Re: Gas skyrockets !
[Re: jbyrd63]
#7374397
10/08/21 12:50 PM
10/08/21 12:50 PM
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Joined: Dec 2010
Posts: 11,181 Armpit, ak
Dirt
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trapper
Joined: Dec 2010
Posts: 11,181
Armpit, ak
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"Bradley explains with the following hypothetical “daisy chain” of trades, which is fictitious but based on plausible numbers. (Note that “old oil” means oil coming from established, domestic producers who were subject to the price ceiling, while “new oil” referred to either imports or oil from new producers who were able to charge the world price.) Assume that Class A gathering margins are $0.15 per barrel and Class B telephone-trading margins are $0.50 per barrel in August 1974, at which time old oil was at $5.25 per barrel and new oil was at a market price of $10.00 per barrel. The following scenario was typical: Step one: Gatherer A buys old oil at $5.25 per barrel at the lease and transports it to a pipeline connection point where it is sold to Reseller [B] for $5.40 per barrel. Step two: Reseller B sells to Reseller C for $5.90 per barrel. Step three: Reseller C sells to Reseller D for $6.40 per barrel. . . Step eight: Reseller H sells to Reseller I for $8.90 per barrel. Step nine: Reseller I sells to Gatherer A for $9.40 per barrel. Step ten: Gatherer A ships the crude in his facilities to [a refiner] who purchases it for refining at $9.55 per barrel. (Bradley 1996, p. 690) In the above sequence, the only truly “economic” transactions were Gatherer A getting the oil and transferring it to the pipeline, through which it can be delivered to a refiner. But because of the price control regime in place, this move would only allow Gatherer A to reap 15 cents of a markup, with the windfall gain—the difference between the world price of crude at $10 and the controlled domestic price of $5.25—accruing mostly to the refiner (and possibly the consumers, depending on how much was passed along). Rather than let this large gap in potential mark-ups get away, financiers came up with a clever way to “trade” barrels of “old oil” around in a circle, without physically moving them. These were all telephone transactions on paper. But technically, each change of possession allowed for a 50-cent markup. Thus, rather than Gatherer A turning over the barrels to the refiner at $5.40 each, he can instead charge them $9.55. He and the other paper-traders have pocketed the gap between the “old oil” controlled price and the world market price of crude."
Who is John Galt?
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Re: Gas skyrockets !
[Re: jbyrd63]
#7374416
10/08/21 01:18 PM
10/08/21 01:18 PM
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Joined: Dec 2010
Posts: 11,181 Armpit, ak
Dirt
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trapper
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Posts: 11,181
Armpit, ak
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Maybe white was thinking of the good ole days of capitalism. "Part of the reason flying was so exclusive and relatively luxurious in the '40s, '50s, and '60s was that it was very expensive. Until the Airline Deregulation Act of 1978, airlines were considered a public utility and airfares were set by the federal government, which ensured airlines always made more than enough money."
Who is John Galt?
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Re: Gas skyrockets !
[Re: hippie]
#7374440
10/08/21 01:48 PM
10/08/21 01:48 PM
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Joined: Mar 2007
Posts: 35,169 McGrath, AK
white17
"General (Mr.Sunshine) Washington"
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"General (Mr.Sunshine) Washington"
Joined: Mar 2007
Posts: 35,169
McGrath, AK
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I'd say alot of the big jump jbird saw was from the local distributor to all the stations. I worked for a distributor (in the 70's) that bought X gallons at a time from the depot, kinda like this pre-paying that's more common now. New contract, new price which might be a month apart. I think too that a lot of people don't realize that oil producers sell their oil before they produce it. Then they attempt to hedge the price changes in the futures market. If I sell you a tanker load of crude for delivery in December at $70/bbl, I want to protect myself against the possibility that oil will be selling for $80 at the time of delivery while you want to take advantage of any decline in pricing. Also, remember just a year ago oil companies were renting tankers just to store oil. At just about $40,000. per day you could store 2 million barrels of oil...that's about 2 cents per bbl per day. Once oil is out of the ground it can be shipped almost anywhere in the world for about a dollar per barrel. That is one reason that a change in conditions in one location can change the economic equation worldwide. In Europe right now, natural gas prices have quintupled. That is causing some utilities to convert to burning oil rather than natural gas, to generate power. That is driving up demand for oil while the supply is still constrained.
Mean As Nails
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Re: Gas skyrockets !
[Re: white17]
#7374506
10/08/21 03:38 PM
10/08/21 03:38 PM
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Joined: May 2010
Posts: 10,471 mn north of blakely
Steven 49er
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mn north of blakely
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You know me, I don't buy the official inflation figures.
"Inflation is always and everywhere a monetary phenomenon". Milton Friedman.
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Re: Gas skyrockets !
[Re: jbyrd63]
#7374515
10/08/21 03:55 PM
10/08/21 03:55 PM
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Joined: Dec 2006
Posts: 21,031 St. Louis Co, Mo
BigBob
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Joined: Dec 2006
Posts: 21,031
St. Louis Co, Mo
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www.gasbuddy.comStill $2.74 at some places
Last edited by BigBob; 10/08/21 03:56 PM.
Every kid needs a Dog and a Curmudgeon.
Remember Bowe Bergdahl, the traitor.
Beware! Jill Pudlewski, Ron Oates and Keven Begesse are liars and thiefs!
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Re: Gas skyrockets !
[Re: white17]
#7377691
10/12/21 07:25 PM
10/12/21 07:25 PM
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Joined: Sep 2010
Posts: 2,785 Northern lower Michigan
Feedinggrounds
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Northern lower Michigan
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Yeah I recall buying gas for 33-35 cents in 1963.
An inflation calculator indicates that 35 cents in 1963 is equivalent to $3.13 today. A cumulative rate of inflation of 794% I WAS a twinkle in my daddy's eye in 1962 and a official tax deduction in spring of 1963.
you're only allowed so many sunrises... I aim to see every one of them!
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Re: Gas skyrockets !
[Re: Deerkiller]
#7377716
10/12/21 08:05 PM
10/12/21 08:05 PM
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Joined: Jan 2008
Posts: 3,012 USA MN
Snowpa
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USA MN
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It’s going to be over $5 buck a gallon next summer. Hearsay [ I hope} [ i
Never Confuse Stupid With Crazy
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Re: Gas skyrockets !
[Re: jbyrd63]
#7377840
10/12/21 10:22 PM
10/12/21 10:22 PM
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Joined: Mar 2014
Posts: 3,655 Central Texas
Chancey
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Posts: 3,655
Central Texas
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Diesel 3.29 on Friday. Down to 3.09 today. Gas 2.89.
Resident Conspiracy Theorist Accused Moron, Nazi, Low IQ, and Putin Fan Boy
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