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By Robert Rapier on May 19, 2007 with no responses

Comments on Senate Hearing on Gas Prices

On May 15th, the Senate Committee on Energy and Natural Resources conducted a hearing entitled Short-Term Energy Outlook Summer 2007: Oil and Gasoline. You can listen to the web cast here. I have done so, and this essay will be about my impressions of the hearing. You can find the testimony of the various witnesses at the links below: Mr. Guy Caruso – EIA AdministratorPaul SankeyGeoff SundstromKevin Lindemer Mr. Sankey is an analyst with Deutsche Bank, Mr. Sundstrom represents AAA, and Mr. Lindemer is an analyst with Global Insight. The witnesses really knew their material, although Mr. Sundstrom seemed terrified and Mr. Caruso had to make sure some of his answers were “politically correct.” On one occasion he stated that… Continue»

By Robert Rapier on May 18, 2007 with no responses

Gouging is an Idiotic Explanation

Not my words, but I have expressed similar sentiments. Paul Sankey, an analyst with Deutsche Bank, testified on May 15th before the Senate Committee on Energy and Natural Resources. I would guess some jaws dropped during his testimony, as some of the Senators on the committee have certainly suggested that gouging is going on. Below are some extended excerpts from Mr. Sankey’s testimony. While I have some minor quibbles here and there, for the most part he told it like it is. Update: Here is the full online version: Gouging is an Idiotic Explanation; there are some very good graphs in there. Thanks to KingofKaty for that link. Gouging is an idiotic explanation – Senate Testimony of Paul Sankey Anybody… Continue»

By Robert Rapier on May 17, 2007 with no responses

Gas Boycott Post Mortem

Well, let’s see what effect the gas boycott of 2007 has had. If you recall, on May 15th you weren’t supposed to buy gasoline, and this would cause gas prices to drop: “Do not buy gas on May 15. In April 1997, there was a ‘gas out’ conducted nationwide in protest of gas prices. Gasoline dropped 30 cents a gallon overnight. … There are 73,000,000-plus Americans currently on the Internet network, and the average car takes about $30 to $50 to fill up. If all users did not go to the pump on the 15th, it would take $2,292,000,000 out of the rich oil company’s pockets for just one day. So please do not go to the gas station on… Continue»

By Robert Rapier on May 16, 2007 with no responses

This Week in Petroleum 5-16-07

2nd Update This Week in Petroleum was just released, and the focus was the gasoline situation. Some excerpts: Why are gasoline prices so high? Gasoline inventories have recently been drawn down at a dramatic rate to bridge the gap between supply and demand (see Figure 4, in the Weekly Petroleum Status Report (WPSR)). Over 12 consecutive weeks during February, March, and April, total gasoline inventories declined by a cumulative total of more than 34 million barrels (15 percent). This is the sharpest decline in gasoline inventories over a consecutive 12-week period in EIA’s recorded historical data. Is there an end in sight or will gasoline prices continue to rise all summer? Although gasoline inventories are expected to remain lower than… Continue»

By Robert Rapier on May 15, 2007 with no responses

Xethanol’s March toward Bankruptcy

In the continuing saga of Xethanol (XNL) – the poster child for overhyped cellulosic ethanol claims – they took one more step toward bankruptcy this week with their earnings release: Xethanol Announces First Quarter 2007 Financial Results I will bet this is one they would have rather skipped. Xethanol managed to more than double their loss of a year ago: For the first quarter of 2007, the company reported a net loss of $5.5 million, or ($0.19) per share, as compared to a $2.2 million net loss, or ($0.15) per share, for the prior year. The increase in the net loss was primarily the result of an increase in general and administration expenses as well as $2.4 million in non-cash… Continue»

By Robert Rapier on with no responses

Politicians Do the Darndest Things

Suspending the Laws of Economics Politicians in Texas have come up with an ingenious method of controlling rising gas prices. They intend to suspend the laws of supply and demand: House OKs suspending gas tax AUSTIN – Relief from soaring gas prices may soon be on the way. The Texas House tentatively adopted a measure Tuesday that would suspend the state’s 20-cent gas tax through the summer. That would mean an immediate 20-cent drop in the price per gallon. “The more cars you have, the more relief you get,” said Rep. Trey Martinez Fischer, a San Antonio Democrat who added the proposal to an omnibus tax collection bill. “We’re sitting here on record savings. We used to say around here,… Continue»

By Robert Rapier on May 14, 2007 with 2 responses

Algal Biodiesel: Fact or Fiction?

The following is a guest post by John Benemann. John has many years of expertise in biomass conversion, and previously co-wrote a guest piece on cellulosic ethanol. On the subject of biodiesel from algae, he literally wrote the book. I originally wrote an article over a year ago in which I mentioned the potential of algal biodiesel. I still believe, as I did then, that biodiesel (or more broadly, renewable diesel) is a far superior fuel to ethanol for reasons I outlined in that essay. However, over the past year, the more I learned about the prospects of biodiesel from algae, the more it started to look to me like cellulosic ethanol: Technically feasible? Yes. Commercially feasible? Nowhere close, and… Continue»

By Robert Rapier on with no responses

AAA on Record Gas Prices

AAA says we hit a new gasoline price record: Retail gasoline prices hit record high: AAA NEW YORK (Reuters) – U.S. gasoline prices climbed to a record high average of $3.073 a gallon on Monday, breaking the previous peak hit after hurricanes knocked out refineries on the Gulf Coast in 2005, travel and auto group AAA said. They round up the usual suspects, but forgot about record demand, without which we wouldn’t be in this situation: Gasoline prices are up about 50 cents since March, according to the survey of 85,000 service stations, with energy experts blaming the spike on planned maintenance and operating problems at the nation’s oil refineries. But, their bottom line is correct: …almost all of the… Continue»

By Robert Rapier on with no responses

Peak Oil: End of the World?

I will have a new post up in a day or so (working with Vinod Khosla on something, and then I will finish that bio-butanol post), but until I get that finished, I will recycle this one (from 5/4/06) that details my views on Peak Oil. ——————- Perhaps like many of you, I spend a lot of time trying to predict what the future holds with respect to Peak Oil. I want to know what the effects will be to the U.S., the world, the economy, my employer, but first and foremost I want to know how it will affect my immediate family and me. I am not a “doomer”, but I do think we are facing a very serious… Continue»

By Robert Rapier on May 10, 2007 with no responses

This Week in Petroleum 5-9-07

Tale of the Stone Yes, I know I am late getting this out. Some of you may have read about my visit to the hospital about a month ago. Long story short, I have a very large (9 mm) kidney stone that sent me to the hospital with acute renal colic, which has been described as the worst pain a person can endure. While the pain eased off over the past 4 weeks, the stone never came out. And on Tuesday morning, it once more got stuck, and I ended up back at the Aberdeen Royal Infirmary. This time they did surgery to get the stone out, but they couldn’t retrieve it so they put in a ureteric stent which… Continue»