How high will gas prices go?

[Rommelvon]

By summertime, how high do you think gas will rise?

[Don Buckbee]

I think it will be $4 by Summer.

[DWARREN123]

As high as they can push it!

[millwright]

Well $3.00/gal gas equates to .$.48/gal circa 1968 in a car getting around 12 mpg on high test. That makes $4.00/gal gas worth $.65 in 1968 dollars.

In 1968 a set of expensive tires only went around 20K miles, spark plugs maybe 3-5 K, oil/filters 3K, brakes 10K, premium shocks every 20K, you did a 'valve job' around 50K and 'overhauled' around 90-100K, and the list goes on......belts, hoses, wheel bearings, bulbs, and coolant flushes were a semi-annual event. With superior care a car would last around 150K miles.

In 2008 tires go 40K+, brakes 50K, oil/filters 5-7K, shocks/struts 50K, coolant flush 3-5 years, hoses at least 5 years, belts 3 years or more, you never do a 'valve job' or even an 'overhaul' unless you want to and a car will last over 200K miles with regular care. That car will yield 25-30 mpg and more horsepower on regular gas, corner at 50% higher "G", stop quicker and straighter, is quieter and more comfortable, and, above all, is safer to drive or in an accident.......

The "Good Ole' Days' of motor cars is right now........ >MW

[Marlin T]

Just wait until somebody tears after those lousy Iranians, oil is going to go way up, then so is gas. How high? Who knows, but I know one thing for sure and that is they produce a lot of oil for the world.

[justdoug]

Front page of my local paper shows $4.23, $4.33, & $4.43 in San Mateo, California. The prices in Claifornia always make me wonder about Jay Leno and his famed "Tank Car" which he is quoted from a Popular Mechanics article saying..."if you don't shut it off at the gas station, it will suck the fuel faster than you can pump it in."

http://www.youtube.com/watch?v=iQHRNeY9zUU

[Vladimir]

Originally Posted by Marlin T

Just wait until somebody tears after those lousy Iranians, oil is going to go way up, then so is gas. How high? Who knows, but I know one thing for sure and that is they produce a lot of oil for the world.

Everyone likes to overstate their importance. For example, Iran exports about 2.52 million barrels of oil a day, absolutely none of which end up in the United States. We alone consume over 20 million barrels a day, the entire world up to 85 million. So that two and a half million... don't get me wrong, it would influence prices... but it wouldn't exactly be the end of the world. It would have a more significant impact on countries who import Iranian oil.

We would personally be screwed a lot more by something in Venezuela, who sends us roughly 1.5 million barrels a day.

Yes world prices will start to stabilize out (in time) if Iranian oil was pulled off the market. However, never forget the United States has nearly 700 million barrels of oil, building the world's single largest oil reserve. So mathematically, in highly hypothetical terms, if Iran went to absolutely 0 oil exports, the United States could maintain current world oil supply for around 280 straight days, without a change in price to the oil market. Obviously hypothetical because oil would still go up a bit because of instability, and obviously we wouldn't occupy Iran and maintain 0 oil export for 280 days, etc. etc.

However, the math is humbling. Iran is still just a bug, meanwhile the United States is simply the single greatest power in the history of the world . We really are invincible .

[CampingJosh]

I really think we're now to the point where the oil companies have figured out about what percentage of one's income one is willing to spend on gasoline (let's say, just to make things easy, 10%). And let's say that 10% is $50/week (Low, I know, but again, arbitrary numbers). I think they set their prices so that they always get that $50, no matter how little gas they sell to take it. If you only need 4 gallons this week, they'll be $12.50 each. Maybe an exaggeration, but I think this line of thought has at least some validity.
I truly believe that gas prices will continue to rise so that people spend precisely their maximum. If suddenly cars now get 50 miles per gallon instead of 25, gas prices will likely double (and we'll be fed some BS about international instability as the reason) so that the oil companies continue taking as much money from us as they possibly can no matter how much it actually costs them to provide the gas.
Has anyone else noticed that Exxon has set record profits every year for the last several. It's certainly not because Americans are buying more and more gas all the time.

[Marlin T]

James I think you are underestimating the importance of Iran.

It does not matter one bit that we don’t actually consume ANY oil from Iran. They are members of OPEC and beings they are, their oil outputs are of major importance to our price of gas regardless of the reserves that we have stored.

In Jan 08 they were the second largest producer of oil, logging 3.902mb/d. (million barrels per day) second to Saudi Arabia, while Venezuela was pumping out 2.397 mb/d. That was the fifth largest producer.

The United States gets most of it’s oil from Mexico and Canada and here within the states, but that doesn’t matter either when buying oil.

That is like saying that Mexico or China has gold on sale cheaper than you can get here. Doesn’t work like that. No, it will cost you 981.60/oz, (as of right now), no matter where on this planet you are. That is the price.

Iran is the Japans third largest supplier of oil, so that wouldn't affect any other prices of anything would it?
Iran supplies China with 13% of their crude, same thing applies when it comes to the prices of not only gasoline, but the crap at Wal-Mart too.

I hope you now see the implications and unintended consequences of what is going to happen when somebody slaps the dog snot out of them for killing Americans, supporting terrorism, building nukes, or just for being stupid and egotistical.

[Vladimir]

I would double check those numbers, I'm pretty sure Russia is consistently the second largest producer, and USA third.

http://tonto.eia.doe.gov/country/index.cfm

These numbers are older but oil production numbers don't tend to change that much unless you look at a country like Iraq.

Another key thing about Iran is they produce quite a bit, but they are also a huge consumer. They consume like half of their own oil, they also have a strategic reserve IIRC, so their exports aren't as massive as we might think.

And your gold analogy only goes so far. WalMart puts pies on sale, within a week they will be on sale everywhere else. But there is still that short layover. Additionally oil is complex since the oil we are using is up to potentially several weeks old. Hence when oil jumps up to a new record yesterday, our gas prices don't do the same.

Sure they market will adjust very rapidly. But then that is why I mentioned our strategic oil reserves. What I was showing is if Iran went all the way to 0 production, the United States could supplement the world market for about 280 days- without the world batting an eye. No longer lines at the gas pumps, no need to conserve, etc. This is all purely math, of course prices would go up a little bit for a short time, of course we would try to conserver- but it is also next to impossible that Iran would go to 0 production for 280 days straight.

Additionally no one is going into Iran alone anytime soon. CNN had an article the other day about new UN resolutions against Iran (interesting Russia still talked big but everyone expects their continued vote), and again called the US the most vocal over Iran. Hogwash, France has probably been the biggest proponent, I mean hell it was France that openly threatened to use nuclear weapons in direct reference to Iran. So long story short with any plausible intervention into Iran you will have a world effort, which will help stabilize the markets, and will also help maintain Iranian oil production post-activity.

All highly hypothetical, but my point is we don't really have that much to worry about in terms of conflict in Iran.

[Vladimir]

double post