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Gas Price Question for you O&G folks
Posted on 6/16/22 at 1:21 pm
Posted on 6/16/22 at 1:21 pm
Saw a Tweet this morning and I felt like the statement made surely lacked nuance. I'm genuinely hoping someone can explain this to me like I'm 10yo...what's responsible for a nearly 50% increase in gas prices with the same oil prices?
Basically, the tweet said that in 2014, with the exact same crude prices, gas peaked at ~$3.60/gal but is now going for over $5 a gallon, roughly a 40% increase in the crude/gas price ratio.
The point of the tweet was to blame price-gouging. What are they missing?
Basically, the tweet said that in 2014, with the exact same crude prices, gas peaked at ~$3.60/gal but is now going for over $5 a gallon, roughly a 40% increase in the crude/gas price ratio.
The point of the tweet was to blame price-gouging. What are they missing?
31
Posted on 6/16/22 at 1:23 pm to mmmmmbeeer
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Posted on 6/16/22 at 1:23 pm to mmmmmbeeer
You don't pump 89 octane outta the earth baw.
Posted on 6/16/22 at 1:24 pm to mmmmmbeeer
quote:well it seems like they are missing 8 years of economic data
tweet said that in 2014
Posted on 6/16/22 at 1:25 pm to JohnnyKilroy
I know there are many components, as you've shown, but which of those components are accounting for a 40% increase given the same crude price?
I'm not trying to make a point...I'm just trying to understand where costs have increased to the degree they have.
I'm not trying to make a point...I'm just trying to understand where costs have increased to the degree they have.
Posted on 6/16/22 at 1:25 pm to mmmmmbeeer
quote:
The point of the tweet was to blame price-gouging. What are they missing?
Cost increases across the board and rampant inflation. Posted on 6/16/22 at 1:25 pm to mmmmmbeeer
I think its the corn..JK..
Supply/Demand
It's always Supply/Demand
Supply/Demand
It's always Supply/Demand
This post was edited on 6/16/22 at 1:27 pm
Posted on 6/16/22 at 1:25 pm to mmmmmbeeer
quote:
I'm not trying to make a point
You don't actually expect anyone to believe this right?
Posted on 6/16/22 at 1:26 pm to JohnnyKilroy
More demand since 2014 and less refinery's. Also more EPA restrictions. Most administrations would wave some EPA restrictions to help drop the cost of gas in the short term, but not Potato Head Biden.
Posted on 6/16/22 at 1:26 pm to Displaced
quote:
You don't pump 89 octane outta the earth baw.
So refinery capabilities are less now than they were in 2014? They can't refine as much oil so, despite the oil price being the same, there's petrol scarcity in play?
Posted on 6/16/22 at 1:27 pm to mmmmmbeeer
quote:
mmmmmbeeer
Posted on 6/16/22 at 1:28 pm to mmmmmbeeer
quote:
What am I missing?
Seems like a more appropriate question
Posted on 6/16/22 at 1:28 pm to mmmmmbeeer
When Covid shut the country down no one was traveling. People worked from home, air traffic slowed down. That was a big hit on O&G. They are making up for those losses right now.
Posted on 6/16/22 at 1:28 pm to mmmmmbeeer
quote:
The point of the tweet was to blame price-gouging. What are they missing?
The people price gouging. Show evidence of the people doing this.
You won't find it. There is probably not a more efficient market due to supply and demand than gasoline.
Posted on 6/16/22 at 1:28 pm to mmmmmbeeer
quote:
The point of the tweet was to blame price-gouging. What are they missing?
The cost of F350's have gone up since 2014.
Posted on 6/16/22 at 1:29 pm to OweO
quote:
When Covid shut the country down no one was traveling. People worked from home, air traffic slowed down. That was a big hit on O&G. They are making up for those losses right now.
Another retard has entered the chat. If it is so easy for them to ave record profits whenever they decide, why do they ever stop?
Posted on 6/16/22 at 1:30 pm to mmmmmbeeer
Do you understand how supply and demand works?
Posted on 6/16/22 at 1:31 pm to LNCHBOX
quote:
If it is so easy for them to ave record profits whenever they decide, why do they ever stop?
Unless their margins have changed, the "record profits" nonsense is just that, nonsense.
That's why I'm asking the questions I'm asking. I don't think these prices are due to oil companies increasing their margins by 40%.
Posted on 6/16/22 at 1:31 pm to OweO
quote:
When Covid shut the country down no one was traveling. People worked from home, air traffic slowed down. That was a big hit on O&G. They are making up for those losses right now.
You are close, but miss a huge part of the puzzle.
Posted on 6/16/22 at 1:32 pm to mmmmmbeeer
quote:
Basically, the tweet said that in 2014, with the exact same crude prices, gas peaked at ~$3.60/gal but is now going for over $5 a gallon, roughly a 40% increase in the crude/gas price ratio.
Inventory is lower than it was in 2014, both in terms of crude and refined product.
On top of that we are exporting more diesel and gasoline to Europe than ever before.
So we less crude to refine thus the higher price per barrel, less gas to sell and a lower refining capacity to restock inventories. All while demand is basically back to 2019 level.
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