Will Tensions in Iran Send Oil Prices Through the Roof?
 

By the time you read this you may already know the answer.

I realize that most people don't watch/read the news daily as I do. So for those that have not heard, yesterday our President meet with several other leaders at the United Nations about what was a top secret discovery of a deep underground maze of miles in Iran at a military site in which it has been claimed the world has positive proof that this oil producing country is extremely close to making several NUKES!

As the rules say here, I will tie this in. Will these increased tensions lead to speculators bidding up the price of Oil? Will possible sanctions on Iran raise the price of Oil? Are we facing $4.00 gas again in a few weeks?

I do not have a full time job at this time and every red cent more I have to pay for gas hurts me. That's why I'm on these forums. I greatly fear Oil will go straight through the roof very soon, resulting in the average gasoline and Diesel price going up up and up. I pray I am wrong. High fuel prices would not be good for this country's economy right now.

I hope I'm wrong and non of this stuff impacts the markets- However in seeing most financial markets are closed on weekends, is it any wonder this news came out on a Friday? I don't think the market has had time to react, and when it does it might impact people from all walks of lives and incomes.

I'm praying for $10 gas but that's mostly just me.

I'm with Frank, and I'm willing to bet something almost valuable that the price of oil will go up: speculators, and especially oil companies, will use any pretext they can just make more $$$. Even if they have to pull the prices back down on the next day, they still made more money for free during that one day.

The less you drive when you don't have to, and the more you ecomod and ecodrive when you must, the more you save over the average population, and the better example you are for others.

[/Just my two cents.]

I'm going to go with "no". Inventories are high, demand is easily met by current supply, so prices are not going to go through the roof on speculation alone. Now if some nukes get launched and a major, oil-powered war starts, that could create enough demand for us to see sustained high gas prices.

I'm with Frank and Piwoslaw. You need to insulate yourself from gasoline prices and be less dependent on the stuff.

Hmm, I must say I see all of your points of view. I now don't know what to expect. I can see where the oil companies might use any excuse they can to raise prices, but on the other hand is it not truly the supply and demand that determines the price of oil? I also can see where $10 a gallon gasoline (U.S.D.) would give the R&D of alternative fuels a big kick in the paints too, and that would be a very good thing!

After some pondering I have to base my opinion on my past observations. I think about what happen on 9-11. The gas stations all had paid the same cheap rate for the fuel in their tanks yet many gas stations started raising their prices as high as $4.90 right here in Kentucky. It did not matter how much supply we had, what mattered was we had a group of business people taking advantage of a situation full of panic. It got so bad our governor had to step in and threaten to bust the gas station owners for price gouging and then the prices went right back to where they wear on Sept/10/2001. Of course I do believe there was an uptick in oil prices just after 9-11.

I look for fuel prices to go up for the near foreseeable future. How much they go up I can not guess. I just can not vision the world talking about a terrorist / oil producing country on the verge of building a bunch of Nukes not impacting the price we pay at the pump. All the reason they need is a lot of panic.



If "some nukes get launched" I will no longer be as concerned over oil prices! :eek:

Such political concerns are a big part of the reason I surf this forum for ideas on how to raise my gas mileage. I'm only up to about 45 MPG right now, but thanks to this site my fuel economy continues to get better.

Syriana
 

You might want to rent this movie and revue the elements of the screenplay.Matt Damon's character,as a consultant to a Middle-Eastern oil producer gives a clear picture of "premiums" that can be anticipated by uncertainties in the marketplace.---------- Higher prices may hurt you and I although they're the best thing that can happen for many in a different food chain.-------- Adapted from a book written from a 25-year CIA operative,it makes for rich thought and contemplation.-------- Iran's intelligence network never overthrew the United States government and installed a puppet regime friendly to Persia.The same cannot be said of the U.S.' Persia does not operate in a vacuum.

Unfortunately, Persia hasn't existed for close to 1400 years, since it was destroyed in the first wave of Islamic imperialism: Muslim conquest of Persia - Wikipedia, the free encyclopedia Iran is no more Persia than Turkey is the Eastern Roman Empire.

Hmm, gas around me keeps getting cheaper. $2.08 for the cheapest 12% ethanol swill, and $2.19 for straight gas.

Hopefully they resolve this Iranian thing with jaw, jaw instead of war, war.

Good point. In town here, with a Krogger CC# it can be had for about $2.35, and it sells for $2.39 at a truck stop 30 miles away and that's as cheap as it gets near me. $2.45 to $2.49 is typical here for 87 octane.

Of course the oil price would be a lagging indicator of actual gas/diesel prices if nobody starts price gouging on the gas station end right away. So I will be watching the price of Oil on Monday.

My weekly fuel consumption is less than 8 gallons average. I could get it below 7 but I don't want to pile the miles on my Insight when gas is cheap. For now I'll trade 53 MPG in a $3300 car for 65 MPG in a $9000 car.

If it went from the current $2.15 a gallon to $5, my weekly cost would not really affect my driving. The wife and I used my cars instead of here Nissan Rogue and our family average is still close to 50 MPG.

Although I know it would be very hard for some, as well as the general economy, I think we should be paying more for gas to make the incentive for all to be more conservative in their fuel consumption.

When it hit $4 a gallon here last year there was a real transformation in the types of cars you saw on the highway and the way people drove. Now it's back to the same old aggressive insanity.

regards
Mech

Old Mechanic -

I agree. I like to claim that the Honda Fit, Nissan Versa, Toyota Yaris, Smart, Honda Insight II, and Cobalt XFE are in the USA *because* of higher gas prices.

(and drivers were monster mean today)

CarloSW2

I have to agree. However it gets more complex when one really breaks down the full impact of high fuel costs on us.

Am I the only person that noticed our American/World Recession all started after a few weeks of over $4.00 (USD) gas prices? It is my family's belief that high fuel prices is exactly what got our economy in such a mess! I know the media never says that, but I happen to feel very strongly about the high cost of fuel sending the economies of the world into a tail spin. I never bought the housing market started it- except for the fact that many people were using their credit cards to fill up their cars/trucks just to afford to drive to work and back, and when they tried paying off their credit cards they could no longer afford their HOUSE!

I agree higher fuel prices lead to more fuel efficient cars and trucks, but if that price gets too high it starts to throw people out of jobs, which is exactly what I believe we seen sparked back in fall of 2008.

I also believe that China has captured so many of our previous middle income paying jobs that something had to burst. But I still feel the catalyst was the high oil prices of late 2008. I really do not wish to see fuel go up to the levels it was in 2008. Maybe somewhere between today's price and what it was in 2008 would work out better.

Many, many stoopids decided it was feasible to commute 100+ miles/day. Time for a reality check.

But still, it was their decisions to a) drive a guzzler; and b) buy a house they can barely afford with an unconventional mortgage that was the cause. They were skating on the thin ice all along: $4 gas was just where it happened to crack first.

Now Now.. Lets put this in the proper perspective. Many people that choose to drive so called gas guzzlers bought these cars/trucks way back when gasoline was 95 cents a gallon.

I live in a location where many people drive around 100 miles to and back from work, and they are not stupid. They also often drive 4x4 trucks. What happen was when they first located in the country and got a job in the city the gasoline was inexpensive enough that their living was fine. Also the jobs USED TO PAY MORE. But when gasoline slowly went up from 95 cents to over $4.00 and they could find NO other jobs to replace their paychecks and health care, THEN the economy faulted. I do not blame these people for not being able to see the future. Back in the 1990's gasoline was under $1.00 a gallon for 87 octane and the economy was booming. One could not even eat a Big Mac without finding a tiny application for "Help Wanted" underneath their food on their tray. High fuel has changed all of that (imho). I feel we are still feeling the shocks from 2008. I also fault the habit most Americans have of buying the cheapest goods made in China no matter what has impacted our economy very badly. This kind of stuff costs this country millions of good paying jobs, but nobody wishes to discuss that.

If many people don't find a way of driving far less or getting much better mileage (or alternative transportation) then I fear this entire cycle is bound to replay it's self again. It's fine to worry about the environment, but lets not throw away our economy while we are at it.

Jammer -

I agree that high gas prices was one part of the fall. In my ideal world, gas prices would increase *gradually*, so that the auto companies and general economy would have time to adapt (aka adopt "kei car" policies and such). How come Europe and Japan are able to function with gas prices that have been historically much higher than ours?

In terms of bubbles, I look at it this way :

Internet bubble -> Housing bubble -> Gas price bubble (with help from war)

Part of the economic bubble was people borrowing against homes they already owned or had cheap mortgages on. I see so many luxury cars in front of dumpy homes, it's unbelieveable. I should start a photo collection of luxury cars that imply people living beyond their means.

The way I look at it, the people that have the money are just running from bubble to bubble, skimming the profits off, and leaving everyone else with the (empty) bag. I heard that even today, the toxic debts are being "cleaned up" and put back on the bank ledgers. They're still toxic, but they've already become "acceptable" again. Welcome to Housing Bubble II (ha ha, HB-I was not the housing bubble to end all housing bubbles).

Another factor in the price of gas are all the wars we've been fighting. This allows for speculation to run rampant. You can make an argument that debates the current high cost of fuel versus the *real* cost of fuel. In my opinion, when you include our military expenditures in the Middle East, the real cost is $10 a gallon or more. In the short run the current cost of fuel does damage to our economy. But in the long run this will force us to conserve and will allow alternative energy economies to become viable.

CarloSW2

OK Let's try putting it in the proper perspective again:

That the U.S. and the world are depleting a finite resource has been no secret for at least 35 years.

People and Americans in particular have had ample opportunities to be proactive. They chose instant gratification instead.

Anyone that built their life around cheap energy was stoopid, period. And by built their life I mean 100 mile commutes, in V8 4x4s, back and forth to McMansions they couldn't afford- and afford to heat and cool- in the first place.

Yup, gas was 95 cents when I got my start too. I didn't buy the most expensive house I qualified for. I made being within bicycling distance to work one of my house-shopping criteria and then I followed through by bike commuting most of the time for 13 years. I added insulation and a new high-efficiency furnace with programmable t-stat to my house before heating costs spiked. Gee, all that and no government financial assistance besides- how did I ever think of it??? It's called awareness.

You know when you're driving at night and you come to a rise and you can plainly see there is a vehicle coming towards you on the other side of that rise and you have lots and lots of time to dim your headlights before they crest the hill? Have you ever noticed that 90% of those dumb em effers evidently aren't situationally aware enough to dim before they crest- they hafta get blasted with headlights before it occurs to them to dim their lights? And even then that often isn't enough, you have to flash them. AWARENESS. SELFISHNESS. STOOPIDITY. :mad:

Jammer -

Yes, but I think that is a false reality. I would argue the old cliche "the bigger they are, the harder they fall". The longer we have cheap gas, the bigger we crash in the future. Unfortunately for you and me, that crash is happening right now.

CarloSW2

Heh heh, bulls-eye! :thumbup:

I've been a landlord, and I've seen how trailer dwellers live. PRIORITIES. Or, rather, the lack of them.

You will see new/nice vehicles and expensive toys in front of clapped out trailers.

You will see said people in their new/nice vehicles, in- say, new leathers which I KNOW cost about $1000, at the grocery store using food stamps.

I've had renters who repeatedly failed to pay rent. It didn't escape my notice that they did have money for cell phones, cable tv, video games, smokes, pull-tabs, bingo, what had to be substantial liquor store and bar tabs, take-out food every day, etc. :rolleyes:

After a very long, very generous grace period for rent delinquency I asked a gal if sitting outside somewhere with her cable tv sounded like a good idea? She absolutely couldn't believe it when the day finally came I booted her *** out. :D

Good points all the way.

I happen to believe part of the reason our economy was going so good over a decade ago was partly due to the sudden importation of cheap goods from China- that meant in the short term our standard of living went up, only to be at the cost of millions of middle income paying jobs that we have now lost. I guess I'm one of the few here they prefer to buy American, but I also believe that due to the competition from the imports our own domestic cars/trucks are of much better quality.

I do not blame people that have to drive a long ways to work. Most people prefer to live near their families, many have to take care of their relatives that are elderly or disabled, and it's not always easy to pack up the bags and move to the big city to save gas. However, I managed to trade my 2005 med size 4X4 Chevy Colorado (due to a bad wreck, insurance settlement paid for my Cobalt XFE) in for the most fuel efficient car I could buy with the money I had for a new car.

I do question why more people near me don't trade in their full size Dodge Rams and other gas guzzlers, which often get around 10 MPG for the older models. I very well could be one of the people that will again have to drive a long ways to find a decent full time job. Personally, I am struggling right now to find full time work. But I did go from 17MPG to over 45 MPG. Most people I know that drive such large trucks rarely ever use them for towing or hauling stuff, and that does puzzle me as to why so many continue to settle for less than 20MPG and drive 80 to 100 miles a day just for their jobs. Often times such drivers claim they are safer in these large trucks because of all of the sheet metal involved in a crash.

Fact is many prefer to live in the country while about 99% of the jobs are in the big city. So people either have to make enough money to cover their gas bill, or perhaps get much higher MPG to get by.

I once worked for a guy that used to pick me up in his extended long bed Dodge Ram pickup truck which hauled a large trailer full of tools. He would normally go about 95MPH on the 70MPH interstate for 45 miles to the big city, and he got some of the lowest MPG of anything I ever seen, about 6 or 7 MPG at best- I think a semi truck gets better mileage! I never could understand how this small business man could not understand how much $$ he was losing by simply speeding so fast. He could of saved some serious $$ just by slowing down from 95 to 65! And the police gave him several tickets as well, but nothing slowed him down even while he was driving such a large 4x4 hauling a large full trailer of tools.

Nevertheless I live near many people that can not easily move due to family roots and family obligations, yet they must drive almost 100 miles round trip to keep a decent job. I do not fault such people if they just to their part to drive and high MPG car at a speed that returns decent mileage. It's the best some can do.

False reality??

I seen it happen. Nothing false about it. People can not tell the future very well. I can not explain why oil prices are currently being traded at less than $70.00 right after we have learned that an oil producing terrorist nation is on the verge of making several Nukes! And despite all of the government spending today the dollar is gaining a lot of ground international. Man, some things just can not be predicted and I certainly do not believe it is fair to blame drivers of cars trucks with poor mileage when we have so many other factors at play here such as speculators on Wall Street and Opec to say the least. Some people actually need such cars and trucks due to large families and the need to tow and haul things. There choice yes, but when I live in a country that subsidies farmer's with cheap tax-free fuel and pays farmers with taxpayer's money to NOT farm tobacco (thus all of the large farms I see that are growing nothing here) then I see bigger fish to fry.

Like I said, reality check time WILL come sooner or later.

First time gas prices spiked I noticed an uptick in bicyclers.

That lasted all of two weeks.

Next time the price spiked, no bicyclers.

Even now, after the spike, what do I see but new Silverados EVERYWHERE.

Dang it, they must have been giving them away and nobody told me? :mad:

Oh Man... count to 10... don't go there... easy now.... watch out... don't get me started... :eek:

hahah- I gotcha. :thumbup:

(I relate)

Jammer -

I categorically want to buy American, but there are almost no choices left. That's *the* original reason I got a Saturn in 1997 and have been a "Saturn Booster" ad nauseum. I don't argue that the car is "class leading" by any account. I only argue that it is "good enough" and cheap to own.

If Americans were trading in their trucks 10 years ago for American made compacts, the profits would have been smaller, but recently bankrupt Chrysler and GM would have been forced to change of their own accord, and likely would have been in a better position to weather the storm.

Frank -

I would have been happy to live within 5 miles of my work, but that would have added hundreds of thousands of dollars to the cost of our house. Today our mortgage is almost 50% of our net income. The extra cost would have made it 70% of our net income.

Ironically, if I lived within 5 miles, I wouldn't even be here because I wouldn't be the problem. It's because I know I'm the "bad guy" that I joined up to at least mitigate the damage I am causing.

CarloSW2

I know it is physically impossible for everybody to be close in enough to bicycle.

But 100+ miles away?!? COME ON. :mad:

Frank -

I'm not disagreeing with you, I'm just stating a common excuse. The arguably better choice on my part would have been to "just say no" and keep renting. I have co-workers with 70+ mile commutes (one-way), and they've been doing it for over 30 years. I remember one fellow who put maybe 300K miles on his classic beetle. He finally got a new car. A bottom-line Mazda compact.

Ha ha, if I was 100 miles away (and if that reality hadn't led me to kill myself), I would probably be driving a first gen Insight. Hmmmm, if I lose my job in this economy (entirely possible), then a 100 mile commute to save my house will suddenly become "reasonable" to me.

CarloSW2

In the 90s my daily route was over 80miles. the fuel ended up around 5000 dollars for just 1 year, A v8 coupe.
Gas was around a dollar. I hated it back then...now is inspiring me to get on a bus from maine, to minnesota, with a battery in a back pack and drive this old sube home sinking in a minnesota field...


http://i227.photobucket.com/albums/d...7/100_5247.jpg

...and its the 1986 unique dual range version. In real world it is an exotic automobile...

anybody got 50 bucks?
:confused:

That reminds me of flying over cities... mind you, I've had this thought for over 25 years now so it's nothing new... anyway, fly over a city especially at rush hour and you get a perfect bird's eye view of....

EVERYBODY on the North end heading South.

EVERYBODY on the South end heading North.

EVERYBODY on the East end heading West.

EVERYBODY on the West end heading East.

WTF??? :confused:

It appears people actually go out of their way to live on the opposite end of town from where they work.

What if everybody traded houses or jobs end-for-end? :p

Frank -

Ha ha, that's one of the conundrums of the suburbs. Originally, the companies were located in the urban city cores. People went home to the "burbs" to get away from the city.

Then something happened along the way. As we abandoned the urban cores, companies started to locate in the burbs too. Next thing you know, you are driving from burb to burb to get to work.

If I switched my parent's house with my house, I'd get back to a 2 mile commute. I would need to get a honking AC for them, though, because it's hot as Hades where I am in the summer. If I were them, I wouldn't make the switch.

CarloSW2

Hey I have a relative that drives OVER 100 miles one direction to work for 4 twelve hour shifts a week. He finally broke down and bought a hybrid. It is fairly common in these parts for people to drive such distance. No surprise on my part.

Right now with the economy being what it is, many people will drive such a distance for a job. Moving is normally an after thought when they realize the cost of gasoline. No sense getting angry about it, because it's just a fact of life here.

I mean even if he is getting 30mpg, that is 27 gallons a week (say $80 per week in gas). Plus another 3 hours of driving per day on top of a 12 hour shift?!?

I'm pretty sure I'd be holed up in a $300 paid-in-full used camper 3 nights a week (with a cantenna of course) in that situation :)

^No doubt, I'd have a sleeping room arrangement.

I've done the calcs 100 times but I think someone else can do them this time if they want to see real numbers: Take that daily miles figure and, if you've never figured your actual cents/mile operating costs either do it or use the AAA's national average figure. Then take your hourly or daily wage and figure what it is NET. Compare and be prepared to :eek: !

Not only do many of these 100 mile 4x4 commutin' stoopids put in several more unpaid hours DAILY vs. someone like me, but they put in over half the day, every day just to suppoort their truck. In some cases I've mathed out the whole wad goes into the truck. I dunno about you but if I'd be pretty embarrassed to be working to support a truck. Even sleeping in and doing nothing would be a better option than that. :rolleyes:

Again, I do not feel these people are stupid, it is their choose. If it makes any more sense, my relative has a family that lives in a house that is fully paid off in the foothills. Also they get free day care from the grand parents for their 3 kids most of the time. SO- When you already have a nice large house fully paid off, family that will offer free baby sitting maybe the math will start to add up for all of you that do not seem to understand. Also this guy is now driving an Insight Hybrid, as I recall, so I suppose his mileage is in the 40's- but most of his driving is on 70MPH interstates, so I do not know how well the Insights get going at those speeds. Either way I figure he is doing better than 30MPG.

Also the job he has pays VERY well! Perhaps when one takes everything into account they can at least understand why this guy drives so far to work. No house payment, plus no day care (wife is a teacher) saves them money. The house was built by the girl's dad so I do not think they can up and sell the home and use such money for a closer house, AND the wife has a job much closer to the home.

Now, for many others here their situation is much more drastic. Some are forced to live with family members, many pay little or no rent, but the only jobs they can find are over 70 miles away (that pay enough). SO in seeing many of these adults have family helping them, they come out ahead on the gas because they are paying little to no rent. Many that drive so far do so because their bottom line is actually better because of what their families do for them. I see it everyday here, and I am not speaking of welfare I'm talking about families helping out their adult kids in a really tough economy. Where I live at one can not buy a job right now.

The millions and millions of hypercommuters all have situations like that?

Yes:

Sleeping rooms

Carpools

Motorcycles

Hybrid/diesel/econobox

55 mph

***************

No:

V8s

4x4s

full-size

95 mph

autostarts

I guess I could choose to drive my F150 exclusively- my carbon footprint would still be but a fraction of theirs.

Forced me to do some math!!!

Hypothetical yet typical here: 160 miles/day, $14/hr job, let's use $4 gas cuz it's been there and it will be again.

14 x 8 = 112; x .72 (28% typical for taxes and misc deductions) = $80.64 net/day.

4x4 V8 with excessive autostarting, speeding, and general thirst esp. in winter returns 10-12 mpg for many; 160/10-12 = 13.3-16 gallons/day x 4 = $53.33-$64 commute gasoline only cost/day- no payments, insurance, maint., repair, etc.

$80.64 - $53.33-$64 = $16.64- $27.31 take home pay/day...

160miles/day @ 65mph = 2.5 hours/day; 8 + 2.5 = 10.5 hours/day; $16.64-$27.31/10.5 = $1.58- $2.60/hour net take home :eek: :eek: :eek:

Alternatively: per AAA for '08: SUV cents/mile = well, 58cents/mile for our guy? = 160 x 5 days/week = 800 x 50 = 40,000miles/year x .58 = $23,200/yr

AAA Exchange

... our guy makes $80.64/day x 5 = 403.20/week x 50 = $20,160

... math wrong or what :confused: Sure doesn't add up. :rolleyes:

... and that is why we find mom 'n' dad or gramma or someone subsidizing this nonsense.

Man, did you read any of the facts I typed? Shesh

Your math has nothing to do with the facts I explained and you have only further confused me as to what you are trying to say..

Oh, by the way, the guy makes much more money than that, read what I said as far as what kind of CAR he drives, and a bunch of other things you skipped or changed. And he is not stupid. :mad:

If these people were not coming out ahead they would not live in such a way.

i just used typ for my area as noted

an that's why i call em stoopids

see?

gots no numbers for your guy

Also it's not "nonsense" for family to care for their kids survival during the worse recession in many decades.