How High Will Gas and Gold Go?

Oil is up 5% and gold broke $1400 since the Libyan unpleasantness. The Dow is correcting down a bit and the dollar isn't as valuable as it has been in the past. I'm guessing that it could be worse than a few years ago. Back then, news that someone farted near an oil line in Chechnya (according to the media talking heads) seemed cause a 25 cent jump in prices. Heck, prices at the station rose several times a day for the same batch of gas that was delivered to the station the week prior. Today, things seem a bit more serious internationally. How high do you think the cost of gasoline will be per gallon this travel season? How long will it last?

XJ-linux said:

How high do you think the cost of gasoline will be per gallon this travel season? How long will it last?

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If I knew the answer to these two questions I could retire! That's called the commodities market...betting on what will happen with prices in the future (oil, gold, silver, soybeans, pork bellies, corn, etc.).

- Nick

Yeah, it wasn't a serious question. I was just curious what people thought. Might be interesting to look back at the thread in July.

XJ-linux said:

Yeah, it wasn't a serious question. I was just curious what people thought. Might be interesting to look back at the thread in July.

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Sometimes I'm too serious!

Yes...it may be interesting to look back a few months from now. But then again...the unrest in Egypt caused a "blip" in oil prices...and if the issues in Libya are resolved quickly...then increases in oil prices may only be temporary.

Of course in the long term...we need to stop relying on oil altogether!

- Nick

XJ-linux said:

Yeah, it wasn't a serious question. I was just curious what people thought. Might be interesting to look back at the thread in July.

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OK
On that grounds I'll bite.

1) Things don't get much worse and slowly settle back to near norm in Middle East and Northern Africa: If so, we've probably seen about as much of a bump as we're likely to. Maybe as much as another 25% gain before dropping again

2) A shooting war between two or more countries or major civil war breaks out: We could see anything between another 25% to 100% spike

I think scenario #1 is by far the most likely.

I don't drive. But I'm worried too. Cause until all vehicles run off ethanol or something, then all high fuel prices will be passed on from the truckie companies to the retailers to finally the end consumer. And us end consumers have to pay higher prices cause of it.

Funny you mentioned this bc for the first time since mid 2008 here in Aust the price of oil dropped to under $100 AUD a barrel. So cnt see it doing too much here down under What really blows though is we dont see the price drop at the pump. These <insert expletive> oils companys always have a answer to why they havnt dropped it when the ACCC ~ The ACCC promotes competition and fair trade in the market place to benefit consumers ask the question

Gold on the other hand is still up around $1280 AUD

TattooedMac said:

These <insert expletive> oils companys always have a answer to why they havnt dropped it when the ACCC ~ The ACCC promotes competition and fair trade in the market place to benefit consumers ask the question

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Exactly! They can raise prices at the pump on a whim for fuel they have already purchased and is sitting in their tanks. What other supply/demand business has this freedom to rob Joe Consumer like that? If a station owner paid $xx for 600 gallons delivered yesterday and his markup is xx%, he shouldn't be able to raise the markup % until those 600 gallons are sold and he has to pay more $$ for the next batch. It's criminal and I'll be relieved some day in the future when the infrastructure for all-electric vehicles is in place and gas pumps are replaced by quick-charging stations. Someday...

MYmacROX said:

It's criminal and I'll be relieved some day in the future when the infrastructure for all-electric vehicles is in place and gas pumps are replaced by quick-charging stations. Someday...

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Then you'll ask yourself "hmm why is the power company putting up my bill 25% each quarter?". You can't win really.

the8thark said:

Then you'll ask yourself "hmm why is the power company putting up my bill 25% each quarter?". You can't win really.

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It's safe to say the whole electric-vehicle-charging-station-infrastructure thing is several years away. I won't be buying a Nissan Leaf or Chevy Volt just yet.

To compensate for increased electricity usage, renewable energy sources have to step up production. Solar, wind, water, bio-waste, etc. are all cheaper ways to generate electricity and better for saving natural resources. In some cases, resulting in the power company paying YOU. Even nuclear plants are safer nowadays, and cheaper than conventional methods. I'm all for it if they can be built to be environmentally safe and are able to prevent radiation leaks, etc.

We're excited about nuclear in Minnesota as they just failed to renew the 20-some-odd-year moratorium on new nuclear plant permits. Gotta get that "clean" electricity from somewhere. Mr. Fusion anyone?

As someone who doesn't drive and lives in a country with the second largest oil reserves, I'd like to see the price keep climbing. I get the feeling I'm in the minority here though .

Might as well make as much money off it while it lasts. The eco-conscious (I refuse to call myself an environmentalist because I'm not) person in me would rather have the electric cars but I'm getting off topic.

It's hard to tell how high gas prices will go. I mean, billions of dollars a year in straight profit certainly isn't enough for the oil companies.

They need more, I mean how can any moral person expect the oil company CEOs to live on only a few measly billion dollars in profits?

My real guess is reg unleaded will hit $4.00 at some point this summer.

Time to get the bicycle back out and start using it for everything local.

I remember my dad saying when he started driving it was only $5.00 to fill 'er up. Now, I'm gonna start driving next year and it's gonna be like $45.00 to fill 'er up. Good thing my car gets excellent gas mileage.

MYmacROX said:

It's safe to say the whole electric-vehicle-charging-station-infrastructure thing is several years away. I won't be buying a Nissan Leaf or Chevy Volt just yet.

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Electric vehicles are not the answer. Never were and never will be. You're just robbing Peter to pay a much less efficient Paul.

So, let's say just 10% of the country shifts over to electric cars (unrealistic, but just for an example) - now our already fragile electric grid is working overtime to recharge these vehicles, and with supply and demand being what they are, everyone's electric rates go up and any advantage an electric has in cost per mile is essentially negated.

Electric cars solve absolutely no problem. They're just another ruse for the short-sighted so that oil companies can maintain status quo.

What is needed is a plentiful, easy to refine natural resource. The closest thing I've seen to that is so-called "green gas". Essentially gasoline made from algae. Although there seemed to be a lot of press coverage about it two years ago, suddenly everything has gone silent as new electrics and even some Hydrogen Fuel Cell vehicles (even worse than electrics) are starting to pop on the market.

Anywho... I've derailed this topic enough. Carry on...

IMACFAN15 said:

I remember my dad saying when he started driving it was only $5.00 to fill 'er up. Now, I'm gonna start driving next year and it's gonna be like $45.00 to fill 'er up. Good thing my car gets excellent gas mileage.

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Interestingly with inflation, $5 probably was roughly $45 in today's money

XJ-linux said:

We're excited about nuclear in Minnesota as they just failed to renew the 20-some-odd-year moratorium on new nuclear plant permits. Gotta get that "clean" electricity from somewhere. Mr. Fusion anyone?

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Big nuclear fan here Have to be, considering I'm 7 linear miles from Three Mile Island. Statistically speaking, it's now the safest nuclear plant in the world (I think.... <gulp>!)

What needs to happen is the US needs to massively jack up gas taxes like they do in Europe. This will encourage conservation, a shift to higher efficiency vehicles and alternative fuels, carpooling, and public transportation.

The US populace has consisotently shown an incapability to the right thing or move in the right direction on moving from fossil fuels. Bring the pain, I guarantee we'll not only switch faster, but I'll bet we become pretty innovative pretty quickly.

Electric cars can be part of the answer, assuming that they don't offset the fossil fuel savings in order to ramp up electrical production. If they do, wast of time, if they don't not a bad thing.

Everything I have read to leads me to believe that a vehicle like the Volt uses ~20% of the fossil fuel energy for a full charge that it would use were it sporting a gasoline engine with the same mileage. I don't know how true those numbers are but that is a significant energy savings, assuming the technology is really ready for prime time.

schweb said:

What needs to happen is the US needs to massively jack up gas taxes like they do in Europe. This will encourage conservation, a shift to higher efficiency vehicles and alternative fuels, carpooling, and public transportation.

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Any politician that does that will find themselves out of office and the tax will be repealed quickly. It's not the Govt's job to force new technology on us, it's the private sectors job to get us onboard with realistic , meaningful cost savings. The Govt can help in the form of tax breaks for individuals who brace the new technologies and breaks for the companies the help push them, but that is not necessary.