Ike's aftermath: The return of $4 gas-2009 Ram DOA

Discussion in 'General Motoring' started by Jim Higgins, Sep 13, 2008.

  1. Jim Higgins

    Jim Higgins Guest

    Chrysler just launched their new, big 2009 Dodge Ram truck, saying it is
    vital for their survival. If any of the Macho Truck Crowd were thinking
    that gas had gone back to stay "low" this should remind them that it was
    only a pause before advancing. Two steps back and four steps forward.
    Chrysler is done for.

    Ike's aftermath: The return of $4 gas
    http://tinyurl.com/5hfmzk

    Gas prices poised to climb towards record levels again as hurricane hits
    center of nation's oil refining base; Ike could also cost insurers up to
    $18 billion.
    By Chris Isidore, CNNMoney.com senior writer
    Last Updated: September 13, 2008: 4:45 PM EDT

    NEW YORK (CNNMoney.com) -- Gas prices are poised to shoot back towards
    record highs after Hurricane Ike's direct hit on the heart of the
    nation's oil refinery base, analysts said.

    In addition, Hurricane Ike could turn out to be the third-most expensive
    natural disaster in U.S. history, according to preliminary forecasts
    from a firm that does loss estimates for the insurance industry.

    Experts say it's too soon to know exactly how bad the damage from the
    hurricane, which slammed into Galveston, Texas early Saturday, will be
    to refineries.

    Some early reports suggested that damage to the refineries could be
    limited despite the nearly direct hit.

    But production at the refineries, which produce nearly a quarter of the
    nation's gasoline, could still be affected if it takes weeks or months
    to restore full power to the region.

    The uncertainty has experts projecting everything from gasoline soaring
    above $5 a gallon nationwide to an average price that remains just below
    the $4 mark.
    Gas prices already climbing

    Many consumers throughout the Southeast have already started to see
    sharp increases in gas prices before the storm even hit. The latest
    nationwide daily survey by AAA conducted Friday showed prices up nearly
    6 cents a gallon to $3.733.

    Some markets, particularly in the Gulf Coast and South, have been hit
    with a more than a 20 cent a gallon overnight increase. For example, the
    price of gas jumped 27 cents in Knoxville, Tenn. to $3.924.

    "This is a fear factor among station owners," said Kevin Kerr, editor of
    Global Commodities Alert. "They're worried that they're not going to get
    any more supply or if they do it's going to be a lot more expensive."

    To that end, gas prices soared three years ago in the week after
    Hurricane Katrina slammed into New Orleans. Prices jumped 17% to a then
    record high of $3.0569 due to damage to refineries and pipelines.

    In a statement to CNN, the Department of Energy said it "is very
    concerned about the impact of gasoline prices on American families" and
    encouraged people to report price gouging at its Web site.

    The Department of Energy added that it is ready to release crude oil
    from the Strategic Petroleum Reserve "when and where it is necessary to
    ensure refineries are capable of maintaining operations" and that is
    analyzing the amount of fuel production likely to be lost because of
    Hurricane Ike and Hurricane Gustav, which hit near New Orleans on Sept. 1.

    Kerr said the path of Hurricane Ike was the worst possible scenario.
    There are about 20 refineries from Lake Charles, La., to Corpus Christi,
    Texas. All of them saw winds and heavy rain from the storm. Together,
    they have nearly 5 million barrels a day of refining capacity between them.

    Almost half of that total capacity is concentrated in the
    Houston-Galveston area, which is where the center of the storm hit.
    Beyond refineries in the area, gasoline pipelines and other key
    transportation infrastructure could limit the supply reaching consumers.

    "We could see gas go up to $6 in certain states. I think the baseline
    will be more like $4.50, maybe even $5," said Kerr.

    The ExxonMobil (XOM, Fortune 500) refinery in Baytown, Texas, with a
    daily capacity of 567,000 barrels, is the largest refinery in North
    America. And the eye of the hurricane passed right over it.

    CNN correspondent Ali Velshi reported Saturday morning that there was no
    apparent damage to the refinery that could be seen from outside it,
    despite extensive damage in Baytown.

    Kevin Allexon, spokesman for ExxonMobil, said the company has yet to
    determine if there is damage that could further disrupt operations.

    "There's still some pretty significant weather that affects how safe it
    is to do assessment work," he said.

    Oil analyst Peter Beutel of Cameron Hanover said he's encouraged by
    initial reports suggesting that crucial oil facilities in the region
    survived without substantial damage. He's hopeful that if refineries can
    resume near normal operations later this week, gas prices will remain
    below record levels.

    "Right now it looks like we took a licking and we kept on ticking,
    although it's still early to get full reports," he said. "As of now, I
    don't have reason to believe it's going to be a lasting factor. It
    doesn't look like you'll get to $4 nationwide, but you'll see $4 gas in
    a number of places," he said.

    But Tom Kloza, the chief oil analyst for the Oil Price Information
    Service, which provides the data for the AAA survey, said he's worried
    about how long it will take to get full production going again.

    "Even if we missed the worse of it, it's going to be a mess," he said.
    "U.S. refineries are really dependent on local utilities. When you hear
    them talking about power outages lasting for weeks, it's a worry."

    The Department of Energy reported that 2.4 million customers were
    without power as of Saturday morning, essentially everyone in the direct
    path of the hurricane.

    Kloza said fear of a political backlash could keep oil companies and
    wholesalers from raising prices as high as the market might support in
    the face of such a tight supply.

    But he said that even if consumers are spared the full brunt of price
    increases, they could end up dealing with limited supplies in some markets.

    "You're going to see a lot of stations in some places that don't have
    gasoline and you'll see some lines," he said. He's predicting nationwide
    gasoline prices to rise to about $4 a gallon, give or take a dime for
    the next month.

    What's more, production at refineries along the Gulf Coast had yet to
    return to normal since they shutdown in preparation for Hurricane
    Gustav, even though the hurricane caused limited damage.

    Kloza added that jet fuel, diesel and heating oil prices could sharply
    increase -- partly because they don't get the public attention or
    political scrutiny that gasoline prices do.
    Ike cost may only lag Katrina and Andrew

    But Hurricane Ike will prove to be costly even beyond the impact on gas
    and other energy prices.

    Catastrophe risk modeling firm AIR Worldwide Corporation said Saturday
    that it estimated insured losses to onshore properties would be between
    $8 billion and $12 billion. The firm said it expected significant wind
    damage to skyscrapers in Houston as well as to mobile homes and warehouses.

    And EQECAT, a firm that does catastrophe estimates for the insurance
    industry, said its initial forecast for insured losses from Ike range
    from $8 billion to $18 billion.

    The low end of that estimate would make Ike the fifth most expensive
    storm in history after adjusting earlier storms' costs for inflation.

    But the high end of that forecast would put Ike behind only Hurricane
    Katrina and Hurricane Andrew as the most expensive natural disasters in
    U.S. history, according to the Insurance Information Institute.

    Hurricane Katrina cost insurers an inflation-adjusted $43 billion, while
    Hurricane Andrew, which hit South Florida in 1992, cost the industry an
    inflation-adjusted $22.9 billion.
     
    Jim Higgins, Sep 13, 2008
    #1
  2. Jim Higgins

    who Guest

    That is only a local shot term affect of a serious storm that stopped
    fuel production temporarily.
    Oil hit $100 on Friday, on it's quick drop to $80 or less.
    Gasoline will be dropping as well, back to the 2007 prices.
     
    who, Sep 14, 2008
    #2
  3. Jim Higgins

    Jim Higgins Guest

    Unrealistic expectation that gas would go back to '07 prices-too many
    players on the world stage looking for product. The gas spikes up and
    that is a sharp reminder to potential gas hog buyers, primarily the ego
    truck buyers. Business truck buyers are just plain screwed.
     
    Jim Higgins, Sep 14, 2008
    #3
  4. Jim Higgins

    Bill Putney Guest

    Do you think maybe "Jim Higgins" has an agenda? Check all his posts
    here since February ("his" first post here). I wonder who's funding him.

    Bill Putney
    (To reply by e-mail, replace the last letter of the alphabet in my
    address with the letter 'x')
     
    Bill Putney, Sep 14, 2008
    #4
  5. Jim Higgins

    miles Guest

    Global oil prices have fallen sharply. There is no way the world can
    continue to support $150+/barrel prices indefinatly. It was a seriously
    inflated price not warranted by demand nor stocks. The $5 diesel we saw
    was a spike. We'll get there eventually, but I don't believe the time
    is now.
     
    miles, Sep 14, 2008
    #5
  6. Jim Higgins

    Jim Higgins Guest

    Look at reality.
     
    Jim Higgins, Sep 15, 2008
    #6
  7. Jim Higgins

    Steve Guest


    Blah blah, woof woof, whine whine, whimper whimper.... <KICK!!!>

    Working trucks are a necessity. The new Dodge is the most advanced of
    the lot, and offers the best possible efficiency in a working pickup
    truck. You should be lambasting Toyota for building a whole factory
    their behemoth-that-can't-actually-work poseur-truck for soccer moms to
    tool around in. Where's their dually 3/4 ton version? Where's their
    clean-burning diesel version like Dodge's Cummins Bluetec?

    Get a grip. Building trucks is NECESSARY. Doing it in a technologically
    advanced way with innovative features is a GOOD thing.
     
    Steve, Sep 15, 2008
    #7
  8. Jim Higgins

    Miles Guest

    Not climbing here. Gas dropped another 5 cents today, down to $3.29
    regular, $3.65 diesel. Thats back to January prices. Still about $.80
    higher than last year at this time for diesel but still dropping despite
    the dooms dayers.
     
    Miles, Sep 16, 2008
    #8
  9. Jim Higgins

    Miles Guest

    Doesn't have to drop much more here to be back to December 2007 prices.
    Already back to January 2008 prices at least here in AZ.
     
    Miles, Sep 16, 2008
    #9
  10. Jim Higgins

    Jim Higgins Guest

    $4.199, give or take a few cents, in West Michigan-about 30-40 cents
    more than it was per-Ike.
     
    Jim Higgins, Sep 16, 2008
    #10
  11. Jim Higgins

    Steve Guest


    The stations I normally use are hovering at $3.59 right now, about 10
    cents higher than pre-Ike. Of course I'm only 200 miles from Houston, so
    the effects are more pronounced. A few stations ran out of fuel just
    before the storm hit.

    This morning's paper said that none of the key refineries sustained
    significant damage, and they're in the process of coming back online
    right now. Galveston and Houston have huge infrastructure damage and
    power will be out in some areas for several more weeks (maybe months in
    Galveston) but the refineries will be back at work within a week.
     
    Steve, Sep 16, 2008
    #11
  12. Jim Higgins

    C-BODY Guest

    It NEVER ceases to amaze me at how quick the doomsayers kick into action
    on these allegedly "dire circumstances"!

    Gas prices have now stabilized at about $3.70 for regular unleaded, or
    even a little less. Crude oil prices are falling, too, but it has been
    noted that the oil companies are now somewhat recouping their losses on
    the downside of things rather than on the upside--gas did not rise the
    same percentage as crude oil prices did when they were "spiked".

    These same doomsayers have not considered that the new 2009 Ram is more
    aerodynamic than the truck it replaces. Or that the HEMI has been
    upgraded and is more fuel efficient, too, plus MORE horsepower.

    Increasingly, it seems, the media is being staffed by those who write
    articles quickly to "get there first" rather than taking a little more
    time to see what's all involved. The thought of researching what they
    are writing about never seems to enter into the mix! They have seemed
    to master "the authoritarian" approach to their articles to make it seem
    like their information is infallible. In short, another article that
    seems to push a particular agenda (i.e., "no trucks") and ends up doing
    more harm than providing efficient and credible information.

    Regards,

    C-BODY
     
    C-BODY, Sep 20, 2008
    #12
  13. Jim Higgins

    Bill Putney Guest

    Yeah - and they act upset when they are referred to as the "hate
    America" crowd, even though it is clear that all of their hopes and bets
    are on failure whether the subject is Iraq or the economy.

    Bill Putney
    (To reply by e-mail, replace the last letter of the alphabet in my
    address with the letter 'x')
     
    Bill Putney, Sep 20, 2008
    #13
  14. Jim Higgins

    Bill Putney Guest

    Yeah - we're looking. Looks like you went away as fast as you came. If
    you're reading this "Jim Higgins", tell George Soros to screw himself.

    Bill Putney
    (To reply by e-mail, replace the last letter of the alphabet in my
    address with the letter 'x')
     
    Bill Putney, Sep 20, 2008
    #14
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