[zerostar]

This was recently suggested in a discussion I was having with some family members, the basic Idea is that the EPA and the "nutjob liberals" wont allow any more refineries so they supply is outstripping the demand. There is plenty of crude oil but the refineries can't keep up.

Now that more are closed near the gulf that is why we are seeing a spike.

They are also saying OPEC controls the price and there is no gouging going on, but with almost $7gal in Atlanta I think that is pure BS

Here is an article with the basic premis: http://news.enquirer.com/apps/pbcs.d...0323/1009/edit

I would tend to agree with some of this. Your thoughts?

EDIT to add: Frankly to keep pollution down I don't mind paying $5-6 a gallon where I am, I have an extremely efficient car that fits my families need and it would only add a small amount to our yearly budget.

American industry should get the best prices (to keep some products viable) and we should pay more since oil is such a manufactured low right now.

[loki74]

I would not be so quick to judge the local oil companies, or the EPA.

The local oil companies (ConocoPhillips, bp, etc etc) do make lots of profit... I just saw this on the Factor, the numbers are high. Bill was arguing that because they have all this profit they can lower prices, blah blah. For once I disagree with him. From what the guest said, they're making about a 6% margin--IIRC you need at least 8% to keep up with depreciacion. The guest tried to mention how much it costs to get a new oil rig, etc, but Bill cut him off, saying that the profit dollar number is after all that--which is not true. The purchase of a new oil rig would be considered new capital--which comes out of profit. You need the 8% profit margin to keep up with depreciacion, or on other words the repair and maintenance of the capital you already have. So to for a company to stay the same size, they need to make an amount at least 8% more than what it costs them. So actually these companies are shrinking (or at least losing capital, or not using capital that is in perfect condition) because they are not meeting the 8% minimum margin.

So a company's profit is not just pocket cash for CEOs--it's what keeps the company afloat, and expanding (if they make more than an 8% margin and invest it in new capital).

In short, the more stuff (capital) you have, the more money (profit) you need to put into keeping all that stuff running.

(I'm not an econ master, so correct me if I'm wrong on any of this stuff)

As for the EPA, well, they're just doing their job--I don't really see a political agenda from them.

I think the blame ultimately falls on OPEC--IIRC it costs them $4/barrel to produce, but they sell at like $75--that's WAY over depreciation, and I KNOW they are not buying THAT much new capital.

[RIRedinPA]

Originally Posted by zerostar

This was recently suggested in a discussion I was having with some family members, the basic Idea is that the EPA and the "nutjob liberals" wont allow any more refineries so they supply is outstripping the demand. There is plenty of crude oil but the refineries can't keep up.

Now that more are closed near the gulf that is why we are seeing a spike.

They are also saying OPEC controls the price and there is no gouging going on, but with almost $7gal in Atlanta I think that is pure BS

Here is an article with the basic premis: http://news.enquirer.com/apps/pbcs.d...0323/1009/edit

I would tend to agree with some of this. Your thoughts?

EDIT to add: Frankly to keep pollution down I don't mind paying $5-6 a gallon where I am, I have an extremely efficient car that fits my families need and it would only add a small amount to our yearly budget.

American industry should get the best prices (to keep some products viable) and we should pay more since oil is such a manufactured low right now.

The EPA is not stopping any company from building any new refineries, the EPA only sets standards for environmental protection that the new refineries have to meet. And by environmental protection we're not talking about saving some unknown species of mosquito from extinction, we're talking about stopping the spewing of toxic soups into the air which cause cancer and other illnesses. These make refineries more expensive to build, but, as a nutjob liberal, I would rather see these protections in place through legislature rather than trust the goodwill of any corporation to behave in responsible fashion.

As for the oil companies having only 6% margins, I seriously doubt those figures. In Exxon-Mobil's annual income statement they had $264B (that's billion) in revenue last year. If they were a country that would place them at #30 on the GDP list, ahead of Saudi Arabia, Sweden, Switzerland, Austria, Ireland, Israel, Denmark, Finalnd, Norway, New Zealand and about 200 other countries. Of course they would be behind British Petroleum who had $297B in revenues. Their net profit, after cost of goods sold, taxes, operating expenses, etc. was $26B and their net profit margin was, according to them 9.6%, Chevron (Texaco) had a net profit of $13B and their margin was 9.3%, British Petroleum had a net profit of $15B with margins of 5.5% (but they also purchased ARCO last year).

Let's not worry about the good ole oil companies, they are doing just fine. How about W, who is all about tax breaks, knock off that 18 cent Federal tax per gallon to chip away at the price?

[zerostar]

Originally Posted by RIRedinPA

Let's not worry about the good ole oil companies, they are doing just fine. How about W, who is all about tax breaks, knock off that 18 cent Federal tax per gallon to chip away at the price?

Isn't that everyones 18¢? I don't think it goes directly in to anyones pocket For the most part anyway. Who was responsible for the 18¢ in the first place?

[RIRedinPA]

Originally Posted by zerostar

Isn't that everyones 18¢? I don't think it goes directly in to anyones pocket For the most part anyway. Who was responsible for the 18¢ in the first place?

18 cents here, 18 cents there, soon your talking real money.

[Moderator]

I'm sure the $33 BILLION dollar profit that Exxon made last quarter alone has nothing to do with high gas prices. Damn Liberals.

[dreilly1]

I think there are two issues here:

1) Increased environmental standards that make refineries more expensive to build. As RIRedinPA observed, the oil companies are making quite enough money, and can afford to spend a little extra on refineries that pollute less. Remember that the oil companies are not necessarily going ot do this on their own, because the cost comes out of their own pocket, with the benefit not going to the company directly, but to society at large. Companies that only look at their bottom line will never sacrifice their profits for the sake of the environment unless they're compelled to by the government.

2) In many cases, the "nutjob liberals" that zerostar refers to do not see a need for more refineries at all, either because they do not think we should be using even more oil to begin with, or they think that any pollution is too much, and no refinery can be built to meet their standards. These people, combined with the "NIMBY" crows who have no problem with building more refineries as long as they're built Somewhere Else, are the real problem, IMHO. Our economy still depends on oil, and we need more refineries to meet that demand. All the shiny, happy people in the world won't change the fact that we need oil this winter, and that without oil, people freeze to death. I think the people who are against building new refineries no matter what are just as bad as the conservative "You're either for us or against us" crowd that they claim to hate.

As for the current spike in gas prices, I keep telling people that it's only temporary, due to the disruption in the supply chain caused by the hurricane. The real test will see where gas prices settle back to by Halloween. I think gas will settle back to $2 to $2.50, and home heating oil and natural gas, while higher than last year, won't bankrupt anyone. I hope I'm right.

And for those of you who think $2 is still too high, I'm starting to think it's a good thing, because it makes alternative energy sources more cost-effective, and will ultimately reduce our dependance on imported oil. Maybe this was Bush's plan all along....

[Moderator]

Originally Posted by dreilly1

I think there are two issues here:

1) Increased environmental standards that make refineries more expensive to build. As RIRedinPA observed, the oil companies are making quite enough money, and can afford to spend a little extra on refineries that pollute less. Remember that the oil companies are not necessarily going ot do this on their own, because the cost comes out of their own pocket, with the benefit not going to the company directly, but to society at large. Companies that only look at their bottom line will never sacrifice their profits for the sake of the environment unless they're compelled to by the government.

2) In many cases, the "nutjob liberals" that zerostar refers to do not see a need for more refineries at all, either because they do not think we should be using even more oil to begin with, or they think that any pollution is too much, and no refinery can be built to meet their standards. These people, combined with the "NIMBY" crows who have no problem with building more refineries as long as they're built Somewhere Else, are the real problem, IMHO. Our economy still depends on oil, and we need more refineries to meet that demand. All the shiny, happy people in the world won't change the fact that we need oil this winter, and that without oil, people freeze to death. I think the people who are against building new refineries no matter what are just as bad as the conservative "You're either for us or against us" crowd that they claim to hate.

As for the current spike in gas prices, I keep telling people that it's only temporary, due to the disruption in the supply chain caused by the hurricane. The real test will see where gas prices settle back to by Halloween. I think gas will settle back to $2 to $2.50, and home heating oil and natural gas, while higher than last year, won't bankrupt anyone. I hope I'm right.

And for those of you who think $2 is still too high, I'm starting to think it's a good thing, because it makes alternative energy sources more cost-effective, and will ultimately reduce our dependance on imported oil. Maybe this was Bush's plan all along....

Ehem
I'm sure the $33 BILLION dollar profit that Exxon made last quarter alone has nothing to do with high gas prices. Are you guys kidding me?

[zerostar]

Originally Posted by Moderator

Ehem
I'm sure the $33 BILLION dollar profit that Exxon made last quarter alone has nothing to do with high gas prices. Are you guys kidding me?

Is that revenue or actual profit? After expenses, etc. etc. anyone have some hard numbers on this.

Don't get me wrong, I would LOVE to blame this on corporate greed, but we should look at the real numbers.

[RIRedinPA]

Originally Posted by dreilly1

I think there are two issues here:

1) Increased environmental standards that make refineries more expensive to build. As RIRedinPA observed, the oil companies are making quite enough money, and can afford to spend a little extra on refineries that pollute less. Remember that the oil companies are not necessarily going ot do this on their own, because the cost comes out of their own pocket, with the benefit not going to the company directly, but to society at large. Companies that only look at their bottom line will never sacrifice their profits for the sake of the environment unless they're compelled to by the government.

2) In many cases, the "nutjob liberals" that zerostar refers to do not see a need for more refineries at all, either because they do not think we should be using even more oil to begin with, or they think that any pollution is too much, and no refinery can be built to meet their standards. These people, combined with the "NIMBY" crows who have no problem with building more refineries as long as they're built Somewhere Else, are the real problem, IMHO. Our economy still depends on oil, and we need more refineries to meet that demand. All the shiny, happy people in the world won't change the fact that we need oil this winter, and that without oil, people freeze to death. I think the people who are against building new refineries no matter what are just as bad as the conservative "You're either for us or against us" crowd that they claim to hate.

As for the current spike in gas prices, I keep telling people that it's only temporary, due to the disruption in the supply chain caused by the hurricane. The real test will see where gas prices settle back to by Halloween. I think gas will settle back to $2 to $2.50, and home heating oil and natural gas, while higher than last year, won't bankrupt anyone. I hope I'm right.

And for those of you who think $2 is still too high, I'm starting to think it's a good thing, because it makes alternative energy sources more cost-effective, and will ultimately reduce our dependance on imported oil. Maybe this was Bush's plan all along....

I'll eat my cherished Boston Red Sox hat which I have had for 10 years if oil ever dips below $3 again.

[RIRedinPA]

Originally Posted by zerostar

Is that actual profit? After expenses, etc. etc. anyone have some hard numbers on this.

That has to be a revenue number, not net. All the same, if they netted $26B last year then that means they made roughly $3B after expenses on that $33B.

[zerostar]

http://news.bbc.co.uk/2/hi/business/4223573.stm

US oil giant Exxon Mobil made a record $25.3bn (£13.4bn; 19.4bn euros) profit in 2004 as it benefited from the surge in crude oil prices.

Revenues hit a record $298bn as worries over disruption to oil supplies in Iraq, Nigeria and Russia lifted prices.

Lastly: The sharp rise in profit was achieved despite a 1% fall in oil production and a 2% decline in gas output.

How is this possible without unwarranted price hikes?

[dreilly1]

Originally Posted by RIRedinPA

I'll eat my cherished Boston Red Sox hat which I have had for 10 years if oil ever dips below $3 again.

Before I take that bet, where exactly are you? Here in Rochester, gas prices were in the $2.50 to $2.60 range until last Thurdsay, tailing up from $2.40 or so a few weeks ago. Then over the course of the weekend, they topped out at $3.50. This morning on the way to work, I saw $3.40 . I think gas prices here are pretty much tracking, if not a little higher than, the national average.

Depending on where you are, things may be worse.

[zerostar]

Gas is back to $2.99 here in South Florida...

[Dakar]

Originally Posted by zerostar

Gas is back to $2.99 here in South Florida...

That's crazy. What did it peak at?

[dreilly1]

Originally Posted by zerostar

Lastly: The sharp rise in profit was achieved despite a 1% fall in oil production and a 2% decline in gas output.

How is this possible without unwarranted price hikes?

Well, I would expect prices to go up when demand goes up and production goes down. 1% probably is not enough to cause problems, but then again, it may be.

Another thing to consider: there are places where oil is cheap to pump out of the ground, and places where it is not so cheap. The crude oil price is based on the total supply and demand of the worldwide market, taking all sources into account. If your system is set up to produce crude oil at $20 a barrel, and your competitor's oil fields can only produce crude oil at $30 a barrel, then you are guaranteed to make more profit than he will. Throw in current crude oil prices that are upwards of $60 a barrel, and now you have the problem that money is literally coming out of your wazoo.

The reason places like the Middle East and Venezuela are so rich is not necessarily becuase they have lots of crude oil, it's because the crude oil is so cheap to pump that they make metric sh*tloads of money no mater what the price of crude is.

[Millennium]

I wouldn't say that the low refining capacity of the US is the sole cause of high gas prices, but it's hard to deny that it's a contributor. This said, I've said in many threads before that Katrina was unforeseeable, and that holds just as true for environmentalists as for the government. Had we known that a Cat-5 hurricane was going to slam into Louisiana and wipe out a large portion of our refining capacity, the environmentalists would probably have used their political resources in a different way, just as FEMA would have used its monetary and human resources in a different way.

What is happenning now is basically the unintended consequences of many decisions made with the best knowledge we had at the time we made them. We know better now, of course, but that's all hindsight; it's pointless to blame people for not knowing something they couldn't have known at the time. If I'm going to hold one entity innocent for not knowing the future, it's only fair to give other entities that same benefit.

[zerostar]

Originally Posted by Dakar

That's crazy. What did it peak at?

I remember paying $3.59 so not too bad, you can check gasbuddy.com my zip is 34997 not sure if they have history.

[Dakar]

Originally Posted by zerostar

I remember paying $3.59 so not too bad, you can check gasbuddy.com my zip is 34997 not sure if they have history.

Thanks. We're still at our peak (may have flucuated up 2¢ or so...) which is roughly $3.38. I got gas the day before crap hit (ah... $2.45) so it'll be amusing if the next time I gas up prices are already back under $3.00.

[Moderator]

Originally Posted by zerostar

Is that revenue or actual profit? After expenses, etc. etc. anyone have some hard numbers on this.

The $33B is pure profit, but for the entire fiscal year not just 1 quarter (my mistake)...last year's profit was $25B. Thier second quarter profit was around $8 Billion. The Exxon CEO took home $38M. This quarter is expected to be another record.

http://www.billoreilly.com/blog#104
http://www.billingsgazette.com/index...s/35-exxon.inc

"At $50 a barrel, oil companies are not making money, they're printing it," said Fadel Gheit, an analyst at Oppenheimer & Co.

[RIRedinPA]

Originally Posted by dreilly1

Before I take that bet, where exactly are you? Here in Rochester, gas prices were in the $2.50 to $2.60 range until last Thurdsay, tailing up from $2.40 or so a few weeks ago. Then over the course of the weekend, they topped out at $3.50. This morning on the way to work, I saw $3.40 . I think gas prices here are pretty much tracking, if not a little higher than, the national average.

Depending on where you are, things may be worse.

Philadelphia - and we have refineries right on the edge of the city. Bet on?

[olePigeon]

I'd say the EPA is about 50/50 when it comes to nutjobs from both camps. It's Democratic because it looks like they're doing something constructive for the environment without actually doing anything. It's Republican because what they ARE doing is just catering to big business with no real thought for the environment.

The nutjob liberals actually hate the EPA because there aren't enough restrictions. The nutjob conservatives hate the EPA because there are too many. The Democrats and the Conservatives closer to the middle absolutely love the EPA for the reason listed above. In any event, they all get money.

I think the EPA has very little to do with the rising gas prices, and the gas prices has everything to do with the oil companies finally realizing that people will pay whatever the hell they charge for it because they want to drive cars.

[RIRedinPA]

Originally Posted by Millennium

I wouldn't say that the low refining capacity of the US is the sole cause of high gas prices, but it's hard to deny that it's a contributor. This said, I've said in many threads before that Katrina was unforeseeable, and that holds just as true for environmentalists as for the government. Had we known that a Cat-5 hurricane was going to slam into Louisiana and wipe out a large portion of our refining capacity, the environmentalists would probably have used their political resources in a different way, just as FEMA would have used its monetary and human resources in a different way.

What is happenning now is basically the unintended consequences of many decisions made with the best knowledge we had at the time we made them. We know better now, of course, but that's all hindsight; it's pointless to blame people for not knowing something they couldn't have known at the time. If I'm going to hold one entity innocent for not knowing the future, it's only fair to give other entities that same benefit.

I disagree - you can go back over the past 10 years and find articles in Nat Geographic, Outside, American Scientist, etc. etc. saying that the mismanagement, overdevelopment and depletion of the wetlands surrounding New Orleans was a recipe for disaster. The Times-Picayune also ran an expose 3 years ago to the same effect.

So it's not hindsight, it's passing the problem from one generation till the next until that one particualrly period in time when a big storm hits. The East Coast is the same way, eventually all the development, wet land and barrier island loss is going to result in catastrophe.

But for politicians spending money on flood control or land management doesn't return immediate dividends vis-a-vis votes. You could spend that money and not see results for twenty or thirty years, whenever the next big storm hits, but a highway or some development, that's immediate returns.

[Millennium]

Originally Posted by RIRedinPA

I disagree - you can go back over the past 10 years and find articles in Nat Geographic, Outside, American Scientist, etc. etc. saying that the mismanagement, overdevelopment and depletion of the wetlands surrounding New Orleans was a recipe for disaster. The Times-Picayune also ran an expose 3 years ago to the same effect.

At that point, there was little more than speculation. There wasn't any data to turn it into even a hypothesis, much less a theory. For that matter, even the most dire predictions didn't foresee anything of Katrina's magnitude.

So it's not hindsight, it's passing the problem from one generation till the next until that one particualrly period in time when a big storm hits.

So not believing that a problem exists is merely passing it on? Am I passing on the problem of purple aliens invading the planet to strip us of our supply of mangoes to the next generation, simply because I don't believe this problem exists? Theoretically it could happen, assuming purple aliens exist and they require mangoes for some reason, but there are many assumptions involved in that which simply have no data to back them up.

One can of course argue that a Cat-5 hurricane is much more likely than an alien invasion, and they'd be right, but the question is, just how likely is it? A storm of that magnitude is estimated to strike the region once every thousand years or so, and no efforts we could possibly spend today will last that long; should the hurricane not strike they are wasted. It's called a calculated risk. They made it, and I'm not so sure that I wouldn't have made it either under those circumstances. They got burned. Don't think I consider this a Good Thing -far from it- but that is the nature of risk, and I cannot place blame on them for making the choices they did.

[MacNStein]

Originally Posted by Moderator

I'm sure the $33 BILLION dollar profit that Exxon made last quarter alone has nothing to do with high gas prices. Damn Liberals.

$33B off how much in sales? They have to maintain tankers, buy new equipment, pay for more research, etc.. Think that goes into someone's pocket? Dang man, get your head out of your bum.

[Millennium]

Originally Posted by MacNStein

$33B off how much in sales?

That would matter if the $33B was gross revenue, but Moderator says this is actual net profit, not revenue. In other words, the costs are already factored in, and it still comes out to $33 billion.

I do admit, though; this figure seems awfully high, even for Big Oil. Do you have a link, Moderator?

[dreilly1]

Originally Posted by RIRedinPA

Philadelphia - and we have refineries right on the edge of the city. Bet on?

No bet, only because I think I may be eating my Met hat early if the Mets get swept by the Braves tonight.

[Moderator]

Originally Posted by Millennium

That would matter if the $33B was gross revenue, but Moderator says this is actual net profit, not revenue. In other words, the costs are already factored in, and it still comes out to $33 billion.

I do admit, though; this figure seems awfully high, even for Big Oil. Do you have a link, Moderator?

I heard it on the Oreilly factor last night. I'm a closet Fox listener . He references it here.
http://www.billoreilly.com/blog#104

[Millennium]

Originally Posted by Moderator

I heard it on the Oreilly factor last night. I'm a closet Fox listener . He references it here.
http://www.billoreilly.com/blog#104

I can't tell from that if he was talking about revenue or profit, but in any case those were words I never expected to hear from him of all people.

[Moderator]

Last year's Exxon profit was a US record..for any business. This year will eclipse that. Every oil company is setting records. I can't help but be suspicious. Bush = oil guy..Bush becomes president...Oil sets US record for profits. Coincidence?

Exxon Mobil's profits rose to $25.33bn from $21.51bn last year, on revenues up 17% to $298bn.

http://news.bbc.co.uk/2/hi/business/4223573.stm

[tracemhunter]

i wish the us would just switch completely to public transportation. if i lived in the city i would. this gas is killing me.

[mojo2]

Originally Posted by RIRedinPA

I'll eat my cherished Boston Red Sox hat which I have had for 10 years if oil ever dips below $3 again.

The hat is safe...UNLESS govt. reduces/eliminates gas taxes.

[RIRedinPA]

Originally Posted by Millennium

At that point, there was little more than speculation. There wasn't any data to turn it into even a hypothesis, much less a theory. For that matter, even the most dire predictions didn't foresee anything of Katrina's magnitude.

Did you not read my post. These weren't theories, these were the leading scientist of our times in meterology and hurricane studies predicting that a Cat 5 or strong 4 storm would cause immense devestation in New Orleans. There was plenty of data:

2002 American Radio Works episode:

The Natural Buffer Disappears

And there's another reason why scientists worry more about hurricanes every single year. There's always been a huge natural buffer that helps protect New Orleans from storms. There are miles of wetlands between here and the Gulf of Mexico: they slow hurricanes down as they blow in from the sea. But that buffer is disappearing. Every year, a chunk of wetlands the size of Manhattan crumbles and turns into open water.

Joe Suhayda explains, "So the hurricane can move closer to the city before it starts to decrease. So in effect, the city is moving closer to the Gulf as each year goes by."

And he says, it's partly because of those levees along the Mississippi River. When they stopped the river from flooding, they also prevented the wetlands from getting the regular doses of floodwater and mud that they need to survive. Studies show that if the wetlands keep vanishing over the next few decades, then you won't need a giant storm to devastate New Orleans — a much weaker, more common kind of hurricane could destroy the city too.

http://americanradioworks.publicradi...ane_print.html

This is an excerpt from a 2001 Best of New Orleans article:

While the leveeing of the Mississippi, its tributaries, and its distributaries to narrow beds is responsible for much of the damage, some insults to the ecosystem always receive extra vituperation. The Mississippi River Gulf Outlet is everyone's whipping boy. It's a 76-mile canal dredged in the late 1950s by the Army Corps of Engineers to enable container ships to travel a straight line from the Gulf to New Orleans rather than having to spend 10 hours winding up the Mississippi's tortuous route. The Corps dredged it 500 feet wide. Now, erosion from ships and storms has gouged it 2,000 feet wide and made it a freeway to New Orleans for any hurricane that happens to come from the right direction.

http://www.bestofneworleans.com/disp...news_feat.html

Here's a 2001 National Geographic Video that describes how the levees make New Orleans vunerable to hurricanes:

http://news.nationalgeographic.com/n...vee_video.html

another from Risk and Insurance, 2000

http://www.findarticles.com/p/articl...11/ai_68642805

The 2004 National Geographic article:

http://www3.nationalgeographic.com/ngm/0410/feature5/

2001 Scientific American article:

http://www.sciam.com/article.cfm?cha...5883414B7F0000

So not believing that a problem exists is merely passing it on? Am I passing on the problem of purple aliens invading the planet to strip us of our supply of mangoes to the next generation, simply because I don't believe this problem exists? Theoretically it could happen, assuming purple aliens exist and they require mangoes for some reason, but there are many assumptions involved in that which simply have no data to back them up.

One can of course argue that a Cat-5 hurricane is much more likely than an alien invasion, and they'd be right, but the question is, just how likely is it? A storm of that magnitude is estimated to strike the region once every thousand years or so, and no efforts we could possibly spend today will last that long; should the hurricane not strike they are wasted. It's called a calculated risk. They made it, and I'm not so sure that I wouldn't have made it either under those circumstances. They got burned. Don't think I consider this a Good Thing -far from it- but that is the nature of risk, and I cannot place blame on them for making the choices they did.

Your analogy is ridiculous. Had there been years of documented proof from the scientific community, the corps of engineers, FEMA and other agencies that actions we were taking were making us vunerable to alien invasion for mangos then perhaps it would make sense. This was, for the most part by local, state and the federal government ignoring the evidence that the problem exists - and to restate what I have already said because flood control is not something politicians get elected on - for flood control you have to deter growth and the dividends are long term, not short.

I'm not sure where your getting your information but a Cat 5 Hurricane is not a once in a thousand year storm - there have been 28 since 1923, 8 have made landfall as cat 5s and three of those hit the continental US - the 1935 Labor Day storm that hit the Florida Keys, 1969 Hurricane Camille which hit 100 miles from New Orleans and Andrew, which devestated Florida in 1992. In the same period nine Cat 4 hurricanes (which Katrina was) have struck mainland USA.

In the last 150 years 18 major hurricanes (Cat 3-5) have struck Louisiana, (29 in total). Ignoring the data is not a calculated risk but negligance, especially when you are playing with tens of thousands of lives by doing so.

[Dakar]

Originally Posted by Dakar

Thanks. We're still at our peak (may have flucuated up 2¢ or so...) which is roughly $3.38. I got gas the day before crap hit (ah... $2.45) so it'll be amusing if the next time I gas up prices are already back under $3.00.

$2.99 as of this morning. That didn't take long.

[smacintush]

Originally Posted by Dakar

$2.99 as of this morning. That didn't take long.

$2.95 here.

[zerostar]

http://releases.usnewswire.com/GetRelease.asp?id=52755

Some Highlights: "The three internal memos from Mobil, Chevron, and Texaco show different ways the oil giants closed down refining capacity and drove independent refiners out of business."

"The exposure comes in the wake of Hurricane Katrina as the oil industry blames environmental regulation for limiting number of U.S. refineries."

[Y3a]

Hmmmmmm.....

DC (As in Washington, D.C.) had the highest prices for gas in the country. Smells like politics to me. Time to drag the boards of all the gas providers into a set of long drawn out hearings where they can answer a bunch of inflamitory questions, and then get told to stop the crap and lower the prices or get their butts taxed out the wazoo! maybe threaten them with a government takeover and confiscation of all their property and profits.

[Millennium]

Originally Posted by RIRedinPA

Did you not read my post. These weren't theories, these were the leading scientist of our times in meterology and hurricane studies predicting that a Cat 5 or strong 4 storm would cause immense devestation in New Orleans. There was plenty of data:

There was plenty of data that were such a storm to strike, it could do immense damage. There was data to indicate that such storms exist. But there was no data indicating when or if such a hurricane would strike New Orleans.

Your analogy is ridiculous. Had there been years of documented proof from the scientific community, the corps of engineers, FEMA and other agencies that actions we were taking were making us vunerable to alien invasion for mangos then perhaps it would make sense.

Then here's a more concrete example: a growing bulge of land in Oregon, thought to be caused by magma flows beneath the surface. This bulge is growing very rapidly in geological terms, and it is thought that it could become an actual volcano. Should this occur, scientists currently think that the risk to population centers is small, but as Katrina teaches us we can't count on a lack of data now to mean that we shouldn't be prepared for later. Should we be preparing all of the towns around the area to deal with a sudden and catastrophic volcanic eruption? What scale of eruption should we be dealing with? Should we go with Mount St. Helens as our example, which was one of the largest ever recorded in the US? Should we instead use Mount Etna, or Vesuvius, which laid waste to cities in their respective times? Should we use Krakatoa, which destroyed the entire island on which it was located? Of course, we could take the data at face value, as you say we failed to do for Katrina, but if we do this then there would be no preparations made at all.

[Millennium]

Originally Posted by Y3a

DC (As in Washington, D.C.) had the highest prices for gas in the country.

Are you sure about that? Around here I've only seen prices for Regular get as high as $3.599, except for one station that actually did get accused of gouging, and by its parent company no less. I've heard rumors of gas in Houston getting as high as $9/gallon, because regulations there required a special type of gas and the only refineries that produced it were in -you guessed it- Louisiana. Result: extreme shortages.

Smells like politics to me. Time to drag the boards of all the gas providers into a set of long drawn out hearings where they can answer a bunch of inflamitory questions, and then get told to stop the crap and lower the prices or get their butts taxed out the wazoo!

No need for new taxes. The threat of removing the old subsidies should be more than enough to make them blink first, and even if it's not they should be removed anyway. Those subsidies are a product of a time when the oil industry truly needed them to stay afloat, but that time has been over for many years now. They are more than capable of thriving in a truly free market without government assistance. I'd suggest that some $33 billion in profit should demonstrate that.

maybe threaten them with a government takeover and confiscation of all their property and profits.

That's going too far; they have not yet proven themselves to be working so dishonorably that government should usurp a large part of the private sector.

[RobOnTheCape]

I listened to a program on NPR where someone stated that the problem is in fact a refinery issue, and that there aren't enough of them. Problem is that the cost of construction is huge, and amortizing that project over 20 years poses a problem. The problem is that industry thinks that alternatives to oil will be coming online well within that 20 year period, and they will be left with more refineries than the market demands. Thus, no new construction of much needed refineries.

who knows.

[mojo2]

Originally Posted by RobOnTheCape

I listened to a program on NPR where someone stated that the problem is in fact a refinery issue, and that there aren't enough of them. Problem is that the cost of construction is huge, and amortizing that project over 20 years poses a problem. The problem is that industry thinks that alternatives to oil will be coming online well within that 20 year period, and they will be left with more refineries than the market demands. Thus, no new construction of much needed refineries.

who knows.

You missed this post...

Originally Posted by Y3a

Todays oil takes a few days to be taken($) to a refinery($) and split into the gas, kerosene, etc.
Then it's delivered to the local storage facility($)
where it's put into tanker trucks and driven($) around to the ga$ $tation$. They have to add in the Local TAXES and FEDERAL TAXES. So it costs 3.00 today.

Tomorrows oil costs less so the final result will be less.

8/16/05 ABC Evening News (with the terrific, Charlie Gibson)

Thanks to ABC News' Betsy Stark.

149 US oil refineries process appx. 17 million barrels of sweet, light, crude oil a day, which, btw, leaves us about 10% short of what we need daily. We make up the difference by importing gasoline from other nations. The last new US oil refinery went on line 30 years ago and despite a greater demand than ever before, because of the boom and bust nature of the oil business there are fewer refineries now than in 1981 when 324 US refineries processed almost 19 million barrels/day.

New refineries would ease gas prices but current refineries are maxxing out and making record profits so the owners are less interested in plowing those profits into new processing plants.
Eventually they'll have to though, because some of the current plants are starting to break down, causing even greater shortages, which supports higher prices at the pump.

Especially promising would be new refineries which are able to process the heavy crude oil. Heavy crude is harder and more costly to refine than sweet, light crude but the heavy crude is $14/bbl cheaper and there are millions of barrels available but few refineries today are capable of processing the stuff.

Analysts agree that a few big refineries could help bring down gas prices but building new capacity is a daunting task.

Because of government red tape and EPA requirements and etc., one company, Arizona Clean Fuels will have spent 15 years trying to get a relatively small refinery built by the time their first product is sold in 2010.

And even more of a problem is that despite the hue and cry for lower gas prices no one wants a refinery built in THEIR 'backyard.'

The strain on the country's 149 refineries is showing. Months of operating at full throttle, of trying to satisfy record demand has produced a summer of fires, accidents and shutdowns, creating worries about supply shortages which drive up the prices.

The futures market determines the price for oil as investors and the oil companies themselves bet on the price per barrel at a point in the future. That price is determined by market factors, global news events, newly discovered supplies, increased or decreased worldwide production capacity and the like.

Other than the profiteering which may or may not be going on from place to place, the price at the pump has been determined months ago, on the futures market.

As far as alleviating current high prices, there is pressure on refinery owners to build new facilities, but relief isn't around the corner.

Years ago, analysts predicted consumer conservation and driving habits wouldn't begin until pump prices reach $4.00/gal.

For the record, here is what President Bush had to say about cheap oil:

I once made the mistake of suggesting to Bush that he use the phrase cheap energy to describe the aims of his energy policy. He gave me a sharp, squinting look. Cheap energy, he answered, was how we got into this mess. Every year from the early 1970s until the mid-1990s, American cars burned less and less oil per mile traveled. Then in about 1995 that progress stopped. Why? He answered his own question: Because of the gas-guzzling SUV. And what had made the SUV craze possible? This time I answered, "Um, cheap energy?"

He nodded at me.

Dismissed.

But if Bush was no energy free-marketeer, neither did he share the crusading zeal of the environmental Left. For Bush, the point of energy conservation was not for Americans to USE less, but for Americans to IMPORT less. For him, energy was first and foremost a national security issue. He had warned in 2000, "As a result of our foreign oil imports skyrocketing, America is at the mercy more than ever of foreign governments and cartels."

Source: The Right Man, by David Frum, p. 65-66 Jun 1, 2003

[mojo2]

Originally Posted by RIRedinPA

I disagree - you can go back over the past 10 years and find articles in Nat Geographic, Outside, American Scientist, etc. etc. saying that the mismanagement, overdevelopment and depletion of the wetlands surrounding New Orleans was a recipe for disaster. The Times-Picayune also ran an expose 3 years ago to the same effect.

So it's not hindsight, it's passing the problem from one generation till the next until that one particualrly period in time when a big storm hits. The East Coast is the same way, eventually all the development, wet land and barrier island loss is going to result in catastrophe.

But for politicians spending money on flood control or land management doesn't return immediate dividends vis-a-vis votes. You could spend that money and not see results for twenty or thirty years, whenever the next big storm hits, but a highway or some development, that's immediate returns.

On El Camino Real between Colma, CA and SSF there was (I haven't had to drive that way in a while) and still may be a roofing co. which had a sign posted to remind drivers, "...it WILL rain again..." The unspoken message is that even though the holes in your roof have stopped leaking now that the rain has stopped, you really SHOULD patch that roof because...

There are studies and it's no secret or mystery that there WOULD someday be a cat 4 or 5 storm come through. But it's a gamble, innit? Will I be able to dodge that bullet or should I just bite it and build the infrastructure for something that may happen tomorrow or in 10 years?

[RIRedinPA]

Originally Posted by Millennium

There was plenty of data that were such a storm to strike, it could do immense damage. There was data to indicate that such storms exist. But there was no data indicating when or if such a hurricane would strike New Orleans.

I really don't understand your point - isn't that the exact reason to prepare for such a thing, it's unpredictability. If you live in Tornado Alley then you should be prepared for the possibility of a tornado because there is a chance a tornado could strike. If you live on a flood plain better have flood insurance and prepare for the possibility. If you live in the hurricane zone you should prepare for that eventuality.

Then here's a more concrete example: a growing bulge of land in Oregon, thought to be caused by magma flows beneath the surface. This bulge is growing very rapidly in geological terms, and it is thought that it could become an actual volcano. Should this occur, scientists currently think that the risk to population centers is small, but as Katrina teaches us we can't count on a lack of data now to mean that we shouldn't be prepared for later.

Should we be preparing all of the towns around the area to deal with a sudden and catastrophic volcanic eruption?

Um, yes. If there's the potential for a volcanic eruption why wouldn't you (READ: government) prepare to deal with it?

What scale of eruption should we be dealing with? Should we go with Mount St. Helens as our example, which was one of the largest ever recorded in the US? Should we instead use Mount Etna, or Vesuvius, which laid waste to cities in their respective times? Should we use Krakatoa, which destroyed the entire island on which it was located?

I don't think you plan for a volcanic eruption by what type of volcano erupted in the past, you would plan for it as you would other natural disasters - evacuation plan, debris removal plan, fire fighting plans, long term displaced population plans, security plans, etc. etc. You go with the worst case scenerio, you know, plan for the worse, hope for the best.

Of course, we could take the data at face value, as you say we failed to do for Katrina, but if we do this then there would be no preparations made at all.

I think we're debating on different levels. Your talking emergency planning, which to some extent was done and actually, if you look at what occurred - 80% of the population of a major American city was evacuated safely, done well, but that was those with the means to get out. The failure was in accounting for those who wanted out but had no means to get out and then providing security and resources in a timely fashion for those left behind.

Anyway, what I am talking about was the environmental aspect of it. For the past twenty or whatever years the wetlands that have protected New Orleans from hurricanes has been destroyed, making the city much more vunerable to an even lower category hurricane. Nothing was done to address this despite the dire warnings from experts and hence, we see the results today.

So your example is still kind of Apples and Oranges to my point. In Oregon you can't change zoning laws to stop the formation of a volcano. New Orleans and Louisiana could have addressed their irresponsible development plans to counter the past effects that placed them in danger.