Watch for Rising Gasoline prices this summer

[Stewy]

(08-05-2023, 03:58 PM)basballguy Wrote: Oil still only 82 bucks a barrel but up 5 straight weeks.  It looks primed to continue to 100.  

Though the counter is OPEC has been saying for months that 80 dollars a barrel is the target and they may opt to not reduce production again at the next meeting thus driving prices back down.  100 bucks is still the taboo number.

I bet it gets up to the high 90s just in time for the next OPEC meeting for everyone to put the spotlight on them…I thought they met every two months but next meeting is October.  Maybe it’ll get over 100 by then?

Oil has been so volatile over the last two years, I wouldn't bet on long term trends.

Demand in China is a huge factor and the recovery of the chinese economy post COVID.  They held on to their COVID restriction far longer than any other country.  This more than anything has been suppressing oil prices over the last 1-2 years.

Even as the supply / demand gap has been predicted for the last 12 months to go negative this fall the market was ignoring the ever shrinking gap until it actually hit.  Draw downs and builds of crude stocks at the Cushing refinery in Oklahoma in a benchmark for what is happening in the greater oil market across the country.  Draws and builds usually are in the 1 million barrel range +/-, with extremes being 4 million +/- and maximines 6-8 million.  Last week saw a 15 million+ barrel draw, which was unprecedented.

FYI - Saudi's govt was in the red below 80$ oil, so yes they want it higher.  They'd like a nice 90-100$ barrel price.  Over 110$ damages the world economy however, so it's a delicate balance.

[Stewy]

(08-05-2023, 06:11 PM)KillerGoose Wrote: You know, fair enough. I am not completely certain if I am in this group you are telling to fuk off but based on what I posted, I feel I am. I always enjoy your threads, so I apologize for keeping the political banter going. Thanks for the info, I was genuinely wondering why gas skyrocketed so quickly.

Wasn't talking to you.  I always enjoy your responses.  

I think it's pretty clear who I was talking to, but I didn't want to single someone out.

[GMDino]

(08-05-2023, 05:13 PM)SunsetBengal Wrote: Time to resume shale fracking.  No matter the production levels, it will still encourage OPEC to increase production in order to keep the money flowing to them, and not other sources.

Isn't there a lower limit on the barrel price for that?  I thought that at least.

[Dill]

(08-05-2023, 06:01 PM)Stewy Wrote: To those trying to turn this into another radicalized polarizing political disucssion - go fuk yourselves (talking to 1-2 people).  

I was just providing critical information about some dovetailing but related circumstances which will lead to temporary high gasoline prices.  This is NOT political.  It has nothing to do with politics.  It's business.  Period.

There is a sense in which NOTHING is political, I suppose.

But gasoline prices ALWAYS have a political impact. 

I see the value in understanding the mechanics of cause and effect first, though, separately from politics, so I can better perceive the degree of validity/factual accuracy of the politics which inevitably follow. 

So I thank you for raising this issue and your posts, and striving to present a chain of cause and effect separate rom political interpretation,  I generally trust what you say and listen to it. Much appreciate C-Dawg and Killer G's contributions too. Taken together you are all like an informative article. 

That said, I'll remain curious as to how and which way the politics will break if the prices rise as you predict. I am interested in how each side (or sides) will construe the causes and whether and what the policy response might be. 

[SunsetBengal]

(08-05-2023, 07:36 PM)GMDino Wrote: Isn't there a lower limit on the barrel price for that?  I thought that at least.

Seems like around 2014ish, I was listening to someone explain that in order for fracking to be a viable and profitable option, the price at the pump needed to be above $2.50/gal (2014 prices).  Not sure if that holds true today, I would assume that those numbers certainly would have to be significantly higher today.  The one with the knowledge to explain this topic much better, would likely be Stewey.

[*pally*]

(08-06-2023, 11:23 AM)SunsetBengal Wrote: Seems like around 2014ish, I was listening to someone explain that in order for fracking to be a viable and profitable option, the price at the pump needed to be above $2.50/gal (2014 prices).  Not sure if that holds true today, I would assume that those numbers certainly would have to be significantly higher today.  The one with the knowledge to explain this topic much better, would likely be Stewey.

well if the current problem is that refineries are down for maintenance or shutting down due to age, the issue isn't the amount or type of oil being drilled, its the ability to turn the oil into gasoline or other petroleum products.  If you don't expand refining ability it doesn't matter how much you can drill for

[SunsetBengal]

(08-06-2023, 11:35 AM)pally Wrote: well if the current problem is that refineries are down for maintenance or shutting down due to age, the issue isn't the amount or type of oil being drilled, its the ability to turn the oil into gasoline or other petroleum products.  If you don't expand refining ability it doesn't matter how much you can drill for

That leads to another conundrum.  With the policies of transitioning to green energy, companies aren't willing to spend the billions of dollars on construction and permitting for new refineries.

[Stewy]

(08-06-2023, 11:23 AM)SunsetBengal Wrote: Seems like around 2014ish, I was listening to someone explain that in order for fracking to be a viable and profitable option, the price at the pump needed to be above $2.50/gal (2014 prices).  Not sure if that holds true today, I would assume that those numbers certainly would have to be significantly higher today.  The one with the knowledge to explain this topic much better, would likely be Stewey.

What people don't know about fracking is legion.  Firstly not all frac'ing is the same.  Frac'ing is a shortened term for "Stimulating the productivity of the reservoir through the inducement of artificial "frac"turing or other stimulation techniques."  

How is this done?  Well it depends on the reservoir type, pressures, identification of a natural fault/fracture network to tap into.  Most geologic and engineering needs for stimulating a well can be deduced by taking whole core while drilling the well or taking highly detailed images of the wellbore after drilling it (https://sd.copernicus.org/articles/25/15/2019/sd-25-15-2019-f09-web.png ).  By having very accurate and sensitive dip and azimuth calculations and core or image one can deduce the natural fault and fracture network and design a frac job to safely exploit and enhance the productivity of the well.

We start getting into trouble when people think frac'ing is a new thing and that all frac'ing is the same and that all oil companies are just greedy and negligent.  You see oil companies have been trying to stimulate wells to enhance production for 100 years.  Early on in the Appalachian Basin oil companies used acid to enhance carbonate reservoirs and nitro ( controlled bombs) to stimulate The Big Lime (Mississippian Carbonate and the "Devonian Shale", respectively.  Early on these were done in open wellbores.  Acid stimulation has turned into acid frac'ing, where the whole is cased, cemented, and then perforated through the casing so that the acid can be pressurized at the surface and pumped directly into the target formation to reduce/eliminate chances of contamination but to maximize the effect of the stimulation technique.  Today it is not in the best interest of the oil companies to willy nilly acidize outside of the target zone, or induce fractures in random manners.  #1 - It's expensive and #2 if they get it wrong it's difficult to go back and #3 we have laws about protecting aquifers.  On a side note of interest, to this day using nitro in open holes (not cased over the reservoir zone) is still the preferred method to stimulating the Devonian Shale in WV and KY.  This is the best method found to tap into the rocks natural fracture network.  Because the shale is so "gooey" all other attempts at fracturing have failed.

You see, frac'ing has gotten a bad name because people don't understand how it works and the extremely precise science and engineering around it.  Also, specific cases where get sensationalized as being representative of the whole.  The best Example:  Frac'ing inducing fault movements in Oklahoma.  That is a very specific problem.  Most of that frac'ing was older, AND the company responsible negligent.  So a bad and greedy entity colors us all, unfortunately, similar to BP / Deep Water Horizon / Blowout / Gulf of Mexico, where BP was abhorrently greedy and negligent in their operations.  The rest of industry was horrified by the things they did and short cuts taken, but that's another story.

Any more question, please feel free to ask.

[Stewy]

(08-06-2023, 12:32 PM)SunsetBengal Wrote: That leads to another conundrum.  With the policies of transitioning to green energy, companies aren't willing to spend the billions of dollars on construction and permitting for new refineries.

They can't get the permits - period.  That's why there's been no new construction.  Not in my backyard.  Similar with new Nuclear Plants.

[CJD]

(08-05-2023, 05:52 PM)Stewy Wrote: There's more than one refinery in Port Arthur.  You're thinking of the Motiva Refinery 100% owned by Saudi Aramco.

https://en.wikipedia.org/wiki/Port_Arthur_Refinery

Ah, gotcha. I just recognized the city name.

(08-05-2023, 05:57 PM)Stewy Wrote: They're so old because no local or federal govts want to provide permits for new ones.  Not in my back yard is always the mantra (same with new Nuclear Plants).  I don't think a new refinery has been built since the 70's.  Owners just keep expanding / fixing the old ones.  As a matter of fact one of the largest refineries in the country is shutting down in the next year or so because the owner wants to go more green and no one wants to buy it.  That's a huge amount of refining capacity we're losing and will never get back.

Yea, it's viewed as a dying business, I imagine. And the equipment is highly specialized and expensive. It would take a lot of space and a lot of money to open a new one and there's always the risk that green energy takes over before the payback period of the investment is reached. A lot of risk there.

[masonbengals fan]

(08-06-2023, 01:39 PM)Stewy Wrote: They can't get the permits - period.  That's why there's been no new construction.  Not in my backyard.  Similar with new Nuclear Plants.

 It's the same with practically all electric generation. Not in my back yard. 

 Kudos to you Stewy on keeping us informed. 

[Stewy]

It continues:

https://oilprice.com/Energy/Crude-Oil/Distillate-Prices-Soar-On-The-Back-Of-Refinery-Issues-And-Expensive-Crude.html

[grampahol]

Another reason oil prices have gone up is most of the Russian crude is either offline or about to disappear. They can't ship enough of it since the only warm water ports they have are on the Black Sea and there happens to be a war going on there. The bulk of Russian oil is in permafrost and once that shuts down and winter hits it's done. Pipes crack and everything has to be rebuilt from scratch and without western oil companies are there with the expertise that oil is going off the market for at least a decade and that's if the war and sanctions ended today. 
Another factor is the global flow of crude oil over the past 50 years only really happened because the US Navy kept freedom of navigation on the high seas protected. We've pretty much gotten out of being the global ocean cops for everyone else. Just the price of insurance for a tanker to sail 10 feet much less around the world has skyrocketed. The world is changing rapidly and were bracing for another potential global war and this time it won't be jihadists trying to knock down a few buildings with commercial jets..  One of our saving graces is the shale revolution and it just happens to be in abundance close to where most of us actually live. The rest of the world doesn't have mass shale fields close to population centers. The US is extraordinarily blessed with the greatest geography on this planet. Bar none!    
If you think oil prices are bad here take a look at the problems facing the rest of the world.. The rest have to either import nearly all of their energy or they're in pretty damn hostile parts of the world. The US for better or worse is not really a trading nation since we can grow our own food and generate the bulk of our own energy needs. Plus we have a badass navy capable of getting most of what we need when push comes to shove most anywhere in the world..Another thing to consider is oil in the global markets is all pegged to the US dollar..We have the rest of the world by the shorthairs whether they like it or not. 

[*pally*]

(08-10-2023, 11:06 PM)grampahol Wrote: Another reason oil prices have gone up is most of the Russian crude is either offline or about to disappear. They can't ship enough of it since the only warm water ports they have are on the Black Sea and there happens to be a war going on there. The bulk of Russian oil is in permafrost and once that shuts down and winter hits it's done. Pipes crack and everything has to be rebuilt from scratch and without western oil companies are there with the expertise that oil is going off the market for at least a decade and that's if the war and sanctions ended today. 
Another factor is the global flow of crude oil over the past 50 years only really happened because the US Navy kept freedom of navigation on the high seas protected. We've pretty much gotten out of being the global ocean cops for everyone else. Just the price of insurance for a tanker to sail 10 feet much less around the world has skyrocketed. The world is changing rapidly and were bracing for another potential global war and this time it won't be jihadists trying to knock down a few buildings with commercial jets..  One of our saving graces is the shale revolution and it just happens to be in abundance close to where most of us actually live. The rest of the world doesn't have mass shale fields close to population centers. The US is extraordinarily blessed with the greatest geography on this planet. Bar none!    
If you think oil prices are bad here take a look at the problems facing the rest of the world.. The rest have to either import nearly all of their energy or they're in pretty damn hostile parts of the world. The US for better or worse is not really a trading nation since we can grow our own food and generate the bulk of our own energy needs. Plus we have a badass navy capable of getting most of what we need when push comes to shove most anywhere in the world..Another thing to consider is oil in the global markets is all pegged to the US dollar..We have the rest of the world by the shorthairs whether they like it or not. 

We should always remember history. Hitler’s attack on the Soviet Union failed in part because he diverted his panzers away from the attack on Moscow to send them to the battle for Kiev and the Ukrainian oil fields. With the removal of the panzers, the attack on Moscow bogged down just outside the city, winter hit, and we all know how that ended.

Japan wanted to expand their empire because they needed better access to oil, they targeted on the Dutch East Indies, now Indonesia. In the convoluted world of international politics, the attack on Pearl Harbor was in part to prevent the US from interfering with the Japanese takeover of Indonesia in aid of our Dutch allies.

Fuel and water have started more wars than anything but religion

[Rotobeast]

(08-07-2023, 10:46 AM)Stewy Wrote: It continues:

https://oilprice.com/Energy/Crude-Oil/Distillate-Prices-Soar-On-The-Back-Of-Refinery-Issues-And-Expensive-Crude.html

*just quoting to catch your attention*

Any insight on extracting lithium from old oil wells ?
I recall reading or listening somewhere that a lot of old wells were going to be revisited for this purpose.

Sent from my SM-S515DL using Tapatalk

[Stewy]

(08-11-2023, 05:53 AM)Rotobeast Wrote: *just quoting to catch your attention*

Any insight on extracting lithium from old oil wells ?
I recall reading or listening somewhere that a lot of old wells were going to be revisited for this purpose.

Sent from my SM-S515DL using Tapatalk

Not much insight - sorry.  Though it seems a bit far fetched to me.  Lithium isn't everywhere in concentration.  It is usually specifically related to hydrothermal/volcanism areas, again to be concentrated enough for economic extraction.  With that said, Lithium extraction technology is in its infancy.  The science is under developed as there was no money or strong global need for it, until the last decade.

One areaof supposed large concentration for Lithium that is undeveloped is the Salton Sea (failed rift/triple junction) - https://www.cnn.com/videos/business/2023/05/28/exp-salton-sea-lithium-valerio-pkg-052808asg1-cnn-business.cnn - just google SALTON SEA LITHIUM for more

[Stewy]

(08-10-2023, 11:06 PM)grampahol Wrote: Another reason oil prices have gone up is most of the Russian crude is either offline or about to disappear. They can't ship enough of it since the only warm water ports they have are on the Black Sea and there happens to be a war going on there. The bulk of Russian oil is in permafrost and once that shuts down and winter hits it's done. Pipes crack and everything has to be rebuilt from scratch and without western oil companies are there with the expertise that oil is going off the market for at least a decade and that's if the war and sanctions ended today. 
Another factor is the global flow of crude oil over the past 50 years only really happened because the US Navy kept freedom of navigation on the high seas protected. We've pretty much gotten out of being the global ocean cops for everyone else. Just the price of insurance for a tanker to sail 10 feet much less around the world has skyrocketed. The world is changing rapidly and were bracing for another potential global war and this time it won't be jihadists trying to knock down a few buildings with commercial jets..  One of our saving graces is the shale revolution and it just happens to be in abundance close to where most of us actually live. The rest of the world doesn't have mass shale fields close to population centers. The US is extraordinarily blessed with the greatest geography on this planet. Bar none!    
If you think oil prices are bad here take a look at the problems facing the rest of the world.. The rest have to either import nearly all of their energy or they're in pretty damn hostile parts of the world. The US for better or worse is not really a trading nation since we can grow our own food and generate the bulk of our own energy needs. Plus we have a badass navy capable of getting most of what we need when push comes to shove most anywhere in the world..Another thing to consider is oil in the global markets is all pegged to the US dollar..We have the rest of the world by the shorthairs whether they like it or not. 

Interesting take, but doesn't fit with current data.  Russia is still pumping away.

https://oilprice.com/Latest-Energy-News/World-News/Russias-Oil-Exports-Remained-Steady-As-Revenues-Rose-In-July.html

[JustWinBaby]

(08-05-2023, 12:31 PM)Stewy Wrote: ...

Sorry, too lazy to find the right thread...

What do you have to say about the recent replication of fusion gain?  Is it fully viable, or is the jury still out?  Is it possible to reach commercial scale within the next 30-50 years?

[Stewy]

(08-27-2023, 01:31 AM)JustWinBaby Wrote: Sorry, too lazy to find the right thread...

What do you have to say about the recent replication of fusion gain?  Is it fully viable, or is the jury still out?  Is it possible to reach commercial scale within the next 30-50 years?

There ya go.

http://thebengalsboard.com/Thread-Fusion-Power?pid=1382154#pid1382154