By on May 16, 2014

gasprices

 

From Zero Hedge, a look at global gas prices, with New York City as the benchmark. A look at the price of a liter of gas (multiply by 3.8 for the gallon equivalent) gives a better picture of the choices that people make around the world when it comes to buying cars.

While European countries are well known for having expensive gasoline (and subsidised diesel fuel, to boot), I didn’t realize that Australia, land of the V8 muscle car, was such an expensive place to fill one’s gas tank. No wonder the Aussie car market is shifting from the Falcadore to the Corolla and the Mazda3 – to say nothing of diesel, Thai-built trucks replacing V8 Utes.

Another oddity is Rio, where an ethanol-heavy energy strategy still yields little in the way of cheap gasoline. Perhaps Marcelo can shed some light on this?

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153 Comments on “Chart Of The Day: A Look At Global Gas Prices...”


  • avatar
    TonyJZX

    to put that into perspective

    Australia has a 40c federal tax on every “liter of gas” or ‘litre of petrol’

    Australians have a high avg. wage and high standard of living

    in that light, $1,40 isnt too bad?

    also you’ll find that people like their cars… per capita AMG V8s seem to infest the roads as if the C63 is the middle managers’ company car

    i am reminded of the way Londoner’s feel about their cars

    they earn £xx,xxx a year and they spend £1.40 per liter and its no different from an Australian earning $xx,xxx a year and spending $1.40 per liter… the currency conversion makes it sound bad

    oh yeah… obviously this is the end of an era for V8s

    enjoy it while you can get the cars and afford the gasoline

    when there are no more cheap V8s and gasoline is $2.00+ you’ll wonder why you didnt live a little

    • 0 avatar
      FormerFF

      I always enjoyed driving smaller cars. Good handling and a responsive engine is where it’s at, power doesn’t count for that much. You can’t go all that fast on the street anyway.

    • 0 avatar
      brn

      Tony,

      Thank you for being one of the very few people to take into account taxes. When you buy a liter of petrol, you’re buying a lot more than petrol. You’re also buying government services. If one strips that out of the equation, one finds very little difference in gas prices across most civilized countries.

      • 0 avatar
        brn

        I just did the math. Prices and taxes vary within a country, so these are approximations. If one eliminates the tax, below is the number of US Dollars paid for a US Gallon of tax.

        US: $3.24
        UK: $2.54
        Canada: $3.36

        We (US) do pay a little less than Canada. We also pay quite a bit more than the UK.

        Sources include:
        gasbuddy.com (US/CA prices, CA taxes)
        petrolprices.com (UK prices, UK taxes)
        wikipedia.org (US taxes)
        xe.com (Exchange rates)

  • avatar
    Lou_BC

    In my town the price is 1.349 per litre Canadian converted to USD (1.0871 exchange) = 1.241 USD/Litre.

    My last fill up, I managed to squeeze 135 litres into my fuel tank. It ain’t pretty.

    • 0 avatar
      Big Al from Oz

      Sh!t Lou, geez I hope you are making some good cash!

      I just paid $135 to put 82 litres in my truck. I paid AUD$1.65 or USD$1.55 per litre. That’s about USD$5.75 per gallon for diesel.

      But I’m living in the Outback. We can pay up over $3 per litre up here in some places.

      Have a look at the link in my post. It’s paints a better picture of the real costs of fuel in a country.

      I hope you get those diesel Amaroks soon! Maybe Chev is betting on Canada to be it’s saviour with the diesel NA Colorado/Canyon.

      • 0 avatar
        FormerFF

        Yeah, you have to consider distances as well. Gasoline is expensive in Hong Kong? How far are you going?

      • 0 avatar
        Lou_BC

        @Big Al from Oz – my truck has a 135 litre tank. If I’m just putting around town I can go 2 weeks on 1/2 tank. If I’m going into the back country I can easily go a tank every 2 weeks. If its a longer back country run I need to fill in less than a week or worse when I get back to town.
        The most fuel I ever burned around my home town was with my F250 with dual tanks (164 litres). I was building a new motocross track which was 22km out of town. I was hauling fence posts, fencing, fuel for the heavy machinery etc. and I was going through 80 litres a day (roughly 1 tank out of my 2 tanks). That got expensive considering it was all volunteer and out of my own pocket.

    • 0 avatar
      psarhjinian

      “I managed to squeeze 135 litres into my fuel tank.”

      Why fill up? All you end up doing is towing around the weight of the fuel and further reducing your mileage.

      I never put more than $10-15 in my car; I might do $20 on longer winter trips.

      • 0 avatar
        danio3834

        I have a truck with a 120L tank and I always fill it and don’t run it near empty because:

        1. Stopping for fuel more than I need to is a waste of my time
        2. I don’t like changing fuel pumps
        3. Significant net savings can be realized when you buy this much fuel when the price cycle is at it’s cheapest over when it’s not.

      • 0 avatar
        Lou_BC

        @psarhjinian – if you live in northern BC or any more remore area and have to deal with cold weather, it is much safer to always keep the tank close to full. One is less likely to get condensation in the tank if kept full.
        When one considers the weight of an F150 SuperCrew 6.5 box 4×4 the fuel load is insignificant compared the the overall weight of the truck.
        In winter or when I do a lot of back country running my extrication gear, survival and first-aid gear easily pushes 500 lb.

  • avatar
    SeriousInternetBusiness

    Vancouver, BC, Canada is clocking in at $1.46/L as of today.

  • avatar
    jimbob457

    The type of light motor vehicle that people in a given place choose to drive depends on:
    1. their per capita income
    2. the cost of fuel
    3. the road system both urban and rural
    4. the physical size and age composition of the population
    pretty much in that order.

    The cost of fuel is mostly a policy variable as differences between fuel cost in various places is primarily the excise tax per gallon or liter. The biggest policy driver is the question of security of supply. Fuel is generally cheaper in places that produce the stuff like Saudi Arabia, Indonesia, Russia and Texas plus Iran and Venezuela. Other important factors are environmental considerations and the dead hand of yesterday’s policy decisions.

    The latest data from GasBuddy.com show that in California the average pump price is 7% above the NYC price. The USA average is 6% below the NYC average. In Texas the average is currently 11% below the NYC average. This higher cost of gasoline is one of the reasons the people in California are so in love with EV’s.

    Right now the Europeans are glad for their high taxes on fuel and the short-lived little turbo diesel crapcan vehicles it engendered. They are presently getting seriously messed with by their main foreign oil supplier, Vladmir Putin’s Russia. Fortunately, with a little help from the USA and the Middle East they can weather even a complete shut off of Russian crude oil and natural gas more or less permanently if it actually comes to that.

    • 0 avatar
      Big Al from Oz

      @jimbob457
      Pretty accurate regarding the influences of the purchase of a motor vehicle.

    • 0 avatar
      Onus

      Sounds about right.

      As for Russia they don’t subsidize fuel costs. It the same on the list as Boston. I practice I’ve found the fuel price to be identical if not a few cents cheaper than here.

      I have Russians that complain about price ( it used to be heavily subsidized ). I still can’t figure what they are complaining about when their European neighbors pay double and they still get the selection of fuel efficient cars. They also tend to get engines slated only for the Americas. Like you can get the focus with the 2.0L we have in Russia.

  • avatar
    APaGttH

    This point is lost on American consumers. The argument goes something like this. If we tap more oil locally, and import more oil from Canada, United States prices will go down because our supply will go up.

    Let me start with point one. I am not anti-fracking or anti-pipeline. This isn’t the point of this.

    The largest US export in terms of dollars the last three years? Refined fuel – diesel, gasoline, and aviation fuel. Largest export. Wait? WHAT? Export? How much. Think north of 750 million barrels. A “barrel” is 42 gallons (not 55 gallons as many think). A gallon of crude will produce out from 35% to 42% into refined product. If we split the difference, we can say 39%.

    So one barrel of crude produces about 16.4 gallons of refined product.

    750,000,000 barrels is 31,500,000,000 gallons. Ahh, but that is refined product.

    31,500,000,000 / .39 = 80,769,230,769.23 gallons of crude to produce the finished product, or 1,923,076,923.07 barrels of crude. According to the EIA, the United States consumes about 134.5 billion gallons of refined product in 2013. So the 750 million exported is a fraction of consumed product – but another point, the US is exporting more than it imports. And here is another tid bit from the EIA, refinery capacity in the United States is running around 86% – surprise.

    So why all the exports? Because the United States is no longer the almost exclusive consumer of the worlds petroleum products. Other nations are rapidly increasing their consumption, and their consumers are willing to pay more – a lot more – than US consumers. So given that we live in a global economy, refiners are keen to export finished product for more profit.

    Sure, they could flood the supply in the US and drive down costs but if you understand capitalism – why would they do that? It wouldn’t make any sense at all. Keep the supply tight enough to sustain $3.50 to $4.00 a gallon national average and the economy doesn’t get shocked. Count the profits. Sell the excess capacity to South America and Asia for larger profits. Cash the checks.

    We can frack the whole darn country. Every last square inch. It will be great for American jobs. It will be good for the American economy. It won’t do squat to lowering the price at the pump. Game set match.

    Even supporters of Keystone XL admit that one of the main goals behind it is to bypass the Midwestern and rust belt refineries, which already have pipeline connections to Canada and enjoy the lower cost crude. If they can move the crude to the Golden Triangle, it can be refined, and exported for more profit – profits that go to Canada by the way. It is also very likely, and if you do some real research you’ll find even the oil and gas industry admits, that Midwestern prices will go up, not down, due to a tightening of supply. Ouch.

    Now the good news. We’re ahead as a nation on our consumption of oil. We now consume 1 out of 5 gallons of crude in the world, down from 1 out of 4 (in large part due to BRIC development and their increased consumption). Our overall energy consumption as a nation (all sources) is down about 20% since 2005. It isn’t just recession driven (consumption is ticking up) and the decline started well before the Great Recession. We will likely be “North American” dependent for our energy needs by 2020. Let that sink in for a second, our trade partners for US energy will likely be Canada and Mexico by 2020. That’s all we’ll need. Full blown energy independence is actually very attainable – and it doesn’t require fracking every square inch of land either (but increased production plays a big part).

    The reality is “drill baby drill” and Keystone XL won’t do squat to lowering our prices. Anyone who thinks that doesn’t understand global economics. We’ve actually got it easy compared to many other parts of the world.

    Oh yes, some OPEC nations have dirt cheap subsidized fuel – and they are borderline third world Hell holes or banana republics. I guess we could live under Sharia law or South American dictators and enjoy cheap gas – but that’s another story.

    • 0 avatar
      CapVandal

      Good post.

      I don’t think anyone that understands global markets will disagree with your point that US gasoline will not be cheaper than global oil prices. This is a nice graph that illustrates your point about gasoline exports … http://s.wsj.net/public/resources/images/OB-VH353_TRADE_E_20121108145040.jpg

      Natural gas is much harder to export and it is much cheaper in the US than it has been historically and globally. You have to get it to a port and liquify it, which is expensive. US prices will be floe to global prices, minus the significant cost of processing and shipping.

      The price differential is enough that locally based fleets (like our garbage collectors, Waste Management) run on natural gas. Long haul trucks and railroads are also trying to convert. Cost per mile is much cheaper than gasoline or diesel, and it burns clean.

      Cheaper natural gas is the first tail wind American industry has had in a long time. Unlike a lot of the OPEC countries, we can produce it and use it as an input for production (chemicals, plastic, clean electricity, etc.).

      Net oil imports have been a large component of the US balance of trade deficit. It is going to get better, and eliminating the oil portion brings it down to a manageable size: http://static2.businessinsider.com/image/4fb651cbeab8ea0725000008-900-/safe-monthly-trade-deficit-petroleum.jpg

      The trade deficit seemed to be hopeless 10 or 15 years ago. Now we aren’t far from reducing it to a very small portion of GDP, if not eliminating it.

    • 0 avatar
      Big Al from Oz

      So, how many gallons to the barrel??

    • 0 avatar
      Kenmore

      Fantastic summary. Right wing stooges like myself need more of this kind of clear, quick presentation because usual debates bore us and give us time to think of the Queen MILF.

    • 0 avatar
      Felis Concolor

      I see crude oil unit trains rumble past my house every single day; fuel prices are one of the last reasons I want Keystone XL to be built.

      Besides which, any product which can be discovered, extracted, transported, cracked, refined, transported again, stored and dispensed – at a lower price than the bottled water people buy at grocery stores – is a damn good deal.

      • 0 avatar
        Kenmore

        But bumping the price of bottled water will just result in people relying on tap water again.

        We’re not yet to the point where the average homeowner can fuel a vehicle with that.

        • 0 avatar
          Felis Concolor

          While some in my household still purchase bottled water, I’m gradually weaning them away from the profligate practice. My beloved Braun electric kettle’s seen its 12th year of near daily service, and its heating element has remained as shiny as the day it was purchased with zero cleaning cycles, a testament to the quality and softness of the municipal water in this region. I refill what empty bottles I find on the countertop when I can and replace them in the fridge, the better to set an example for them. No pesticide checks yet, but I’m certain once I run a water test it’ll come back clean.

          • 0 avatar
            Kenmore

            Wow, as someone who lived two decades in a place where lime scale would have a tactile presence on a pet’s new water bowl after 8 hours (and softening), I’m impressed.

            And fixing building mechanicals in that area made my recent hip X-ray seem strangely familiar… like the socket for a 10-year old ball valve in that water.

          • 0 avatar
            APaGttH

            Totally off topic but key words, “in this region.”

            I lived in southeastern South Dakota where the water was incredibly hard. The tap water tasted salty because of so much conditioner in the system. Mineral deposits was a hopeless battle.

            Almost 80% of Americans live in areas with some degree of “hard” water. You’re lucky actually.

    • 0 avatar
      CJinSD

      We currently import eight million barrels of oil and petroleum products a day and produce a bit more than seven million barrels a day domestically. Three million barrels come from Canada, but plenty comes from places we don’t want to enrich. The idea that increasing global supply by 8% through increased domestic production won’t drive down global oil prices is born from ideology rather than economics. Oil is traded in a forward looking market, so even a commitment to greater production would have an immediate impact on price. It has played out exactly that way in the past, but reality has no place in some agendas.

      • 0 avatar
        korvetkeith

        It’s really comical how far a socialist statists will go to try to refute the laws of supply and demand. “If I make my argument really long and complex, I’ll seem credible!”

        • 0 avatar
          VoGo

          You have a choice: you can either call people names, or you can offer a well reasoned alternative.

        • 0 avatar
          thornmark

          Same thing w/ minimum wage. It’s nutz to impose the same wage on NY and Arkansas. Plus all these “consensus” devotees suddenly don’t like the fact that the vast majority of economists agree that the minimum wage destroys opportunity and employment w/ little benefit to people at the bottom. The NYTimes used to write editorials about that fact.

          The same people forget the law of supply and demand when it comes to low skilled labor – wages will rise if the US stops allowing cheap labor to flood the country from abroad.

          • 0 avatar
            APaGttH

            I don’t forget it – and the laws of supply and demand are in part killing the middle niche middle skilled jobs in this country – and with it – the middle class.

            With manufacturing of goods now a global reality, the country with the largest supply of middle skilled labor at the lowest price is going to get the jobs. Period. Capitalism sure is a betoch sometimes.

            In this case we’re seeing the winners are Malaysia, Thailand, China, South Korea for certain things, India for skilled services (code monkeys) and the Philippines.

            It is pretty simple actually:

            Can it be shipped to and from other countries?

            Yes – then the United States is at the whim of the global markets, which will increasing be led by China

            No – then the United States is in control of its own rules of supply and demand. CEOs are hard to find – supply – demand – paid (but I do think income inequality is a big cultural problem and growing – different story)

            Labor for middle skilled manufactured goods is easily exported. The returned finished goods are easily imported.

            Of course you reach a tipping point which we are already starting to see, if the average American consumer can’t afford to buy the cheaper made goods because they can’t find a job – who is left to buy it? Ask Walmart how they feel about this system as an example (they’ve missed their numbers 4 quarters in a row and getting worse, their own clientele can’t afford to shop at Walmart)

            To the point of minimum wage – I’ll bite. I agree with you that the minimum wage in Bumblescum, Alabama can likely be lower than Snootynose, California.

            But the reality is when we look at economic buying power, minimum wage in 1980 afforded someone a “living wage” so to speak. Enough for a roof over their head, gas in the tank, and three square meals a day. Maybe a bit left over for a movie and some new clothes.

            We are all paying for the low wages which isn’t even keeping up with inflation (inflation adjusted, minimum wage should be around $8.90 an hour). We pay through subsidization by the government that keeps people poor. It is a sick, twisted, broken system that feeds on itself.

            1) Companies get tax incentives for hiring employees on public assistance – WE pay for that as taxpayers

            2) Companies get tax incentives of up to $24,000 in one year for hiring a veteran on public assistance. So for a company like Walmart, that would cover the new hire’s salary for the year. Think about that? What part of capitalism does that fit into? We the People are paying for that

            3) Companies that take EBT get their profits subsidized. Sorry for picking on Walmart but in their last quarterly filing it was revealed profits dropped because food stamp programs got cut. Eighteen cents of every food stamp dollar in this country goes to Walmart. Never mind the shameful practice of businesses like Papa Murphy’s and 7-11 taking food stamps for “take and bake pizza.” Seriously – WTF?!?! Papa Murphy’s is fighting tooth and nail and hired lobbyists to not close this pizza loophole because it would crush them as a business.

            It is just so messed up.

            In other to “break” this machine – you need to separate the calculation for the poverty line from the average income – otherwise when you raise all the boats with a minimum wage increase, you just move the poverty line up and the food stamps and public assistance keep coming unabated.

            BUT – if you decouple them, enabling the government to gut these programs for the working poor, which represent about 43% of all food stamp recipients, then you’re ending this cycle of talking from the “rich” (well really the upper middle class) and giving to the poor – to keep them – poor.

            A true reform of minimum wage hand-in-hand with reform on safety nets and entitlement programs would actually stimulate the economy effectively.

            It’s a very complex equation – and we don’t have the stomach to do both.

        • 0 avatar
          APaGttH

          The part that is stunning about your reply is that everything in that post is based on easy to review facts. Several posters who have replied praising the analysis are I can assure you, quite right leaning in their thoughts.

          I’m lost on how a post that is pro American jobs, pro fracking, condemning of Venezuela, and steeped in fact is socialist in nature,

          Why don’t you reply with a compelling argument refuting anything I posted with facts and evidence.

          • 0 avatar
            Kenmore

            The toad is righteous here, and my cologne is gun oil. Used to be WD but then *everyone* started wearing that.

          • 0 avatar
            Lou_BC

            @APaGttH – individuals search for validation of beliefs (pre-conceived notions)as opposed to the truth.

            If the truth does not jive with belief , the truth must be wrong.

      • 0 avatar
        CapVandal

        A large sudden increase in oil supply would drive down prices.

        The US is increasing production by a modest amount annually, substituting gas for oil, and reducing oil consumption. As you pointed out — this should be priced into oil markets to the extent that future production impacts today’s prices.

        As far as major declines in oil prices, a lot of current development and production depends on relatively high oil prices.

        As far as future gasoline prices at the pump … I have no idea what they will be in the future, but doubt if they will decreases materially.

        The US balance of trade deficit from oil? … trending down and no reason to expect that trend to change anytime soon.

        • 0 avatar
          APaGttH

          A large sudden increase of oil would just mean more exports and not lower the prices in the United States, which are already some of the lowest in the world (surprise).

          What part of that don’t you understand.

          Part two, if the price of a barrel of oil dropped below $80 USD – the fracking operations in this country would come to a halt so fast it would make your head spin. North Dakota would become an economic wasteland overnight.

          Don’t think so? Ask anyone who remembers the oil crash of 1986 or 1998.

          Fracking isn’t cheap – and it doesn’t have anything to do with regulations. You need chemicals – A LOT. You need to transport them, to the well sites, which move, so rail infrastructure doesn’t cover the last mile. You need temporary roads to reach the sites. You need waste treatment and storage – A LOT. At around $80 a barrel, fracking no longer is cost effective.

          If one of the OPEC nations suddenly found a way to dramatically increase their capacity – US production would grind to a halt, the oil industry would buy the “cheaper” product and ship it here.

          What part of capitalism do people do not understand. It’s amazing to me that there are these arguments going on with no acknowledgement that oil is a global commodity and the price and supply is no longer dictated by US consumers and political policy.

          You better get use to it – because in another 10 to 15 years, what China want, China gets – and we’ll be in the back seat.

          It is an inevitability and an absolute. You can’t change the economics of GDP and market based consumption.

          • 0 avatar
            CJinSD

            “A large sudden increase of oil would just mean more exports and not lower the prices in the United States, which are already some of the lowest in the world (surprise).

            What part of that don’t you understand.”

            I don’t understand how you can spend so much time arguing about a topic without learning anything but some propagandist’s talking points. Oil is a global market. Increase global supply, and the price will fall everywhere. If the US were to become a net exporter, or even if we were merely to reduce our imports by 5 million barrels a day, the people currently selling the oil we would take over supplying would reduce their prices to defend their share of the global market. Denying this is cause to reexamine your assumptions.

          • 0 avatar
            krhodes1

            People never seem to understand that the more oil costs, the more there is of it, and the less it costs the less there is of it. We literally will NEVER run out of oil. It will just get too expensive to use frivolously, and/or it will get to be SO expensive that we pay the upfront infrastructure costs to mine Jupiter…

          • 0 avatar
            CJinSD

            Someone has seen a supply curve. You might want to consider that a number of countries are entirely dependent on their oil exports for revenue, so they have little choice of shutting down production when the price falls.

          • 0 avatar
            Landcrusher

            apa,
            I agree with most of that except the inevitability of the Chinese rise. I still think they will blow it all up over there. We will only be overtaken if we keep becoming less free and they keep becoming more free. State control always has it’s failures. Much of the western world has avoided disaster only because in one way or another they could get a free ride on the US. That bill may come due, and it will likely be collected by the Grim Reaper.

    • 0 avatar
      FormerFF

      Nicely put.

      Another thing to remember is much of the new found oil is expensive to produce. If the price of oil goes below $80 rather a lot of the current North American production becomes uneconomic. Low oil prices are not coming back.

    • 0 avatar
      Pch101

      Keystone will increases prices for those in the Midwest because they’re getting a deal on shale oil, thanks to the high shipping costs that constrain Alberta distribution.

      The only sound argument for building Keystone is to build it as a goodwill gesture to the Canadians who will benefit from the higher net revenues. The idea that the pipeline is going to somehow help American consumers is criminally stupid (which probably explains why it is the latest cause celebre for one particular US political party.)

      • 0 avatar
        FormerFF

        Shale oil or tar sands oil?

        • 0 avatar
          Pch101

          All of it. Alberta oil sells for prices below world prices in part because of the difficulty of transporting it to world market.

          The Canadians are well aware of how much money is being left on the table without a pipeline. Alberta oil will probably sell at a discount even with the pipeline, but it would help them to get more than they would get otherwise.

      • 0 avatar
        Landcrusher

        So you are saying that somehow the “Canadians” (a suspicious term here, who exactly do you mean?) will take all the monetary gain from the reduced transport costs? And, making it cheaper to export to the US than any other market will not put the US consumer at an advantage?

        Seems you are stretching things here, PCH. You have a monetary interest in this or are you just being partisan?

        • 0 avatar
          Pch101

          It’s pretty obvious what I’m saying. Alberta has to discount the oil because it has fewer customers. Most of the world’s oil is a fungible, global product, but Alberta oil is a distinct exception.

          A pipeline will give the Albertans access to more customers, who will pay higher prices. This is not exactly a secret, but I would expect ideologues who can’t Google to miss this.

          • 0 avatar
            Lou_BC

            Pch101 – not totally true.
            Alberta tar-sands oil takes more refining and therefore doesn’t fetch the same price as benchmarks like Texas Sweet Crude. My understanding is Fracked oil has similar properties to tar-sands oil.

            Eco-freaks and misinformed Aboriginals are trying to ban a pipeline from Alberta to Prince Rupert on the North Coast for shipping to China and the rest of the orient.
            (It is ironic that most protesters show up in hydrocarbon powered auto-mobiles.)

            We’ve seen enough rail disasters lately that would indicate the risks of shipping by rail.

          • 0 avatar
            Landcrusher

            I lived in Alberta, but never got a check. Who do you mean? Oil company stockholders? Canadian government? Who?

            And, while you are bothering to google for statist nonsense, find something from Krugman or Reiche that pretzels things around to where what you are saying isn’t good for us.

            I totally get you see zero sum games everywhere, but Canadians making more isn’t always at your expense. Really, trust me, I just know this without Google.

            Yes, the XL pipeline will give them a big bunch of customers who presently can also buy their product in the US only it will come by pipe rather than truck and rail. Better for everyone involved.

          • 0 avatar
            Pch101

            Is it too much to ask some of you guys to conduct basic research?

            Shipping oil via truck or rail costs more. As a consequence, not much of the Alberta oil gets out of the Midwest and Prairies, and the price is lower than oil in the Gulf of Mexico and elsewhere.

            The Alberta oil is also inferior in quality, which ensures that it will probably remain somewhat cheaper than Saudi sweet crude or Mexican oil, for example. However, it will command higher prices if more of it can make it to Houston, and accordingly, the rest of the world.

            This is not a matter of left-vs-right, but of getting it to a global port versus being stuck in a small regional market. Spend less time typing and more time learning about the oil business (and for that matter, all of the other stuff that you don’t understand.)

          • 0 avatar
            danio3834

            “I lived in Alberta, but never got a check. Who do you mean? Oil company stockholders? Canadian government? Who?”

            The Province collects the royalties which go into their treasury. A big part of the reason why there is no sales tax in Alberta as well as a flat income tax rate.

          • 0 avatar
            Landcrusher

            Somehow, I doubt the royalties will rise to soak up all the savings in transport costs so if that’s who he meant, he was just wrong.

      • 0 avatar
        APaGttH

        Agreed. Which is why my view on Keystone XL is the Canadians should build the pipeline through Canada to the Pacific coast. The average American gets zilch from Keystone XL and if there were a catastophic accident, it has dramatic implications. (never mind the Ogalala aquifer is draining out faster than it can fill itself up, and once capacity is lost in an aquifer, it is generally lost forever due to compression)

        • 0 avatar
          Lou_BC

          @APaGttH – proponents of the pipeline to Prince Rupert state that if “we” as in Canada does not get it built countries like China will source cheaper to refine oil elsewhere. In some respects that does jive with Pch101’s assertion that “we” do not have sufficient markets to sell at higher price.

      • 0 avatar

        U.S. Gulf coast refiners will get their value add if Keystone becomes reality. One wonders why the Canadians feel obliged to grace us with their oil. Aren’t they capable of refining it themselves. Do they just want to do us a favor?

        There are some who think domestic and N.A. production solves our vulnerability problem. If we produced ALL of our own consumption it doesn’t free us from the global market price of oil. Refined fuels is already our single biggest export. Consumers, and the RW in general, really don’t understand the issue.

        My problem is with the API, who knows better, yet pays for advertising on the issue that is patently deceptive.

        • 0 avatar
          Landcrusher

          The refiners “get” their value add? That’s an odd phrase. Not sure what you mean. And then comes the blurry “Canadians” again as if they were the Chinese or Arabs with mostly nationalized oil companies controlling their markets rather than the names there being mostly the same players we have here.

          A reasonable person would assume that there is no great margin to be made by refining the crude before it crosses the border, so none of the companies involved is doing it. Logistics and regulation seem like obvious answers. But hey, we all love a good conspiracy theory if you want to flesh it out for us.

          I have heard no ads promising absolute security or price protection and there will never be any, but it will improve things so it will still protect us. That’s the language. I suppose one might pretend that those aren’t political ads, but they are. If an industry is forced to jump into politics and lobbying to even survive, I would think we could forgive some politics in their political ads. Your problem is that for some selfish, ignorant and/or base reasons you hate the oil companies. Do you share your bile with the dairy lobby or is it saved for groups you are told you are supposed to hate?

    • 0 avatar
      Roader

      “So given that we live in a global economy, refiners are keen to export finished product for more profit.”

      Apple is keen to export finished product for more profit.

      Archer Daniels Midland is keen to export finished product for more profit.

      Coal miners are keen to export finished product for more profit.

      The world would be a much poorer place were that not the case.

    • 0 avatar
      vvk

      I wonder, why not export more? If it is really so profitable and the market is free, I would expect big pressure to export more.

      • 0 avatar
        Pch101

        Oil is a national security item. The US would make itself vulnerable with an open export policy.

        • 0 avatar
          Lou_BC

          @Pch101 – that is a valid point. War consumes massive amounts of oil. Some out in deep “right field” have stated that is part of the reason why the USA does not push for diesel vehicles and emissions are more strict on those as well. It keeps diesel and jet fuels for the military.
          IIRC the early days of the gulf war #2 was consuming the equivalent to 1/2 of the USA’s domestic daily consumption.

        • 0 avatar
          Landcrusher

          This one ranks right up there with not swimming after eating and your face will freeze that way. Sorry, but tell Mom you know she cares, but she has been misinformed. Exporting oil is no more weakening to our security than is exporting grain.

          • 0 avatar
            APaGttH

            Wrong, wrong, wrong, wrong.

            When I export grain I can easily grow more grain. To export more grain. To grow more grain. To export more grain.

            When I export oil, once the oil is gone, I can’t export empty holes in the ground.

            Our ability to produce and distribute our natural resources isn’t a strategic issue?

            Gee – I guess those World War II ration cards and victory gardens were completely unnecessary then. I guess Japan didn’t attack us in large part because we cut off exports and they wanted to dominate the Pacific Rim oil fields to control their own markets.

            How quickly we forget. If we opened up our markets for wholesale export of crude, the oil industry would punch holes everywhere they could and extract every last drop to squeeze out every last penny of profit. Once its gone – we’re hosed – just as the Middle East will be in a few decades.

            There is a reason that Dwight Eisenhower, a five star general who commanded allied forces in World War II, understood the reasons for holding the North Slope in Alaska as a do not touch unless there is an absolute emergency strategic reserve.

            No oil – no refined fuel. No refined fuel, no tanks can maneuver, no aircraft can bomb.

          • 0 avatar
            Landcrusher

            Apa,
            Almost all the cheap and easy oil on private land is gone. Your scenario is just not going to happen. If it started to look that way, you could justify changing the law back. At present, the law just creates an externality on local production while adding to the endless stream of unnecessary regulation. And, it’s not green either.

    • 0 avatar
      Landcrusher

      Oil is bought and sold on a world market, and that isn’t changing. It’s non perishable just like aluminum and copper and helium. What you have to grok is that the price is mostly affected by the marginal amounts being traded among the most desperate sellers and buyers.

      The price of gasoline is affected by many things including the price of oil. What people are rightly concerned about is the price of gasoline. First, keystone can actually help the price of oil by reducing the spikes caused by Mideast turmoil. If the US refineries are not trying to outbid each other and every other wealthy country on the spot market, that reduces the spikes. On the refinery side, output amount and cost is affected by different types of oil (which have different prices, btw). When a Midwest refinery shuts down to change to different seasonally mandated formulas of gasoline, the price goes up locally. It’s a market much like for a seasonal fruit in this case. All the sellers want supply to keep their customers. Also, if you change the input oil, you shut down, and not every refinery can even take shale oil without modification. It’s weird stuff.

      What is really curious to me is the concern over exporting of gasoline? Do we hate people who work in petrochemicals? It’s okay to export cars, but not gasoline? Why is one good and the other bad? You think GM would sell you a car here for 20k if they could get 25k by putting it on a ship? But if Exxon buys oil from Mexico, refines it in Beaumont, and sells the gasoline in Venezuela, it’s somehow a big rip off? They should have to sell it into the US market to save Americans money at the pump?

      Currently, their is a lobbying war going on over the export of LNG. Manufacturers and consumer groups want to keep the price of natural gas cheap by continuing the ban on exports. It’s purely a fight to move money from resource owners and drillers to factory owners. Logically, there is nothing special about an international border. Think about how fair it would be if your county became the market for some of your neighbors but not others. The doctor might not care, but how about the farmer? The manufacturer? He might go out of business, or change what he makes to something he can export out of the county.

      Export bans are archaic and unfair and need to end. Scare mongering over it is what ought to be banned. Yes, the price of energy is raised slightly by exports, but the supply is actually strengthened by it, and in crisis it will mostly taper off and can still be banned for real emergencies.

      • 0 avatar
        Lou_BC

        @Landcrusher – a large number of US subs patrol shipping lanes not only ensures freight gets to the USA but to make sure it (including oil) does not get to any country that may end up in an armed conflict with the USA. China is very dependant on oil shipped by super tanker. This link sums up China’s current dependency on oil. They are in fact considerably more vulnerable to instability than the USA due to their dependence on imports.
        http://www.zerohedge.com/news/2014-01-20/where-does-china-import-its-energy-and-what-means-petroyuan

    • 0 avatar
      DC Bruce

      Well, I’m with you on the basic point: the market for crude oil and products is global, not local (unlike the case with natural gas).

      But, I get off the bus after that. First off, because the market for natural gas is local not global and because, for a number of purposes natural gas is a substitute for petroleum, it makes a lot of sense to develop North American gas resources. As you probably know, long-haul truckers are seriously considering natural gas-powered tractors for lower operating costs than diesel fuel. And, most local transit systems have converted their buses to CNG, originally to minimize smell and pollution and now, perhaps, to reduce operating costs. Other fleet/dispatch vehicles are converting to CNG for the same reason. A CNG-powered automobile would be a far superior alternative to an EV.

      Secondly, as we found in 1974, petroleum is, in the short term, has a very inelastic demand. In other words, small changes in supply will produce large changes in price. While theoretically it’s true that producers can choose to just leave oil in the ground if the price isn’t high enough, the reality is that a number of large producers — most especially Russia — have their entire economies based on receiving X revenue from the sale of petroleum. So, if the price falls, their response is not to reduce supply, but to increase it to keep the level of dollars flowing in. Venezuela is in that box, and so is Iran.

      Thirdly, since oil is priced in US$, the nominal price of oil is subject to changes in the value of the dollar. Right now, with the Fed pumping money into the economy and driving interest rates to unprecedently low levels, the value of the dollar is comparatively low. In the early 1980s, the U.S. broke the back of OPEC (and the rampant inflation that had existed for at least the previous 10 years) by ratcheting up interest rates to unprecedented levels. The price of oil collapsed.

      Finally, markets are forward-looking. Today’s price reflects trader’s expectations about tomorrow’s supply. The expectation of increasing supply will have a depressing effect on today’s price.

      • 0 avatar
        CJinSD

        Well said. If the treason stain in the White House were serious about sanctioning our more ambitious external adversaries, depressing the price of oil through a rational energy policy centered on increased domestic production would be the obvious answer.

      • 0 avatar
        APaGttH

        I am on the record here – multiple times – on being very supportive of a natural gas infrastructure.

        If the government is going to hand out $7,500 checks to get people off gasoline, I would rather see $7,500 checks going to offset the $10K to $13K conversion costs to CNG on petrol driven cars than tax breaks for the generally speaking wealthy – to buy generally speaking toys.

      • 0 avatar
        Landcrusher

        So you are for or against allowing exports of LNG? Keep in mind that presently we, and many other countries, have untapped supplies. In fact, there is plenty of it still getting flared off everyday where they don’t have infrastructure or know how to use it.

        • 0 avatar
          Pch101

          Currently, the US natural gas market is regional in nature, not international. The US pays far lower prices for natural gas than do Europeans and particularly Asians because US gas producers aren’t in a position to export it.

          Converting US gas into LNG will make it more valuable. It will probably end up going to Asia, since the Asians will pay the most.

          American consumers will suddenly find themselves competing with consumers half-way around the planet for something that used to be a bargain.

          Ironically, guys like you will respond to higher prices by blaming the liburahls, Kommunists and the rest while forgetting that it was guys like you who wanted to turn US gas into a pricey global product. How dimwitted can some among us possibly be?

          • 0 avatar
            Landcrusher

            Last bit first. You used to be interesting to talk to, but your current need to insult, condescend, and otherwise be rude is getting out of hand. And, in addition, you know I wouldn’t do that. There isn’t even a grain of truth in there to make it funny.

            As for the rest, I love how you think a pipeline to the US will make consumers pay more for a product that will then become part of a local only market while making NG into a world market will also make them pay more even though only a very small fraction would likely get the expensive process to make it exportable. It sounds like any statist regulation is good for the consumer, and any loosening of regulation is bad for the consumer which is of course true when we use the statist view of what’s good and bad.

            I also love how the fairness of this is totally overlooked no matter how many times I bring it up. How about we disallow you from working deals outside of your state? Your customers could likely get a much better deal on your services if we limit your ability to find customers. If I knew exactly what you do, I could likely make a security argument for it as well. There is no moral excuse for this nonsense.

          • 0 avatar
            Pch101

            So in answer to my question, some people can be stubbornly dimwitted.

            These concepts should not be difficult to understand. But the irony is that those on the internet who squawk the most about free markets don’t seem to understand a single thing about them.

          • 0 avatar
            Landcrusher

            For new readers, allow me to translate what PCH just said: I’ve been shown to have repeated liberal cocktail party nonsense I don’t understand well enough to question and so now I will just say anyone who disagrees is dumb because obviously, if they don’t agree with me they just don’t understand the real truth.

          • 0 avatar
            Pch101

            Your commitment to laziness is truly astounding.

            If you would simply devote a fraction of the time that you spend here to researching the topic, then you would know that what I am saying is not at all controversial. Europeans and Asians pay more for natural gas than Americans, and Alberta’s lack of a pipeline reduces the price of Alberta oil. These are not secrets, and those facts are easily verified from credible sources.

          • 0 avatar
            Big Al from Oz

            @Pch101
            For once you did research and are completely correct. I’m proud.

            The reason for cheap natural gas in the US is due to transportation of the gas.

            The most viable method to transport gas is through pipelines.

            Australia is lucky at the moment concerning gas exports. We are still in the throes of a gas investment boom.

            This is due to the infrastructure we are developing for it’s transportation and storage.

            We are catering to the rapidly expanding E and SE Asian markets. China is even discussing building a gas line to China from Australia.

            The US is a very regional market and largest consumers of gas in the US are the power generators followed by industry and lastly the domestic users.

          • 0 avatar
            Landcrusher

            Your lack of reason is the real issue here. I have no argument with any of those points so restating the few things you said which are correct isn’t fooling anyone. The lies you draw from those facts is the issue. We are better off with the pipeline. Banning exports is theft. Competition creates a better world.

            How about we regulate you and your life? How much of your wealth depends on the energy business? I don’t have to google what a bunch of useless know it alls think about this stuff. I talk to the people who actually do it for a living every day. Besides, whatever I google up that disagrees with your tainted view will just be denounced as biased or you will say I am reading it wrong when I quote it verbatim.

            You still make no comment about the morality of the ban, nor back up your security argument which can only be backed up by silly peak oil assertions which get proven wrong every time.

            You don’t fool me, PCH.

        • 0 avatar
          APaGttH

          The reality is converting to LNG and its transport is costly. Crude oil is a more global commodity because it’s cheaper to transport.

          Also, a lot of that flare gas is very sour and highly corrosive, hence why its burned off. Hydrogen-sulfide is nasty stuff.

          I’m not against its export – but I think people are really not seeing the big picture on this idea that we can just start sending LNG tankers to Europe and tell Russia to stick it. We don’t have the infrastructure to convert on that scale, it is very expensive to build, and once again capitalism (damn that capitalism comes into play). Oil and gas companies would have to be convinced, 100% convinced there was profits for decades and decades after building that infrastructure for LNG transport.

          Am I for it? Of course! Do I think the energy industry will buck up and do it. No way in Hell.

          • 0 avatar
            Landcrusher

            Well, they seem to want to do it. They realize the Ecocrats will make it ungodly tough to do it. Yet we need a law saying it can’t be done?

          • 0 avatar
            APaGttH

            …Well, they seem to want to do it…

            The O&G industry? Really? Where are the permit applications then for the LNG conversion plants. Link please.

            Sending minions to the talk show circuit to get the echo chamber going is not the same as wanting it.

            Case in point – this was the same argument 15 years ago. Oh regulation hasn’t allowed the building of a single refinery! It ignored that the O&G industry was dissembling refineries wholesale and selling them to third world countries due to cheaper labor and less shipping costs to produce in house. It also conveniently ignores that US consumption peak in 2005, and has dropped almost 20% since. We have an over capacity for refineries now – that don’t even operate at 90% production anymore.

          • 0 avatar
            Landcrusher

            APa ,
            I doubt there are any requests to make facilities for illegal exports. If they aren’t going to do it, then why have a law forbidding it? Anadarko had plans to build one in Halifax, but it got canceled. The payola was much appreciated by the locals throughout the process though.

            As for refineries, it’s a worthless argument. Do you argue that a company with a good record for safety wanting to build a new refinery would be able to do so without spending millions and taking years just to get past the inevitable storm of government BS? I suspect any refineries being sold off were done so for good reasons, and it don’t doubt that there would be companies willing to build new ones in the right places if the legal situation were more reasonable.

        • 0 avatar
          thelaine

          Excellent posts Landcrusher. I don’t believe we would have developed fracking in the first place without widespread privately held mineral rights. Many have argued that oil and gas are a national resource and private ownership should not be permitted. This is in fact the case in many countries. It is no accident that fracking developed in the US, where people had the financial incentive and opportunity to get after it. The socialist impulse, the arrogance, the hypocrisy, and the suppression of economic growth and human freedom all go together. They never quit believing they know better than you what to do with your time, labor, money, speech, property and freedom.

          • 0 avatar
            dartman

            Landcrusher:…Well, they seem to want to do it…

            APa:…Where are the permit applications then for the LNG conversion plants. Link please….

            Here you go…

            http://www.ogj.com/articles/2013/12/south-texas-lng-project-issues-epc-contracts.html

            And another…

            http://www.bizjournals.com/houston/blog/drilling-down/2014/02/obama-administration-approves-rare-lng-export.html?page=all

            And finally…

            http://www.fossil.energy.gov/programs/gasregulation/authorizations/2012_applications/gulf_coast_export12_05_lng.html

    • 0 avatar
      jimbob457

      Excellent posts.

      One additional very important point. As fracking (for both crude oil and natural gas) spreads it will sooner or later affect the Saudis and break today’s $100 oil price. Word on the street is that it will take $70 to drive fracked crude oil back in the ground. As experience with fracking grows and it spreads geographically, that number might actually fall.

      Meanwhile, natural gas at Henry Hub and elsewhere is selling for the energy equivalent of $24 per barrel thanks to fracking. You can’t export the stuff directly except (maybe) for one specific instance that would convert an abandoned LNG receiving terminal in Texas. This cheap natural gas will, however, indirectly affect the demand for Saudi oil and thereby put additional downward pressure on world crude oil prices.

      Bottom line. Fracking, even at this early stage in its development, will eventually lower gasoline prices in the USA by maybe 75 cents to a dollar (USD) per US gallon. It may take a few years to play out. It might happen sooner if Russia quits acting up.

      Assuming the oil boom prices will last indefinitely is always wrong.

  • avatar
    Kyree S. Williams

    Okay, so based on your conversion rates, I paid about $0.86 per liter to fill up the Sonata earlier. Not bad…

  • avatar
    Zykotec

    Here in Norway gas prices vary from $2.40 up to $2.65 pr. liter over the course of a week. (usually cheapest on Monday mornings)
    So despite the average paycheck in Norway being 3.5k to 4K a month (after around 30% tax) everyone drives loaded midsize(Passat/Mondeo etc.)wagons or compact hatchbacks with small diesels.
    My CRV is looked upon as a quite powerful gas guzzler (150hp R20).Offcourse tax on horsepower and displacement doesn’t help much either. And still there are more and more people with semi-powerful BMW’s here.

    • 0 avatar
      George B

      Zykotek, are heating fuels and fuel for farming taxed at the same high rate? In rural Texas some people used to use “red dye” diesel illegally in on-road trucks. Big fines if you get caught, but people can go decades without ever getting stopped by the police. How does the government keep heating oil and farm diesel from ending up in car fuel tanks?

      • 0 avatar
        Garak

        At least in Finland, the penalties for using heating oil are astronomical – 26000€ is the norm for trucks, and the law allows for a maximum fine of 2.34 million euros. It’s simply not worth the risk to ruin your entire life for fairly small savings.

        • 0 avatar
          krhodes1

          The fines are pretty steep in the US too. In Maine it is $10K for a first offense. And because we have LOTS of fisherman with access to untaxed diesel, checkpoints for tank testing are not at all uncommon. And here the savings are nowhere near as much since our taxes on fuel as so paltry. But people try to get away with it anyway.

      • 0 avatar
        Zykotec

        Yep, we have a similar system here. Untaxed red diesel for any vehicle that doesn’t go on roads more or less. The pumps for farming diesel are placed separately from the others, so I guess gas station attendants can report illegal activities if they want to. And they put some sort of tracer in it in addition to the color. A lot of farmers have larger tanks at home that they can use, but the ticket if you’re caught can make up for a few years of use.

  • avatar
    LambourneNL

    Dutch prices are about 10% above Germany’s, and there’s a monthly tax based on vehicle weight ($75-100/month for midsize cars, twice that for an SUV). New cars also get a CO2 tax which can get fairly insane (new CTS-V is $200k…)

    Consequently, I don’t know anyone under 40 that’s ever bought a brand new car unless it was a Fiesta or Yaris. Most people have a leased company car (think Focus or low spec 3-series diesel) and those that don’t, buy used.

    Then again my health insurance covers everything for under $1k/year and my car insurance is $20/month for $5m liability coverage. Win some, lose some.

  • avatar
    Big Al from Oz

    Here is a relatively recent tabulated account of fuel prices in many nations. You can see the ‘pump pain’ between nations.

    By the looks of it, fuel costs the Canadians more than us for fuel as a percentage of our income. I can see why the Canadians’ might want to do more business with the European vehicle manufacturers.

    If Canada can go the Euro system for fuel emissions, hopefully they can start to get some of those diesel midsizers we have as well as those US full size pickups.

    Canada will then have the best vehicle market in the world, even better than what we have currently in Australia.

    The US is only slightly better than the US for fuel prices, hence our love affair (past) for V8s and the influx of Thai utes.

    I think the demise of the V8 is a little more in depth than the cost of fuel as Derek alluded too.

    http://www.bloomberg.com/visual-data/best-and-worst/highest-gas-prices-countries

    • 0 avatar
      Big Al from Oz

      I erred;
      “The US is only slightly better than the US for fuel prices”

      Should read;
      “The US is only slightly better than the us for fuel prices”

    • 0 avatar
      grinchsmate

      That is a great table.

      Raw $/L data doesnt really tell us much except the level of fuel excise. The %income/L and %income spent on fuel are much more interesting.

      On an income basis the US has the sixth cheapest fuel but only four other nations spend a higher percentage of their income on it. Some of that will be due to higher disposable incomes than most of the world but I would guess the F150 has its hands in it as well.

      • 0 avatar
        Big Al from Oz

        @grinchsmate
        The table only covers gasoline, not diesel, LPG, or any other alternative fuel.

        But, other liquid fuels based on crude will be roughly similar in price.

        You can see why the US has gasoline biased regulations that work against fuels like diesel.

  • avatar
    Noble713

    Odd selection of cities in this list. Auckland and Wellington between them have <2 million people and only a $0.01 difference in gas price.

    Similar situation with Melbourne and Sydney (roughly the same geographic area of Australia and no price difference).

    Meanwhile Japan is represented exclusively by Tokyo, and while the metro area is like 1/4 of Japan's population, other areas have vastly different fuel cost/income dynamics. For example, here in Okinawa fuel costs are roughly the same but incomes are *FAR* lower. Yet the near-total absence of public transportation forces virtually everyone to have some kind of car (predominantly kei cars). Granted Okinawa is hardly a blip on Japan's radar but I'd at least expect some data for Osaka or Sapporo.

    • 0 avatar
      Zackman

      When I was on Okinawa at Kadena AFB over 40 years ago while in the USAF, gas was 12¢ per litre! still expensive compared to what I paid in NoCal where my permanent base was at 25¢ per gallon on average.

      Have an Orion beer or two for me! Only if it’s ice cold, though…

  • avatar
    thornmark

    Something like 75% of the price of petrol in Britain is taxes.

  • avatar
    BunkerMan

    All I know is that last Thursday I filled up my F150 at $1.35 Cdn per litre, for a total of about $130. My family and I then went on a camping trip to Maine and NH last weekend. On the way to the campsite, I had to fill up the truck again (it’s a long drive). It was $3.66/gal US for regular, $3.74 for “plus”. I filled it up with plus for $90 US. I actually spilled gas on the ground by overfilling the tank, since I thought there was a problem with the pump. Even taking into account conversion rates, that saved me $30 on a tank.

    I ran plus and supreme all weekend, obviously.

  • avatar
    Athos Nobile

    Petrol prices is one of the reasons among many. Running a Falcadore on LPG is almost as cheap (if not cheaper) as running a Corolla on petrol.

    I drive a V6, and my first fill up was traumatic. From spending $2 for a full tank of 40 lts to AU$70 for 60, the shock was big. But I got used to it. I have also ran the numbers on a range of 4 banger options and the savings are there.

  • avatar
    grzydj

    Remove taxes from the equation and prices for fuel remain similar across the board. I don’t know why the author didn’t make that distinction in the original post.

    Also, you’re statement about many European countries subsidizing diesel is inaccurate as well, it’s just that petrol is taxed much higher than diesel is.

  • avatar
    seth1065

    I run an oil burner in my jetta TDI , about 8percent more than reg unleaded in NJ, rug runs about $3.20 here so not bad at all and I go to canada pretty often so I see high fuel prices. What I want to know is why when some 2 bit country has a problem does my fuel price shoot up it seems that very minute but when all calms down it takes “time” for the cycle to get me lower fuel. As long as gas is cheaper than milk and bottled water we can not complain in the USA.

    • 0 avatar
      TonyJZX

      funny you should use that metric

      where i am i pay $1 for a litre of milk

      you can buy pepsi for a $1 a litre too

      you can buy a dozen 600ml or 1.2 pint bottles of water for $3

      gasoline is more than stuff you drink but you can thank the govt. for that

    • 0 avatar
      brn

      Where I live, water is piped straight to my house and it costs a hell of a lot less than gasoline.

  • avatar
    Pch101

    Norway usually tops these international price comparison lists. Norwegian prices make fuel costs in the UK look cheap.

    For that matter, the UK is usually ranked below much of the rest of Europe for fuel costs per liter.

    While Americans certainly pay less than just about everyone else, the difference is slightly exaggerated in that some nations are buying higher octane fuel than others. For example, the regular grade fuel in Europe is equivalent to US midgrade or premium (depending upon the state), and premium fuel does genuinely cost more to produce.

    • 0 avatar
      grzydj

      Again, as the author of the article failed to mention, that’s because of the taxes added to the fuel. Pretax, costs in many parts of the world, including Europe are sometimes cheaper than they are in the US.

      • 0 avatar
        Pch101

        I’m well aware of the tax differences. The point of this discussion is to show the range of prices, not to itemize the taxes that contribute to those differences.

        That being said, comparing US 87 octane to Euro 95 (which is about 91 octane in the US) isn’t an apples-to-apples comparison.

        • 0 avatar
          vvk

          Why do you assume that this list has not been normalized for octane variations?

          • 0 avatar
            Pch101

            I have my doubts that an economics blog written by people who don’t understand economics would have any more wisdom about octane differences.

            Many of these reports compare “regular” to “regular,” without accounting for the fact that regular doesn’t have the same meaning everywhere.

  • avatar
    Master Baiter

    How come no cities in the Middle East are listed? The price of gasoline in Iran is $0.47 / gallon.

  • avatar
    mikey

    Its the start of our long weekend up here. Gas buddy has Costco at 1.26 a litre. The line up is 5 deep at the pumps. 1.37 for Supreme.

  • avatar
    danio3834

    Filled up in Detroit this morning for $0.93 USD a liter ($3.51/gal). Probably as good as you’ll find at the moment.

  • avatar
    TW5

    The tacit implication of these charts is that American gasoline is cheap and American gasoline taxes are too low. Global oil and gasoline prices are much too high, and American gasoline tax is not judged by its relation to other G20 nations, rather the proportion of interstate funding which should be borne by road users.

    Oil is $100 per barrel because that’s what the US wants it to be. The US needs high oil prices to pump free stimulus out of the ground, and we want economic stability in the Middle East. We go out of our way to make painfully slow progress regarding conservation and alternative-energy/biofuel production. We would rather have someone import $5,000 of gasoline over the life of an Fusion sedan, than give the buyer $3,000 to get the hybrid version.

    The US works hard to burn this much oil. Why? Because we’ve decided we don’t want 1986 all over again.

  • avatar
    Spike_in_Brisbane

    PCH101 has a point. Here in Oz we have had a recent explosion of companies extracting and exporting LPG and CNG which, contrary to some claims is not much more expensive to export than it is to transport around the country. The expected expansion of facilities in Queensland has fuelled speculation that nearly all the gas will be sold overseas at higher global market pricing making the stuff much, much dearer for us.
    Currently LPG, which is available at most petrol stations, costs about half the price of petrol. NG piped to homes is cheap fuel for cooking and hot water and possibly not for much longer.

    Check out :- http://www.abc.net.au/news/2014-04-23/household-gas-prices-going-up-176-per-cent-in-nsw/5406752

    P.S. Regular petrol here is 91RON. Premium is 95 or 98. I believe that is different to the type of numbers used for octane rating in the U.S. Can someone clarify?

    • 0 avatar
      Landcrusher

      Lol, thanks for making my point, Spike. You guys are looking at a 10% increase in cost due to demand and a 10% increase in cost due to tax. The response by the statist politicians is to propose a quarantine on part of the resources to prevent export so what? So the companies doing all the work can’t raise prices the same amount the useless politicians just raised the tax!

      Never mind that the only thing being exposed is how much the regulators are cheating the producers.

      If the government wants to charge higher royalties for resources on public lands or extract terms that an equal amount of gas extracted from public leases will only be sold domestically, that’s something the voters should rightly consider. Otherwise, it’s thievery, and they have just as much right to come into your home for your furniture and your business to set your prices.

      Could someone please tell me one way or another the difference? Am I the only adult in the room? Are you all just getting while the getting is good? For shame.

    • 0 avatar
      Big Al from Oz

      @Spike in Brisbane
      It’s all of our export commodities that are pretty much higher.

      My mother in NJ buys Australian beef at the supermarket. She’s buys what the US calls fillet mignon, even though fillet mingnon is the way a particular cut is cooked and prepared (it doesn’t come wrapped in bacon!).

      She’s paying between 2/3s to 3/4s of what we are paying at the butchers or supermarket.

      What Pch101 fails to understand is capitalism and how it works. This occurs when you are a unionist. He believes in controls that moves power away from the people and business into the hands of the unions. Read and interpret what he writes. He should move to China a place that suite his paradigms.

      If the US exports energy there are many countries that will buy it up. This still creates demand. But currently there isn’t enough oil produced to sate demand.

      I do know the US has recently released some oil from it’s oil reserves onto the global market. It caused a downward blip in oil prices.

      The US did this to show Putin that the US has the capacity to screw around with Russia’s economy.

      But, overall the US can only do this for a short while and then the market will stablise with prices rising.

      The other area Pch101 fails to understand the US is far from the only country with the oil reserves that it has. Even China has much oil and gas.

      We in Australia have in one of our reserves as much oil as Saudi Arabia has. This is in the Coober Pedy Basin.

      Cost of oil recovery and distribution is the problem.

    • 0 avatar
      Scoutdude

      RON is Reasearch Octane Number, another method is the Motor Octane Number. In the US what is posted on the pump is an average of the two systems, sometimes called AKI for Anti-Knock Index. So in the US in most areas regular is 87, mid 89, and premium 91 or 92. However in high altitude areas regular is usually 85.5.

    • 0 avatar
      Pch101

      It’s funny how some of the other posters here simply can’t grasp how opening up domestic fuel supplies for export to higher cost markets would lead to higher prices at home. (Not everyone paid attention in capitalism school, I guess.)

      But the fuel producers do understand this, which is why they’re doing it.

      Gas is a popular source of energy because it burns clean. The Asians need to import it, and their demand growth is outpacing that of the west. Putting the average US (and I suppose Aussie) household in competition with those foreign markets will understandably come at a price for the domestic consumer.

      As for octane, subtracting 4 from the RON octane rating used in much of the world will get you pretty close to the AKI octane rating used in the US and Canada. Regular fuel in Australia has a similar octane rating to regular in the US, while the Europeans are using something closer to what Americans would call premium as the standard fuel.

      • 0 avatar
        Landcrusher

        Could you point out where someone made the assertion that allowing exports won’t raise prices? One poster in particular, you actually, seems to be arguing that increasing imports from Canada, or at least making it much cheaper to export them to us rather than Asia, won’t reduce prices here.

        The point is how much it will affect prices and whether we would be better off overall. A very important consideration is, no matter how much you ignore it, whether it is moral to ban exports for the purpose of affecting the price. Everyday that Washington, or anyone other than markets, picks the winners and losers postpones a true recovery, costs us all much happiness, and actually costs lives. It must end.

  • avatar
    Big Al from Oz

    Here is an interesting story from an Australian news outlet.

    An article released by the IEA predicts an oil shortage by the end of the calendar year.

    Supply and demand, all balanced on production.

    http://www.abc.net.au/news/2014-05-16/energy-agency-predicts-oil-shortage-unless-supply-boosted/5457302?section=business

  • avatar
    SaulTigh

    This is part of the reason I just bought a 2014 F150 with a 5.0 liter V8 and a 36 gal fuel tank. I think this is in many ways the quintessential “American” vehicle. Huge, with a V8. And I want to enjoy it before the America I grew up in goes straight into the globalization/overpopulation crapper. It helps that I live in an area that generally has some of the lowest fuel prices in the country. I’ve only put gas in it once since I bought it (and insisted the dealership fill it up). $3.23 a gallon (or $0.85 cents a liter).

    I feel even better about my choice after seeing that chart, and I’ve got a 2% cash back on gas credit card to boot.

    • 0 avatar
      highdesertcat

      SaulTigh, that is the exact same reason a long time friend of mine, and fellow Air Force retiree, gave for the purchase of his 2014 All-Black V-powered 4-door F150 4×4.

      He wanted to enjoy his first-ever new truck before America goes further to hell in a handbasket.

      The cost of gas wasn’t even part of the decision process because a person who can’t afford to put gas in his truck ought not to buy a truck.

  • avatar
    Lou_BC

    @highdesertcat – yes and no. I agree that if someone cannot afford to run a truck or any vehicle for that matter, they shouldn’t buy it BUT irregardless of the fact that I can afford it, forking out 180 dollars for a tank of gas has some bite to it.

    • 0 avatar
      highdesertcat

      Lou_BC, I guess that really is the heart of the matter, isn’t it?

      My Canadian brother-in-law enjoys the best of both worlds in that he lives in the Seattle area married to my sister, but draws his income from the properties he inherited from his Canadian parents.

      He has two personal vehicles all his own — an econobox with Canadian plates on it that he uses to drive down from Canada to the Seattle area, and a V-8 powered F250 four-door for use while in America.

      But when he and my sister go up to Canada to visit, they take one of her cars, depending on the length of stay and the amount of baggage they take with them, either her Sequoia 4X4 or her Tacoma 4X4.

      At no time is there ever any discussion about the price of gas or the amount of pollution the cars wreak on the environment. They just put in the gas, and go.

      It’s where we each put ‘money’, or the lack of it, on the list of our priorities.

      My point: if 180 dollars for a tank of gas has some bite to it, for you, then it must rank pretty high on your list, even if you can afford it.

      For others, like myself, money is a tool. It’s the utility we buy with it. And for me, and others like me, driving in comfort beats walking at any price. Once the money is gone, it’s gone. Until then, get the most for it that does the most good.

      Maybe for my brother-in-law and his Canadian-titled econobox, it is more about image (while in Canada). Maybe he just doesn’t want to project the image of living a life of largesse driving a V-8 F250 solo in Canada.

      From a personal perspective, my Tundra 5.7 is a thirsty beast. In addition to that I have two gasoline-fired AC generators and one diesel-powered AC generator,and therefore keep two 55-gallon drums of gasoline on my property and a 25-gallon drum of diesel.

      I fill up my wife’s Grand Cherokee at home from my stash if she doesn’t have a chance to fill it up while in town. Ditto with the Highlander my 16-yo granddaughter is using for her daily ride. And until recently I also fueled my 22-yo grand daughter’s Elantra.

      So I buy a lot of gas, sometimes more than 100 gallons a week, depending on how much driving we each do. SOME of my expense for gasoline is mitigated if I do work and travel for the business owned by my wife’s family. But that is usually no more than topping off the tank, since I start with a full tank to begin with.

      Since I can go through as much as $400 (American) a week in just buying fuel, which is near the top of my list of priorities, I don’t worry about how much it costs. I need to have it, at any price.

      What has been drastically reduced in my life has been spending on the daily lattes, eating out most meals, getting my hair cut (my wife does that now), and/or snacks. Austerity has an effect, on others, not on my priorities.

      I mention this, just so you know that I’m not a wealthy individual. There is a limitation to the amount of money I get and can spend every month.

      I bring this up only to illustrate that MOST Americans do the very same thing with their money. They choose what they want to drive, fuel it to keep it going, and cut back on less important things.

      • 0 avatar
        Lou_BC

        @highdesertcat – The 0.1% and the 0.1% are probably the only people who aren’t faced with limited resources.
        I would prefer to spend less on fuel. The part that bites is as you have pointed out, means you have less to spend elsewhere.
        I purchased my truck fully cognisant of the fact that fuel consumption was something that goes with the territory. When I was single, I did not give a sh!t. When one has family to support then it does become an issue to look at.
        I look at the allocation of my finite resources. I make good money but never the less, money is a finite resource. I’d rather put money into my children’s future than put money in my gas tank.

        • 0 avatar
          highdesertcat

          Lou_BC, at my age there are even more things to consider, like being able to get in and out of a vehicle. Most of all, comfort!

          In my case, I trade my money for what gives me the most of what I am looking for.

          I am actually starting the process of pinging the Toyota dealerships of my choice to let them know I will be in the market to trade my wife’s 2012 Grand Cherokee for a 2015 Sequoia 4X4.

          This worked very well when shopping for the 2008 Highlander and the 2011 Tundra, which, incidentally, I bought from the same dealership in El Paso, TX.

          At the end of next year (2015) I’ll be trading my 2011 Tundra 5.7 for a brand new one, this time with four doors and 4X4. Hope it comes together. Else I’ll have to step back into antiquity and buy a 2016 F250 with the largest gas motor I can find.

          A couple of things about money, though. No matter how much you make, it is never enough. And it isn’t how much you make — it is about how much you actually get to keep!

          What riles me is when people start belly-aching about the cost of gas, yet they drive what they choose to drive (regardless of brand). The best selling vehicle in America is the F150!

          If people are so concerned about the cost of fuel, they always have the option not to buy it. That will drive the price down and the supply up for gasoholics like me, people who MUST buy gas because without it we would be lost, stranded, our lifestyles destroyed.

          • 0 avatar
            Lou_BC

            @highdesertcat – I fully understand your point of view. I find that my priorities have changed over time.

            When I purchased my truck there were other trucks with better fuel economy but they did not have other features, options, or durability that I wanted.

            I hated the Chevy and it and the Titan didn’t even make my short list. The Sierra I liked looks wise but the 5.3 is a torqueless wonder and I couldn’t get a 6.5 box. The Ram got dumped of the list due to poor durability data. I ruled out the 6.2 due to mpg.
            It became a choice between the Tacoma, Tundra, and F150.
            The Tacoma did not have the tow/haul capacity that I wanted. So it fell next.
            The Tundra has a wonderful drivetrain BUT it was considerably more expensive than the F150 and didn’t have a 6.5 box crew.

            Fuel economy wasn’t a huge priority but I did look at it. I can get 15 mpg (US) and 20.5 mpg (US) just by driving more cautiously.

            Winter time with heavy snowfall or -25C (-13F) or colder kills mpg and I can easily consume a tank of gas in a week.

            My truck gets the job done in that weather and meets all of my other wants and/or needs. It is ultimately a luxury I want and am willing to pay for.

            It does not mean that I will continue to choose to pay for that luxury.

            If Toyota comes out with a Cummins powered Tundra I may choose that as my next vehicle or my life could take a turn where I don’t want a truck any more.

            The price of fuel is just one more variable that I juggle along with all of my other costs.

          • 0 avatar
            highdesertcat

            Lou_BC, and you will find that as time progresses your priorities will change even more, including that of transportation.

            For most Americans, fuel is a necessity, not a luxury. Knowing that, people still buy the vehicles they do but at the same time complain about the cost of fuel.

            I know what MY priorities are and gasoline is high on the list. I also know what I want out of life and what I will give up to attain what I want out of life. Been that way all of my life!

            Personally, I believe that when a person opts to buy a truck, they have already fixed in their mind the why and wherefores that go along with that purchase. Yep, that includes what it will cost to feed the beast and what the buyer is willing to forego in order to enjoy it.

            I cannot envision MY life without a truck! I have owned many trucks, most of them used. I have only owned three brand new trucks and in each case I bought what I wanted — not necessarily what I could afford.

            My next trucks should be the last one I’ll buy during my lifetime and you can bet that it will be exactly what I want, with all the bells and whistles, and all the toys.

      • 0 avatar
        Big Al from Oz

        @highdesertcat,
        I normally do believe what you state is true. But in the case of the fuel you are buying only holds true because you have adequate resources to buy the stuff.

        If you didn’t you would have to find an alternative.

        Not everyone is in your position financially.

        How can someone in the US earning between $10-$20 per hour even consider fuel as an open resource?

        They will buy what they can afford. That is what you are doing.

        But, it appears you view the rest of the US lives and has available the resources you have.

        This is quite naïve of you.

        • 0 avatar
          highdesertcat

          BAFO, I can’t even begin to tell you how many times over the decades I have run out of money and still had a lot of month left at the end of the dollars.

          Actually, it is my belief that the vast majority of Americans have far greater financial resources than I do. I have real estate, property, but actual cash money is limited to my official pension and social security, and of course what I can scrape together unofficially.

          Just because my wife’s dad keeps bags of cash money at our house does not mean I can dip into those funds.

          But when I do a job, I expect to get paid when that job is done. And since I do a lot of maintenance and repair on the properties owned by my wife’s family, they have been pretty good about paying when the job is done.

          It is equally true, that as we wind down the business and sell off the excess properties, my need for gasoline has somewhat lessened. But there are times, like the past two weeks, when it is balls to the walls in getting property ready for sale.

          Fortunately, that is for the business, and the business picks up my gas and expenses.

          But, really, the bottom line remains: Americans keep buying fuel until their money runs out. We’ve seen this time and again as fuel costs have sky-rocketed.

          I don’t think it is naive to observe people’s behavior and document that. I’ve seen plenty of people whip out the credit card to fill up the gas tank. If they really were so concerned, why don’t they change their behavior and stop buying the gas?

          Why aren’t they all switching to PEVs?

          If the planet actually ran out of oil, I bet that would change a lot of things. But most Americans know there will be plenty of oil during their lifetime, and live their lives accordingly.

          Why aren’t the environmentalists all jumping on the EV bandwagon? If they did a lot more EVs would be on the road now.

          • 0 avatar
            Lou_BC

            @highdesertcat – I’ve seen the same behavior with cigarettes, alcohol, or drugs. People will make huge sacrifices or sacrifice their families to get what they want. In reality for most of us a tank of gas like cigarettes is a want and in some respects is as addictive as tobacco.

            We do not know what price fuel will have to reach to start changing behavior. Most economic indices indicate that a large percentage of Americans cannot afford their current lifestyles.

          • 0 avatar
            highdesertcat

            Lou_BC, I know a man in his late sixties who wrapped up all his vices in one and bought a 2013 Raptor. Talk about addiction. Sometimes he just sits in the truck for hours, his wife told us.

            Funny part is watching him get his wife into the truck, using a stepstool and the running boards, and then….off they go! Slower than molasses flowing uphill in the middle of winter, like he was driving a Prius (which is his wife’s car.)

            The two of them recently went to Disneyland in Anaheim, CA, and he got a speeding ticket in the vicinity of Indio, on I-10.

            Now, you gotta understand why this ticket is simply not a credible possibility, and you would, if you knew the man.

            He hasn’t gotten a speeding ticket EVER during his life because he drives like the old fogey he is. Always has. I hate when he drives me anywhere. In fact, his Garmin substantiated that he never exceeded 75mph during the entire trip to CA and back.

            So, the bright color of the truck must have stood out like a sore thumb and attracted the Highway Patrol like a magnet. Add to that the bright yellow out-of-state plates, and that spelled M-O-N-E-Y to the bankrupt state of California — $370 all told.

            Sometimes the price of gas is not all a person has to worry about.

  • avatar
    Lou_BC

    @highdesertcat – funny story (but not for your friend).

    Our provincial government passed a law that if you are 40kph (25 mph)over the speed limit means an automatic 7 day vehicle impound and fines. They also have a speed limit even on freeways of 100 kph (62.5 mph).

    • 0 avatar
      highdesertcat

      Lou, point was, sometimes WHAT you drive matters more than HOW you drive it.

      I remember from my younger days how some of the guys driving hot cars, like Porsche, Corvette, BMW 6-series, bought with their re-enlistment bonus, would get speeding tickets. I had a couple of them working for me.

      In the US military, getting a speeding ticket back then was a big deal, often resulting in double jeopardy for the same offense. Like you pay the fine to the civilian court and then you get your driving privileges taken away by the military, especially overseas. The Commanders and the SJA didn’t fool around, and the senior NCOs were tasked to enforce the rules.

      I think if a person willfully breaks the rules there should be consequences. And when my #2 son was CHiP for 12 years he wrote a lot of tickets that were deserved. He cut a lot of people slack so it would save them some money on the fine by charging them only for 10 over instead of their actual clocked speed.

      But when the courts ran low on money and the judges told the cops to get on the ball and raise more money with stricter law enforcement by writing more tickets, it gave new meaning to the phrase, “mining the highways.” Money poured in! In many cases faster than the clerks could process the payments.

      Problem for out-of-staters is, who’s going to contest the ticket? You’re a traveler, passing through, and you have no way to prove that you were not speeding. And who wants to come back to go to court and be saddled with the additional expenses of lodging, food, fuel, plus the fine and court costs on top of that? You know beforehand, you’re going to lose.

      That whole racket is a pretty sweet deal. Hell, even New Mexico is doing it to out-of-staters. Good thing they leave us locals alone, else my lead-footed wife would have been cited numerous times.

      • 0 avatar
        Lou_BC

        @highdesertcat – we buy based on wants as opposed to need. Men tend to be bad for buying vehicles on emotion, kinda like some women with shoes or handbags.

        In BC the same thing has happened with speed enforcement and out of province drivers have been hit hard. A 7 day automatic impound hurts.

        It is done as part of a “speed kills” campaign but it is really a way to fill the coffers.

  • avatar
    Jeff S

    The price of fuel does not have as much of an effect on me as it did when I lived in the country and I commuted 70 miles a day round trip to work. Now I drive a couple of miles to the bus stop and I telework a couple of days a week. I have been combining my trips for years. My vehicles are not too bad on fuel but they are not the most fuel efficient. I went from putting 15k miles a year to 5k. I try to time my purchases around when gas is the cheapest but that is not always feasible. I can keep my vehicles longer and spend less on maintenance because I drive less than I have in the past but I realize that not everyone has that option. So yes I do gasp when I fill up an empty tank on my trucks but I don’t really fill up that often. Since I am getting close to retirement I do want a more fuel efficient vehicle but then I want a certain type of vehicle that is more functional which is one reason we bought a new CRV last year. Crossovers are not the most efficient vehicle but it is a compact and it is more efficient than the larger alternatives and it is more functional. Buy what you can afford and what best meets your needs.

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