Low Gas Price how long

Saw $1.82 today and the news says average is $1.88 around Ohio but there are 4 stations near each other in southwest Columbus that are having a gas war at $1.59.

David
 
$1.69 a gallon today!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
 
While on the topic, any speculation wrt the new lead free avgas coming in a couple of years. I was told that it will be blended at the tank farm from 2 feed stocks.
 
The downside of cheap oil? We've got 70,000 guys laid off in an arc from Houston to San Antonio here in Texas. All those "man camps" and new motels built to house them are empty, and 40+ Texas oil-related companies have declared bankruptcy since summer.

It's only a matter of time before it hurts us down here on the island.
 
paflyer said:
fly-me.jpg
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Do a complete and thorough preflight on that thing...
 
flhrci said:
Saw $1.82 today and the news says average is $1.88 around Ohio but there are 4 stations near each other in southwest Columbus that are having a gas war at $1.59.

David
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Yea, my MOGAS source is staying about $2.40. That's about $24 / hour. Was hoping to see it go down to $20/hour :D
 
Jay Honeck said:
The downside of cheap oil? We've got 70,000 guys laid off in an arc from Houston to San Antonio here in Texas. All those "man camps" and new motels built to house them are empty, and 40+ Texas oil-related companies have declared bankruptcy since summer.

It's only a matter of time before it hurts us down here on the island.
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Yep, but this is completely normal for the industry, it's not designed to serve society well. The way the entire system is financed assures that development will be done as expensively and inefficiently as possible.

Rather than take time like this when most all the drilling equipment is stacked and you can rent it dirt cheap, you can't get the financing to do the drilling. When demand and the price of oil goes up, everybody wants to drill and then the day rates on the rigs jump 10 fold or more, and you may have months or over a year's lead time before you can get a rig to your sight and start drilling. If you're really unlucky, the cycle reverses just as you're finishing off your well and the price of crude or gas drops, and now you have a well that won't pay for itself that you have to cap until the crude rice goes up again, and in the mean time you still have to pay the vig on the money you borrowed to drill, call it a $1MM. Most guys end up pumping enough to pay the vig even though it's costing them a lot of future revenue.

The oil business is truly a banker's best friend.
 
Henning said:
Yep, but this is completely normal for the industry, it's not designed to serve society well. The way the entire system is financed assures that development will be done as expensively and inefficiently as possible.



Rather than take time like this when most all the drilling equipment is stacked and you can rent it dirt cheap, you can't get the financing to do the drilling. When demand and the price of oil goes up, everybody wants to drill and then the day rates on the rigs jump 10 fold or more, and you may have months or over a year's lead time before you can get a rig to your sight and start drilling. If you're really unlucky, the cycle reverses just as you're finishing off your well and the price of crude or gas drops, and now you have a well that won't pay for itself that you have to cap until the crude rice goes up again, and in the mean time you still have to pay the vig on the money you borrowed to drill, call it a $1MM. Most guys end up pumping enough to pay the vig even though it's costing them a lot of future revenue.



The oil business is truly a banker's best friend.
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Right now, cheaper to buy assets than drill them.

Even the super-majors are putting stuff up for sale.

I hope nobody feels sorry for Texas. They enjoyed a boom, if they weren't smart enough to save for a rainy day, that is on them.
 
JoseCuervo said:
Right now, cheaper to buy assets than drill them.

Even the super-majors are putting stuff up for sale.

I hope nobody feels sorry for Texas. They enjoyed a boom, if they weren't smart enough to save for a rainy day, that is on them.
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Exactly, which is why right now is the time to be drilling and developing future reserves that pay off down the line. The reason it doesn't happen is because the people who control the big capital for the industry are an Apocalypse cult, the whole European aristocratic class has been since the beginning when they changed over from being Saturnists to Christians.
 
Henning said:
Yep, but this is completely normal for the industry, it's not designed to serve society well. The way the entire system is financed assures that development will be done as expensively and inefficiently as possible.

Rather than take time like this when most all the drilling equipment is stacked and you can rent it dirt cheap, you can't get the financing to do the drilling. When demand and the price of oil goes up, everybody wants to drill and then the day rates on the rigs jump 10 fold or more, and you may have months or over a year's lead time before you can get a rig to your sight and start drilling. If you're really unlucky, the cycle reverses just as you're finishing off your well and the price of crude or gas drops, and now you have a well that won't pay for itself that you have to cap until the crude rice goes up again, and in the mean time you still have to pay the vig on the money you borrowed to drill, call it a $1MM. Most guys end up pumping enough to pay the vig even though it's costing them a lot of future revenue.

The oil business is truly a banker's best friend.
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Have family in the oil business. Not the guys that own the land, oil, oil companies or anything else with value. Just the poor slobs that have to do the work. (Got some college money working roustabout for a while.)

It really is feast or famine - even worse than in IT. I have a cousin that had a truck (one of those country Cadillacs) that cost him more than my airplane - MX included. Now he is sitting on his thumbs. His job: he runs the seismic equipment that indicates where the drill should be aimed. (Drilling is no longer straight down.)

My mom (who was also in the oil business as a worker) put it best when I told her a friend of mine got lucky when they found oil shale under his hunting land here in Arkansas: "Get those *** holes for all you can!"
 
All you have to do is look at the history of Spindletop, ethically (or dynastically) nothing in the energy industry has changed since that day. Yes, society suffers for it because while 'boom and bust' is a great technique for growing wealth using, and then sucking it off, society, it is society that becomes 'the loser'; and that is the way it is meant to be.
 
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JoseCuervo said:
Right now, cheaper to buy assets than drill them.

Even the super-majors are putting stuff up for sale.

I hope nobody feels sorry for Texas. They enjoyed a boom, if they weren't smart enough to save for a rainy day, that is on them.
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Easy to say, from your armchair -- but there are 70,000+ families who won't be enjoying the holidays this year. The blue collar guys are taking it in the shorts.

Not to mention the thousands of businesses who depended on those guys having enough money. That includes virtually everyone, from grocers to car dealers -- to hoteliers.

Even the wealthy are pulling back. Lots of oil money down here, and prices this low can be ruinous. That means lots of trucks, boats, and planes unsold, and condos empty.

And then, there's North Dakota. I hear it's gone back to dust bowl ghost towns virtually overnight -- can anyone up thataway comment?

$1.69/gallon on the mainland yesterday. I never thought I would see that price again.
 
Jay Honeck said:
lol Easy to say, from your armchair -- but there are 70,000+ families who won't be enjoying the holidays this year. The blue collar guys are taking it in the shorts.

Not to mention the thousands of businesses who depended on those guys having enough money. That includes virtually everyone, from grocers to car dealers -- to hoteliers.

Even the wealthy are pulling back. Lots of oil money down here, and prices this low can be ruinous. That means lots of trucks, boats, and planes unsold, and condos empty.

And then, there's North Dakota. I hear it's gone back to dust bowl ghost towns virtually overnight -- can anyone up thataway comment?

$1.69/gallon on the mainland yesterday. I never thought I would see that price again.
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Jay is right. Eventually it all trickles back down hill and affects everyone.

David
 
Yea, depending upon where you are in Texas - you are really dependent upon oil money one way or another.

I will say that I'm seeing a lot of construction across the US right now. The mini "oil bubble" created by all all the fracking (my guess on the cause), has moved. Just not 100% sure where it moved to or just spread out now that energy prices are not stopping folks from investing. I'm even seeing hiring start up again...

... Just hope no more airplanes get shot down. Don't need that negativity in the economy ... Heck, I would just like to see some folks come home ...
 
Jay Honeck said:
Easy to say, from your armchair -- but there are 70,000+ families who won't be enjoying the holidays this year. The blue collar guys are taking it in the shorts.

Not to mention the thousands of businesses who depended on those guys having enough money. That includes virtually everyone, from grocers to car dealers -- to hoteliers.

Even the wealthy are pulling back. Lots of oil money down here, and prices this low can be ruinous. That means lots of trucks, boats, and planes unsold, and condos empty.

And then, there's North Dakota. I hear it's gone back to dust bowl ghost towns virtually overnight -- can anyone up thataway comment?

$1.69/gallon on the mainland yesterday. I never thought I would see that price again.
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It is hurting us in the midwest. We sell steel and other components to the companies that drill. I have survived many business cycles but it always seems to come as a surprise to the managers getting paid to put us in the right strategic position.
 
Jay Honeck said:
Easy to say, from your armchair -- but there are 70,000+ families who won't be enjoying the holidays this year. The blue collar guys are taking it in the shorts.

Not to mention the thousands of businesses who depended on those guys having enough money. That includes virtually everyone, from grocers to car dealers -- to hoteliers.

Even the wealthy are pulling back. Lots of oil money down here, and prices this low can be ruinous. That means lots of trucks, boats, and planes unsold, and condos empty.

And then, there's North Dakota. I hear it's gone back to dust bowl ghost towns virtually overnight -- can anyone up thataway comment?

$1.69/gallon on the mainland yesterday. I never thought I would see that price again.
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Yeah, easy to say it from my armchair, just like it was easy for Rick Perry to run around the country claiming that he was some sort of job creation genius...

"I have been guided by a simple philosophy: That job creation, not higher taxation, is the best form of revenue generation," Rick Perry said in his Jan. 15, 2015, speech. "And we have created jobs. In the last year, we have created 441,000 jobs. Since I became governor, with your help, we have created almost one-third of all the nation’s new jobs."
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The fact he happened to be in office during a boom should not be mistaken for some sort of genius on his part.

Texans made lots of money for the past 8 years, really didn't suffer the 2007 Bush/Cheney recession. Now the rotation is rotating thru Texas, just like it did the other states. Hopefully they learned something from watching the others states.


As for North Dakota, yes, it has pulled back. You can buy equipment out of there pretty cheap. Lots of guys who quit locally to go work back in Williston are now moved back, looking for jobs.
 
JoseCuervo said:
Texans made lots of money for the past 8 years, really didn't suffer the 2007 Bush/Cheney recession.
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lol! This part of Texas was decimated by the 2008-09 Obama Great Recession. It's why we were able to buy our hotel in 2009 -- the worst year in hotel history -- for a very reasonable price.

The island has seen explosive growth since ~2012, when the fracking boom really took hold. Development has been incredible, but I can see it slowing soon. I've noticed realtors are starting to use social media again, something they had stopped doing the last few years, simply because they didn't have to bother. I've seen double wide trailers on stilts sell for $200K.



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Jay Honeck said:
lol! This part of Texas was decimated by the 2008-09 Obama Great Recession. It's why we were able to buy our hotel in 2009 -- the worst year in hotel history -- for a very reasonable price.

The island has seen explosive growth since ~2012, when the fracking boom really took hold. Development has been incredible, but I can see it slowing soon. I've noticed realtors are starting to use social media again, something they had stopped doing the last few years, simply because they didn't have to bother. I've seen double wide trailers on stilts sell for $200K.



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Haha. 2008-2009 recession blamed on Obama? Might want to brush on history.

If you remember to Sept 2008, during the failed Bush/Cheney regime, the economy screeched to a halt, causing GOP candidate McCain to proclaim " the fundamentals of the economy are strong", gift wrapping the election to the other side.

You bought your hotel at the bottom of the Bush Effect and have enjoyed a boom under Obama.

Facts matter.


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Low energy prices will help the economy in the long run, cheap abundant energy runs economies.
 
PaulS said:
Low energy prices will help the economy in the long run, cheap abundant energy runs economies.
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May be too late to help here. The global economy is pretty flatlined. Shipping companies are literally parking/mothballing ships due to no demand. My gut says the bull is going to turn bear within 6 months of the election.
 
JoseCuervo said:
Haha. 2008-2009 recession blamed on Obama? Might want to brush on history.

If you remember to Sept 2008, during the failed Bush/Cheney regime, the economy screeched to a halt, causing GOP candidate McCain to proclaim " the fundamentals of the economy are strong", gift wrapping the election to the other side.

You bought your hotel at the bottom of the Bush Effect and have enjoyed a boom under Obama.

Facts matter.


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I was there. Actually, I was here, posting about the Obama Effect on the Great Recession.

In the fall of 2008, when everyone woke up and realized that, my God, a socialist community organizer might actually win the presidency -- with all of the terrible side effects we knew would follow -- everyone (and I mean EVERYONE) stopped buying and hiring. A downturn that might have been contained to Wall Street spread quickly to Main Street -- and the rest was history.

I know this isn't what the government schools and media teach about the Great Recession nowadays, but I was there, I saw it with my own eyes, and experienced the fear that caused me, too, to immediately stop hiring and buying in my business. Multiply that times 300,000 business owners, and results were 100% predictable.

Since then, it's been a long struggle back to something approaching economic normalcy. Calling what we have seen economically a "boom" falls into the category of propaganda.

But I digress. Extremely low oil prices are definitely a double edged sword in Texas.
 
Fearless Tower said:
May be too late to help here. The global economy is pretty flatlined. Shipping companies are literally parking/mothballing ships due to no demand. My gut says the bull is going to turn bear within 6 months of the election.
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Yes, I think the pain will continue, but hopefully we'll get some sanity. This isn't the spin zone so I'll stop there.
 
Could we take the Bush/Cheney/Obama discussions somewhere else?
 
An illustration of the ripple effect these incredibly low oil prices are having throughout Texas:

Today I met with one of our suppliers who sells restaurant equipment. (We are buying stainless steel prep tables for our new laundry room -- they are perfect for folding laundry), who also leases ice machines and other equipment.

He told me they have had to rent a warehouse to store all of the equipment from the now abandoned "man camps" that had sprung up to house oil workers everywhere from Houston and San Antonio.

If anyone needs a new ice machine, you can get a screaming good deal right now on one here in Texas.
 
SkyDog58 said:
But that would only leave Biden.



Oh wait, plenty of material there. Never mind.
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Compared to the knuckleheads in the running for both the GOP and Dem side right now, I'd give anything for Grandpa Joe to run.

We are seriously doomed no matter which way you slice it.
 
Jay Honeck said:
I was there. Actually, I was here, posting about the Obama Effect on the Great Recession.

In the fall of 2008, when everyone woke up and realized that, my God, a socialist community organizer might actually win the presidency -- with all of the terrible side effects we knew would follow -- everyone (and I mean EVERYONE) stopped buying and hiring. A downturn that might have been contained to Wall Street spread quickly to Main Street -- and the rest was history.

I know this isn't what the government schools and media teach about the Great Recession nowadays, but I was there, I saw it with my own eyes, and experienced the fear that caused me, too, to immediately stop hiring and buying in my business. Multiply that times 300,000 business owners, and results were 100% predictable.

Since then, it's been a long struggle back to something approaching economic normalcy. Calling what we have seen economically a "boom" falls into the category of propaganda.

But I digress. Extremely low oil prices are definitely a double edged sword in Texas.
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History is interesting if you don't remember it.

Lehman Brothers did not collapse because John McCain decided to choose some nutcase from Alaska to be his running mate. Lehman collapsed because of bets they made that turned disastrous as 2008 unfolded due to actions of the failed Bush / Cheney regime.

At that point, banks everywhere shut down their lending, took an incredible self-preservation stance, grinding the economy. If you don't remember the first 9 months of 2008, you will be doomed to repeat them.

Interesting how you quickly started buying assets in the beginning of the Obama presidency and were able to ride the high tide with other boats.

Facts matter.


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Jay Honeck said:
Easy to say, from your armchair -- but there are 70,000+ families who won't be enjoying the holidays this year. The blue collar guys are taking it in the shorts.

Not to mention the thousands of businesses who depended on those guys having enough money. That includes virtually everyone, from grocers to car dealers -- to hoteliers.

Even the wealthy are pulling back. Lots of oil money down here, and prices this low can be ruinous. That means lots of trucks, boats, and planes unsold, and condos empty.

And then, there's North Dakota. I hear it's gone back to dust bowl ghost towns virtually overnight -- can anyone up thataway comment?

$1.69/gallon on the mainland yesterday. I never thought I would see that price again.
Click to expand...

Again though it's hard to feel sorry for them because it's not a new phenomenon, yet we keep allowing the same people to run the industry to the destruction of the country. Einstein one ce said the definition of insanity is doing the same thing over and over and expecting a different result.
 
Henning said:
Again though it's hard to feel sorry for them because it's not a new phenomenon, yet we keep allowing the same people to run the industry to the destruction of the country. Einstein one ce said the definition of insanity is doing the same thing over and over and expecting a different result.
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Yep. Remember when Denver was the capital of the Energy World?

Boom.
Bust.

If you look inside the Oil Companies there are entire age-classes missing from their management structures. They went a decade or so without meaningful hiring.

To hear Texans crying the blues after their governor trotted around the country trying to steal companies based on unsustainable tax policies is entertaining.

Buying MoGas at $2.20 to fly is going to stimulate local retail spending wherever I travel.


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JoseCuervo said:
Yep. Remember when Denver was the capital of the Energy World?

Boom.
Bust.

If you look inside the Oil Companies there are entire age-classes missing from their management structures. They went a decade or so without meaningful hiring.

To hear Texans crying the blues after their governor trotted around the country trying to steal companies based on unsustainable tax policies is entertaining.

Buying MoGas at $2.20 to fly is going to stimulate local retail spending wherever I travel.


Sent from my iPhone using Tapatalk
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What is missing from the management structure is 'oil men', they're all 'money men'. Bankers are the CEOs of oil companies. Don't do what's best for the long term of the industry, do whatever it takes to boost the stock value for the quarterly statement.
 
Henning said:
Again though it's hard to feel sorry for them because it's not a new phenomenon, yet we keep allowing the same people to run the industry to the destruction of the country. Einstein one ce said the definition of insanity is doing the same thing over and over and expecting a different result.
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I don't feel sorry for the "oil men" at all. These are the same idjits that bought all of the hangars at our island airport, stuffed them full of boats, and visit the island ten times a year in planes that are too big to fit inside said hangars. Meanwhile, two dozen local pilots are on a waiting list that never gets shorter.

These people are the detritus of the island -- the Austin billionaires who like to call themselves "locals" because they own third homes in walled communities 4 miles outside of town. They are doing their best to ruin this lovely island, and their bankruptcies would only improve the landscape.

No, my pity is reserved for the 70,000 "Joe Lunchboxes" who sacrificed everything to come to Texas in hopes of a better life, who now find themselves in a harsh land without a nickel. They have been whipsawed by market forces none of them can imagine, and their families will be paying a stiff price for years to come.
 
Jay Honeck said:
I don't feel sorry for the "oil men" at all. These are the same idjits that bought all of the hangars at our island airport, stuffed them full of boats, and visit the island ten times a year in planes that are too big to fit inside said hangars. Meanwhile, two dozen local pilots are on a waiting list that never gets shorter.

These people are the detritus of the island -- the Austin billionaires who like to call themselves "locals" because they own third homes in walled communities 4 miles outside of town. They are doing their best to ruin this lovely island, and their bankruptcies would only improve the landscape.

No, my pity is reserved for the 70,000 "Joe Lunchboxes" who sacrificed everything to come to Texas in hopes of a better life, who now find themselves in a harsh land without a nickel. They have been whipsawed by market forces none of them can imagine, and their families will be paying a stiff price for years to come.
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Again, "Joe Lunchbox" should know the cycle, it's nothing new, been like this since the 70's, one boom and bust cycle after another. See, this is how wealth gets pumped to the top, in growth and collapse cycles. They grow the industry with imagined up money and the labor of a bunch of people during a time when high prices will support the growth strictly on a cash flow basis, plus provide a profit boon to the stock holder in mostly unrealized gains in stock value. So all this money flows into the market and when it's big enough, boom, you glut the market and collapse it. Now here is where the nifty trick is, how oil field projects are financed. The under ground reserve value s calculated once a year at whatever the price of the oil is that day. If you were capitalized for a project at let's just say $750,000,000 on what was calculated to be a $1,000,000,000 reserve last year, when recalculated a year later to reflect that day's benchmark rate leaves you with a reserve value of $250,000,000 reflecting the four fold drop in crude price, you may be subject to a 'margin call' where all of a sudden you have to sell off assets you just payed premium prices for at fire sale prices. That's going on right now all over the globe, rigs, drilling ships, brand new fleets of work boats.... Even leases and producing assetts end up sold, the Chinese just bought $1.8BB worth of the Permian in TX. If oil export authority goes through, we could see that oil leave America without contributing a dime to our society. Australia is already in much the same boat with mining, they have basically sold them not only the rights to the minerals, but to be able to bring in Chinese to mine them. That includes Uranium.

All the money ends up in the hands of the ultra wealthy ate the end of the day, the ones who at the bottom of the crash have billions of ready reserve to buy up all the real resource assets. But you notice the trend has changed, the ultra wealthy are no longer the ones buying, the Chinese are.
 
"Captains of Industry" no longer own industry. As much of bastards as they were, they were building empires to serve as lasting memorials to them, and they succeeded. Everybody still knows the names Rockefeller, who can tell me the CEO of Exxon/Mobil now? What we have now is MBAs who look at quarterly statements as their product, and a 5 year plan to raise it to the highest level they can and bail out with their exit package based on that value. "Get Rich, Get Out."
 
Henning said:
Again, "Joe Lunchbox" should know the cycle, it's nothing new, been like this since the 70's, one boom and bust cycle after another.
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I don't think you know the people we are talking about here. Many are not sophisticated or educated folks.

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