Fan in Chicago

O what a fool I am !! Current project at work must have gotten to me. {cowering in a corner and hiding his face deep}

So you are picking the Pats to go the SB again and lose ? You miserable little traitor !

I am now convinced that Mart's source was soprano3695 and he is now back peddling to avoid looking like an a$$ in the national media as compared to the friendly confines of the TBD board.

Yep - $225 million in stock-based compensation. Wonder what Schein and Cross are getting (in stock comp that is).

In other news, Sirius reported today that its first-quarter loss more than doubled to $459 million.

The strawman is not that we allegedly neglected the defense over the years, but that we chose defense over the two QB prospects for a reason. I see nothing wrong with the approach we took this year. I have not gone through all the postings and opinions on the draft, so can you give me a link to your take ?

Isn't it a general opinion that OL players take longer to develop than DL ? Then this draft must be seen in light of our past two drafts where we loaded up on Offense. If Peters and Preston have matured enough to nail down starting spots, then we are doing fine. Optimistic view of things will go this way: OL has been addressed with Peters, Preston from past drafts and bolstered by Reyes and Fowler from free agency. DL has all necessary players though Denney is a question mark. Secondary is fine with some veterans and players from this years draft to develop under them. Offensive skill players are all average to good (we know what they are and no question marks save for the all important QB spot). Special teams is intact and hence, great. In summary, if we get 2-3 starters from this years draft, we have done well. I know I am making a lot of conclusions from little data but we HAVE 'addressed' all need positions.

Lets all take a deep breath - draft has just started

Methinks a trade for NC has been done and we will get Bunkley or somebody else. Just a hunch ...

You actually mean Ultra low sulfur diesel for on-road consumption. On road has been low in sulfur for a while but ULSD drops the limit down to 15 ppm which will be by Sept 1 in California and Oct 15 for the rest of the country. As you probably know, the less the output sulfur required, the harder it gets to take it out during processing. Logistical challenge for ULSD is that when diesel is transported by pipes, it will pick up old deposited sulfur and what comes out at the back end will most certainly be much higher than what went in at the refinery. I think the industry is going by making 8 ppm at the refinery to get 15 ppm at the retail outlets ! Huge investments have gone into meeting this mandate. It is good for the environment no doubt, but the public must be made aware of the level of spending that big bad oil does for meeting the specs. I think the biggest mistake the oil industry did over the years is not devoting adequate attention and effort to public relations.

No harm in a peaceful rally as long as they don't fly any non-US flags and shout anti-US slogans.

Made my morning !

Adding more fuel to the fire, 30 year old CB Charles Woodson signed a seven-year deal with GB that can be worth as much as $52 million ! Guess that will make Nate's case even stronger to be paid beaucoup $$. http://sports.espn.go.com/nfl/news/story?id=2423159

I have not participated in a partisan discussion here, but want to rant a bit and add to AD's points. If the Democrat's are truly in favor of moving towards energy independence, can they get Edward Kennedy also to play ball ? The Cape Cod wind farm project aims to install windmills off Nantucket Sound - a project that will reduce energy generated from fossil fuels. The only reason this idiot is leading the opposition to this project is because that farm will be an eyesore as it will be visible from their family compound. I just cannot believe these hypocritical attitude of politicians such as Senator Kennedy. Sure, go for alternative energy but let it be an eyesore for anybody but themselves. Who cares about the aesthetic needs of the average American when it suits their purpose to endorse 'green' reforms ? Bloody idiots !

Not driven by needs but wants - either psychological or social. I have a doctor friend who owns two SUVs - one a Cayenne for his commute through Chicago traffic & the other a Lexus 470 for his dimunitive framed wife to go to the health club ! But hey, he can own it so he does.

Here is a link to the capacity, demand, utilization and capacity increase information . Look from slide 26 onwards as the rest is probably too technical for this current discussion. If so inclined, read the notes for each slide. http://www.eia.doe.gov/pub/oil_gas/petrole...2006/index.html And yellow, Bush seems to have heard you. Not sure what this will amount to, my suspicion is not much. But hey, it sounds good for the headlines. http://news.yahoo.com/s/nm/20060425/pl_nm/bush_energy_dc_4 Yet another point I failed to make earlier. In anticipation of the upcoming summer driving season and in preparation for the switch to ethanol, several refiners planned maintenance shutdowns this spring. (Recently maintained equipment can crank out more gasoline). This, combined with other factors has caused the recent spike. Most turnarounds are completed, and one of the nations biggest refineries in the Gulf Coast finally came back onstream this month after the severe Katrina damage. I expect prices will not continue their upward trajectory for too long unless demand drastically exceeds the 1.4% or so expected this year or if the political unrests worsen.

I have worked long enough in the 'oil business' to speak with some knowledge about this. Actually, refining capacity tanked in the late 80s and early 90s when the first of reformulated gasolines were mandated. Smaller refiners just did not have enough money to make the investment and still remain profitable. Those inefficient refineries shut down and stayed shut down. The consolidation did happen but that is only in the number of refinery owners - not refining capacity. The magic that us chemical engineers did (and I feel the community deserves a pat on the back) did was that capacity in the remaining refineries kept creeping UP over the years and we are back to where we were before in terms of capacity. I don't have the exact numbers. Now on to what is being done with the capacity. Average capacity utilization is running around 93% which is an awfully high number for reasons a bit too complex for this discussion (not all units can run at 100% simulataneously). Previously, it was thought that such pedal to the metal operation will cause big problems. But maintenance schdeduling and planning has become an art form and the frequency of maintenance has gone DOWN in the 90s and continues to be so. What this means is that the unit is processing more on a continuous basis than ever before. So any and all rumours about poor maintenance is just baloney. Let those bloggers show me data and I will prove them wrong any day. So, refiners are truly doing their best to get as much gasoline to the market as they safely can (too much stretching of process units can cause safety problems which no insured refiner in their right minds will risk). Hope this convinces you that there is no supply side manipulation. I can gladly provide information that proves my points but it will be long and boring reading for you (no sarcasm here so don't read this wrongly). As an aside, the one place where capacity utilization is down right pathetic is Russia. They typically run at 30-40% of full capacity. I have done a project there and it is sad , as an engineer to see the wonderful pieces of equipment in such severe state of disrepair. That is living proof of how capitalism drives business to higher and higher levels of efficiency thus making the consumer better off.

Thanx. Anyone know if it is just for Verizon subscribers ? I have Cingular ...

Related request, how can I sign up for V-coach to send me a text message ?

Don't know the reserves amount. But, the technology to extract it economically still does not exist. Maybe at $120/barrel, existing technology can make it profitable. The oil sands in Alberta, Canada was faced with a similar issue a few years back. But it is now very profitable to extract heavy crudes from there with current level of crude prices.

Probably easier to answer in terms of overall refiners margins, typically measures as 3-2-1 crack spread which indicates total refinery margins. Currently running ~ $9.3/barrel in Chicago and ~ $9.7/barrel in Gulf Coast. Note this is highly dependent on how efficiently refiners run their plants but the above are numbers quoted in the press and should be averages. As an aside, gas is taxed like crazy and as a percent, the government is making a lot of money right now (estimated $58 billion in 2005 !!). Any calls for a windfall profit tax on the government ?

Sorry, but very close to that number. I think given no political instabilities (ME, Venezuela, Africa), the price of oil would probably have been $60-$65 as compared to $74 today. But all other factors I listed would still be valid and hence end price of gasoline would not be much different. Home heating gas is another matter. We are right now building infrastructure to import LNG (natural gas in liquid form) and that capacity won't come on till maybe next year. At that point, we will start getting good supply of natural gas (from guess where - Middle East) and see prices stabilizing. Currently, our imports are from Canda and Trinidad & Tobago which is not adequate to make up the domestic production-demand gap. Our natural gas demand has really increased as a country. It is used for heating, cooking and electricity generation. As electricity demand has gone up big time, so has natural gas. Before, a lot of our elec used to come from nuclear & coal plants. But in the 90s, most were built to use natural gas (nuclear = 3 mile island hangover, coal= perceived as dirty) and hence there is more 'competition' for you as a consumer to use the available gas.

And probably will never be though not all for NIMBY reasons. The Arizona Clean Fuels refinery has all but been approved but is not going ahead. The problem is that the long term margins for refiners are uncertain. Historically, margins have swayed widely and for financing a $2.2 billion+ project that won't start seeing revenues for 3 years, with average ROI not very good, is a challenge. Also, while gasoline production is limited domestically, Europe has excess of it and exports it to the US. Which isn't necessarily a bad thing. If shipping charges get exorbitant, then probably there is a case to be made for less imports but right now, it makes more economic sense to import than risk the capital for an all new refinery. Finally, existing domestic refineries are not sitting on their hands. There is investment going on (Valero will invest $3.4 billion this year, $3 b next year for all projects) to expand capacities for existing gasoline producing process units. This capacity has started coming on-line but will only kick-in significantly by next year.

Please understand one major fact - demand is one of the biggest factors driving prices upward. There is no pricing game going on but simply market forces balancing out supply (of end products) with the demand. You got it right - refining is a problem. Their long term return on capital sucks and hence even today they are unwilling to go on an investment splurge. If they indiscriminately invest gobs of money to increase refining capacity by say 20% over the next 2-3 years, prices would plummet and their margins will be down in the dumps again. Even if it will make you happy, remember one thing - they are a business and have every right to stay profitable and give their shareholders a return commensurate with its long term risk. I am no supporter of Bush overall so my opinion is un-biased but knowledageble. The government can pull no levers to 'right' the situation without causing major imbalances in the market. No release of ANWR or strategic reserves is going to stop the demand juggernaut. The oil demand is around 85 million barrels a day. Release of any small amount is literally a drop in the bucket. And, anyway, what are we to do with this oil if we cannot refine it ? Oil and as exploration efforts are very high right now. But finding oil is getting increasingly difficult and whatever we find is of lower quality needing more processes to convert into gasoline and diesel. Finally, the phasing out of MTBE and phasing in ethanol is also causing a huge problem as we speak. And look in the mirror - who demanded MTBE be banned ? It is the morons who took little scientific evidence and used it to prove that it causes underground water contamination thus demonizing that chemical out of the gasoline pool. The entire uninformed public is now paying the price for that tragic misuse of evidence to swing public policy. But again, it was not the government but 'environmental' and civic action groups that are to blame. I don't know yellow, this is way too complex an issue to blame the government for. No policies are going to stop the fundamental issues at work here.

Go back to CTM's original post which very well explains why gas prices are so high. The price of gas gets reflected in the rest of the economy so arguably including it in the producer basket is double counting. The government has very little to do in all of this - it is the surging demand for end products worldwide, lack of refining capacity, switch from MTBE to ethanol and to a certain extent the political problems in the Middle East, Africa and Venezuela that combine for where we are at.