I had the opportunity to visit with my neighbor over the weekend.  He is the President of a gas pipeline.  We talked about the economy and he told me how much money they are loosing on gas this year. I don't know what the rest of you are paying but regular gas around here is in the $1.40-$1.47 range depending on the station.  Utah has a 48 cent per gallon combined tax ( state & federal)  That puts the wholesale price of gas under a $1.00 per gallon. As he tells me, They (the oil companies) are selling a barrel of gas cheaper now than they are paying for a barrel of crude for.  He says they are still making money on diesel. ( which is selling for $2.20 a gallon here)

It's hard to feel any sympathy for the oil companies after we all saw them announce record profits last year. But the point I wanted to make is that either Crude Oil prices need to decline even more, or the price of gas will have to increase. Oil companies are selling off the excess inventory of gas now. Since they can not store it for extended periods.  But soon that inventory will come in line and retail prices will increase to reflect what it actually cost to make  gas and make a profit selling it.  Since OPEC seems to favor reducing production of crude, I doubt we will continue to see a decline in crude prices.

I'm not telling you anything most of you don't already know. But I would suggest that we enjoy the low price of gas now because it won't last.

I was a little miffed when the price of oil went though the roof and oil companies posted unbelievable profits.  Now I am pleased as punch that they made those profits, because my pension fund is heavily invested in oil, and the profits from that may just save our bacon over the losses elsewhere in the market.  I believe things are going to get a lot worse befor they get better.  Hold on for the ride!

Marla

"Hold on for the ride!"    You got that right!  I was traveling through central VA on Wednesday and actually saw gas for $1.29!!!  This morning, the news said that gas in Louisville, KY was at $1.79.

What a roller coaster!  Hang on, throw your head back and scream!!! 

I just had to wonder how the cost of fuel could differ so much from state to state. Here in the high desert of So. Calif, it is still 1.79 a gallon for regular and last summer at the same station it was 4.05!!!  And that was on the Air Force base!!  It used to be that at the exchange or commissary, the prices were some what less, as the state taxes were not imposed. But that was in my teens when I was an officers brat and my Dad was in the service. ( 1960's?)  Now I work for a contractor to NASA, and the prices on base are higher than off base frequently.  ( we are allowed to use the gas station on base as it is at least 30 miles to a civilian station.)  I know that our airmen and soldgiers/seamen/marines, DON'T make high wage, and the on base sale of commodities used to be a way they could make ends meet.

Hmmmmm....able to stand between us and the terrorists, but not able to make ends meet!    Hmmmmm.... somethings awry here!

My 2'C's....Steve

Filled my truck yesterday.  Took 27 dollars to top it off.  I nearly fell over!  I was expecting close to 100 bucks.

Marla