Rising gas prices, Creating the competitive edge

What is with the rising gas prices. The only thing I can think of is that the prices are being allowed to increase so that the new hydrogen and renewable alternatives can become more competitive. They are too expanesve now but if the price goes high enough, it will be profitable to draw in big business. This competition will eventually make everything cheaper allowing the price of all energy to drop. I hope market forces work faster than slower.

What ever happened to converting coal into gas. The German's during WWII already had this technology and USA has plenty of coal. Back in grad school days, I was part of some energy research at ORNL that used extrusion technology to liquify coal. The solid coal generates the electricity for extrusion, you then catalylse the liquid, strip the sulfur etc, gradually recycle the clean fuel for electricity, then moth ball the old coal plant. The extra output becomes cheap fuel. Environmental paranoia or conspiricy squashing a very cheap alternative that should be online by now.

I think, at least part of the reason gas prices are going so high is that (at least when it comes to driving) that its the summer and vaction time. Many familys have vactions in the car, plus RVing has been a really big thing for the last few years ( at least in Canada its growing, not sure about elsewhere). Vacations are a time to spend money, so expensive gas isn't going to stop people, and if there is profit to be made, people want to make it.

As far as I know the Oil companies are fighting hydrogen and other energy sources. I know the oil companies don't want car companies to stop using internal combustion engines, at least not yet.

MDT, is converting coal to gas really cheaper than getting gas from crude? My guess (although uneducated on this subject) is that the coal to gas is very expensive!!

coal to gas =$5.00 a gallon gas cleaner but not worth it at this time. prices are high due to iraq, adead king in saudi arabia and our lack of conservation!!

The way I see it coal conversion techonlogy has been around for at least 60-70 years. Its too bad that it wasn't allowed to go through all the technology growing pains since that time. Gas from coal wasn't given a good second look until it became a little too late; by the time social perception and environmental standards had changed.

It sort of analogous to the third and fourth world countries. For them to get industry implies that they are required to jump from the stone age directly into the year 2005. They are not allowed to follow the natural learning curve of mistakes that western culture enjoyed; labor intensive, water power, to steam, to electricity, labor unions, to polution ,to electronics, to robots, to environmental concern and conservation, while being able to buy political influence all along the way. The third world countries, like coal, loss all the luxury of ignorance and social acceptance which buffered the slowly evolving innovation within our culture. The loss of that bridge of innovation continuiity, between past and present, definitely makes that jump risky and therefore calculated to be much more expensive; not worth trying under the current political and social climate unless everyone is willing to pay $5/gallon. That is the starting price, but innovation would make it get cheaper with time.

We have plenty of oil. Supply is not the problem, production is.

We simply do not have enough refineries to meet demand. Add to the fact the negative reaction of environmentalists when old refiners are retrofitted. Building new refinery would be incredibly costly due to over-regulation of the EPA not to mention the predictable uninformed outrage of the environmentalists.

Add to this the inability to move gas between regions due to local gasoline blends regulations. Remember last year’s hurricanes in Florida? Governor Bush announce the he would temporarily remove the mandate of blended gas to allow the import of gas from other locals in order to meet needs.

Even a visiting Saudi Prince commented about the lack of production within the U.S.

Just one of many stories commenting on this issue:

Just "liberate" another Oil producing country, and you have another oil source to drain from.

Luckily, with the current known supply, and at the current projected use, In 14 years, there will no longer be any oil to use. So, I guess in 25 years, the oil problem will be no more, because there will be no oil anymore.

Where did those figures come from?

There is great debate about just how much usable oil is available using current technologies, but the amount left is estimated in gigatonnes. Current estimates range from 500 gigatonnes on the conservative side to 850 gigatonnes. That is much more than a 25 year supply.

From what I have read, a problem is in locating oil deposits that can be cheaply extracted. For instance, a significant percentage of the available oil is either mixed with sand or too viscous. Another issue is that a good percentage of it is in small deposits. It simply isn't cost effective, for example, to build and maintain an offshore rig unless it will have a healthy payout. There is still plenty of oil left, but output will continue to dwindle. Some countries could easily cut their energy consumption.
I don't see oil companies feeling bad about enough about the high gas prices to try to do anything about it. Think?

The price of gasoline is in line with oil futures. Anything you can imagine occuring in the world that would lead an investor to buy oil, no matter how speculative or short term, will lead to higher prices. Oil is a limited resource, but current prices don't have to reflect the reality of the current situation.

one thing people seem to miss..
the good oil is on top and used first.. it gets more and more expensive to refine..
gas companys are making record profits yet no refineries have been made in years
2 years ago after begging the saudis for relief, they released 500 million barrels of oil... problem was it was high sulfer sludge.. if anwar is already giving sludge we are all in trouble,
all the opec producing nations "fudged" there reserves to try to get the largest percentage of te opec quoto they could. There is no outside verfication of reserves.
a big sign of being over the top to peak oil.. is gas price volatility (ie rise on every bit of news, hurricane etc)
last week we had 12 refineries go down....
the reason we dont build new ones.. isnt expense...it is the likelyhood of profit.
if it takes 20 years to pay off cost of building a refinery and oil will only last 14 years(just used as an example)..
when a field starts to get low on oil.. they have to pump in water or something to get the rest of the oil out, because of laws of pressure.. when you pump in water .. you get out mostly water.. so you have to pump in millions of gallons of water to get 100,000 gallons of oil.
there are tar sands and shae that is too expesive to extract the oil from..
all countries oil demand goes up yearly
most of the people screaming the loudest about oil running out are former geologiest for the oil industry.
Fuel only accounts for 50% of oil use
products like plastics, fertilizers, pesticides make up the other 50%
for every calorie of food grown we burn 9 cals of oil.
sure we may have oil for another 50 but it gets thicker and harder to remove, more expensive to refine.
DONT BUY THE LACK OF REFINERIES>> IT IS JUST POLITICAL SPIN. and as for cost especially due to enviromentalism.. the bush admin proves tht it will do what it takes inspite of the enviroment.)look at the wall arround sandiego.. pulling out of the kyoto, easing enviro restrictions.. etc). GAs companies make so much you dont have to sign for credit card purchaces(they pay more for that privealedge). They are making record profits and just got billions in tax breaks and incentives. gas stations get upgrades all the time.. one near my house has tv's in the pumps to advert at you.. If it could make them money... IT WOULD BE BUILT

Where did those figures come from?

There is great debate about just how much usable oil is available using current technologies, but the amount left is estimated in gigatonnes. Current estimates range from 500 gigatonnes on the conservative side to 850 gigatonnes. That is much more than a 25 year supply.

I read it in the MEED (Middle East Economic Digest) a few years ago.

Their numbers were already calculating with the estimated resources of the Sakhalin and Sakhalin II development that are to go online coming year and also the estimates of the Petrobras Field development for P50, P51, P52, P53, P54 Platforms out by Brazil. that are also planned to be finished this decade.

I do not think they included the Transneft (Privolzhsknefteprovod) expansion and the Prirazlomnoye expansions in Russia. Also they had no figures for the Sudan development, but since most of the Oil from Sudan (+/-90%) goes to China, it is hard to make an estimate.

Have any facts to back that claim up? According to the market itself, refineries are a huge factor. But I’m sure they are all just lying.

Spoken like one of the cited environmentalists.

Articles like this one tend to disagree with your claims that environmental issues do not impact refineries or is just “political spin”.

And as far as what I said earlier about refineries needing to be replaced or upgraded:

Cite your sources other than Greenpeace propaganda.

Exxon made $21bn in 03 and $25bn in 04. It will likely be more this year. A refinery costs an estimated 2-4bn. In three years (03-05) Exxon will have made approximately $75bn. 4bn/75bnX100=5%. Exxon would have had to spend 5% of their profit over that time to build a new refinery (2.5% at the lower cost estimate for a refinery).

It's nice to have someone to blame (those darn environmentalists).

Neither Exxon nor any company will invest in a refinery if there is not a positive payback. Nor should we ask them to. The growth of our economy depends on prudent investments.

And for those complaining about high prices, well, high prices lead both to greater conservation and more exploration etc. In fact, the worst thing that could happen would be some ham-fisted government attempt to cap prices. Let the market work.

I certainly don't see what the problem is, here.

It should be a goal of some people in society, to declare open season on the people who own oil companies, that they can be hunted in the Fall.

These catches would serve as a good source of food, provided that they are caught, according to proper hunting rules.