February. Be prepared to discuss the ramifications of moving away from oil for gas and into electric vehicles to remove threats to our economy and to our allies around the world.

[fintstone]

Originally Posted by Shaun @ Tru6

Admitting defeat is fine, you are on your way to discovery, Bravo. You're like a moth just emerging from a chrysalis. Spread your wings and explore the world. When you can get to intelligently discussing OPEC+ and market manipulation as a threat to our national security, to say nothing of bad actor influencers like Putin and Xi, let me know next January or February. Be prepared to discuss the ramifications of moving away from oil for gas and into electric vehicles to remove threats to our economy and to our allies around the world.

LOL. Don't bet on it. If you do, don't bounce the check. Again.