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Varchild2008 (84.54)

Gas Prices at $2.50 in a single day



March 11, 2012 – Comments (3)

How you say?

Foxnews "The Five" mentioned this simple solution quite sometime ago.

There are several mixtures of fuel that our Oil/Nat Gas companies have to mix up on their own expense before they can sell it to gas stations in various parts of the United States.  Which means the fuel mixture you get in California isn't the same as Mississippi or Michigan or etc...  Then of course there are the seasonal mixtures throughout the year that add to that.

Why on EARTH would an Oil/Nat Gas company spend GOBS of $$$ creating 36 mixtures of fuel before they can then be allowed to sell it, when they could just ship and sell it over seas to China?

So the soluton is sto standardize all of these mixtures to a single mixture that only changes seasonally.

Once that is done then yes $2.50 a gallon gas is achievable.

Of course toss in off-shore, on-shore drilling and you drop the prices further.   Throw in Keystone Pipeline and Drilling in Anwaar and prices will be extremely cheap.  Expand horizontal drilling techniques and again....even better.

But, I believe a single legislative action done over night to standardize the fuel mixtures would dramatically drop the price of the fuel.

Above is an nice article on the subject of Gasoline Reformulations of which AT LEAST 18 reformulations existed in 2002 and many more reformulations occured since then, especially under President Obama.

So the next time you see $4.00 gallon of gas, you can ask yourself why when President Obama is declaring "This is not my fault" is he not bothering to fix it?

3 Comments – Post Your Own

#1) On March 11, 2012 at 2:07 PM, PrintMeSomeMoney (< 20) wrote:

A barrel of oil is 42 gallons.  Even if the entire barrel were able to be turned into gasoline, (it's not), you would have 42 gallons of product to sell at a price of $2.50.  That equals $105/barrel. 

Last I looked, oil is trading above this level, so no, one generic fuel mix is not going to drop the price of gas to $2.50.  Besides buying the barrel of oil there's refining costs, transportation, and of course the person buying the fuel from the refiner is often reselling it to a convenience store chain, both entities marking the price up along the way.

 The only people likely to profit from one blend are the people between the refiner and my gas tank.

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#2) On March 11, 2012 at 2:43 PM, Varchild2008 (84.54) wrote:


Much of the price of the gasoline at the pump consists of how expensive the process to refine it, ship it, and get it in the pump in the first place.

When we have 36 reformulations give or take you have a gigantic amount of cost to incur before you can put it out on the market.

Your $2.50 = $105 Barrel of oil is completely incomprehensible.

The cost of a barrel of oil is not by itself indicative of the cost of gasoline at your pump.

Not when you have factors that do not even have anything to do with Oil / Gas  costs.....  Like city. state, or federal gas taxes for example.  That's 30+ cents added in taxes to the price at the pump.

All I am saying is the reformulations are cost Oil and Natural Gas companies billions of dollars each year.

"Prices were already expected to rise over the next few months, Lundberg said, driven by required fuel reformulations, provisions in last year's energy bills taking effect, and the renewed rise of crude oil."

The article above is from 2006 when Gasoline prices at the pump were $2.33.   Well below the $2.50 gaslone price I claim we can get to just by standardizing the fuel reformulations and basically making getting the gasoline to the pump cheaper.

You mention shipping, refining, and so on as other expenditures involved.  Alot of that can be alleviated by reducing all of the energy requirements built into the last 10 years of EPA, and Congressional Regulatory Actions.

Reduce the cost....and the price drops.  It's a no brainer.

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#3) On March 11, 2012 at 2:53 PM, Varchild2008 (84.54) wrote:

Read the above article.   The Price of a Barrel of Oil does not correlate well with the price at the pump.

Your $2.50  times 42 gallons  = $105 a barrel.... Therefore, we are already at $2.50....huh?

No we aren't...  We are at $4.00 last I checked my nearest Gasoline Station.

The Barrel price has to drop least around $80 a barrel of oil in order to get to $2.50 or close to it.


Cause you have to throw in a multitude of factors that push the pump price UP.    TAXES is just one factor......  Multiple Reformulations is another.

Standardize the formulations and bring the PUMP pricing a lot closer in-line with the Barrel of Oil pricing.....

And this..... Maybe $95 a barrel of oil gets us to $2.50.  Who knows?  Depends on Gasoline Taxes as the article above explains.

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