Oil Price Increases After Biden Shuts Down Drilling Permits Again

[OSU Beavers]

But Biden wants everyone to run out and buy an electric vehicle.

Electric Jaguar I-Pace Catches Fire While Charging, Reduced to Ashes in Middle of Road

I-Pace vehicles use LG pouch battery cells. LG Chem battery cells have previously caused fires due to a defect in it.

www.westernjournal.com

 

[Zoe]

I think it is a trend even with the big players like General motors and Ford. They are headed that way strong where almost all will be electric eventually. If the biggies go that way, there is no where else people can go but how the biggies go. Think about long term implications. Won't be near as many gas pumps.

 

[Fernando]

Oil prices today is around $90. It's heading down. Prices for gas should be lower later this week.
Can't believe prices below $90 was going to happen soon.
Inflation is going to go down. Good for economy and Biden.

 

[OSU Beavers]

https://twitter.com/x/status/1555098747205476354

CO2 emissions. The richest 10% are responsible for 46% of total emissions growth.

So killing the elite would have the same ESG effect as the elites killing 90% of us...

HMMM...

 

[Terrel L. Shields]

Oil prices today is around $90. It's heading down. Prices for gas should be lower later this week.
Can't believe prices below $90 was going to happen soon.
Inflation is going to go down. Good for economy and Biden.

“We know that most American drivers have made significant changes in their driving habits to cope with high gas prices,” AAA spokesperson Andrew Gross said.

Demand destruction comes with high prices - which high prices are the cure for high prices. We are still a buck above a year ago...AND

Russia is producing just as much oil as before. Just selling it to India and China instead of Europe. So the gross supply of oil is unchanged. Expectations that "sanctions" would stop Russia from taking oil to market has proven to be wrong.

OPEC meanwhile has been unable to produce as much oil as they promised. Venezuela, OTOH, saw a major reduction in oil production largely due to their incompetence and as a result have created the largest environmental disaster in the whole of the Americas. Far larger than Macondo or Exxon Valdez.

So people are driving less. Which impacts tourism significantly. 60% polled said gas prices will impact their summer vacation trips. Colorado is expecting a record year but not matching 2019. 2020 was dismal and 2021 rebounded significantly. It also is depending upon cannabis being a big draw. Flying, as a result, is up and car travel more moderated. International tourism is down and CO is spending millions to attract overseas tourists to visit the state.

Branson, MO reports a decrease in tourists from over 300 miles away at 11%. However, they have steady numbers as Covid bound pent-up demand has led people to seek closer destinations.

 

[IlliniApp]

U.S. gasoline demand down a whopping 6.3% last week.

 

[Fernando]

Today I drove by a gas station and I couldn't believe it - $4.99/gallon.
Gas has gone below $5. It's been months since I saw a "4".
With gas prices continue going down, Biden was right that inflation is transitory. Prices should be much lower by November.

 

[Terrel L. Shields]

Standard Chartered this week released a commodity alert that said that this year, driving season in the U.S. never really materialized. The report noted substantial demand declines for both June and July, adding, however, that the recent price decline should result in a pick-up in demand this month.​

​

There has been a lot of talk about the cure for higher oil prices being higher prices still. It appears this might have happened in the U.S. as prices for gasoline earlier this year hit the highest level in several decades.​

Prices should be much lower by November.

Actually they may be higher. Summer driving demand for gasoline was over estimated and refiners shifted production to maximize gasoline only to see gasoline reserves increase as diesel stock piles (and prices at the pump) are well over the price of gasoline by as much as $1.50 or more)

“Diesel stocks have declined for the past year a half and are down by nearly 70 million barrels, to the lowest level since 2014,"​

​

The refiners, now realizing there will be no "summer driving season", are going to be shifting gasoline production to produce more diesel and lower the cost of diesel while gasoline is likely to see a modest increase.

Demand destruction also is an indicator that vacations have been curtailed or "staycations" with perhaps some taking late vacations with prices falling. This is not a good thing for the common summer driving destinations like the Rockies. It will be interesting to see tourism numbers. People have been stuck home for 2 years and the urge to travel has been stifled by the price of travel.

The crude prices now are almost fully "Risk Off" when it comes to the geopolitical edge. Russia, contrary to expectations, is selling plenty of oil on the international market. Europe cannot wean themselves off natural gas nor diesel from Russia. China and India have ramped up millions of barrels of purchases and that has freed the world supply to meet the demands of the world. This places crude oil at about $20-30 above when Biden came into power and we are unlikely to see prices fall significantly more unless the economy falls flat on its face. The next 3 months are critical as housing has slumped and consumer buying has weakened.

 

[Fernando]

Standard Chartered this week released a commodity alert that said that this year, driving season in the U.S. never really materialized. The report noted substantial demand declines for both June and July, adding, however, that the recent price decline should result in a pick-up in demand this month.​

​

There has been a lot of talk about the cure for higher oil prices being higher prices still. It appears this might have happened in the U.S. as prices for gasoline earlier this year hit the highest level in several decades.​

Actually they may be higher. Summer driving demand for gasoline was over estimated and refiners shifted production to maximize gasoline only to see gasoline reserves increase as diesel stock piles (and prices at the pump) are well over the price of gasoline by as much as $1.50 or more)

“Diesel stocks have declined for the past year a half and are down by nearly 70 million barrels, to the lowest level since 2014,"​

​

The refiners, now realizing there will be no "summer driving season", are going to be shifting gasoline production to produce more diesel and lower the cost of diesel while gasoline is likely to see a modest increase.

Demand destruction also is an indicator that vacations have been curtailed or "staycations" with perhaps some taking late vacations with prices falling. This is not a good thing for the common summer driving destinations like the Rockies. It will be interesting to see tourism numbers. People have been stuck home for 2 years and the urge to travel has been stifled by the price of travel.

The crude prices now are almost fully "Risk Off" when it comes to the geopolitical edge. Russia, contrary to expectations, is selling plenty of oil on the international market. Europe cannot wean themselves off natural gas nor diesel from Russia. China and India have ramped up millions of barrels of purchases and that has freed the world supply to meet the demands of the world. This places crude oil at about $20-30 above when Biden came into power and we are unlikely to see prices fall significantly more unless the economy falls flat on its face. The next 3 months are critical as housing has slumped and consumer buying has weakened.

With oil prices going down and your view of declining demand for gas, I foresee gas prices keep going down.
I'm seeing more gas stations having gas below $5/gallon which is a psychological relief. I don't need electric cars and I can drive my big SUVs more.

 

[Terrel L. Shields]

With oil prices going down and your view of declining demand for gas, I foresee gas prices keep going down.

Gasoline prices are likely to firm up unless crude prices fall. They will continue to be much higher than when Biden took office. And it looks like oil will remain in a trading range from maybe $85-110 a bbl. futures prices - spot prices being more volatile. Meanwhile our Strategic Oil Reserve is depleted to levels not seen since it started. And thus will be useless to us if China is to invade Taiwan.

An invasion of Taiwan would be disastrous to us. They are home to the largest chip maker in the world. They are a significant source of refining, petrochemicals, and information technology. That is a huge plum to pluck off the tree by China. And there isn't a thing we can do to stop them short of a nuclear exchange. And like Russian oil, within a few months, "sanctions" will have about as much impact as having school children write letters telling them to stop.