[Gizmag] Breakthrough promises $1.50/ gallon synthetic gasoline.

[v6sonoma]

Two things.

First is while this could be revolutionary it falls into the same traps as Hydrogen fuel cells. Where (or rather how) do we get the Hydrogen? The two options are basically from using reformers to separate it from hydrocarbons in fossil fuel creating hydrogen and carbon dioxide. (not the best idea) Or by using electricity to split water into hydrogen and pure oxygen. (much better option) The main issue is then where the electricity comes from. Currently the most of the US's power (68%) comes from coal and natural gas plants. So in the end we're still not quite off of fossil fuels. Some more info can be found here.

http://auto.howstuffworks.com/fuel-e...n-economy4.htm

Second the price at the pump also includes state and federal taxes. In the EU more than half the cost is taxes. In the UK they have just passed several increases recently. adding to the problem. Glad I live here.

[a_Username]

Originally Posted by DGthe3

By mark up, do you mean above and beyond a 'reasonable' proffit? If so, you're mistaken. Profit margins at the pump are usually fairly thin. The insane profits that get reported are based off of selling an enormous volume.

They make a good deal of their money based on the price of oil as a commodity. As I understand, oil gets sold at market value, not production cost + X profit. So if crude futures are trading at double or tripple the extraction cost, profits go way up for anyone extracting oil. If, for some bizarre reason, the market dictates that crude should be sold at $5/barrel (far less than the extraction cost) ... all the oil companies would be in serious trouble.

You're confusing cause and effect here; the market only conveys information using a price system, aka the "market mechanism." Basically, production and consumption will determine the prices and not the other way around as you put it. Also, I'll send a PM of a neat graph to show something that may be a little troubling for some on this forum. Plus, contrary to popular fear-mongering, corporations do not just randomly decide to raise profits.

BTW, Premium has just went up to $3.23 where I'm at.

[Mr. Wyndham]

I like troubling graphs.

[fielderLS3]

This would be great, but I'm a bit skeptical. Here are the problems I see.

Where do the chemicals required to manufacture this come from, and how abundant are they? (i.e. could we produce 90 million barrels worth a day well into the future)?
Where is the energy coming from? Is this a source of energy, or just an energy carrier? If the latter, where is the energy actually coming from? What is the net energy return (input vs. output)?

There are many silver bullet solutions like these, but they all remind me of cold fusion. The concept has been proven, it works in laboratories on a small scale, but no one can figure out how to make it work economically, or on any kind of useful scale.

It's good to know that there are at least some ideas out there, though. Maybe sometime years from now......

[The_Blur]

Originally Posted by a_Username

You're confusing cause and effect here; the market only conveys information using a price system, aka the "market mechanism." Basically, production and consumption will determine the prices and not the other way around as you put it. Also, I'll send a PM of a neat graph to show something that may be a little troubling for some on this forum. Plus, contrary to popular fear-mongering, corporations do not just randomly decide to raise profits.

BTW, Premium has just went up to $3.23 where I'm at.

[fielderLS3]

Originally Posted by Dragoneye

This is cool!! One of the major issues with hydrogen has been the storage concern.

There are so many alternative fuels out there it's crazy....we just need and environment that facilitates their rapid and widespread development.

Personally, I'm a big fan of algae-based "green crude".

Algae oil has always been something I've wanted to see too. First, because I think it could work...second, it allows us to keep our internal combustion engines...and third because I'd like to see diesels become more available as daily drivers. Gas is good for a weekend car, but on most days, I like torque more than horsepower.

[fielderLS3]

Originally Posted by a_Username

You're confusing cause and effect here; the market only conveys information using a price system, aka the "market mechanism." Basically, production and consumption will determine the prices and not the other way around as you put it. Also, I'll send a PM of a neat graph to show something that may be a little troubling for some on this forum. Plus, contrary to popular fear-mongering, corporations do not just randomly decide to raise profits.

BTW, Premium has just went up to $3.23 where I'm at.

"Speculation" is determining prices, not production and consumption. Oil and gas inventories are at record highs, but still, Wall Street investors own 4 to 5 times more oil on paper than there actually is in storage. It is a bubble doomed to burst eventually, just like in 2008. The only question is, how high first?

[Mr. Wyndham]

Originally Posted by fielderLS3

"Speculation" is determining prices, not production and consumption. Oil and gas inventories are at record highs, but still, Wall Street investors own 4 to 5 times more oil on paper than there actually is in storage. It is a bubble doomed to burst eventually, just like in 2008. The only question is, how high first?

Storage has very little to do with production/demand...oil reserves aren't to be tapped except for the in the worst of circumstances...so that's right out of the equation.

World production is remaining steady or marginally increasing...while demand is steadily, and rapidly rising...and I'm sure there's some inflated speculation in there too, this time.

[DGthe3]

Originally Posted by a_Username

You're confusing cause and effect here; the market only conveys information using a price system, aka the "market mechanism." Basically, production and consumption will determine the prices and not the other way around as you put it. Also, I'll send a PM of a neat graph to show something that may be a little troubling for some on this forum. Plus, contrary to popular fear-mongering, corporations do not just randomly decide to raise profits.

BTW, Premium has just went up to $3.23 where I'm at.

I never said the corporations were arbitrarily raising their prices, or even attempted to imply it. They simply take advantage of favourable market prices.

The price of oil is determined by the market, but not the market of buyers. Oil contracts are traded on futures exchanges mainly by speculators, who have a whole host of concerns beyond how much oil there is, and how much is being used. And they don't actually take delivery of any oil. Speculators even caused the price of oil to triple in a year and a half (early 2007 to mid 2008) for no good reason. No major global events and while demand was creeping up it wasn't skyrocketing (and supply was more or less keeping pace). Yet in that time, oil went from ~$50/barrel to ~$150, for reasons known only unto them.

Originally Posted by Dragoneye

I like troubling graphs.

I'll forward it. Buts not all that troubling

[fielderLS3]

Originally Posted by Dragoneye

Storage has very little to do with production/demand...oil reserves aren't to be tapped except for the in the worst of circumstances...so that's right out of the equation.

World production is remaining steady or marginally increasing...while demand is steadily, and rapidly rising...and I'm sure there's some inflated speculation in there too, this time.

By storage, I don't mean the strategic reserves. I'm talking about the delivery points/distribution centers for the markets. Speculators are walking a very tight line now. They own more oil than there are places for them to put it, so even though they have bought oil, they have no where to put it when it actually arrives, and thus have no ability to take delivery. They are driving up prices by buying like crazy now, but if there is any snag in the market that forces them to start liquidating their holdings, the result will be a price collapse like in 2008 when it went down 80% in 4-5 months.

[Mr. Wyndham]

Originally Posted by fielderLS3

By storage, I don't mean the strategic reserves. I'm talking about the delivery points/distribution centers for the markets. Speculators are walking a very tight line now. They own more oil than there are places for them to put it, so even though they have bought oil, they have no where to put it when it actually arrives, and thus have no ability to take delivery. They are driving up prices by buying like crazy now, but if there is any snag in the market that forces them to start liquidating their holdings, the result will be a price collapse like in 2008 when it went down 80% in 4-5 months.

We'll have to see. The whole 'game' irritates me....I would very much like to see prices stabilized, one way or the other.

[DGthe3]

Originally Posted by fielderLS3

This would be great, but I'm a bit skeptical. Here are the problems I see.

Where do the chemicals required to manufacture this come from, and how abundant are they? (i.e. could we produce 90 million barrels worth a day well into the future)?
Where is the energy coming from? Is this a source of energy, or just an energy carrier? If the latter, where is the energy actually coming from? What is the net energy return (input vs. output)?

There are many silver bullet solutions like these, but they all remind me of cold fusion. The concept has been proven, it works in laboratories on a small scale, but no one can figure out how to make it work economically, or on any kind of useful scale.

It's good to know that there are at least some ideas out there, though. Maybe sometime years from now......

From the sounds of things, its a storage/delivery method for hydrogen, effectively converting it from a high pressure gas to a more conventional liquid.

[Mr. Wyndham]

Originally Posted by DGthe3

From the sounds of things, its a storage/delivery method for hydrogen, effectively converting it from a high pressure gas to a more conventional liquid.

I don't know why this comment reminded me just now......There was an article...back in 08 probably...where scientists had been able to synthesize a "pellet"...that absorbed hydrogen gas, and slowly released it at a ratio to the pressure of the container they were in. It was pretty cool, because it lowered the pressures necessary to store adequate amounts of hydrogen on-board a vehicle dramatically. Much like this, except it wasn't a liquid.

[fielderLS3]

Originally Posted by Dragoneye

We'll have to see. The whole 'game' irritates me....I would very much like to see prices stabilized, one way or the other.

I'm quite confident that prices will come crashing down again at some point. I only worry how high it will go in the mean time. Then, we can repeat the cycle again in another few years.

You're right, it is a 'game.' One that must be driving product planners at the auto companies crazy.