Gasoline Prices To Soar
- Dear Friends,
Click the link if you don't receive the images.
Love and Light.
~ Oil prices per barrel could reach $80.00 a barrel by October 2005 and $100.00 a barrel by
December, 2005. Gasoline could reach $7-$8 dollars a gallon. ~
~ 20 oils rigs have been destroyed or are missing in the affected region according to the Coast Guard. ~
In addition to the worst disaster to hit the United States in 100 years and the untold possible thousands of deaths in the region where hurricane Katrina hit, consumers have something else to worry about. Rising gasoline, heating oil and natural gas prices, which will trigger inflation for everything across the board. Energy is tied to every facet of the economic sector.
Unleaded gas futures edged closer to $3 a gallon Wednesday. Despite an announcement from the WhIte House that oil will be released from the Strategic Petroleum Reserve, oil futures climbed above $70 a barrel as an unexpected decline in inventories are expected.
An already overworked refining capability in the country has taken another serious blow. It appears that a refinery whch produces gasoline for the Diamond Shamrock gasoline chain has been destroyed in Louisiana. This will cause gasoline prices to soar in the coming days because demand will outweight refinery capability supply.
Having enough oil is not the major problem. Having the refining capacity to refine it is. Releasing oil from the reseves will have little impact on gasoline prices that will soar in the coming days and weeks.
Add to these facts - the market realizes that Hurricane Katrina's devastation at the Gulf Coast hasn't been factored into the nation's petroleum supply report -- at least not until next week's data, which will cause another price soar.
"Hurricane Katrina's impact will only begin to impact the data next Wednesday," said Jason Schenker, an economist at Wachovia Corp.
As of Tuesday, 735 oil and natural-gas rigs and platforms were unmanned in the Gulf of Mexico, according to the Minerals Management Service. The evacuations halted the movement of more than 1.4 million barrels a day of oil production, or 95.2% of the region's regular output. Daily natural-gas production dropped by 8.8 billion cubic feet of gas, or 88% of production in the Gulf, the MMS said.
"The move by the President to release SPR product will contain further price spikes" for crude, said John Person, president of National Futures Advisory Service. But only "as long as we see improvement in the restructure in the LOOP [Louisiana Offshore Oil Port] and Gulf of Mexico region refineries capacity ability to get back to operating within the next two weeks." This is very unlikely to occur.
Given that, "$4 gasoline will likely be visited upon consumers in many areas very shortly," he said. And that is already occuring. The photos below are of gas pump prices taken this afternoon across the country.
20 oil rigs have been destroyed, they are missing in the Gulf of Mexico according to the Coast Guard. These cannot be replaced/rebuilt in just a few weeks.
It will take years and this is going to effect the oil supply in the U.S. In addition, more than one oil refinery has been destroyed in the region according to the Coast Guard.
Below are prices across the country that jumped just this afternoon. Prices are already climbing.
Heating oil this winter will also increase. Oil prices per barrel could reach $80.00 a barrel by October 2005 and $100.00 a barrel by December, 2005. States that do not regulate natural gas prices, will see soaring prices in the winter months. Oil and gas production capabilities have been destroyed in the Gulf.
Maybe its time to use some common sense in these coastal areas. STOP BUILDING this close to the ocean, especially below sea level. This is the fourth time in this century that these coastal areas in the United States have been hit ,costing billions upon billions of dollars and thousands of deaths. The devastation that is being seen in this region has been predicated by several disaster organizations for years if a hurricane ever hit New Orleans head on.
A woman recently interviewed on television in Louisiana said, "Well... mother nature whipped us down pretty good, but we won the war."
I'm not sure what planet this woman is living on or her education, but she better take another look around her. We did not win the war, the whole region has been leveled by hurricane Katrina.
A few years ago, an analyst at one of the major insurance companies told me the following, "the billions of dollars the insurance companies have had to pay out for such disasters, especially to corporations owning resorts in these areas cost the average homeowner in other areas an additional 35-38% for a homeowners policy. We have to make up the money some place."
Early reports are stating that the minium dollar damage to this region will equal the four major hurricanes that hit last year. That is already in excess of $230 billion dollars. Where is this money going to come from? We are already spending $80 billion a year in the war in Iraq.
Isn't it time to learn from Mother Nature...she is telling us...don't build major cities near the ocean.
I received an interesting email from a reader who forwarded comments by a John Nelson. Nelson says,
" the rising oil prices is not due to hurricane Katrina."
Here are his other thoughts on what he perceives are the real reasons.
"The current fuel cost increases are due to the depreciated purchasing value of the Federal Reserve Note. This is the core of the problem, not the oil and gas. The direction appears to be misguided and will not have any direct or consequencial effect."
"The U.S. is foreign oil dependent. Even domestic production facilities for crude resources has been outsourced. Other countries and producers will not sell crude and sweet oils to American companies while taking a significant loss from the sale of the resource for continually decreasing purchasing values inherent in the medium of exchange."
"The 'risk' and loss was undoubtedly intended to be passed off on others. Public Law 94-564, Senate Report. Unlike the generally subjugated American who cannot even define the word 'liberty', foreigners are not obligated to accept such chicanery as a means of transacting business."
"I wish those who promote such things would take a little more time to think of ways to accomplish a corrective and just end."
The real problem is China and Japan which I have been trying to warn people about for three years. China is now the world's No. 3 oil importer, depending on foreign fuel to run its booming factories. The country's consumption remains strong at a 7% growth projected through 2010...read the rest of my column about China, Eyes On China
I believe there is truth in the above.
[Non-text portions of this message have been removed]