Yikes.......$104 a Barrel !!!!!

Discussion in 'The Tiki Bar' started by Dave S, Mar 5, 2008.

  1. Dave S

    Dave S Well-Known Member TECHNICAL Contributor

    Oct 3, 2006
    Upstate South Carolina
    Boatless
    Boatless
  2. fc3

    fc3 Well-Known Member TECHNICAL Contributor

    Nov 12, 2006
    Northern NJ
    1999 Sea Ray 330DA
    Twin 7.4 MPI (310 propshaft HP) V-drives
    Twin Mercury Marine marinized 7.4L L-29 V8s
    Cast iron block w 4-bolt mains
    4.25x4.00 bore & stroke
    The fix is simple and cheap. But the trash in Washington are too stupid to enact it. They need to kill the ethanol subsidies and allow drilling in Alaska and off-shore. If, by some miracle they do that, they should, while they are on a roll also:
    • Make the tax cuts permanent.
    • Cut the corporate tax rate, or better yet, eliminate it.
    • Eliminate the capital gains tax.
    • Eliminate estate taxes.
    • Eliminate Sarbanes Oxley.
    There. That's not so hard, now is it?

    Best regards,
    Frank C
     
  3. delliott00

    delliott00 New Member

    115
    Oct 10, 2006
    Lake Travis TX
    Yeah. Thats the biggest reason I downsized to a 280 from a 320. It got to the point where running out to the cove and back on the weekends was burning 15 gallons at $4 a gallon = $60 each trip, x 3-6 trips a month..... yikes. Now it'll be $5/gallon on the lake.

    The biggest problem is going to be diesel prices. There is a "perfect storm" brewing there. It used to be cheaper than gas. Right now, its about $.50-60 more than regular unleaded.... but it'll get a LOT worse. Reasons....

    - US refineries' cracking process can only produce a max of 7-8 gallons of diesel blend per barrell of oil. You simply can't turn a knob and produce more to meet demand.
    - You could produce more diesel if you had more barrels of oil to refine. But oil production is not going up. Many experts believe the oil fields in the mid east have peaked and production will gradually decline, at the same time extraction costs will go up.
    - Even if there was more oil produced, refineries are already at near capacity during peak periods. And since theres only so much diesel in a barrell of oil, you need more refining capacity as well as oil. Number of new refineries being built today = 0.
    - Clean diesel blends are more costly to produce and harder to refine, with lower output per barrell, and the new regulations hinder blending kerosene and fuel oil to make retail diesel.
    - Diesel fuel in Europe is subsidized (actually, taxed less) and diesel cars there have gone from 25% of those sold 10 yrs ago to over 50% today. And still growing dramatically.
    - Growing economies like India and China are expected to put 200 million more cars on the roads over the next 7-8 years, a higher proportion of which will be diesel.
    - Diesel is used for most commercial transport, which makes it far less price sensitive than gas. Gas prices go up? People cut back and prices stablize. Diesel prices go up? The trucks and trains can't cut back or stores go empty.
    - And finally, every car manufacturer sees diesel as a way to meet the new stricter CAFE regulations. Within 12 months you will be able to buy a new clean-diesel powered passenger car (not truck) from toyota, honda, subaru, mazda, mitsubishi, BMW, audi, vw, mercedes, as well as all the big 3. Think about the demand for diesel when 25% of all the new accords and camrys are running it too.

    So, with a highly constrained supply, and demand going nowhere but up..... I have seen some wall street reports that say the premium for diesel will be $1.25-1.50 above regular unleaded within 3-5 years.

    Start converting those big Cat's to bio-willie!

    -Dave
     
  4. Four Suns

    Four Suns Head Pot Stirrer TECHNICAL Contributor

    Oct 4, 2006
    Williamsburg, VA
    2003 480 DB
    Zodiac ProJet Dinghy
    Yamaha 110vx WaveRunner
    QSM-11 Diesels
    What Frank C. said...

    There is such a serious bubble in commodities that only stupid people would buy into that now. If you want to get free fuel for the boat for the summer, short the commodities... oh wait... that would be stepping on little people.
     
  5. dpvandy01

    dpvandy01 Active Member GOLD Sponsor

    Sep 6, 2007
    Cincinnati, Ohio/Ohio River
    2003 320 Sundancer
    &
    2012 185 Sport
    &
    2007 Pro-Line 20 Sport
    Twin 6.2L Close Cooled V-Drives & 3.0L Alpha 1 & 135 Honda OB
    I take quite a beating at the firehouse about buying a bigger boat.... "that will suck for you now that gas is so expensive" well maybe but if it gets too bad at least I have more room on the boat at the dock. The good news is that if Obama get elected, (according to his comercials) he will stop huricanes, which will stop the fuel cost run-ups in the short term anyway...... who cares about abortion, taxes, home land security etc., I want a President that can stop huricanes..:smt043
     
  6. jrirvine1

    jrirvine1 Member

    747
    Dec 3, 2006
    Chester, MD
    2005 420 da
    Cummins 480 CE's (Rocket Sled)
    Maybe you diesel dudes should start collecting the used oil from the fast food joints, strain it and start burning it. I understand there is even an additive that can prevent your exhaust from smelling like Big Mac’s.
     
  7. Newbie

    Newbie New Member

    858
    Oct 22, 2007
    Apex, NC
    '01 230BR
    350mag B3,
    I beleive oil has pretty much hit its peak and will level off for awhile before dropping back into the 80's. Investors and hedge funds seem to have been buying heavily into commodities such as oil and gold only to run it up. Just like the dot com in the late 90's and more recently, real estate boom and bust, commodities IMO, are the next to bust as their booming now. When they do, crude prices should level back out for awhile. IIRC, I thought I read OPEC has no clue as to why oil is so high. The supply at the moment exceeds demands and reserves are high. I'm not buying into the deisel at $5 a gallon though anytime soon. I could be completly wrong though since I don't really follow any of this much :huh: I'm too busy looking for boats and reading this damn site. SB
     
  8. JV II

    JV II Active Member SILVER Sponsor

    Nov 17, 2007
    Newport, RI
    2016 50 Fly
    Volvo Penta D11
    Reality check:

    Even if oil were drilled out of the arctic, the oil companies would not sell it to America at a discount because they could get more money from other nations. So, that's not going to bring down the prices. Do you really think they are going to sell it to us cheaply for nationalistic pride?

    Guess what. We're not going to see $2.00 a gallon gas ever again. Anyone who remembers $1.00 a gallon are becoming the silly old men the kids laugh at when you repeatedly tell the story about $1.00/gallon gas. Stop hoping that the price is going to come down enough to make a difference.

    Gas is $4.00 a gallon at the marina. If it goes to $5.00 a gallon that is a 25% increase, not a 100% increase. When gas was $3.00 and it went to $4.00 that was a more painful increase percentage wise.

    Go boating and don't let it stop you.
     
  9. dpvandy01

    dpvandy01 Active Member GOLD Sponsor

    Sep 6, 2007
    Cincinnati, Ohio/Ohio River
    2003 320 Sundancer
    &
    2012 185 Sport
    &
    2007 Pro-Line 20 Sport
    Twin 6.2L Close Cooled V-Drives & 3.0L Alpha 1 & 135 Honda OB
    Plus since my boat runs on gas not oil directly, we sorely lack the refining capacities to produce the end product that we all use GASOLINE. This cyclical run-up is predictable..... with the hundreds of varriations on the boutique fuels required by the small jurisdictions dictating national energy policy, it's a wonder we get eonugh product out of the 30+ year old refineries as it is.... Let's nationlaize the gas standards, shoot the tree-huggers preventing new development in refineries and drilling, feed the cows corn to make me Steak and get past this crisis



    OVER SIMPLIFIED ALERT:smt101
     
  10. Stray Cat

    Stray Cat Active Member TECHNICAL Contributor

    Oct 4, 2006
    Pool 10 Guttenberg, IA
    2006 300DA Sundancer
    350 Mags / Bravo III
    Holly buckets, where is the economic stimulus check?
     
  11. delliott00

    delliott00 New Member

    115
    Oct 10, 2006
    Lake Travis TX
    People don't understand markets, or the fiduciary responsibility of a publicly held company. A public company is OBLIGATED to do what is in the best interest of the company and its shareholders. If not, the CEO and directors are personally liable.

    Suppose Exxon decided to sell oil to US refineries for $70/bbl, and make a nice profit on it, to do whats best for the country and lower the price of gas. The company, its CEO, and all its directors would be slapped with a shareholder lawsuit. And because of the personal liability clause, they would end up losing all their homes and personal wealth and end up in jail. Thank Enron for that clause.

    Regardless of the price of oil today, the fact is that it will only go up over the long term. The question is how fast. Speculators did not cause the inventory levels to drop today. Consumption did. What happens when the 200 million households in China and India get the cars they've always wanted? Its going to happen, soon. Tata Motors just launched a $2500 car in India, and there are millions of first time car buyers lined up to buy it.

    The only choices we have are: just pay the price and continue to consume oil; use less; produce more; or invest in alternative energy and the vehicles to use it and hope that the price per barrell equivalent drops to less than the going rate of oil. Or a combination of those.

    So regardless of whether the avg price of oil is $90 or $100 or $110 for 2008, it will be higher in a few years.

    The problem is that our economy is susceptible to economic terrorism should one of the major oil producing countries decide that hurting America is more important than the economy of his own country. I don't think thats too far fetched.

    I have some shares in a oil partnership that operates platforms in the gulf. 10 yrs ago, that $25K investment provided me $4-5K a year in operating LOSSES when the price per barrel was $18 and the cost to extract it was $25. I bought it to offset capital gains. Now, they are still pumping oil at ~$30/bbl, and I'm getting a $1300-1500 check each month. So I'm not complaining! :)

    But I also have investments in solar, tidal power, and bio-diesel companies. Hopefully enough to buy me that fuel cel powered yacht in 10 yrs....

    -Dave
     
  12. dpvandy01

    dpvandy01 Active Member GOLD Sponsor

    Sep 6, 2007
    Cincinnati, Ohio/Ohio River
    2003 320 Sundancer
    &
    2012 185 Sport
    &
    2007 Pro-Line 20 Sport
    Twin 6.2L Close Cooled V-Drives & 3.0L Alpha 1 & 135 Honda OB
    Check the prevoiusly posted thread on this ever so sad subject............... not gettin' one. thanks you Uncle Socialist... I mean Uncle Sam.:smt021 I'll rest easy tonight knowing that others will spend my money better than I could...
     
  13. JV II

    JV II Active Member SILVER Sponsor

    Nov 17, 2007
    Newport, RI
    2016 50 Fly
    Volvo Penta D11
    The next think you'll see is oil futures rising on the news of impending war in Venezuela (CITGO). The oil companies love that kind of news.
     
    Last edited: Mar 5, 2008
  14. Ozzie-iv

    Ozzie-iv New Member

    289
    Mar 27, 2007
    Bilgola, NSW, Australia
    Riviera 4700 sy
    Riviera 37
    Sea ray 400db
    CAT C9 575hp
    Diesel 6bta
    Mercruisers 8.1s
    LOL LOL LOL

    if its all true and Diesel goes throught the roof..

    then my gas guzzlers (8.1 Mercruisers) will be over shadowed by your buck burners (buck=dollar)


    LOL LOL LOLhttp://clubsearay.com/forum/images/icons/icon10.gif
    Talking
     
  15. comsnark

    comsnark New Member

    Apr 10, 2007
    NJ Shore
    SeaRay SunSport
    5.7LX
    Oh wow. Where do I start?

    First, regarding "no new oil refineries". That may be techinically true. . .but I see how much money is being poured into the refineries today. The number of refineries may not be increasing, but I can tell you that refining capacity is not remaining the same.

    Second. . .the arguments for artic drilling remind me of the NAFTA arguments of an earlier age. You remember those discussions: If a sweater costs $30 to make in Boston, and $10 to make in Mexico. . .isn't that better? (Answer: only for the maker. In reality, the cost of the sweater to the consumer stays the same in all cases).

    Third: The Bush tax cuts.
    Look. . capital gains taxes suck. AMT sucks.

    But the answer CANNOT be to cut taxes while increasing *domestic* spending. You can't cut taxes, increase *domestic* spending AND fight a war and expect everything to come up roses.

    What you end up is with the Euro at $1.50, oil at $104/barrel, and Oranges at $1.50 EACH. I see the cost to build industrial chemical plants has basically tripled in the last 5 years. This is why SeaRay increases prices 3-5% in spite of decreasing sales.

    I am all for cutting taxes. But you can't cut taxes while increasing spending. From an economic perspective. . that is simply retarted.

    And yeah. .. I would LOVE to get a check as well. I ain't gettin one either. :(
     
  16. ruf1967

    ruf1967 New Member

    349
    Nov 18, 2006
    North Texas
    185 Sport
    V6
    My boat is staying winterized this summer...................
     
  17. Hoo'sdave

    Hoo'sdave Member SILVER Sponsor

    241
    Dec 4, 2007
    Mechanicsville Va/Deltaville, VA
    340 Sundancer Garmin touch screen Garmin HD radar
    454 Mercruiser
    Why a 2006 185 Sport should be easy on gas.Enjoy life we
    might not be here tomorrow,Peace
     
  18. JV II

    JV II Active Member SILVER Sponsor

    Nov 17, 2007
    Newport, RI
    2016 50 Fly
    Volvo Penta D11
    Lattes at Starbucks are $64 a gallon. Gas is only $4 a gallon.
    I paid $16 a gallon for bottled water at a sporting event recently. Gas is only $4 a gallon.
     
    Last edited: Mar 6, 2008
  19. DragonAnchor

    DragonAnchor New Member

    342
    Oct 22, 2007
    Falls Church, VA
    290 Sundancer 2006
    5.0 BIII
    Heh I am one of those "silly old men" who remember $1 a gallon gasoline...It was a long, long time ago in a galaxy far far away ....

    Err nm, dont want to be laughed at by the kids.

    The world is what it is.. you can apply a little logic and reasoning and come out ahead in the end or be overwhelmed by it. Me, I am gonna do what I always have.. work hard, plan ahead and enjoy myself out on the water !

    *note: no little people were stepped on, punctured, mutilated or harmed in the making of this post
     
  20. ImpulseIII

    ImpulseIII Active Member

    Oct 3, 2006
    Jersey Shore/Venice FL
    2001 410 Sundancer
    Caterpillar 3126TA
    Hell, I remember regular gas at $.29 9/10 and premium at $.31 9/10.....but then again, at that point in time my Bell Lab's employed Electrical Engineer Father made about $7,500annually are we were living well!! I also remember cigarettes at $.25 a pack. Cripes, I am old!

    I paid $1.39 9/10 for my first fill up of diesel when I bought the boat in 2003...

    it is what it is and if you want to boat, you pay, if you don't, you sell your boat!

    Just my $.02 (which is not really worth $.02 any longer!)
     

Share This Page

Show Sidebar