5 bucks a gallon for gas? Expert sees it in 2006


August 17, 2005

BY MARK J. KONKOL Transportation Reporter



If you think all this flirting with $3-a-gallon gas is already a pain in the pocketbook, brace yourself.

Oil expert Craig Smith predicts gas prices will skyrocket next year, jumping to five bucks a gallon.

And if terrorists successfully strike a major Middle East oil field, Americans might end up paying $10 a gallon -- about $110 to fill a Ford Focus' 11-gallon tank.

Smith, a self-proclaimed geopolitical know-it-all hawking his new book Black Gold Stranglehold, says Americans -- tree-hugging politicians and car-addicted commuters alike -- should blame themselves for the coming spike in prices.

"Why are they charging higher prices for gas? Because people will pay it. Apparently, we're not changing our driving habits much," he said. "Blame this on ourselves. This country has not built a new refinery in 30 years, we stopped new oil exploration . . . and put a moratorium on offshore drilling."

Smith -- who last year predicted $3-a-gallon gas and $65-a-barrel crude oil prices this year -- says oil prices will jump to $80 a gallon by the end of 2006.

On Tuesday, the national average was $2.52 a gallon, according to AAA. And the price of gas topped $3 here last week.

If you don't believe the average cost of gas will double in 12 months, Smith points to places such as Hong Kong, Korea and France, where gas prices regularly top the $5 mark.

The solution here for high oil prices: "find it, drill it, refine it and burn it" domestically, Smith said, pointing to untapped crude reserves in Alaska, Colorado, Utah, off the California coast and in the Gulf of Mexico.

I believe it.  I also believe that the .gov is HIGHLY irresponsible by not taking actions to curb our importation of oil.  Hybrids out to get huge tax breaks at the dealers, and R&D for fuel cells ought to be subsidized by gov grants.  Spend our money on something that will benefit us, please.

If It ever goes to $5 per gallon I will buy a horse and move alot closer to work.  I'm not kidding either

Quoted: If It ever goes to $5 per gallon I will buy a horse and move alot closer to work.  I'm not kidding either

I don't think I'll go that far, but I might be forced to buy one of those queerbait scooters like a Vespa or something. Lucky for me I live about 2 miles from my job. But, at $5 a gallon...I'll be making some major changes in my travels!

Damn, glad I work at home.

I wish we would get on with making some biodiesel. Let our farmers farm, growing soybeans to make it and stop paying money to not farm. www.biodiesel.org Willie Nelson has a site, too with info,  www.wnbiodiesel.com I do not see how independent truckers can go much further.

Once Thunderhorse goes online, expect 250,000 barrels PER day to enter the Gulf Coast refining pool.  For 20 years.

Then Atlantis will come on line.  200,000 barrels PER day.  Same pipeline, same area.

When?  Thunderhorse sometime later this year.  Atlantis?  Next year.

Now refining will be an issue.  

so prices gonna go down this year and next year or what KJ?

Quoted: so prices gonna go down this year and next year or what KJ?

Yes.  After Labor Day.  Slight price increase before Thanksgiving.  #2 distillate (and diesel) will be an exception due to very low inventories of this currently.  Due to the phase-in of ULSD (10 PPM sulfur) in June of 2006, diesel is expected to remain high eve if #2 distillate drops.  No longer are these two interchangeable as some refineries, specifically on the east coast, will continue to produce 50 PPM #2 for non-road use/home heating/power generation.

Another sticky wicket is refining capacity.  The current demand along with low inventories are major contributors to the current high prices.  

Quoted: I wish we would get on with making some biodiesel. Let our farmers farm, growing soybeans to make it and stop paying money to not farm. www.biodiesel.org Willie Nelson has a site, too with info,  www.wnbiodiesel.com I do not see how independent truckers can go much further.

+1  especially since I just bought a new Powerstroke.  Shit, I might even start making it myself, its not that difficult.

Quoted: Quoted: I wish we would get on with making some biodiesel. Let our farmers farm, growing soybeans to make it and stop paying money to not farm. www.biodiesel.org Willie Nelson has a site, too with info,  www.wnbiodiesel.com I do not see how independent truckers can go much further. +1  especially since I just bought a new Powerstroke.  Shit, I might even start making it myself, its not that difficult.

Where are you getting the oil?  

Quoted: Where are you getting the oil?

WVO - waste vegetable oil, every restaurant has a fryer and needs to get rid of oil.

Quoted: Quoted: Where are you getting the oil?   WVO - waste vegetable oil, every restaurant has a fryer and needs to get rid of oil.

Guess again.  You and all the rest of the WVO "buzzards" will be fighting over the oil from the rags.  

Quoted: I believe it.  I also believe that the .gov is HIGHLY irresponsible by not taking actions to curb our importation of oil.  Hybrids out to get huge tax breaks at the dealers, and R&D for fuel cells ought to be subsidized by gov grants.  Spend our money on something that will benefit us, please.

You get a Tax credit to your federal income tax I think for buying a hybrid.

Quoted: Quoted: I believe it.  I also believe that the .gov is HIGHLY irresponsible by not taking actions to curb our importation of oil.  Hybrids out to get huge tax breaks at the dealers, and R&D for fuel cells ought to be subsidized by gov grants.  Spend our money on something that will benefit us, please. You get a Tax credit to your federal income tax I think for buying a hybrid.

problem now is intial cost of hybrid compared to savings in short term is still way to high for most people to switch.