The Stealth Return of $100 Oil

The days of $100 oil are back—and not just in Europe, where the Brent crude benchmark vaulted past $108 a barrel on Monday.

While U.S. prices haven't scaled such heights—the benchmark oil contract on the New York Mercantile Exchange briefly surged Tuesday past $94—many U.S. oil refiners and consumers are finding their costs have already escalated. Refiners such as Valero Energy Corp. are paying prices that mostly track Brent, not the U.S. benchmark often referred to as West Texas Intermediate, and those costs are being passed on to gas stations.

Gasoline prices averaged $3.14 a gallon in the U.S. last week, according to the U.S. Energy Information Administration, up 2.9% from Dec. 27. In February 2008, when oil prices settled in triple digits for the first time in history, retail gasoline prices in the U.S. were at $3.13 a gallon.

"You think oil is $85 a barrel, but you're paying $100-a-barrel prices," says Ed Morse, Credit Suisse Group's chief energy economist.

http://online.wsj.com/article/SB10001424052748703610604576158613735835374.html

Right.

They've kept it as low as they can, since global production has been at its peak for more than five years.

It's hard to keep those greedy speculators in check when the stuff is getting scarce and there's bucks to be made!

"We totally have spare capacity!"

"No, we see no reason at this time to deploy it."

:rofl:

Nothing to see here. Move along...

:sarcasm:

Shades of the movie Poltergeist anyone? Now is the time to get off of oil.

Drive electric cars.
Use only LED light bulbs.
Insulate and make airtight every home, apartment and commercial building feasible.
... if you think you have enough insulation -- double it, and seal all cracks and holes in the building envelope.
Start a WWII-style program for solar power plants and wind farms, geothermal power plants, tidal and wave power wherever workable.


We can get off of oil and we can do it quickly. But some special interest groups are going to get the short end of the stick. So sorry, these are the same businesses that have enjoyed record (all-time world record) profits even during times when the rest of us were economically devastated. You takes the good wit' the bad, ya know what I mean?

But the economy is still in the crapper. Just think what gas would be / will be if we get back to full employment or any semblance of a normal economy... or had never had the banking, real estate, gasoline, etc., crashes all at the same time.

I personally suspect the ratcheting-recession peak oil scenario is now in play. Any increase in economic activity will be knee-capped by a subsequent spike in oil and fuel prices. It's disconcerting that our economy didn't even really pick up much before it happened again. I assume the epidemic of unrest in the middle east has a lot to do with it.

Here is a neat interactive chart that will give you the last 6 years of gas prices at the pump.
http://www.gasbuddy.com/gb_retail_price_chart.aspx?time=24

For some reason, you have to manually select to see the last 6 years of gas prices. The link will come up with only the past 2 years. Choose 6 years' worth and you'll see a steady build up of prices.

The American economy doesn't seem to matter in world affairs anymore.