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Thu Mar 22, 2012, 11:54 AM

Gasoline Use Goes Back To Collapsing

For the latest week, gasoline usage was 8.2% off of what it was the year before.

And you can see in this chart of the four week moving average, that we're moving sharply lower than last year's trends.



Read more: http://www.businessinsider.com/gasoline-use-goes-back-to-collapsing-2012-3

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Arrow 12 replies Author Time Post
Reply Gasoline Use Goes Back To Collapsing (Original post)
FarCenter Mar 2012 OP
earthside Mar 2012 #1
tularetom Mar 2012 #5
russspeakeasy Mar 2012 #2
gratuitous Mar 2012 #3
demosincebirth Mar 2012 #4
safeinOhio Mar 2012 #6
demosincebirth Mar 2012 #7
Duer 157099 Mar 2012 #8
uponit7771 Mar 2012 #9
Zalatix Mar 2012 #10
taterguy Mar 2012 #11
Zalatix Mar 2012 #12

Response to FarCenter (Original post)

Thu Mar 22, 2012, 12:02 PM

1. It's the roller coaster of price.

Price goes up, use goes down.

Use goes down, price goes down.

Price goes down, people start driving more again and use goes up.

Use goes up, price goes up.

It is Peak Oil.

The problem is that since all the cheap to find and pump petroleum has been found, the new reserves are from places and are of a quality that makes them much more expensive to obtain and refine.

That's why more drilling has not resulted in lower prices overall. It cost a whole heck of a lot more to produce a barrel of oil out of the Gulf of Mexico than out of the Texas fields when they were in full production.

Put rampant speculation on top of that and in the end we are facing higher gasoline prices no matter what.





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Response to earthside (Reply #1)

Thu Mar 22, 2012, 01:37 PM

5. Good analysis

It's actually sort of like this:

Price goes up, use goes down.

Use goes down, price goes down but not as far down as it was before.

Price goes down, use goes up.

Use goes up, price goes up higher than it was the previous cycle.

Rinse and repeat. And the price at the pump slowly creeps upward.

The astonishing fact to me was that something like only 10% of those purchasing oil futures are heavy users of oil (airlines, trucking companies, etc.). The other 90% are speculators (hedge funds etc.).

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Response to FarCenter (Original post)

Thu Mar 22, 2012, 12:04 PM

2. Get speculators out of commodities.

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Response to FarCenter (Original post)

Thu Mar 22, 2012, 12:08 PM

3. Consumers aren't stupid

This is a very risky game our corporate overlords are playing. They depend heavily on mindless consumerism, but when a commodity like gasoline gets priced too high in the public mind, consumers start paying attention to the choices they're making. Running down to the corner store because you're out of milk becomes a decision requiring a little more thought: do I really need milk? What else can I get? Are there other places I should go on this little errand to save gas?

When consumers think about their choices, it's bad for the folks who depend on consumers to be reactive and unthinking.

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Response to FarCenter (Original post)

Thu Mar 22, 2012, 12:41 PM

4. Gas and public utilities run contrary to the laws of supply and demand. The more you conserve, less

revenue, the higher the prices go

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Response to demosincebirth (Reply #4)

Thu Mar 22, 2012, 01:55 PM

6. No, it's called the law of "what the market will bear".

I work for a gas station. They make the big money on the volatility. Rumor of a price increase at the wholesale level and the price shoots up. Every station will jump to one price within an hour, say $3.99. The wholesale price drops 10cents and the stations will drop a penny every few days. The district manager, who sets the local prices gets big bonus for the fast mark up and slow price drop.
I suggest, when the price goes up, only buy a few bucks worth every day until the price drops. When the price seems low, go ahead and buy a full tank. Screws up the managers bonus big time.

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Response to safeinOhio (Reply #6)

Thu Mar 22, 2012, 03:47 PM

7. County water district tell you to conserve water - you conserve. Next the thing you know water

bill goes up. Why? Less revenue collected. What is that called?

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Response to demosincebirth (Reply #7)

Thu Mar 22, 2012, 03:52 PM

8. Getting screwed n/t

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Response to demosincebirth (Reply #4)

Thu Mar 22, 2012, 03:54 PM

9. Yeap, we're driving less now than in 1980 and have more people living in country

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Response to FarCenter (Original post)

Thu Mar 22, 2012, 03:57 PM

10. GREAT! That means less damage to the environment.

 

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Response to Zalatix (Reply #10)

Thu Mar 22, 2012, 06:48 PM

11. It means fewer people have jobs to go to

And people aren't traveling as much which really screws people who are employed in the tourist industry.

It would only be great if people were using different modes of transportation. They're not doing that. They're just staying home.

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Response to taterguy (Reply #11)

Thu Mar 22, 2012, 07:37 PM

12. Hopefully this will force an end to urban sprawl

 

which is at least PART of the reason why people can't get anywhere here without cars.

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