Gas Prices Drop Even Though We Voted For Obama

[BioDefenseGrad]

Ah, I see. So you're saying that since the overall price has fallen so much, consumers will barely notice a few cents here or there in taxes. Thanks for straightening me out on that.

My point was that certain state governments are responding to declines in revenues by increasing taxes where they can do so with the least amount of resistance or backlash: fuel, food/restaurant, sales, personal, real estate, etc.

As I said before, our original points weren't in disagreement.

 

[BioDefenseGrad]

Yup. It will be interesting. It may stop new fracking development, but for the most part the fracking investments are a sunk cost. So, it wouldn't make sense for those companies to fold, even operating at a loss. I think the biggest bite is really being put on Russia, not the US fracking industry.

Well, how long before they can turn a profit to eat away at that sunk cost? Lower price for gasoline means that turn-a-profit date gets a little bit farther in the future, no? I wonder how the revenue plan is structured.

 

[Rey C.]

I'm working on a list of publicly traded banks, drillers and related oil service firms that are most vulnerable to this drop in oil prices. My thinking is, if the price of oil stays down for another quarter, by the second quarter of next year (if not before), we'll begin to see certain firms defaulting on debt payments. They'll be running out of money since their existing lines of credit are already being cut and the interest rate on new financing for many of them is approaching 25% in the high yield (junk) bond market. It'll be too late to short the ones that just die a quick death. But the dead men walking... those might provide some good shorting or option opportunities.

Even though the oil price decline is great for consumers, like I said before, if the problems in the oil patch spread, it could eventually take down other parts of the economy. Kind of like how the collapse of housing took down the rest of the economy several years ago - but probably not on that scale. But I'll put my money where my mouth is in a few weeks and we'll see.

 

[BioDefenseGrad]

I'm working on a list of publicly traded banks, drillers and related oil service firms that are most vulnerable to this drop in oil prices. My thinking is, if the price of oil stays down for another quarter, by the second quarter of next year (if not before), we'll begin to see certain firms defaulting on debt payments. They'll be running out of money since their existing lines of credit are already being cut and the interest rate on new financing for many of them is approaching 25% in the high yield (junk) bond market. It'll be too late to short the ones that just die a quick death. But the dead men walking... those might provide some good shorting or option opportunities.

Even though the oil price decline is great for consumers, like I said before, if the problems in the oil patch spread, it could eventually take down other parts of the economy. Kind of like how the collapse of housing took down the rest of the economy several years ago - but probably not on that scale. But I'll put my money where my mouth is in a few weeks and we'll see.

Would that include names big enough that the average casual investor would recognize?

 

[Rey C.]

Would that include names big enough that the average casual investor would recognize?

Well, some probably are. Just an initial screening:

Banks: Wells Fargo (most exposure of the money center banks), Zions, Comerica, Regions Financial and Green Bancorp (Houston based ).
Driller: Nabors Industries
Exploration & Production: Denbury Resources, Newfield Exploration, Cimarex Energy

 

[Rey C.]

EOG Resources (EOG): stock is currently down 25% but earnings are expected to drop 40% going forward. May be a good play on buying early mid-year $90 (out of the money) puts, with the stock currently trading at $93+/-.

 

[dakdak]

i just got gas for $1.88. i never thought id see that price again.

why are the republicans not thanking president obama for lowing the gas prices? they blamed him when they were high. fucking idiots.

 

[Rey C.]

AAA Says Motorists May Save $75 Billion on Gasoline This Year

AAA Says Motorists May Save $75 Billion on Gasoline This Year :clap:


The rout in crude oil prices may mean as much as $75 billion in gasoline savings for U.S. drivers in 2015, according to AAA.

Americans saved $14 billion on the motor fuel last year compared with 2013, Heathrow, Florida-based AAA, the country’s largest motoring group, said by e-mail. Pump prices dropped a record 97 consecutive days to a national average of $2.26 a gallon yesterday, the lowest since May 12, 2009.

A global glut of crude oil and a standoff between U.S. producers and the Organization of Petroleum Exporting Countries over market share has been a boon for consumers. U.S. production climbed in 2014 to the highest in three decades amid a surge in output from shale deposits. Oil capped its biggest annual decline since the 2008 financial crisis.

“Next year promises to provide much bigger savings to consumers as long as crude oil remains relatively cheap,” Avery Ash, an AAA spokesman, said by e-mail yesterday. “It would not be surprising for U.S. consumers to save $50-$75 billion on gasoline in 2015 if prices remain low.”

U.S. benchmark West Texas Intermediate crude dropped 46 percent in 2014 while Brent oil, the international benchmark that contributes to the price of gasoline imports, fell 49 percent.

“It’s getting lower because what happened? We drilled in the United States,” Peyton Feltus, president of Randolph Risk Management in Dallas, said yesterday in a telephone interview. “We’re buying more of it from ourselves, which is a great economic multiplier.”

Gasoline Futures

There is “significant uncertainty” over the cost of crude this year as lower prices may force companies to curb production and may also lead to instability in other oil-producing countries, the motoring group said.

Gasoline futures fell 48 percent in 2014 to close at $1.4353 a gallon yesterday on the New York Mercantile Exchange.

The average U.S. household will save about $550 on gasoline costs this year, with spending on track to reach the lowest in 11 years, the Energy Information Administration said Dec. 16.

 

[Mayhem]

Re: AAA Says Motorists May Save $75 Billion on Gasoline This Year

AAA Says Motorists May Save $75 Billion on Gasoline This Year :clap:


The rout in crude oil prices may mean as much as $75 billion in gasoline savings for U.S. drivers in 2015, according to AAA.

Americans saved $14 billion on the motor fuel last year compared with 2013, Heathrow, Florida-based AAA, the country’s largest motoring group, said by e-mail. Pump prices dropped a record 97 consecutive days to a national average of $2.26 a gallon yesterday, the lowest since May 12, 2009.

A global glut of crude oil and a standoff between U.S. producers and the Organization of Petroleum Exporting Countries over market share has been a boon for consumers. U.S. production climbed in 2014 to the highest in three decades amid a surge in output from shale deposits. Oil capped its biggest annual decline since the 2008 financial crisis.

“Next year promises to provide much bigger savings to consumers as long as crude oil remains relatively cheap,” Avery Ash, an AAA spokesman, said by e-mail yesterday. “It would not be surprising for U.S. consumers to save $50-$75 billion on gasoline in 2015 if prices remain low.”

U.S. benchmark West Texas Intermediate crude dropped 46 percent in 2014 while Brent oil, the international benchmark that contributes to the price of gasoline imports, fell 49 percent.

“It’s getting lower because what happened? We drilled in the United States,” Peyton Feltus, president of Randolph Risk Management in Dallas, said yesterday in a telephone interview. “We’re buying more of it from ourselves, which is a great economic multiplier.”

Gasoline Futures

There is “significant uncertainty” over the cost of crude this year as lower prices may force companies to curb production and may also lead to instability in other oil-producing countries, the motoring group said.

Gasoline futures fell 48 percent in 2014 to close at $1.4353 a gallon yesterday on the New York Mercantile Exchange.

The average U.S. household will save about $550 on gasoline costs this year, with spending on track to reach the lowest in 11 years, the Energy Information Administration said Dec. 16.

Thank yew Prez'dent Obammer, thank yew yer muzlimness. :bowdown: Ah new yew twern't as bad as mah buddee Ace sez yew were. :maildude: Ahm sorree ah voted for Geengrech...Gitrich...Gangrene...hell yew kno who ah mean, but mah buddee MP sez yew went to Bengayzee and killed yew some bunch of 'muricans in der sleep. Dey eben sho'd memes sezing yew did. :kiss: Ah bets dey wuz rong 'bout dat too. Anyyway, all deze wurds makin my hed hoort, but ah cooldnt find dat meme dat says thank yew Prez'dent Obammer ont it. Thank yew Prez'dent Obammer, eben tho yer a muzlim. ":clap:

 

[D-rock]

I wonder if this goes on for some time what's going to happen to all those big oil producing western states in the U.S. that gloated so much about how well their economies were doing when oil was sky high, they have little population, and/or little social services. If they have to start shutting down production because they can't produce oil cheap enough does everybody else get to turn around and gloat at their shortsightedness and the pitfalls of their mindless drilling? I also wonder what would happen to all those influx of expensive workers they have that have sky high cost of living and high home cost when the jobs and oil money start drying up.

 

[dakdak]

fox news is gonna fox news

http://thedailybanter.com/2014/10/thanks-obama-fox-news-praises-president-low-gas-prices-right/

 

[mikexmoran]

fox news is gonna fox news

http://thedailybanter.com/2014/10/thanks-obama-fox-news-praises-president-low-gas-prices-right/

...and water is wet.

 

[Rey C.]

I wonder if this goes on for some time what's going to happen to all those big oil producing western states in the U.S. that gloated so much about how well their economies were doing when oil was sky high, they have little population, and/or little social services. If they have to start shutting down production because they can't produce oil cheap enough does everybody else get to turn around and gloat at their shortsightedness and the pitfalls of their mindless drilling? I also wonder what would happen to all those influx of expensive workers they have that have sky high cost of living and high home cost when the jobs and oil money start drying up.

Even now, their economies are suffering. Shale oil production in the Bakkens (from Canada down into North Dakota and Montana) is already down and the drillers are already laying people off as they cut production. I'm not sure that I would describe their reaction to their good fortune as "gloating" or that I would refer to it as "mindless drilling". Above a certain price point, drilling in the shale formations makes sense. Below that price point, it does not - same as with any other product or commodity. But because they drilled and increased the supply of oil (and natural gas) on the market, it's led to a lower price for Americans and the whole world (given that demand for oil has not increased enough to absorb that extra supply). So the Saudis are content to accept a lower price for now, and make this squeeze play, in order to drive North American production down and our producers out of the picture. The biggest reason (IMO) that we should not gloat is because these are American workers and companies being affected (even the Canadians are quasi-Americans ), and in the end, if the Saudis are right, losing that production will lead to American consumers having to eventually go back to filling the Saudi's pockets with $ for our oil needs. Gloating is a form of arrogance. And arrogance has a habit of sneaking up behind you, when you least expect it, and punching you in the back of the head.

Another unfortunate victim of these low oil prices is the solar and alternative energy producers. I'm very happy that I can buy 93 octane for $2.25/gallon right now. But in the bigger picture, longer term, it concerns me that there will be less R&D money available for making cleaner, more energy efficient cars, homes and factories going forward. The Saudis are playing the long game... something that us Americans are no longer very good at.

 

[Johan]

4 Things That Were Supposed To Happen By 2015 Because Obama Was Reelected


It’s now 2015, nearly two years after Obama took the oath of office for the second time. A few years ago, prognosticators were very confident about what would happen to America by now because of Obama’s reelection. Let’s check in and see how their predictions turned out:


1. Gas was supposed to cost $5.45 per gallon.

In March 2012, on the floor of the United States Senate, Mike Lee (R-UT) predicted that if Obama was reelected gas would cost $5.45 per gallon by the start 2015. Lee said that gas prices would rise 5 cents for every month Obama was in office, ultimately reaching $6.60 per gallon.
http://www.huffingtonpost.com/2012/03/07/mike-lee-gas-prices_n_1327224.html

Lee was not alone. Newt Gingrich, running for the GOP nomination, predicted that if Obama was reelected he would push gas to “$10 a gallon.” Gingrich said he would reduce gas prices dramatically by reversing Obama’s energy policies. Gingrich flanked himself with campaign signs promising $2.50 gas if he was elected.
http://firstread.nbcnews.com/_news/...the-250-gas-president-obama-is-the-10-gas-guy

Today, the nationwide average for a gallon of gas is $2.24.
http://www.fuelgaugereport.com/

A lot of the reasons for the decline in gas prices are well beyond Obama’s control — including weak international demand and OPEC’s failure to reduce supply. But the policies that Lee, Gingrich and others criticized — the failure to approve the Keystone XL pipeline, more EPA regulation and limiting drilling on public land — have not gotten in the way of historically low prices.


2. Unemployment was supposed to be stuck at over 8%

In September 2012, Mitt Romney predicted that if Obama is reelected “you’re going to see chronic high unemployment continue four years or longer.” At the time, the unemployment rate was 8.1% and had been between 8.1% and 8.3% for the entire year.
http://talkingpointsmemo.com/livewi...onic-high-unemployment-if-obama-is-re-elected

What would breaking out of “chronic high unemployment” look like in a Romney presidency? Romney pledged that, if elected, he could bring the unemployment rate down to 6% by January 2017.
http://politicalticker.blogs.cnn.com/2012/05/23/romney-promises-to-bring-unemployment-down-to-6/

The unemployment rate currently stands at 5.8% and has been under 6% since September 2014. Since January 2013, the economy has created nearly 5 million new jobs.
http://data.bls.gov/timeseries/LNS14000000


3. The stock market was supposed to crash

Immediately after Obama won reelection in November 2012, many commenters predicted that the stock market was toast.

Charles Bilderman, the author of the “Intelligent Investing” column at Forbes, wrote that the “market selloff after Obama’s re-election [was] no accident,” predicting “stocks are dropping with no bottom in sight.” Bilderman said that the policies the Obama administration would pursue in his second term would “crash stocks.”
http://www.forbes.com/sites/investo...mas-re-election-no-accident-recession-coming/

On Bloomberg TV, investor Marc Faber predicted that, because of Obama’s reelection, the stock market would drop at least 20%. According to Faber, “Republicans understand the problem of excessive debt better than Mr. Obama who basically doesn’t care about piling up debt.” Faber joked that investors seeking to protect their assets should “buy themselves a machine gun.”
http://www.businessinsider.com/marc...self-a-machine-gun-2012-11?IR=T#ixzz3NZqGUm32

The Dow Jones Industrial Average currently stands at 17,823 and is up over 35% since Obama was reelected.
http://finance.yahoo.com/echarts?s=..."2014-12-31T17:00:00.000Z"},"scale":"linear"}


4. The entire U.S. economy was supposed to collapse

Rush Limbaugh predicted that “the country’s economy is going to collapse if Obama is re-elected.” Limbaugh was confident in his prediction: “There’s no if about this. And it’s gonna be ugly. It’s gonna be gut wrenching, but it will happen.”
http://www.newsmax.com/Outbrain/Limbaugh-doomed-Obama-re-elected/2012/09/11/id/451480/

The economic freefall would begin, according to Limbaugh, because “California is going to declare bankruptcy” and Obama would force states like Texas to “bail them out.” California currently has a $4 billion budget surplus.
http://www.reuters.com/article/2014/11/19/us-california-budget-idUSKCN0J32CT20141119

Limbaugh added, “I know mathematics, and I know economics. I know history. I know socialism, statism, Marxism, I know where it goes. I know what happens at the end of it.”

He did fudge, however, on the exact timing of the economic apocolypse. Limbaugh said it could take “a year and a half, two years, three years.” It’s been two years and two months since Limbaugh’s prediction, so he still technically has another 10 months to be proven right.

The U.S. economy grew at a robust 5% in the 3rd quarter of 2014, following 4.6% growth in the second quarter.
http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

Although these dire economic predictions have proven false, it doesn’t mean there aren’t real, persistent problems with the U.S. economy. Most critically, wage growth for American workers remains stagnant. That’s why, although many economic indicators are strong, a lot of Americans aren’t yet feeling the impact.

http://thinkprogress.org/economy/2015/01/01/3607416/4-things-2015-obama-reelected/


The unemploment part is just great : Not only the predictions made by Romney were completely false but what he promised to do in 4 years, Obama made it in 2 years.

The economical crash part is not as relevant s the rest of the article, 'cause we all know Rush Limbaugh always goes much too far. I mean, who could actually think that "California is going to declare bankruptcy" !

 

[D-rock]

Even now, their economies are suffering. Shale oil production in the Bakkens (from Canada down into North Dakota and Montana) is already down and the drillers are already laying people off as they cut production. I'm not sure that I would describe their reaction to their good fortune as "gloating" or that I would refer to it as "mindless drilling". Above a certain price point, drilling in the shale formations makes sense. Below that price point, it does not - same as with any other product or commodity. But because they drilled and increased the supply of oil (and natural gas) on the market, it's led to a lower price for Americans and the whole world (given that demand for oil has not increased enough to absorb that extra supply). So the Saudis are content to accept a lower price for now, and make this squeeze play, in order to drive North American production down and our producers out of the picture. The biggest reason (IMO) that we should not gloat is because these are American workers and companies being affected (even the Canadians are quasi-Americans ), and in the end, if the Saudis are right, losing that production will lead to American consumers having to eventually go back to filling the Saudi's pockets with $ for our oil needs. Gloating is a form of arrogance. And arrogance has a habit of sneaking up behind you, when you least expect it, and punching you in the back of the head.

Another unfortunate victim of these low oil prices is the solar and alternative energy producers. I'm very happy that I can buy 93 octane for $2.25/gallon right now. But in the bigger picture, longer term, it concerns me that there will be less R&D money available for making cleaner, more energy efficient cars, homes and factories going forward. The Saudis are playing the long game... something that us Americans are no longer very good at.

I'm not happy at their workers misfortune or am I gloating. Any suggestion of that was a rhetorical statement to have others that agreed with them see how foolish that was. By them gloating I was referring to their republican politicians that held up their economic model as some genius thing they came up with that was superior to everybody else when in reality they were nothing more than the lucky beneficiaries of several fortunate events and circumstances both social and economic, ones that weren't necessarily sustainable even in the near future.

The problem with us not taking alternative energy seriously is just a by product of our country's economic philosophy. Nothing can get done unless there is some profit in it for somebody, and usually even that takes some organization maximizing it to the nth degree to want to do it. In the real world that doesn't always work when we and the planet just can't wait that long and need to do things despite decent profit being involved along the way. By then it's too late.

 

[Rey C.]

By them gloating I was referring to their republican politicians that held up their economic model as some genius thing they came up with that was superior to everybody else when in reality they were nothing more than the lucky beneficiaries of several fortunate events and circumstances both social and economic, ones that weren't necessarily sustainable even in the near future.

OK, gotcha. :hatsoff:

 

[BioDefenseGrad]

i just got gas for $1.88. i never thought id see that price again.

why are the republicans not thanking president obama for lowing the gas prices? they blamed him when they were high. fucking idiots.

Is this a joke? President Obama isn't responsible for lowering gas prices, heck if the Democrats had their way our gas prices would be higher right now.

The most important factors for lower gas prices right now are a glut of supply due to extraction innovation (due to fracking, tar sands etc.) and Saudi Arabia.

 

[sean miguel]

i just got gas for $1.88. i never thought id see that price again.

why are the republicans not thanking president obama for lowing the gas prices? they blamed him when they were high. fucking idiots.

meh. I'm still waiting for Obama to lower the sea levels then walk on it. He did increase the depth of the polar ice caps from what I understand. And he personally rescued a drowning polar bear from Marine One only to have it later put into a sleeper hold by a shirtless Badimir Putin.

 

[Mayhem]

Is this a joke? President Obama isn't responsible for lowering gas prices,

Please explain how he's not responsible for them being lower when he was responsible for them being higher.

And your thing about Dems wanting gas prices, or any prices higher.....yeah, you're full of shit.

 

[Rey C.]

meh. I'm still waiting for Obama to lower the sea levels then walk on it. He did increase the depth of the polar ice caps from what I understand. And he personally rescued a drowning polar bear from Marine One only to have it later put into a sleeper hold by a shirtless Badimir Putin.

Animus closed his account???!!! :wtf:

Get your ass back in here, dude! This place is like the Hotel California: you can check out, but you can never leave!