Arkansas Blog

It was 3.48 last night and 3.99 at lunch with cars lined up south of you. Might want to think about it before driving toward Texas on a quarter of a tank.

This is silliness. Beebe and McDaniel's populism has already caused gas shortages in Gravel RIdge.

Its the station owners' gas under you pump it and pay for it. Let them charge what they want for it.

To quote the Arkansas Business story:

"The Mapco attendant told ArkansasBusiness.com that, at the rate drivers were filling up their vehicles, the station would run out of gasoline in 20 minutes and that the station wouldn't be able to get a delivery for at least three days."

Would you rather pay $5.00 a gallon and be able to buy gas or pay $3.50 today and there not be any tomorrow?

Y'all will be bitching tomorrow when there's not gas left. If you'd let the prices take their course we wouldn't run out.

Mondo paying more for gas is not going to increase the supply.

RIght, but charging less for it will decrease the local supply available.

Mondo,

Put your ire at the right target. You just suggested the Attorney General ignore a law on the books. The price gouging statute is not something McDaniel invented. Whether you agree with the statute or not, the General Assembly passed it. Should be in the Deceptive Trade Practices Act around A.C.A. 4-88-301, and I think I saw a link to it in the other price gouging thread.

Complaining about a statute designed to prevent predatory pricing in the wake of a natural disaster because the elected official charged with enforcing the statute is actually enforcing it seems odd.

Its a silly law. We have lots of silly laws; McDaniel doesn't demagogue on those.

Nightly news shows spikes in gas prices all over the nation, and people running to the pumps to fill up.

I hope as they do so, they ask themselves what the current administration has done to prepare for emergencies like this--that is, besides assuring that those in the administration and its oil friends will all make off like bandits.

It is beyond belief that there are still Americans who would want to return More of Same to the White House in November.

Bebee and McDaniel can put out that bull but tell me when was the last time someone was prosecuted for price gauging?

If there is not enough gas then it will run out regardless of the price. People don't buy gas for the hell of it.

Does anyone really believe that this country runs out of gas whenever a hurricane hits the gulf coast?

If we lose some of the refineries most of you who have fought building more will bear the responsibility for its impact. Not having built one single refinery since 1976 with the growth of usage is irresponsible and rests squarely with the environmentalist nut cases.

The administration isn't responsible for the fact that we have fewer refineries and haven't built one since 1976. That responsibility rests squarely with the environmentalists and the demos.

If we lose some of the refineries most of you who have fought building more will bear the responsibility<<

Could you please name some goddamn names to back up your empty bullshit allegations?

I've been on this blog much longer than you and I've never seen anyone, including the publishers
call for banning gas/oil refineries or protest additional refineries. You wingnuts were in charge of
Congress from 19994 thru 2006 now you somehow want to say it's someone else's fault for no additional
refineries. You've had a wingnut president since 2001 and you say it's "most of you who have fought".

Who in the hell are you kidding? It's the freakin oil companies who have not chosen to build additional refineries. When you can make billions per quarter with existing facilities why build more. Just use the refinery shortage bullshit to keep prices high. Is anyone standing in line to buy gas? Is gas consumption up since 1994, I would say yes.

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You are full of bul,l elwood. i don't have to prove anything. They haven't built a refinery since 1976. Try that crap with somone else, pal.

WHO has stopped a refinery from being built? Name one example. Hell they can build one in my back yard if they'd like. I'm sure nobody in the delta would turn one down but nobody has tried to build one.

Name one that was stopped by somebody.

Also tell me why Bush and the Republicans controlled congress for 6 years yet didn't get one built.

As good as you parrot lies, McCain should have picked you as his VP.

Hey guys be glad you are not here in Virginia! This morning gas was 3.54 by noon 3.98 by 2pm 4.05 and still rising, if the stations still have fuel!!! Station owners are telling people it will be over 5 bucks tomorrow! This is not right! I watched one station raise their price 3 times today. I refuse to give in to this, and I am low in the gauge. I may learn my lesson when it hits the 9.00 predicted by Sunday.........Texas still has normal prices...WTF????

"His stations in Pine Bluff were selling gas for $3.99 per gallon late Friday afternoon."
Uh, yeah, and at about 1:30 this afternoon too. Maybe earlier, but that's what time I ran an errand. But Mr. Ferren didn't lie. He just said they were selling it at that late Friday afternoon. Just kinda forgot to mention the price went up earlier, didn't he? Wouldn't be the same Mr. Ferren who often manages to price Exxon gas in Pine Bluff as much as 10, 12, sometimes 15 cents higher than at his stations in Hot Springs, Sheridan, Benton and Monticello, now would it?

Gee, the Houston area refineries are at risk, so Virginia's got problems? Right. If folks would just say forget it, I'm not paying that, I'll stay home over the weekend, we might just see how much of a crisis there really is. Of course, I can say that with maybe 15 gallons of gas in my tank.

>>>You are full of bul,l elwood. i don't have to prove anything.<<

Not to mention that you CANNOT substantiate anything you post. NOTTA. Total bullshit.

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I don't have to give an example. None have been built. 1976 was the last refinery that was built. Now I'm sure you can google and find out that fact. You can also find out a wealth of info about why the refineries haven't been built. Only someone so dense or an ideologue could deny that obvious point. However, knowing the moonbats on this blog nothing surprises me.

Here you are strange, if you haven't cut and run yet, note the interview says refining down 10%

and the distillate market is over supplied. Also note how many times you hear "value of U.S. dollar."

Bonus Question: How many oil refineries are in the U.S.?

20-25
200-250
50-60
150-160

.

149 today. We had approximately 339 in 1949. Interesting the significance of the year we last built a refinery---1976. I wonder who was elected President in 1976 and started serving in 1977. I'm sure that is just a coincidence!!!!!!!

How can the price go up at a service station when a tanker truck has clearly not just recently delivered a new load of gas into the tanks?

Rode the bicycle home from work today. Lines of cars along Kheil lined up are very easy to get around. Got home 20 minutes later and those cars where probably still waiting to get gas.

Behind high gas prices: The refinery crunch
When gasoline prices surge, a lack of refining capacity is often blamed. What's being done, and is it enough?
By Steve Hargreaves, CNNMoney.com staff writer
April 17 2007: 3:43 PM EDT

NEW YORK (CNNMoney.com) -- It's the same story every year.

Each spring, just before the summer driving season, gasoline prices skyrocket. And every year, these four words appear in news reports nationwide as a big reason for the runup: "lack of refining capacity."

Then experts call for more refineries, politicians pledge to make the dirty behemoths easier to build, but guess what? Nothing really happens. Next year, repeat story.

So why hasn't a new refinery been built in the U.S. since 1976?

"There have been calls every year this decade for new refining capacity, yet no new projects initiated," said Geoff Sundstrom, a spokesman for AAA, the motorist organization. "Refining capacity has not kept pace with demand for gasoline."

Numbers from the government prove Sundstrom correct.

In 1995 American drivers burned about 17 million more gallons of gasoline a day than the country produced, according to the government's Energy Information Administration. The difference was made up for by imports.

By 2005, the latest figures available, the gap had widened considerably to about 36 million.

"Consumer demand just continues to grow, and we can't grow as fast at the refining level," said Charlie Drevna, executive vice president at the national Petrochemical and Refiners Association, which includes companies like Valero (Charts), ExxonMobil (Charts), Chevron (Charts), and ConocoPhillips (Charts). "But there are plenty of economic reasons why that hasn't happened."

First off, experts note, gasoline, like any commodity, is subject to big price swings. After all, in the late 1990s it was selling for less than $1 a gallon, hardly an encouraging number if you're a refinery exec looking at making a decades-long, multi-billion dollar investment.

While retail gasoline prices are currently near record highs at just below $3 a gallon, where they might be five years from now is a matter of debate.

Some experts say new investment, in both alternative energy and conventional sources, will boost supply and could cut prices in half. If a global recession hit, the drop could be even more dramatic.

Others say rampant demand, especially in the developing world, will keep prices from going anywhere but up. For an oil executive trying to decide on a refinery investment, picking who's right is a tough call.

Secondly, stringent environmental laws and effective community organizing have made it very difficult to build a new refinery in the U.S.

"Everyone is quick to say "look at these refiners, they're driving up the price,'" said Phil Flynn Flynn, senior market analyst at Alaron Trading in Chicago. "But if I wanted to build a refinery tomorrow, I couldn't do it."

And then there's the public's newfound concern over global warming and its supposed commitment to do something about it. President Bush himself has called for a 20 percent reduction in gasoline use over the next 10 years.

"What refining executive in their right fiscal mind would say, gee, we need to add refining capacity right now," said Drevna at the refiners' association.

While refinery capacity may not be growing as fast as demand, it is growing.

For example, Drevna noted that expansion projects at the nation's existing refineries have had the effect of adding the equivalent of a brand new refinery every year. That increase came despite mandates for cleaner gasoline and diesel fuel, which take longer to make.

And the future looks even brighter.

"There is a tremendous amount of expansion," said Tom Kloza, chief oil analyst at the Oil Price Information Service, speaking of projects at existing facilities. "We will have a solid increase in North American refining capacity, but not for another two years."

Kloza said much of the expansion would come along the Gulf of Mexico and in the Midwest, an ideal spot to process heavy crude from Canada's emerging oil sand deposits.

The only place that might not see more capacity is the West Coast, said Kloza, where there is little refinery expansion planned, leaving the region more dependent on expensive imports.

TRY PAYING 4.29 PER GALLON HERE IN JONESBORO, AR. I WAITED IN LINE TO BUY IT FOR 3.79 . I WOULD NOT HAVE BUT I WAS OUT OF GAS. THIS COUNTRY AS GONE TO HELL IN A HAND BASKET.

Ah Strangle love, you should read what you paste:

strange wrote: "Not having built one single refinery since 1976 with the growth of usage is irresponsible and rests squarely with the environmentalist nut cases."

CNN report: "For example, Drevna noted that expansion projects at the nation's existing refineries have had the effect of adding the equivalent of a brand new refinery every year"

Additionally, as I implied the FIRST consideration regarding building refineries is NOT "Environmentalist nut cases" as per strangle love BUT

CNN report: "First off, experts note, gasoline, like any commodity, is subject to big price swings. After all, in the late 1990s it was selling for less than $1 a gallon, hardly an encouraging number if you're a refinery exec looking at making a decades-long, multi-billion dollar investment."

Finally per CNN report refining capacity and bidness decisions: "then there's the public's newfound concern over global warming and its supposed commitment to do something about it. President Bush himself has called for a 20 percent reduction in gasoline use over the next 10 years."

There you have it. No environmental wackos at work. Expansion is occurring but markets/executives are the real decision makers. Good thing strangelove avoided bidness and was a government bureaucrat for many years in Washington.
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"If we lose some of the refineries most of you who have fought building..." strangehate

Ya gotta admit reading some of strangehate's posts is funnier than Barney Google. Remember Barney, the first 'Google'? Sorry, I wandered off subject.

Re strangehate's post and followups- it's hard to know how to parse such a stupid statement (par for his course). Let's see, if 'most of you' have fought building them, then either (1) you were successful and they never got built or (2) you were unsuccessful and they did get built. Has to be one or the other, right?

If they never got built, how can we now "lose them", pray tell? And if they did get built, well, I shouldn't even need to explain that, should I? strangehate, you are one funny guy and don't even mean to be!

Re no new refineries built since 1976- if true, so what? Use the blue name link to see that U.S. refineries have increased production since 1985 by roughly 2 millions barrels a day (Point 1). Point 2- we import gasoline that, as strange already knows, has already been refined outside the U.S. Point 3- Big Oil is not the least bit interested in whether or not U.S. refinery capacity has kept pace since 1976 with demand. They care only about maximizing profits, nothing else. Point 4- you need to factor in average mileage of U.S. vehicles in 1976 compared to 2008 to get any meaningful comparison (strange, you can do that exercise for yourself, thank you). Point 5- refineries have been running at about 90% of capacity in recent months/years, not even maxing out on the amount of gas they could produce if it increased profits (info also at linked site).

Conclusion- strange knows all this, as we're just chasing our tails by duplicating similar posts (also by strange) some weeks/months ago. Same accusations, same set of facts, same instigator.

strange- do us all a favor and print a copy of this. Next time you want to pull this s**t, get it out and read it.

elmwood, obviously you didn't read the article that I provided above:

"Secondly, stringent environmental laws and effective community organizing have made it very difficult to build a new refinery in the U.S."

Google the subject and there are a wealth of articles that blame environmental standards for inhibiting the building of refineries. Try again, sweetheart.

One station in Star City raised prices from $3.64 gal to $4.45 gal in one day...

Elmwood, you just may get an opportunity to find out just how few refineries we have and how delicate the balance is between our refining capacity and demand. We have added capacity by expansion to existing facilities but when we have to bring these refineries down to reformulate or if something, like a storm, should put one out of production we are screwed. Enjoy the hurricane. However, I would not get even close to a service station tonight because a panic is in process because everyone else, except you, knows what happens when these go out of production.

1) Prices are determined by demand, not by input costs. Those saying "how can prices go up when no tanker truck has pulled up today" don't understand how business/economics works. If more people are demanding a product, then prices go up. Period. Why do you think movie tickets cost more at night than during the afternoon? It's obvious it's not because it costs more to run the theater. It's because more people demand movie tickets at night.

2) High prices are actually your friend in these situations. Obviously, the lines at the gas stations prove that demand increases due to fear in these situations. If prices stayed low, everyone and their brother would top off their tank just for the sake of it. But higher prices encourages only those that actually need it to fill their tank. I'd guess those of you with 3/4 of a tank weren't topping off today after the $.50 hike. But I bet you'd be thinking about it if prices were the same as yesterday.

3) Whoever said that charging less for gas 'will no increase supply available" is not looking at the sitation with the proper perspective. The point isn't increasing available supply, the point is to allocate the available supply as efficiently as possible. The best way to do this is to raise prices to meet the increase in demand in these situations. Once again, it allocates that resource to the person that actually needs it, as opposed to the people that are topping off their tanks "just because."

4) Lastly, revisiting the whole "no new truck has pulled up so how have prices increased" argument, businesses don't simply raise prices as input costs rise and fall. They raise prices based on demand of their customers, and on ANTICIPATED price increases. If you owned a business and found out your cost would be increaseing by 15% a week from now, would you raise your prices today or next week? Anyone that says next week is not being honest with themself.

Besides, there are undoubtedly several, several smaller operations that actually pay for next weeks supply with today's gas sales. In other words, if they didn't increase prices today, in advance of cost increases, they wouldn't be able to pay for next week's supply.

Read the link at my name with an open mind and think logically about the situation. i'd bet if you would you'd see things in a new light.

1) Prices are determined by demand, not by input costs. Those saying "how can prices go up when no tanker truck has pulled up today" don't understand how business/economics works. If more people are demanding a product, then prices go up. Period. Why do you think movie tickets cost more at night than during the afternoon? It's obvious it's not because it costs more to run the theater. It's because more people demand movie tickets at night.

2) High prices are actually your friend in these situations. Obviously, the lines at the gas stations prove that demand increases due to fear in these situations. If prices stayed low, everyone and their brother would top off their tank just for the sake of it. But higher prices encourages only those that actually need it to fill their tank. I'd guess those of you with 3/4 of a tank weren't topping off today after the $.50 hike. But I bet you'd be thinking about it if prices were the same as yesterday.

3) Whoever said that charging less for gas 'will no increase supply available" is not looking at the sitation with the proper perspective. The point isn't increasing available supply, the point is to allocate the available supply as efficiently as possible. The best way to do this is to raise prices to meet the increase in demand in these situations. Once again, it allocates that resource to the person that actually needs it, as opposed to the people that are topping off their tanks "just because."

4) Lastly, revisiting the whole "no new truck has pulled up so how have prices increased" argument, businesses don't simply raise prices as input costs rise and fall. They raise prices based on demand of their customers, and on ANTICIPATED price increases. If you owned a business and found out your cost would be increaseing by 15% a week from now, would you raise your prices today or next week? Anyone that says next week is not being honest with themself.

Besides, there are undoubtedly several, several smaller operations that actually pay for next weeks supply with today's gas sales. In other words, if they didn't increase prices today, in advance of cost increases, they wouldn't be able to pay for next week's supply.

Read the link at my name with an open mind and think logically about the situation. i'd bet if you would you'd see things in a new light.

elmwood, obviously you didn't read the article that I provided above:<

"Secondly, stringent environmental laws and effective community organizing have made it very difficult to build a new refinery in the U.S."<<
Strangelove

Uh huh. But again what was the FIRST reason given strange? It was business considerations. Long term prospects. Can you grasp that?
Likely not.
You are, after all, a long term government bureaucrat. Know nothing about long term investments.
Had the oil companies wanted new refineries with two oil guys running the White House can you seriously think there's more than one other person on here who's going to believe you?

Have you ever heard of "outsourcing?" It's mucho cheaper to get oil refined into gasoline in low cost labor markets. That is exactly what they're doing and will keep doing.
Again, with your lack of reasoning ability it's best you were a government bureaucrat.
.

>>None have been built. 1976 was the last refinery that was built. Now I'm sure you can google and find out that fact.<< by strangle

Remember President Reagan? He was elected in 1980. He reformed the tax rules.

" Since 1981, with the removal of refinery subsidies, the number of oil refineries has
decreased from 315 to 144 at the end of 2004."

Recall President Bush, ver. 1? He was president from 88 to 92:

"The decrease in refineries is also due to
the environmental restrictions in the Clean Air Act Amendment of 1990...
The operating
costs of meeting these regulations became too high for smaller refineries. Today, large
corporations own most refineries and to compensate for their lack in number they have
become more efficient in their operations in order to meet demand."

Now who do you suppose had an interest in helping Big Oil control refineries?

.

Here it is:

AG targets stores for gas prices

by george jared

JONESBORO - State officials are investigating an unprecedented rise in fuel prices Friday in Jonesboro.
The average price for a gallon of gas Thursday afternoon in the city was $3.59. By 10 a.m. the next morning some gas stations were charging $4.29 per gallon or more.
Arkansas Attorney General Dustin McDaniel said he will issue subpoenas to Jonesboro Kum & Go convenience stores to explore reasons for price hikes. "I would not encourage people to buy gas from these places at that price," he said.
Repeated calls to gas station owners throughout the area went unreturned. Kimberly Henson, sales manager at the Kum & Go on Highland Drive, said her corporate office ordered the price increase after it was learned Ike will hit the ports in Houston and Galveston, Texas.
When asked why the price rose so quickly, Henson said company policy prohibited her from commenting.
"I think there's definitely some price gouging going on," McDaniel said. "It's crazy. We've been getting calls from all over the state, and the worst problem we have is right here in Jonesboro."
Investigators are "seriously looking into a couple of businesses in Jonesboro," McDaniel said.
Gov. Mike Beebe declared a state of emergency Friday morning to allow McDaniel to prosecute those who violate price gouging laws.
"We have dealt with emergencies before when severe weather has impacted fuel prices in Arkansas and throughout the region," Beebe said. "This situation is unique with the interruption of pipeline service, and we want to do everything we can to make sure that any price gouging that results can be dealt with swiftly and strongly by the attorney general."
When Barry Martin arrived at his office at 8 a.m., gas at the Exxon Station at the corner of Johnson and May was $3.59.
An hour and a half later the price rose by 70 cents, and cars were lined out of the parking lot trying to get fuel.
"It was crazy seeing all those people in line," Martin said. "I never saw a fuel truck fill up the tanks at the station. When that fuel was bought [by the station], it was at yesterday's price."
Gas pipelines from the Gulf of Mexico have shut down due to Hurricane Ike, and price increases were expected, according to state officials.
Those lines are expected to be fully operational by Tuesday.
Reports of gouging started pouring into McDaniel's office early Friday morning.
There's been more calls about this than there were when Hurricane Katrina hit," McDaniel said. A gas station in Mississippi County was charging up to $4.90 per gallon, but officials were not able to confirm if prices at some gas stations went over $5.
Prices ranged from $3.89 to $4.29 on Caraway by mid-afternoon. The average price of a gallon of gas last year at the same time was $2.80.
McDaniel said it's too early to know how many, if any, charges will be filed. For now he wants prices to be dictated by market forces, not greed.
"I call on all retailers to demonstrate some restraint," McDaniel said. "It's not fair. It's not right, and it's not legal."

Thanks jimmv for the lesson in demand and supply. I understood it before your explaination and understand it the same way now.

So what do you think raised price of oil up to nearly $150 over a month ago?
I've heard it because we all drove less lowering the demand, I've heard it because speculators inflated the price. A little more complex then just demand and supply nonetheless.

Pre Ike Hike, with oil near $100 the price of gas is not below $3 as it was when oil was last at $100. Must be some other forces at work on the gas price other than demand & supply.

I saw one service station in the range of 14 miles on the bicycle commute charging 3.99 for regular and just 1/2 a mile down the street it was only 3.75. The same gas at the 3.99 station was just 3.45 that morning as was the gas the 3.75 station that same morning. If price follows demand, why would the demand be higher at one station over the other station?

So then there must be some other forces at work when a service station raises prices on the spot. Illegitimate forces. Some call it gouging. To oversimplify and justify this afternoons gas price runup with a demand and supply line is insulting to my common sense.

Good commentary Ron R. I think Jimmy's linked article referred to the macro role of pricing while you and state officials are dealing with MICRO circumstances.
Gasoline is a necessary commodity for most folks. Hence, it's like other necessary commodities, electricity, water and gas. The state steps in to prevent gouging, which is opportunity pricing plain and simple, so that hardships are not placed too severely upon too many working level families. The rich can hail a cab or have their necessary stuff delivered.

Locally we trade with some Pakistan owners or operators of a C-store, mainly because of their Eastern deli offerings. yummy.
If they were being honest with us then, when gasoline was at its highest earlier this year, they were making about 5/6 cents per gallon. Their margin per gallon is fixed by the local distributor/wholesaler. They simple lease the store with an agreement to sell gasoline. As prices soared their other in-store sales fell.

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"Crude oil futures briefly sank below the psychologically important $100-a-barrel mark for the first time in five months Friday, showing that investors believe a worsening global economy will continue to drive down demand for some time in the U.S. and elsewhere.

Gasoline prices, however, jumped at the wholesale level as Hurricane Ike swept through Gulf of Mexico, prompting companies along the Texas coast to shut down refining and drilling operations.

On the New York Mercantile Exchange, light, sweet crude for October delivery fell 6 cents to settle at $100.18 a barrel in afternoon trading, after briefly sinking to $99.99. In London, October Brent crude fell 6 cents to settle at $97.58 a barrel on the ICE Futures exchange, after closing at a six-month low in the previous trading session.

October gasoline futures climbed 0.11 cent to $2.76 a gallon on Nymex.

The fact that U.S. fuel demand is so weak right now might mean the recent surge in the wholesale price of gasoline - which rose to about $4.85 a gallon in the Gulf Coast market Friday - might not be passed along to consumers unless Ike's impact is severe and long-lasting."
Just saying...[CLICK]