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27 June 2012

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TWV

Off the bat, I can think of two reason for the price disparity between the Shenandoah valley and NOVA.
Overhead; rent, insurance, etc. is most likely higher in NOVA than Harrisonburg.
Geography; Yes, refiners - just like supermarkets - price for what the market will bear.

Alba Etie

This welcome news . I own a one man & van charter business -and the savings this past month for my E 350 ten seater here in Central Texas have been put into the 'going fishing fund ".

kao_hsien_chih

To reinforce (I think) the colonel's point: Oil (and other commodities') prices depend on mass psyche much more than actual supply and demand. Most of these goods are traded not so much in actual products but contracts dated far in advance, and anticipation of shortages or just plain mass fear leads both legitimate consumers (of the product--e.g. refiners and various users) and speculators to hoard these contracts. It is still a function of supply and demand, but "demand" in this case is generated more by psychology and self-fulfilling prophecy than by any immediate "need to consume."

Bobo

The Colonial Pipeline and its spurs goes right through the valley thus a possible reason for the disparity in pricing.

My concern is that oil will drop to less than $2.00 per gallon which will bring on a whole lot of other problems. Always be careful on wishing for which Gift Horse you want.

tony

You mean the American public is so narrow-minded that vote for BHO just because the gasoline is cheaper?? That can’t be :)

turcopolier

tony

"That can’t be." Funny pl

r whitman

Don't get your hopes up. Right now there is a surplus of crude at the terminals in the US and surplus refining capacity. It will not go on forever. Something will come along to screw it up. A big refinery outage or saber rattling by the Israelis and Iranians or something else out of the clear blue.

You cannot make predictions based on linear data in a non-linear world and expect accurate results.

turcopolier

r. whitman

"You cannot make predictions based on linear data in a non-linear world and expect accurate results." I never do. I consder the data, eliminate the improbable and then guess. I am mostly right. It's my feminine side at work. I'm like the cowboy in a bar who chats up a dishy woman only to be told that she is a lesbian, that all she wants is women and thinks about them all the time. Another comes in, equally toothsome and after a while she asks what he is. His response is that he used to think he was a cowboy but now he knows that he is a lesbian. Claude and I are like that. pl

Fred

I would disagree. There is easy financial manipulation of supply. (Refiner outages, storage removed from service, etc; just as Enron did in California in 2000. It is market manipulation (un-regulated). That drives the pricing, not consumer fear.

Fred

Following up on your post on civility I must say I'm not sure if 'my, my' or roflmao is the right resonse to your follow up to r.whitman; how about both?

rjj du Nord

hmmmm...is that what some people refer to (personality-wise) as "integrated?"

turcopolier

rjj du Nord

Could be, I was born like that. Claude and I have discussed it with his father and grandfather. The grandfather said he was like that too. Charles (the father) said we were sick and irresponsible. Hope came in later to say that we were all losers and that she was sticking with Smoot. pl

N M salamon

1., The Iran war premium has disppeared for the time being, means approx $10-15 per barrel
2., The world is getting closer and closer to a system wide dperession [notwithstnding US data manipulation re GDP, Unemeployment etc, similar issues to a smaller effect are in China, India etc].
3., most people follow Saudi oil production, and disregard Saudi export, the first is rising, the second rising lot slower.
4., Hopefullyy this is not the start of the same issues as arose when the price dropped from $140 to somewhere around $40.

Dan Gackle

Here are an interesting couple of sources that support the claims made above.

Re "Forces internal to the markets are largely responsible for price movements."

Michael Greenberger, former Director of the Division of Trading and Markets at the Commodity Futures Trading Commission, has been making this case for some time:

http://www.mcclatchydc.com/2012/04/04/144181/finance-expert-says-speculators.html

Re "There is no short term shortage of crude oil."

A recent survey of every oil field in the world concludes that the largest boom in oil production since the 1980s is currently underway:

http://belfercenter.ksg.harvard.edu/files/Oil-%20The%20Next%20Revolution.pdf

Summarized here:

http://dotearth.blogs.nytimes.com/2012/06/25/a-fresh-look-at-oils-new-boom-time/

An interesting detail: the study finds that the most plausible scenario is of the US being the second largest oil producer in the world (after SA) by 2020.

Alba Etie

How does one eliminate the improbable ?

rjj du Nord

Bet Claude, Hope, et al. have met some of my v. close associates from the same sector of The Ont.

rjj du Nord

I WANT to read those books. For the past few years have read nothing but history - mostly 20th C. Wars and memoirs - plus a few other things. No fiction - except the one or two Le Carre published in that period.

Seems there is to be a relocation to North Carolina (via California). That will bump them to the top of the list.

r whitman

Does being a lesbian make the gasoline cheaper??

JohnH

No surprise that oil retailers charge what the market will bear, free of any restraint of a free market.

Senator Maria Cantwell recently asked the FTC to investigate why oil prices were increasing in Washington while they were decreasing in the rest of the country. Apparently, there was a fire at a West Coast refinery. In response, other refiners DECREASED output.

Most of the Fortune 500 now consists of shared monopolies, where a market leader often sets prices and other companies follow. By setting prices above the free market level, they all profit. For example, Barclay's just got convicted of fixing LIBOR rates.

Such oligopolistic behavior helps explain why profits and salaries of the largest companies are so outrageous, even in the worst of times. If demand drops, they simply raise prices to cover the shortfall. Alternatively, they cut service to drop costs.

There is nothing earth shaking here. It's all explained as part of any college level Economics 101 (or at least used to be when I went to school.) Given the prevalence of monopolistic behavior, understanding this should be required of anyone graduating high school.

Only then can something be done about it.

turcopolier

r. whitman

Could be, you might try it. pl

turcopolier

tjj

The transplant people? Claude became tired of us all and left in search of the Whitman woman. pl

turcopolier

rjj

There are a few left on the market. There are no vampires in them. pl

The Twisted Genius

du Nord, get them and read them. Judging by your listed reading preferences, I would wager that you will enjoy them immensely... and you will gain a rich group of acquaintances.

turcopolier

TTG

I can't get them to shut up and go away. Now they are elbowing their way into the new book. Jim Lewis and Jeff Shields showed up yesterday to say that they should be Does anyone know?in TDS. I am trying to rememmber which of them was a slave. Lewis sais that since he led sorrel in the funeral he muct be a main character. Too bed you weren't on the trip. did you read "targets?" pl

rjj du Nord

Humor the bastards or they will turn surly and unionize (just for the pun of it) - they are outside of time where anachronism is only the artifact of a point of view.

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