Inflation here? gas/grocery prices just continue to climb (5 Viewers)

[buzd]

There is one other element to the oil price issue and domestically sourced oil. In 2017 we made it legal to export domestically produced oil. At the time, no one cared because oil was cheap and it "helped" oil companies. Now that the price of oil is high, we are exporting over 1 million barrels of oil a day to Asia(mostly China). Sweet crude that is easier and therefore cheaper to refine.

But also (and I may be wrong about this, so please correct me), aren't our refineries built to refine foreign oil, not "our own" oil? So all this talk about energy independence is kind of BS, right? Because it just means that we are trading at a surplus, not that we are truly "energy independent".

 

[BobE]

Dollar Tree is raising its prices to $1.25, officially breaking the buck for good

Dollar Tree was the last of the major US dollar store chains to stick to its $1 promise. It began testing higher prices in September.

www.businessinsider.com

 

[DaveXA]

Dollar Tree is raising its prices to $1.25, officially breaking the buck for good

Dollar Tree was the last of the major US dollar store chains to stick to its $1 promise. It began testing higher prices in September.

www.businessinsider.com

Dollar Tree Fiddy, yeah.

 

[Maxp]

But also (and I may be wrong about this, so please correct me), aren't our refineries built to refine foreign oil, not "our own" oil? So all this talk about energy independence is kind of BS, right? Because it just means that we are trading at a surplus, not that we are truly "energy independent".

I believe our refineries are set up for specific types of crude and that can be changed. Not all our refineries process the same oil either. Gulf Coast oil hasn't been leaving the country for very long so someone was refining it. Used to be we exported finished products and not crude. I'm sure we have some refinery operators on here way more knowledgeable than I.

 

[saintmdterps]

I nominate bcclems for Secy of Common Sense

Common sense is no longer common.

 

[Mr. Sparkle]

I believe our refineries are set up for specific types of crude and that can be changed. Not all our refineries process the same oil either. Gulf Coast oil hasn't been leaving the country for very long so someone was refining it. Used to be we exported finished products and not crude. I'm sure we have done refinery operators on here way more knowledgeable than I.

I think that is correct. Most Gulf refineries were designed to refine high sulphur (sour) crude from the Gulf. Canada has traditionally been set up for refining low sulphur (sweet) crude found in their oil fields. I think its easier to go from sour to sweet than vice versa. At this point I think most refineries are pretty well set up to handle whatever type of crude comes their way.

Regardless of oil type, refineries are constantly changing the mix of the products they produce based on market conditions and other business plans. If gasoline prices tank, they will produce less gasoline and increase production of other refined products (chemicals, etc.)

I think the current gas crunch (across the globe) is an aftershock from shuttered production during covid that isn't yet ramped up again to meet growing demand for fuel.

 

[bigdaddysaints]

I know the Shell Covent refinery shut down last year because they were only set up to refine a certain kind of crude oil. I don't really know the specifics of which kind (I don't know enough about crude oil) but it quit being profitable for them to do so. it was obviously cheaper for them to shut down than to alter the process.

 

[kizzy821]

Something that has been widely ignored on the labor shortage end. Reminds me of my dad screaming about the immigration problem while his entire landscape crew was made up of Hondurans while completely failing to see the irony beating him across the head with a bat.

MSN

Oil may already be in the process of screaming back towards $50 due to a combination of increasing supply, reduced demand in Europe and a coordinated release of oil reserves. The question then becomes, are we starting a battle with OPEC+ who will slow production as their way of pushing back against the stategic oil release causing oil to surge back up? Reserves are just that, the supply is finite. If oil runs down too much then the same people griping about high gas prices will be griping about being unemployed.

The solution to the oil problem is to quit subsidizing oil and do everything in our power to go green for so many reasons.

On the inflation end, yeah we have inflation. We doubled the national debt in a few years with free money. Inflation was going to happen and I've been preaching it in the investment threads for a couple of years. Pretending it isn't being pushed into overdrive by pent up demand is also naive.

It reminds me of the saying, "If money only grew on trees". If it did, money would be worth the same amount as leaves.


In conclusion, both political sides are like cars driving down a one lane highway at full speed in opposite directions. The left want to give money away to everyone pretending the end result isn't less value of that money. The right want to pretend that we can control the price of oil without consequence when it costs us twice as much money to produce as places like Saudi.

Reduce immigration and suddenly low paying jobs aren't so low paying. Reduce immigration and suddenly the low paying jobs can't be filled and the worker shortage leads to higher pay. You would think the left would want to reduce immigration to help raise wages from the bottom up. You would think the right would want to increase immigration to keep wages low so businesses could make more money. The battle lines that are drawn in politics make absolutely no sense.

For anyone paying attention to the price of oil and wants to know how it works, it's really simple. In January of 2020 the US became energy independent. It was the first time in decades the US did not import any oil from Saudi Arabia. Within 3 weeks Saudi and Russia flooded the oil market crashing the price. Saudi and Russia can sell $25 oil and still make money. At $25 the US oil business goes belly up and they have to shut down production. Once the US production is completely disrupted then OPEC+ meets and puts production caps in place driving the oil prices back up. It takes years for the US oil production to get back up to full speed and in that process oil prices go through the roof because US companies understand that if they dump all their investments in at once to get things running that OPEC+ will just crash the market again wiping out all that investment. High oil prices don't impact places like Saudi where gas is never more than pocket change, it only impacts places like the US and Europe.

Want to add extra incentive to OPEC+ to push control over the market? Talk about green energy and green initiatives on a global scale. They know they have a product that has a limited shelf life and they are going to try and maximize the price of every drop and I can't blame them. For the US, it's like Missouri trying to compete with Louisiana in the shrimp industry, it's simply geographical advantages that can't be overcome. The only way to get energy independence is the greatly reduce the need for oil through green energy policies. The same people on the right yelling at the gas prices are the same people fighting the transition to green energy. Meanwhile, the left is pushing reducing the use of fossil fuels before the infrastructure for green energy is in place acting like it isn't going to drive prices up, even if it is all talk.

It's no wonder other countries think we are so dumb and it's no wonder Saudi can pretend to be our ally while inflicting tremendous damage to our contry without any consequence.


So just like Covid, politicize very basic function of markets and expect disasterous results. In the end, free markets will work it out and prices will stabilize but the swings getting there are going to be really volatile. At least until the next crisis unfolds and we start the process over again.

I'm making a lovely scrapbook documenting the reasons life sucks. This would be a delightful submission.

I could insert it between the sections on the pervasiveness of arugula and the one where I list all the fees we incur for existing.

For a title, I'm thinking 'Crude Intentions' or 'It's No Wonder Other Countries Think We Are Dumb.'

I hope you don't mind.

 

[bigdaddysaints]

if we "really" stopped illegal immigration and also went to more domestic manufacturing, inflation would probably double overnight. people who are anti-immigration are somehow blind to this.

 

[buzd]

I think that is correct. Most Gulf refineries were designed to refine high sulphur (sour) crude from the Gulf. Canada has traditionally been set up for refining low sulphur (sweet) crude found in their oil fields. I think its easier to go from sour to sweet than vice versa. At this point I think most refineries are pretty well set up to handle whatever type of crude comes their way.

Regardless of oil type, refineries are constantly changing the mix of the products they produce based on market conditions and other business plans. If gasoline prices tank, they will produce less gasoline and increase production of other refined products (chemicals, etc.)

I think the current gas crunch (across the globe) is an aftershock from shuttered production during covid that isn't yet ramped up again to meet growing demand for fuel.

Helpful, thank you (and @Maxp ) for the clarification.

 

[SystemShock]

I hate to keep saying this, but we, as Americans, are generally too stupid, too greedy and too shortsighted to see the forest for the trees.

OMG look at gas prices. Gas is too high...., but finally my oil people are making money. The people don't care about Ida or the fact that a year ago oil cost more to store than produce and so production stopped.

We whine about how much stuff costs, but then fight any attempt to regulate anything.

You want stable oil prices? Regulation does that.

The pandemic was an enormous shock to a fairly efficient system. Instead of going to the mall, we ordered from Amazon or anyone who would deliver to our doors. Hell, my country club has had the best 18 months for dining in 30 years because they deliver now to the area within 3 miles and do more food business than ever and when the whole thing started they thought they'd be crushed. Membership is up 100 members in 18 months all due to the pandemic. FedX, UPS and USPS are busier than ever delivering coffee from places we never heard of 18 months ago, but can click online and get it in 3 days.

It's going to take another year or so to work out the shock assuming we don't collapse the economy because of the very free market inefficiencies inherent in our system that most of the complainers support ignorantly and to the death.

My wife is in MX, ordering Circle K deliveries

 

[Mr. Blue Sky]

They should just go ahead and call it the 2 dollar store.

And they should give you a discount if you pay with an actual $2 bill.. i think i have one around here somewhere .

 

[Eeyore]

And they should give you a discount if you pay with an actual $2 bill.. i think i have one around here somewhere .

People are too stupid to handle complicated currencies. If it isn't a single, or a multiple of five they'll melt down.

Police Involved After Student Tries To Buy Lunch With $2 Bill

An eighth grader got more than she bargained for - but not her chicken nuggets - when she tried to buy lunch with a $2 bill.

www.forbes.com

A tale of customer service, justice and currency as funny as a $2 bill

PUT YOURSELF in Mike Bolesta’s place. On the morning of Feb. 20, he buys a new radio-CD player for his 17-year-old son Christopher’s car. He pays the $114 installation charge with 57 cr…

www.baltimoresun.com

Cops Pinch Man For Donating $2 Bills to Students | News | The Harvard Crimson

Lamont fund and SAC to the contrary, Yard police prevented a would-be benefactor of the College from giving his money

www.thecrimson.com

 

[DaveXA]

People are too stupid to handle complicated currencies. If it isn't a single, or a multiple of five they'll melt down.

Police Involved After Student Tries To Buy Lunch With $2 Bill

An eighth grader got more than she bargained for - but not her chicken nuggets - when she tried to buy lunch with a $2 bill.

www.forbes.com

A tale of customer service, justice and currency as funny as a $2 bill

PUT YOURSELF in Mike Bolesta’s place. On the morning of Feb. 20, he buys a new radio-CD player for his 17-year-old son Christopher’s car. He pays the $114 installation charge with 57 cr…

www.baltimoresun.com

Cops Pinch Man For Donating $2 Bills to Students | News | The Harvard Crimson

Lamont fund and SAC to the contrary, Yard police prevented a would-be benefactor of the College from giving his money

www.thecrimson.com

Good lawd, people are stupid.

 

[guidomerkinsrules]

And they should give you a discount if you pay with an actual $2 bill.. i think i have one around here somewhere .

So it used to be that my great grandmother would attach pennies to the bottom of letters she sent us
then it was Susan b Anthony dollars
then $2 bills
miss her