Saw $2.29 gas just south of Nashville last weekend coming back from Florida.

Other than taxes assessed governments do not have any significant impact on gas prices IMO.

Shouldn't they go up since supply is being threatened by our battles with ISIS? Doesn't volatility send prices sky rocketing??? That could potentially affect supply, right? That's the excuse for pumping prices every week leading up to a holiday.

 

North American production continues to increase. Dollar stronger. Plus there's always a drop after summer driving season.

There are a few reasons: consumption has been down, supply of crude has been up due to Libyan production. Also, the formula changes during the winter to a cheaper formula than the spring/summer formula, and OPEC has also reduced their pricing. Once/if their price falls below a certain threshold in the low $70's, then domestic production of crude will decline as this is below the breakeven point to operate wells. This has the chance to change the cycle again as the supply will decline giving opportunity for OPEC then to increase prices.

I'm not going to look a gift horse in the mouth. I just pray it continues down, but I'm not holding my breath much longer. I fully expect it to be back to norms of $3.50+ within 6 months.

Saw $2.29 gas just south of Nashville last weekend coming back from Florida.

 

saw a pic on Twitter yesterday that gas was $1.99 in Oklahoma City.

North American production continues to increase. Dollar stronger. Plus there's always a drop after summer driving season.

 

The strong dollar is what I am hearing also. Somewhere I read that much of Europe may start experiencing deflation? If that is true, that would explain the strong dollar and why they dollar is able to buy more crude than usual.

OPEC doesn't set the price, only the amount of production. The market sets the price. OPEC recently voted to keep production levels where they are, which in turn is going to squeeze the crap out of Russia. High oil prices have driven Russian expansion recently and if oil goes down it will really impact them.

$2.34 in Versailles today.

US and Canada are producing an extra 3 mill bpd with shale. OPEC is terrified and letting oil drop, so the shale companies can't afford to invest more into it.

North American production continues to increase. Dollar stronger. Plus there's always a drop after summer driving season.

 

Saudi Arabia is trying to cut that shale production off or at least choke it. They can survive with $25 dollar oil, shale companies can't.

Explain this shale thing a little more.

Same thing happened in the late 80's.

 

Whole lot of small oil wells still sitting idle all over Kentucky, Ohio, & Pennsylvania because of this same tactic.

 

Shales process has minimum cost is around $60 a barrel from stuff I have read.

 

$60 a barrel is around $2 a gallon. I'm ok with that. Tell Middle East to stick it.

Explain this shale thing a little more.

 

The new fracking technology the US and Canada are doing. It has literally added 3.5 million barrels per day of oil SiNCE 2010 alone that we don't need from the Middle East.

 

OPEC and Saudi Arabia hate it and fear it could evolve further. However, fracking isn't cheap you need oil to be around 80 a barrel for the companies to make it profitable

 

Saudia Arabia said no to OPEC cutting oil production which would have kept prices around 80-90 dollars, they want to kill shale production in North America. We have no real allies in the ME.

Same thing happened in the late 80's. Whole lot of small oil wells still sitting idle all over Kentucky' date=' Ohio, & Pennsylvania because of this same tactic. Shales process has minimum cost is around $60 a barrel from stuff I have read. $60 a barrel is around $2 a gallon. I'm ok with that. Tell Middle East to stick it.[/quote']

 

It's $63 per barrel right now and we're still at $2.59 in Ohio.

 

I predict oil will fall into the 50's but not much lower which could get us near $2-2.25 a gallon.