Heating Oil (China, Mexico: real estate, houses, unemployment)

[Maineah]

A friend of mine showed me his oil bill from today. $4.33 a gallon!!!!
Hey folks it's summer time! That $5.00 a gallon price seems VERY real at this point, maybe even before winter. It will be close to $1,400.00 to fill your oil tank ONCE this winter. We're looking at a $6,000.00 oil bill here next winter!
I hope you're all taking the time to write and call your Congressmen and Senators about this outrage. If not you had better be saving an extra $400.00 a month starting NOW for your fuel oil!

[Chinagoats]

Its sad.....I hate to think of people being cold in their homes...
We heat with wood....oil is for hot water here... which we may switch back to electric!I never thought I'd say that when we yanked the HW heater out 15 years ago!

[shadowfax1997]

Originally Posted by Maineah

A friend of mine showed me his oil bill from today. $4.33 a gallon!!!!
Hey folks it's summer time! That $5.00 a gallon price seems VERY real at this point, maybe even before winter. It will be close to $1,400.00 to fill your oil tank ONCE this winter. We're looking at a $6,000.00 oil bill here next winter!
I hope you're all taking the time to write and call your Congressmen and Senators about this outrage. If not you had better be saving an extra $400.00 a month starting NOW for your fuel oil!

I completely agree that the price of oil will see $5 and I believe $6 by the end of the year. 200 gallon delivery wil be $1200 at $6/gallon - whoa. We use about 750 gallons a year - $4500 or $375/month.

I have written to both our congressman and senator, but it seems to fall of deaf ears. They blame oil companies and want to tax their profits. Oil companies are seeing huge profits simply because of the price of oil. They do own oil rigs and pump cruide. Taxing them will simply mean higher prices.

I have requested they look into commodities trading. I believe that is the largest part of the inflated price right now. They also need to relax restrictions on drilling and allow/demand more. More supply means lower prices.

WHile I have doubted we would enter a depression because of oil prices, I no longer do. I am hoarding cash. I am paying off debts. I have been moving my retirement investments into more secure investments. I really believe we are on the brink in the next few years of a major meltdown worldwide. We simply can't grow the economy with fuel prices so high.

[Maineah]

Originally Posted by shadowfax1997

I completely agree that the price of oil will see $5 and I believe $6 by the end of the year. 200 gallon delivery wil be $1200 at $6/gallon - whoa. We use about 750 gallons a year - $4500 or $375/month.

I have written to both our congressman and senator, but it seems to fall of deaf ears. They blame oil companies and want to tax their profits. Oil companies are seeing huge profits simply because of the price of oil. They do own oil rigs and pump cruide. Taxing them will simply mean higher prices.

I have requested they look into commodities trading. I believe that is the largest part of the inflated price right now. They also need to relax restrictions on drilling and allow/demand more. More supply means lower prices.

WHile I have doubted we would enter a depression because of oil prices, I no longer do. I am hoarding cash. I am paying off debts. I have been moving my retirement investments into more secure investments. I really believe we are on the brink in the next few years of a major meltdown worldwide. We simply can't grow the economy with fuel prices so high.

Agreed. We've done the same thing. The problem I see with hoarding cash is that if we do see a real depression the dollar will become pretty much worthless. Gold is ok but if there is a depression you run the risk of a State selling off it's gold reserves and knocking the price down very low,very quickly. Real estate will lose a large portion of it's value as the buyer's will have no money to buy land, the banks will have no money to lend and those sitting on real estate as an investment will also join the ranks of the bankrupt. We figured the best we can do is to pay off everything we owe, including the mortgage, prepare for a worst case scenario by buying seeds and getting ready to live off the land as much as possible.
People are going to have to choose between eating and heating...if that isn't the basis for a depression I don't what is.

[maine4.us]

I hear that the cost of oil is up because of demand, and that may be partially true. However, you have to have something to burn all that oil that is supposedly going overseas. You can't have that many things that use oil come on line at the same time. It takes years to build the infrastructure to use that much oil, so the only logical explanation is price gouging because of oil speculation. I mean how can China, and India suddenly demand so much more oil as to double the price in a year??? Impossible,the present crisis is the commodity market speculators. They are making the money now, not the oil companies, and certainly not the guy with 4 pumps at his gas station. We need to reign in the speculation market. We need to tax so viciously the speculators, that it is no longer profitable for them to jack up the price of oil on paper. Why do we allow them to decide what oil will be worth in 6 months? If we don't act soon, the world has never seen such a depression as we are about to encounter.
I may be spreading some gloom and doom here, but what other scenario is realistic if prices keep rising at the current rate.

[Nor'Eastah]

We have just concluded our last winter heating with oil. We will leave the oil burner in place as it is. But we are in the process of installing a vented propane heater. That will be for back-up while we are at work. When we (or one of us) are at home, it will be the wood stove for the remainder of the 2 years we'll be here. Of course when we move to Maine, it will be all wood, all the time. Actually, the oil price is due for a correction at any time. Nothing goes up parabolically forever.

I'm not sure whether the 'blame' goes to speculators, oil companies, OPEC, rising demand from emerging countries, or what. I do know for sure that the devaluation of the dollar has a great deal to do with it. We tend not to notice that here in the states because we use dollars here. But in foreign countries, it is very noticeable. Did you read that Congress voted to make pennies and nickels out of steel? More monetary debasement, like in 1964 when they decided to take all the silver out of our dimes, quarters, and halfs. If you don't want to invest in gold, trade dollars at your bank for rolls of coins. Holding metal is better than holding paper!

[Northern Maine Land Man]

Oil refineries have long term contracts for crude oil. Some of those contracts are for oil delivery at around $40 a barrel. It's that last $126 dollar barrel that is not covered by a contract that is controlled by speculators who have never taken delivery of even one barrel of oil. The difference is why some companies report billions of dollars of profits per quarter. Speculation in oil is legal and speculators are getting rich off of it. The reason speculators are getting rich is that politicians are controlled by wealthy foundations who fraudulently claim they care about the environment. Except for a few true believers, the green movement is about gaining control of land. If they can ruin the value of our dollar they can buy more land at lower cost because landowners will become "willing sellers". This is no off the wall theory. It is all written down on the environmental industry's own web sites.

[Shuffler]

Global markets set the price for oil, not refiners and gas stations. This is one of my bigger concerns...the cost of energy and dwindling supplies in an energy-starved world. My understanding is that most, if not all, of the easily recoverable oil has been extracted using the latest technologies. The Cantarrell field in Mexico is in decline, as is the Ghawar field in Saudi Arabia. As exporting nations start keeping more oil for themselves as they ramp up their own growth/industrialization, there's less for us. There is still a lot of oil 'down there', but we don't have the technology to make recovery worthwhile, i.e. if it costs a barrel or more of oil to extract a barrel of oil, what's the point?

Is it worth opening up virgin tundra at ANWR to recover a few months worth of oil so soccer mommies can continue shuttling the children around suburbia in the SUV? This country has misallocated a most precious natural resource to promote a living arrangement/lifestyle that is not sustainable in a world of declining oil supplies.

Demand will slip a bit as people conserve, then as prices fall, demand will go up and people will start partying again, then prices will rise, and thus the vicious cycle repeats.....

[Coaster]

Originally Posted by maine4.us

I hear that the cost of oil is up because of demand, and that may be partially true. However, you have to have something to burn all that oil that is supposedly going overseas. You can't have that many things that use oil come on line at the same time. It takes years to build the infrastructure to use that much oil, so the only logical explanation is price gouging because of oil speculation. I mean how can China, and India suddenly demand so much more oil as to double the price in a year???

China and India, Thailand and Taiwan, all those formerly Third World countries, have been building infrastructure for years, and now they're reaping the "rewards" with higher energy consumption. The Chinese are buying hundreds of thousands of cars every year now in a country that until recently moved only on bicycles. Air conditioning is now common in Thailand. An Indian billionaire just introduced a supercheap car that he expects will sell in the millions over the next ten years.

Add to that the fact that global oil production has remained essentially flat for the past four years --- can anyone finally say Peak Oil? -- and the growth in oil demand inside oil-producing nations themselves as they rise out of Third World status. (Google "Export Land Model" for an explanation.) Then throw in the declining value of the dollar. Is it any wonder we're staring stagflation in the face? And yes, I absolutely believe that the government's official unemployment and inflation numbers are a complete fiction. Even CNN had a story yesterday that essentially proved the government is lying.

Speculators are the latest boogie man, and certainly they influence the price, but not nearly as much as the politicians would like us to believe. At the risk of hauling out an overused cliché, we're on the edge of a perfect storm and the waves are only getting higher. Oil prices are due for a correction, but I believe it will be tiny and temporary, perhaps a fall back to the $110 range, before they start back up again.

Here in Maine, a lot of people are already hurting, but it's next winter that really scares me.

[Mainer61]

I kept my thermostat on 61 all winter. I was heating two houses. Thank goodness we finally sold one of them...of course it was the one that was cheaper to heat. We just bought two cords of firewood (already have one)....we'll probably have to get more. Maybe if we are all really lucky, the bottom will drop out of the oil market.