OldManOnFire

As long as world demand remains greater than world supply the cost of oil will remain static or increase.

In the USA, the next 3-4 months are the peak driving times, therefore one can assume that demand will be even higher.

Of course no one knows precisely what the magic dollars-per-gallon number will cause most people to come to a complete halt, but eventually we will hit that number, lowering demand which will somewhat lower the prices.

Out of our control is the world demand and if China and India continue at their current pace, and if they are willing to pay the equivalent of $6-8 USD per gallon for gasoline, then the citizens of the US have no choice but to deal with the challenge this presents.

Last night on our news they asked a person in the street about gasoline over $4/gallon and their answer was 'I'll just drive less'. How naive I thought since this person has not yet equated high oil costs with higher costs of 'all' goods and services--inflation rates much higher than personal earning rates...

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Did you know both our problems and the solutions can be found simply by looking in our mirrors...and...Never confuse the extraordinary stuff I think and write with that of a well-balanced person...

slowhand

Basically what CNBC was saying last night was along the lines of what you've posted here concerning the suppy and demand..They were saying that the demand vs supply is presently in the oil co's favor..What rattles my cage..(beside that fact the everything else goes up with the price of oil)..is the price of home heating oil..I have oil heat, and I got $600 and $700 oil bills this past winter about every 6 weeks..Im very concerened about next winter..The man on the street who says he will drive less, also isnt thinking that while you can drive less, you can only lower your thermostat so much in the winter months before he's freezing his behind off..A friend of mine is a dispatcher for a trucking co, and they are in the midst of a nightmare right now, between the customer not wanting to pay the higher freight price, and the trucking co not wanting to make a delivery for a $125 return, coupled by the fact that some accounts are paying their freight bills late

OldManOnFire

Total world oil production is about 1 million barrels PER DAY lower than the world demand. There are probably several reasons for this; this is the current world capacity, this is guided by OPEC, this is impacted by world and local politics, etc. No matter the reasons, all of which are out of the control of consumers, there is more demand than supply.

Since there is not enough supply, every little problem, like oil fields down for whatever reason, like a refinery down, like a natural disaster that affects oil fields or refineries, like world politics, in which there would normally be little affect, today is exacerbated because of the pain many are already feeling.

Regarding your heating oil, since 2005 the US average per gallon price has increased from about $2.05 to $3.20. This is a 56% increase!! We are using propane for our water heater, central heating and stove top and I think our last price was about $3.59/gallon and we used about 200 gallons this past winter or about $750--not horrible for four months of our winter...which in our area of CA is pretty mild.

If oil supplies are really limited to today's output, and if demand is growing as we see and as predicted, then the only direction the prices will go are up!! Since the cost of oil products does affect every fabric of our lives, a sustained price increase is going to cause more and more pain. Depending on one's position to deal with this pain, it can range from being a small issue to illness and dying and bankruptcy.

I don't personally care what anyone says about the possibility of oil prices dropping in the future. I'm done with the Russian roulette and we are taking any steps we can afford to be as sustainable as possible. I'm not panicked...I'm not worried...I'm just taking control of our lives. Taking control from the oil and gasoline companies, from the electric utility companies.

A wise futurist once said: Control your future...for if you do not...someone else surely will.

__________________
Did you know both our problems and the solutions can be found simply by looking in our mirrors...and...Never confuse the extraordinary stuff I think and write with that of a well-balanced person...