The official Lexus Enthusiast "Gas Prices" Thread

[Tragic Bronson]

http://www.usatoday.com/story/money/2016/02/09/gasoline-prices-2016-crude-oil/80061164

Gasoline prices may soon dip below $1 per gallon at some stations in the Midwest, putting the price of unleaded fuel in the same category as a pack of gum or a bag of pretzels from the vending machine.

"The cheapest gasoline prices in over 12 years are showing up in some lucky states in the heart of the nation, with previously unthinkable 99-cent gasoline becoming a strong possibility as wholesale gas prices plunge amidst growing supply," GasBuddy.com senior analyst Patrick DeHaan said in an email.

Prices have plunged to 12-year lows in Michigan, Wisconsin, Illinois, Minnesota, North Dakota, Oklahoma, Indiana, Ohio and Kansas, according to GasBuddy.

To be sure, 99-cent gas "still will be isolated," DeHaan said — likely because of the highly regional nature of refining costs, oil inventories and shipping.

But the plunging price of gasoline is beginning to conjure nostalgic 20th Century memories of rock-bottom fill-ups at the corner station, where lollipops and licorice were also prized commodities.

For U.S. consumers, it's fantastic news, providing instant savings — particularly for low-income consumers for whom gas represents a high percentage of their budget.

The nationwide average is $1.721 per gallon as of 1:15 p.m., down 6.8 cents from a week ago, 25.6 cents from a month ago and 45.5 cents from a year ago.

But for oil companies, it's a mess, fueled principally by the global surplus in oil production.

The benchmark U.S. crude oil, known as West Texas Intermediate (WTI), fell 3.2% in mid-day trading to $28.75. The global benchmark, Brent crude, fell 5.2% to $31.16. Both commodities traded below $30 simultaneously at one point in January, reaching lows not seen since 2003.

The stocks of Chevron, BP and Exxon Mobil slipped 4%, 3.3% and 1.8%, respectively, in afternoon trading Tuesday.

An International Energy Agency report released Tuesday projected a downturn in global oil demand growth in 2016 from a five-year high of 1.5 million barrels per day in 2015 to 1.2 million barrels per day, primarily because of economic sluggishness in Europe, China and the U.S.

Lower demand could exacerbate low prices. Compounding matters is that the Organization of the Petroleum Exporting Countries (OPEC) increased production in January by 280,000 barrels per day to 32.6 million.

A sanctions-free Iran, Saudi Arabia and Iraq all turned up the taps," IEA reported.

 

[mikeavelli]

There is energy warfare happening the average person is clueless too.....

 

[IS-SV]

Often good water is price higher. Back-stabbing OPEC members with declining influence keep pumping.

 

[Gecko]

I renamed the title of this thread because I think this is a conversation we're going to hear a lot more about over the next few weeks and months. Thanks for the great post, @Tragic Bronson

I was listening to NPR this morning about how economists are now unsure if the US economy is still headed towards positive growth, fueled mostly by oil prices. It really got me thinking about the reality between what we see in our own homes, businesses and communities, and Wall Street. Wall Street can melt down because of oil futures, gas companies can go bankrupt, and quite frankly, I don't care. These are the same fools who had us paying damn near $5 a gallon in 2008 as they raked in record profits and speculated endlessly about how high prices would go.

OPEC is struggling because they are no longer holding all of the cards... Iran, Canada, the U.S. and other nations have explored and ramped up their own production and now the market is saturated. Too bad.

I believe that what we are seeing right now is a power struggle, as @mikeavelli says. OPEC has seen natural gas, hydrogen, solar and electricity gaining in popular quickly as a result of the turbulence (and quite frankly, robbery) of the last few years. So now, they're hoping that by flooding the market and keeping prices low, they can discourage the type of growth and new investment that we've seen. WRONG! I don't think people will be so caught off guard again, so cripplingly dependent on oil.

I'm enjoying filling up for $18 in the meantime though

 

[Bulldog 1]

But this IS the reason trucks and SUV's have taken over the market, and auto sales are on the decline.
I still remember (and LMAO) vividly the land boats paying over $100 for a fill up.
Quite frankly, I've always run regular gas in all of my cars, but have splurged recently for premium because it's so cheap.
I, for one, appreciate the super low fill-up costs because it frees up much needed cash for other parts of my financial obligations.
This only goes to show just how greedy oil companies really were because none of them have declared bankruptcy yet with the record lows.
Gas in my area always lowest at Costco, where I buy exclusively for a current average of about $1.70 a gallon.
It doesn't make me drive more or crave trading up to a gas hog, but with everything else going up and up in cost, it sure is welcome.
YET...things you'd assume would be affected by lower oil prices such as energy are completely and greedily the same. My electric bill is just as high as always. Airline tickets haven't really gone down much. Always with the corporate greed.

 

[mmcartalk]

Though not always, seems like gas prices at the pump drop sharply before major election cycles. IMO, it's happened too often to be chalked up to mere co-incidence.

 

[mmcartalk]

This only goes to show just how greedy oil companies really were because none of them have declared bankruptcy yet with the record lows.

Low oil prices don't necessarily hurt oil companies across the board. Lower crude prices means that the companies themselves pay less for the crude that they have to buy on the world market and from OPEC countries, before they refine it and sell it. The only areas where they might lose out is with domestically-drilled crude that they own in the first place, because, after their drilling/exploration expenses, they can't get much of a profit on what they sell at today's low prices.

(BTW, with my grocery-discount card, I paid $1.59 for good-quality Shell 87-octane regular yesterday).

But, as I also posted above, though I cannot prove it, there have also been too many co-incidences with dropping gas-prices during election cycles......there may (?) be more going on behind the scenes that we don't know about.