Tag Archives: American Petroleum Institute

News, Politics, Government

Oil falls toward $86 on economy gloom

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The price of fell to near $86 a barrel Thursday in Asia after economic data from Europe suggested global demand for energy will remain subdued.

Benchmark oil for May delivery was down 20 cents to $86.48 per barrel at midday Bangkok time in electronic trading on the New York Mercantile Exchange. The contract dropped $2.04, or 2.3 percent, to close at $86.68 in New York on Wednesday — the fourth daily drop of at least 2 percent in April.

Economic reports from Europe this week were a disappointment. Germany reported a drop in investor confidence, France cut economic growth forecasts, and unemployment rose in Britain. On top of that, the International Monetary Fund lowered its outlook for world economic growth this year to 3.3 percent from 3.5 percent.

The gloom began Monday, when a report of slower-than-expected economic growth in China helped trigger a broad sell-off in commodities that included the biggest one-day drop in the price of gold in 30 years.

Ample crude supplies globally made it easy for investors to set aside the latest data from the American Petroleum Institute showing a drop in U.S. inventories for the week ending April 12. Supplies fell by 354,000 barrels from the prior week to 384.1 million barrels. A drop in supplies can be due to higher demand but the week to week data is volatile.

In London, Brent crude, which is used to price oil used by many U.S. refiners, was down 18 cents to $97.51.

In other energy futures trading on Nymex:

— Heating oil rose 1.1 cent to $2.746 a gallon.

— Natural gas fell 2.2 cents to $4.192 per 1,000 cubic feet.

— Gasoline fell 0.2 cent to $2.719 per gallon.

From: http://feeds.foxnews.com/~r/foxnews/world/~3/is-eFsX6ifE/

Business, Finance, Occupation & Industry

Does Your State Have the Most Expensive Gasoline in America?

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By Aimee Duffy, The Motley Fool

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Growing up, there was always one gas station in town my family avoided at all costs. That station had the highest prices, of course, and was only for the foolish or desperate. It made more sense — and saved more cents — to travel an extra mile or so to the cheaper station. But some Americans are simply out of luck when it comes to tracking down cheap gas. Today we’ll take a look at the states where it costs the most to fill up, and why relief may be nowhere in sight.

Pain at the pump
These days, if you are fortunate enough to live in a tropical paradise, you are also unfortunate enough to pay the highest average price for gasoline in the country. Hawaii is first on the list of the five states with the most expensive gas:

Rank

State

Regular Gasoline 

1

Hawaii

$4.39

2

California

$4.02

3

Alaska

$4.01

4

District of Columbia

$3.90

5

New York

$3.85

Source: AAA 

Hawaii only has two operating oil refineries. Tesoro plans to close the one it owns, Chevron owns the other, and the cost of shipping crude oil out there is the main reason that gas is so expensive. California is ranked second largely because it has the highest taxes on gas in the country. The combined local, state, and federal taxes tack on just shy of $0.69 per gallon, according to the American Petroleum Institute.

What’s in a gas price?
Historically, there has always been more to gas prices than the price of oil. Federal, state, and local taxes, as well as the fees slapped on as gasoline changes hands before it hits your tank, all contribute to the price of gasoline.

The first gasoline tax began in 1919, and 10 years later every state in the union had imposed its own fee on gasoline sales. The revenue collected was used to build out roads and highway infrastructure. In 1929, the taxes brought in $431.4 million, allowing close to half of all states to eliminate property taxes as a source of highway funding.

Flash forward to today
Relying on gas tax revenue to maintain our transportation infrastructure is a tricky business. Today, American roads are in desperate need of repair, but because gas is expensive many of us are driving less. Those that still head out on the highway are increasingly using less gasoline because they are driving more fuel-efficient vehicles.

As a result, many states are making plans to increase taxes on gasoline. Last week, The Wall Street Journal reported that 17 states are considering or have already enacted tax hikes to give their transportation budgets a boost. As further evidence that these are desperate times for infrastructure budgets, 18 states haven’t enacted a gas tax increase in 20 years or more.

It may well be that high

From: http://www.dailyfinance.com/2013/04/11/the-most-expensive-gas-in-america/

Science & Technology

U.S. Crude Oil Inventories Rise to Highest Level Since 1990

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By Reuters

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Damian Dovarganes/AP

By Robert Gibbons

NEW YORK — Oil prices fell more than 2 percent on Wednesday as U.S. crude oil inventories grew to their highest level since 1990 and weak economic data stoked worries about U.S. energy demand.

U.S. crude stocks rose 2.71 million barrels last week, the Energy Information Administration said in its weekly report.

The rise was slightly more than the build of 2.2 million barrels expected in a Reuters survey of analysts and put U.S. commercial inventories at 388.62 million barrels, the most since 1990 and close to the record 391.9 million barrels reached in 1982, the year the EIA started tracking inventories.

“The report is somewhat bearish given the build in crude oil inventories and modest decline in gasoline inventories, which are the focus of the market,” said John Kilduff, partner at Again Capital LLC in New York.

“The rise in the refinery utilization to above 86 percent also signals further easing of the concerns over refined product inventories,” Kilduff said.

U.S. RBOB gasoline futures fell 3 percent, more than 9 cents, after or dropping 6 cents on Tuesday, as the EIA said gasoline stocks fell 572,000 barrels, less than expected and much less than the drop of 5 million barrels reported late on Tuesday by the American Petroleum Institute.

Brent crude was down $2.72 at $107.97 a barrel at 12:52 p.m. EDT, having fallen as low as $107.78.

U.S. crude was down $2.19 at $95 a barrel, having fallen to $94.89, just above the 50-day moving average at $94.64. Brent’s premium to U.S. crude fell back below $13 a barrel on Wednesday, after it reached $14.66 on Tuesday.

The spread between the two contracts had been widened because of expectations that crude stocks at the Cushing, Okla., hub, delivery point for the U.S. crude contract, would be increasing after Exxon Mobil Corp. (XOM) shut its Pegasus pipeline on Friday.

The pipeline moves crude oil from Illinois to the refinery-rich Texas Gulf Coast and a prolonged shut down would curb efforts to relieve the glut of crude oil in the Midwest.

Economic Concerns

Crude stocks at Cushing fell 287,000 barrels in the week to last Friday, the EIA report said.

With the North American heating fuel season waning and crude futures sliding, U.S. heating oil futures, the benchmark distillate contract, also fell and pushed below the 50-day and 100-day moving averages, technical levels monitored by chart watching analysts and traders.

Total distillate stocks fell 2.27 million barrels last week, the EIA said, more than expected, but the inventory drop and data showing demand over the previous four weeks was up 5.5 percent from the year-ago period didn’t prevent heating oil’s price slide.

U.S. companies hired at the weakest pace in five …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

2 Ways Cleaner Gasoline Will Help Refiners

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By Maxx Chatsko, The Motley Fool

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Just last week the Environmental Protection Agency, or EPA, announced plans for cleaning up the nation’s transportation fuels. The new standards would cut the sulfur content of gasoline by 67%, and the content of nitrogen oxides, or ground-level ozone, by 80%. Although the health benefits alone could total billions of dollars per year, the refining industry is warning consumers that they’ll have to fork over more money at the pump.     

It seems the ongoing spat between the EPA and refining industry over mandatory ethanol credits hasn’t left either side running on empty. The two are now battling over how the new standard will affect gasoline prices. The EPA says prices will rise by one penny per gallon, while a study from the American Petroleum Institute claims the number will be between six and nine cents. In the end, the added costs could easily be swallowed up by several consumer- and industry-friendly trends. In fact, it’s likely that the mandate could actually help boost profits for refining companies.  

1. Upgrading domestic infrastructure
As a general rule of thumb, oil tends to get “dirtier” as it becomes more difficult to recover. That poses a problem for refineries processing the growing volumes of unconventional hydrocarbons flowing out shale reserves and the Canadian tar sands. The Energy Information Agency, or EIA, has watched the sulfur content of crude oil inputs into American refineries climb in recent years as conventional oil reserves dry up. Here’s a brief comparison of sulfur content of crude oils sourced from various locations:

Source: EIA

Despite the heavier crude going into refineries, gasoline prices today are $0.30 lower than they were this time last year. How? One reason: Companies processing the influx of shale oil have already begun responding to changes on the ground and show no signs of slowing. HollyFrontier has raised its budget for capital expenditures from just $140 million in 2011 to an estimated $400 million in 2013. BP spent that much bringing a single refinery in Ohio into the future.  

Not all refineries are created equal, but no novel or prohibitively expensive technology is required to comply with the new standards. One senior official said that only 16 of the nation’s 144 refineries would require major capital investments. In other words, the industry has already begun preparing facilities for heavier crudes and cleaner fuels.  

The new standards will act as the extra motivation needed to expedite capital projects and revitalize all of America’s refining capacity. That’s great news for investors, since improving infrastructure has been the driving force behind the most profitable trend sweeping the industry: exports.  

2. Fanning the flames of exports
The proposed rules will normalize the quality of gasoline sold in all 50 states to that of California, Japan, and the European Union — all of which have taken steps to reduce impurities. Currently only 29 domestic refineries can efficiently produce in-spec …read more
Source: FULL ARTICLE at DailyFinance

Science & Technology

Crackdown on Sulfur Could Boost Gas Prices 9 Cents a Gallon

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By The Associated Press

epa cleaner gasoline sulfur oil obama

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Steven Senne/AP

By DINA CAPPIELLO

WASHINGTON — Reducing sulfur in gasoline and tightening emissions standards on cars beginning in 2017, as the Obama administration is proposing, would come with costs as well as rewards. The cost at the pump for cleaner air across the country could be less than a penny or as high as 9 cents a gallon, depending on who is providing the estimate.

An oil industry study says the proposed rule being unveiled Friday by the administration could increase gasoline prices by 6 cents to 9 cents a gallon. The Environmental Protection Agency estimates an increase of less than a penny and an additional $130 to the cost of a vehicle in 2025.

The EPA is quick to add that the change aimed at cleaning up gasoline and automobile emissions would yield billions of dollars in health benefits by 2030 by slashing smog- and soot-forming pollution. Still, the oil industry, Republicans and some Democrats have pressed the EPA to delay the rule, citing higher costs.

Environmentalists hailed the proposal as potentially the most significant in President Barack Obama‘s second term.

The so-called Tier 3 standards would reduce sulfur in gasoline by more than 60 percent and reduce nitrogen oxides by 80 percent, by expanding across the country a standard already in place in California. For states, the regulation would make it easier to comply with health-based standards for the main ingredient in smog and soot. For automakers, the regulation allows them to sell the same autos in all 50 states.

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The Obama administration already has moved to clean up motor vehicles by adopting rules that will double fuel efficiency and putting in place the first standards to reduce the pollution from cars and trucks blamed for global warming.

“We know of no other air pollution control strategy that can achieve such substantial, cost-effective and immediate emission reductions,” said Bill Becker, executive director of the National Association of Clean Air Agencies. Becker said the rule would reduce pollution equal to taking 33 million cars off the road.

But the head of American Fuel and Petrochemical Manufacturers, Charles Drevna, said in an interview Thursday that the refiners’ group was still unclear on the motives behind the agency’s regulation, since refining companies already have spent $10 billion to reduce sulfur by 90 percent. The additional cuts, while smaller, will cost just as much, Drevna said, and the energy needed for the additional refining actually could increase carbon pollution by 1 percent to 2 percent.

“I haven’t seen an EPA rule on fuels that has come out since 1995 that hasn’t said it would cost only a penny or two more,” Drevna said.

A study commissioned by the American Petroleum Institute estimated that lowering the sulfur in gasoline would add 6 cents to …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

The Invention that Built (and almost destroyed) America

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By Alex Planes, The Motley Fool

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On this day in economic and financial history…

Eli Whitney received a patent for his cotton gin on March 14, 1794. For the first time, American plantation owners would be able to harvest large amounts of cotton profitably. This invention — which was copied an astounding number of times before Whitney gained any measure of patent compensation — is perhaps more responsible for America as we know it than any other invention in the nation’s history.

Historian Gene Dattel, writing in The New York Times some material from his book Cotton and Race in the Making of America, paints a stark picture of profound change:

In 1787, there was virtually no cotton grown in America. Two things, however, quickly changed that. Eli Whitney‘s cotton gin allowed cotton production to go from a process limited by manual labor to an industrial machine, allowing a person to “clean” 50 pounds, rather than one pound, of cotton a day. And of course, the cotton gin didn’t remove manual labor from the process; it just shifted it. In fact, this labor-saving device extended slavery by creating a labor shortage in the cotton fields.

The mass production of cotton was accompanied by a dramatic 90% drop in the price of a cotton textile garment. This in turn led to a consumer revolution whose raw material was slave-produced cotton — 80% of which was produced in the South. As a result, American cotton production exploded from almost nothing in 1787 to over 4.5 million bales, at 500 pounds a bale, by 1860. On the eve of the war, cotton comprised almost 60% of America’s exports.

Slavery expanded accordingly. The number of slaves increased from 700,000 in 1787 to over 4 million on the eve of the American Civil War; approximately 70 percent were involved in some way with cotton production. Indeed, so closely tied were cotton and slavery that the price of a slave directly correlated to the price of cotton (except during years of excessive speculation).

Economists Samuel Williamson of the University of Illinois and Louis Cain of Loyola attempted in 2011 to quantify the value of slavery to the South in modern monetary terms:

The average slave price in 1850 was roughly equal to the average price of a house, so the purchase of even one slave would have given the purchaser some status. Comparisons based on economic status are measured by the relative ratio of GDP per capita. Consequently $400 [the average price of a slave] in those days corresponds to nearly $175,000 in economic status today. … Total slave wealth was immense. … While it varies with the price of slaves over the period [1805 to 1860], it is never less that seven trillion 2011 dollars and, at the time of Emancipation, was close to ten trillion 2011 dollars.

By comparison, the American Petroleum Institute estimated in 2007 that the oil and gas …read more
Source: FULL ARTICLE at DailyFinance

News, Politics, Government

Fuel industry envisions American energy independence as domestic production rises

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By Jim Angle

The U.S. has discovered so much more energy than it thought it had that some now talk about the possibility for North American energy independence.

The reason? Advances in technology such as fracking, horizontal drilling and other improvements, which have increased natural gas production by 27 percent in just four years, have made the U.S. number one in gas — with oil on its way.

“We could make OPEC ‘NOPEC’ if we really put our minds to it,” says Charles Drevna of the American Fuel and Petrochemical Manufacturers. “We’re talking decades, if not into the 100s of years, of supply in North America.”

Rep. Doug Lamborn, R-Colo., of the House Natural Resources Committee says, “It’s amazing the amount of energy in North America. When you include our Canadian and Mexican neighbors, we have so many resources that it’s mind boggling.”

And Rep. Ed Whitfield, R-Ky., of House Energy and Commerce Committee adds, “We have the unique opportunity at this particular time in our nation’s history to really be energy independent.”

Jack Gerard, president of oil industry’s American Petroleum Institute says, “It’s very realistic that we could be energy secure as a nation. … It’s been estimated by the Energy Information Agency that we could be the No. 1 oil producer in the world by 2020, surpassing Saudi Arabia. So this is a big deal. It’s a game-changing opportunity, and it’s of historic proportions.”

Even those who share the administration’s desire to reduce the reliance on petrochemicals acknowledge government projections that the U.S. will produce one third more of its own oil by 2020.

One analyst, however, says self reliance must include alternatives, such as wind, solar and more.

“We can reduce our dependence on foreign oil by shifting to electric vehicles and investing in public transportation, as well as having much more efficient cars, which are already under way,” Daniel Weiss of the Center for American Progress said.

Either way, analysts say, being more energy sufficient could bring manufacturers back to the U.S., because they’d have a cheap and reliable source of energy.

“The primary driver right now the manufacturing industry is energy costs,” Gerard said. “When you look at those potential opportunities to build new chemical plants, to expand steel capacity, bring home a lot of those jobs that left over the past decade, the primary driver is the cost of energy.”

The price of natural gas has dropped from $13 to $3, giving the U.S. a huge competitive advantage.

In fact, the U.S. is producing so much natural gas, there’s talk of actually exporting it, meaning hundreds of billions usually sent overseas to buy energy would instead stay here at home to create jobs and boost the American economy.

…read more
Source: FULL ARTICLE at Fox US News