The Way I See It!

I am an Ultra-Conservative, Alpha-Male, True Authentic Leader, Type "C" Personality, who is very active in my community; whether it is donating time, clothes or money for Project Concern or going to Common Council meetings and voicing my opinions. As a blogger, I intend to provide a different viewpoint "The way I see it!" on various world, national and local issues with a few helpful tips & tidbits sprinkled in.

Gas and Oil

Economy, Gas, National, Oil, Policy, Wisconsin

The high gas prices Milwaukee saw a few years ago (2002-2003), boosting our prices to California prices, was a test by the oil industry to see what price people would still pay for gas.  What better place to test then Milwaukee, Wisconsin a test bed, if it sells here, it will sell elsewhere.  High prices are here to stay, we proved it years ago.


There is enough oil, but we cannot turn it into gas.  The gas refineries do this to fatten the bottom line.  Our problem is the oil companies control the refineries as well.  Gas does not follow the supply and demand that we all learned about in school. 


Oil futures shot to a new record above $100 Tuesday for the first time since Jan. 3 as investors bet prices will keep climbing despite evidence of plentiful supplies and falling demand.


Just a search on Google for “oil jumps” gives us these and more:


Oil jumps more than $2 on U.S. spending report

Oil climbs $2 on surprise drop in supplies

Oil jumps on US stockpile report

Oil jumps 3 percent on supply worries, weak dollar

Oil Jumps on Turkish Iraq Incursion

Oil jumps $4 on central bank move

Oil jumps $4 after pipeline blast

Crude oil jumps $2 barrel on gas concerns

Oil higher on possible strong dollar

Oil jumps more than $1 - Oil pipeline fire kills 2 in Minn.

Oil jumps as Opec refuses to lift production

Crude jumps nearly $3 after mortgage plan; natural gas rallies ...

Oil and Gas jump holiday time

Oil jumps $3 on central bank plan, U.S. stock draw

Oil jumps after attack on U.S. ships, Ecuador halt

Oil jumps on political turmoil in Venezuela

Oil jumps to $98 on winter fear - New Jersey Gas Prices

Oil Jumps on News of Nigerian Strike

Oil jumps on tough Iran talk

Oil Jumps As Saudis Shift Policy

Oil jumps $4 after Canada-U.S. pipeline fire


Oil prices push up higher by speculation that there wouldn't be enough when summer driving season begins.  Memorial Day opens that season.  Oil can jump on anything even fear.  Only if the U.S. were in a recession, then it would bring down the price of oil and gas.


It once was if oil moved up so did gas.  That is not necessarily the case now.  Crude oil makes up about 45% of the price of gas; federal, state and local taxes are 23%.  The rest mainly goes to refineries, with a few percent to retailers.


Gas costs rose after big oil mergers.  Big petroleum-industry mergers in the 1990s reduced competition, made it harder to get cheap, unbranded gasoline and contributed to high gas prices.  The GAO study tallied 2,600 petroleum mergers from 1991 to 2000, 13% of them involving refining and marketing.  Source: USATODAY The fragile foundation for any forecast is the U.S. petroleum refining and distribution network.  Industry has no slack.  Disruptions at even a small refinery or section of pipeline could send prices zooming.  Watch for the fires that happen almost on cue at a few of the refineries.  The top 10 refiners of gasoline together control 83% of the U.S. market.Gasoline wholesalers, worried about running out, would offer higher and higher prices.  Retailers would have to pass the increases on to motorists.  The Midwest and Northeast are especially vulnerable.


Many jurisdictions require summer gasoline blends that can't easily be bought elsewhere.  A single hiccup "would take gasoline to new levels” and it is not as simple as getting gas from other places.  Milwaukee’s gas is tied to the EPA and the clean air act of 1990 that Al Gore authored is to blame.  That is why people call our gas “gore gas.”  Reformulated gas and other so-called boutique fuels have been one of the flash points in the debate over what's behind the high gas prices. Saudi Arabia blames record high U.S. gasoline prices on America's tough environmental laws and lack of refining capacity, saying OPEC's oil production policies were not to blame.  There has not been a refinery built in America in the last 20 years.  So if you produce more crude oil but you can't refine it, it's not going to translate into gasoline.


Ethanol that diverts corn from food and feed is not the answer.  Ethanol should only be made as a byproduct of some other process, and not from diversion.


Officials around the world have decried soaring food costs and the increasing use of grains to make biofuels.  Food riots have hit several African countries, Indonesia and Haiti.

High gas prices raise questions of gouging and when they are found guilty, they get a slap on the wrist.  So where is that money going?  Are profiteers manipulating the market?  Economists say oil producers and refiners, not gas stations, are reaping a windfall.  Judging by history and laws of the market, it will be very hard to find evidence of impropriety if you truly want to look for it.

Collusion: The U.S. Federal Trade Commission has investigated the U.S. oil industry several times over the years but did not find that companies worked together to raise gasoline prices.

It is not illegal under U.S. law for a company to act on its own to restrict supplies or close a refinery that may lead to higher pump prices.  Oil companies are also permitted to practice so-called "zone pricing," where they charge different gasoline prices in a specific location or city, which often result in pump costs being higher at service stations located just blocks apart.


Gasoline could go from 10% ethanol up to 20%


Algae for Fast-Growing Biodiesel


A Texas plant scientist and entrepreneur thinks the microscopic algae plant, aka pond scum, could be the next big thing in the energy sector. About 50 percent of an algae plant is oil that could be used to create biodiesel to fuel vehicles.


Glen Kertz's innovation is a patented system called "Vertigro," in which algae is cultivated in long rows of vertically hanging, movable plastic bags.  This system optimizes surface area for growth, yielding 100,000 gallons of oil per year per acre.


Kertz says that cultivating algae is another way to derive useful energy from solar power, and that his solution could help deal with global warming.  Algae plants are among the world's fastest-growing plant species.


More cars use pricier premium gas


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