No surprise as Gas, Diesel up Sunday night

The following Barbados Government press release is “embargoed until 7pm Sunday, March 6”

Barbadians will be paying slightly more for petroleum products in the next few days. Effective midnight, Sunday, March 6, the retail price of gasoline will increase from $2.95 to $2.96 per litre.  The price of diesel will increase by nine cents from $2.53 per litre to $2.62 per litre, while the retail price of kerosene will be $1.74 per litre – an increase of 11 cents. (AR/BGIS)

18 Comments

Filed under Economy, Energy

18 responses to “No surprise as Gas, Diesel up Sunday night

  1. rasta man

    Caption should read March 6th 2011

  2. Green Monkey

    Oilquake in the Middle East
    by Michael Klare

    Whatever the outcome of the protests, uprisings, and rebellions now sweeping the Middle East, one thing is guaranteed: the world of oil will be permanently transformed. Consider everything that’s now happening as just the first tremor of an oilquake that will shake our world to its core.

    For a century stretching back to the discovery of oil in southwestern Persia before World War I, Western powers have repeatedly intervened in the Middle East to ensure the survival of authoritarian governments devoted to producing petroleum. Without such interventions, the expansion of Western economies after World War II and the current affluence of industrialized societies would be inconceivable.

    Here, however, is the news that should be on the front pages of newspapers everywhere: That old oil order is dying, and with its demise we will see the end of cheap and readily accessible petroleum — forever.

    Ending the Petroleum Age

    Let’s try to take the measure of what exactly is at risk in the current tumult. As a start, there is almost no way to give full justice to the critical role played by Middle Eastern oil in the world’s energy equation. Although cheap coal fueled the original Industrial Revolution, powering railroads, steamships, and factories, cheap oil has made possible the automobile, the aviation industry, suburbia, mechanized agriculture, and an explosion of economic globalization. And while a handful of major oil-producing areas launched the Petroleum Age — the United States, Mexico, Venezuela, Romania, the area around Baku (in what was then the Czarist Russian empire), and the Dutch East Indies — it’s been the Middle East that has quenched the world’s thirst for oil since World War II.

    In 2009, the most recent year for which such data is available, BP reported that suppliers in the Middle East and North Africa jointly produced 29 million barrels per day, or 36% of the world’s total oil supply — and even this doesn’t begin to suggest the region’s importance to the petroleum economy. More than any other area, the Middle East has funneled its production into export markets to satisfy the energy cravings of oil-importing powers like the United States, China, Japan, and the European Union (EU). We’re talking 20 million barrels funneled into export markets every day. Compare that to Russia, the world’s top individual producer, at seven million barrels in exportable oil, the continent of Africa at six million, and South America at a mere one million.

    As it happens, Middle Eastern producers will be even more important in the years to come because they possess an estimated two-thirds of remaining untapped petroleum reserves. According to recent projections by the U.S. Department of Energy, the Middle East and North Africa will jointly provide approximately 43% of the world’s crude petroleum supply by 2035 (up from 37% in 2007), and will produce an even greater share of the world’s exportable oil.

    To put the matter baldly: The world economy requires an increasing supply of affordable petroleum. The Middle East alone can provide that supply. That’s why Western governments have long supported “stable” authoritarian regimes throughout the region, regularly supplying and training their security forces. Now, this stultifying, petrified order, whose greatest success was producing oil for the world economy, is disintegrating. Don’t count on any new order (or disorder) to deliver enough cheap oil to preserve the Petroleum Age.

    Continued at: http://www.energybulletin.net/stories/2011-03-03/oilquake-middle-east

  3. TWWIFOS

    The main reason why things are going up right now isn’t because theres any lack of supply. It’s because investors are buying up oil and gas stocks betting that the price is going to go up and therefore driving the price up. Just another example of how these clowns on wall street screw everything up – just when the world economy is starting to show signs of life.

    Great system :-{

  4. watcher

    @green monkey….we won’t be running out for a long time. The sources of supply may have to change and they will. 2.96 BB$ per litre is cheap compared to many countries. If it were $5 per litre we would all find a way to use less of it. There are far too many cars on the road.

    Here is what Wikipedia say about supply….

    “Many countries in the world have large deposits of oil sands, including the United States, Russia, and various countries in the Middle East. However, the world’s largest deposits occur in two countries: Canada and Venezuela, each of which have oil sand reserves approximately equal to the world’s total reserves of conventional crude oil. As a result of the development of Canadian oil sands reserves, 44% of Canadian oil production in 2007 was from oil sands, with an additional 18% being heavy crude oil, while light oil and condensate had declined to 38% of the total.[12] Because growth of oil sands production has exceeded declines in conventional crude oil production, Canada has become the largest supplier of oil and refined products to the United States, ahead of Saudi Arabia and Mexico. Venezuelan production is also very large, but due to political problems within its national oil company,[13] estimates of its production data are not reliable. Outside analysts believe Venezuela’s oil production has declined in recent years,[14] though there is much debate on whether this decline is depletion-related or not.

    Oil sands may represent as much as two-thirds of the world’s total “liquid” hydrocarbon resource, with at least 1.7 trillion barrels (270×10^9 m3) in the Canadian Athabasca Oil Sands (assuming a 10% recovery).

    In October 2009, the USGS updated the Orinoco oil sands (Venezuela) mean estimated recoverable value to 513 billion barrels (8.16×1010 m3), making it “one of the world’s largest recoverable” oil deposits.[15]

    Between them, the Canadian and Venezuelan deposits contain about 3.6 trillion barrels (570×10^9 m3) of recoverable oil, compared to 1.75 trillion barrels (280×10^9 m3) of conventional oil worldwide, most of it in Saudi Arabia and other Middle-Eastern countries”

  5. BFP

    @ rasta man

    Thanks muchly! Too drink much did I thinkly.

  6. Green Monkey

    The problem with the oil derived from oil sands and shale oil etc. is that the oil is harder and more expensive in terms of energy, money and environmental damage to get out of the ground than traditional, conventional oil such as that derived from the supergiant oil fields of the Middle East, and the now depleting North Sea fields and the rapidly depleting oil fields of East Texas, Oklahoma etc. ($80 per barrel for Cdn tar sands oil vs $20 per barrel for Saudi conventional oil). That means oil in general is going to get more expensive. As more of the world’s traditional, cheap to produce oil gets used up (I think it’s pretty well accepted that conventional oil production has peaked and has nowhere to go but down), each day that goes by a higher proportion of overall oil production comes from these new alternative, high cost sources (or from expensive new deepwater sources etc.) the price of oil will have to remain high or even rise to make it economic to produce the new oil. It also takes energy to produce energy, so as energy prices rise in an economy, the already high cost of producing oil from alternative sources will also rise, just as the cost of bread, toys, clothing, food, bus trips and airline tickets will rise. You get a dog chasing its tail scenario. High oil prices cause production costs for goods and services to rise throughout the economy and this in turn means even higher costs to produce non conventional oil, so the price of oil goes up again and the cycle repeats until another economic recession/depression occurs like the one we are just going through.

    This article at the Oildrum.com goes into this aspect of relying on non conventional sources to substitute for a post peak decline in conventional oil production in a bit more detail:

    Does Peak Oil Even Matter?

    snip

    Clearly demand destruction (and a financial crisis) has the ability to lower oil prices, as prices plummeted from 140 to 30 dollars per barrel during the fall of 2008 and winter of 2009. But now, two years later, oil price is again back in the range of $90 per barrel. In a society like ours, where economic growth is touted as the solution to almost every societal problem (see more or less any op-ed on how to fund the U.S. deficit), peak oil presents a paradox: the growth of the economy requires an increasing oil supply, but increasing the oil supply, due mainly to a peak in conventional crude oil production, will require high prices which tend to undermine that growth. The billion dollar question is: at what price of oil does the economy stop growing?

    Over the past 40 years, when petroleum expenditures as a percent of GDP increased much beyond 5.5%, the economy tended towards recessions (Figure 2). This tendency is due mainly to the fact that oil infiltrates almost every facet of an industrial economy, from personal disposable income, to manufacturing, to service sectors. Therefore higher oil prices restrain growth via declining discretionary consumption as individuals allocate more money towards gasoline and home heating, or as the cost of producing a good increases, etc.[6] Chris Nelder of getREALlisthas described this situation succinctly, writing: “The true import of peak oil, therefore, may not be sustained high prices, but economic shrinkage. Demand will be destroyed long before oil gets to $200 a barrel…”

    http://www.theoildrum.com/node/7246

    Another point that has to be kept in mind when considering the possibility of relying on new sources of oil to replace declining production in conventional stocks is that how much unexploited, recoverable oil in total there might be in a new reservoir or in a field of tar sands isn’t the sole factor to take into consideration, although that is usually what is touted the most in newspaper headlines etc., e.g. “Vast new source of oil found in country X . Government sources estimate new tar sands discovery to contain 800 billion barrels of recoverable of oil” etc.

    However the size of the field is only half the story. What is of most concern in calculating how this new discovery can alleviate a projected drop off in conventional oil production is at what rate and at what cost can the oil be extracted from that new reservoir or pile of tar sand. We know the new oil that is supposed to fill in for the decline in conventional oil won’t be extracted as easily and cheaply as the traditional oil was. In addition some substantial infrastructure will first have to be put in place in time for these newer sources to produce oil in the quantities that will be needed to meet expected production.

    What we need is for the rate of extraction from these new sources to be sufficient to not only make up for declining production in conventional oil but as well be sufficient to produce an overall increase in output so that world oil supplies actually grow over time and not just continuously remain at the same level. But, IMHO, that is not necessarily a sure thing.

    Say I went to the bank and gave them a 5 million dollar inheritance from my rich uncle to invest and they said they would give me a higher interest rate if I agreed to put the money in an account for 5 years with another condition being that I could only withdraw a maximum of $1,000 per month while the money was on deposit. Now my monthly expenses, car loan, rent, food etc. comes to $2,000 per month. When it comes to paying my bills at the end of the month it is immaterial that I actually have a very substantial sum of 5 million dollars in my bank account, if I can only take out $1,000 from that account, I am still $1,000 short of what I need to pay my bills. Likewise, we could have a bajilllion barrels of oil lying under the ground or in tar sands, however if it is so expensive and difficult to produce (compared to the old way of just drilling a hole and sticking a giant straw in the ground) that we can only get out 8 million barrels a day and we need to produce 10 million to meet demand and stave off an economic collapse, the huge overall size of the reservoir is immaterial to resolving the immediate problem of having enough oil available to run our economies.

    A very relevant comment to an article posted by a reader, R Lyon, in response to an article on Peak Oil at The Economist:

    Most people don’t really understand the inexorable nature of compounded growth. Maintaining energy growth at an apparently modest 1.8% (its 20 year historical rate) would require us to produce more energy in the next 40 years than all the energy we have ever produced to 2010. In the following 40 years — more energy than we have ever produced in all the years to 2050.

    This has only been sustainable so far because, until recently at least, oil has required almost no manufacturing energy relative to its delivered energy — all of that was provided for free by geological processes. Because of resource high-grading, that is changing as we move offshore, into the arctic and into tar sands — the rate of net usable energy is declining at a much faster rate than the gross extraction rate. So we now need to find not only vast quantities of energy, but also the vast quantities of energy necessary to manufacture those vast quantities.

    At the same time, we have hardwired our systems to run on this particular form of energy. Alternative forms don’t provide energy in the form our infrastructure can handle, give too little net energy even if fully deployed, and would likely not be fully-deployable anyway since the materials required to scale them up and redo the present infrastructure would quickly become too scarce. There is no “price” at which this changes.

    http://www.economist.com/comment/434025#comment-434025

  7. watcher

    In Canada more oil is produced using oil sands than any other method and it is growing. Right now about 50% of oil production is from oil sands and it is exported to the USA. Canada is the largest eporter of oil to the USA and the USA, even in these difficult times, still has an economy that drives the world. Tar Sands oil production is pretty conventional in North American and it will get very conventional once the light crude is out. The Americans will ensure that.

    There are two main problems with the current cost of oil. Speculators and too many dam cars. How much gasoline just going up in the air everyday in Barbados during rush hour with what has become perhpas one of the worst grid locks anywhere in the world. A ride from downtown Bridgetown to Christ Church can take anywhere from 20 minutes to 2 hours…and half the cars have one person in the them.

    What is the Barbados government policy on import duties on electric cars or hybrids. Does not seem there is one. The problem for Barbados is that the automobile has become one of, if not the the largest producer of tax revenues for the government treasury. I don’t see any Toyota Prius, Honda Insight, or Nissan Leaf advertisments or cars in Barbados, and I am sure I wont be seeing any Chevy Volts. I don’t see anything being done to come up with a master plan for energy cost reduction in Barbados other than solar water heating that has one very well. Barbados has lots of natural energy , the sun, the wind and the tide. Those 3 items could well reduce the need for almost all oil in Barbados. It will take time and leadership.

  8. Straight talk

    The distinction should be emphasised between Albertan oilsands oil (1000bpd) and sweet crude.
    Any spurious attempt to correlate that sludge with light sweet crude should be countered. The EROEI should always be defined in any calculation, be it sourced from Canada, Bakken or Venezuela, or we are living in a fool’s paradise.

  9. what will they think of next

    I just paid 3.00 per ltr. for gas at the Shell station opposite trimart in christ church.
    Is this price gouging?

  10. TWWIFOS

    WWTTON – I would not be surprised. I never buy at any of the Shell stations since the one by the airport runway (opposite mikes) ripped me off. I think they have a nice little scam going over there where they have the pumps rigged – where it looks like your getting the right amount, but you never seem to get the tank as full as you usually do buying the same amount elsewhere.

    And by the way, watch yourself whenever you buy gas anywhere, especially by the gas station near the supercenter in Oistins (I stopped using them too). The thieves over there will put $10. in when you ask for $20. and pocket the extra $10. I’ve caught them more then once trying to pull that on me. Make sure you read the pump before you drive off.

    This type of stuff has been going on for years over here. It’s gotten to the point that I now get out of my car and stand at the pump watching to make sure I get what I pay for (and even then you can’t quite be sure) as I mentioned at the beginning of this post.

    BFP: You guys should make a separate post about this. I’m sure I’m not the only one that this is happening to.

  11. BFP

    Too right Twwifos!

    I learned long ago to stop by the pump take a hard look at it and then pull forward and that’s true anywhere, not just in Barbados. Doesn’t hurt to not be so lazy and get out for stretch.

  12. TWWIFOS

    Yeah, you definitely have to watch the people at the pump wherever you go, but I’m more interested to hear if anyone else feels the same way about what “i think” Shell might be doing with the rigging of the pumps. That’s a much more serious crime and if it is indeed true they are getting away with A LOT of cash.

    Does anyone know if there is any monitoring going on either by the police or govt with this? Probably not. A surprise inspection once in awhile would do a lot of good. We are already spending way too much on gas without that kind of stuff going on.

  13. Britty Brat

    @ what will they think of next
    and TWWIFOS :
    Try TEXACO, WILDEY!!! Good value for money ALL THE TIME.

  14. Noob

    I thought i was the only one that noticed that Texaco wildey gave better long lasting quality gas so now the word is out

  15. Britty Brat

    I NEVER HAD difficulty with the quantity of gas received from texaco Wildey. I HAD problems with a lot more gas stations. If my needle is almost on ‘E’, I would risk breaking down on the road just to get to TEXACO WILDEY.

  16. TWWIFOS

    Was in the neighborhood, so I stopped in Texaco Wildy to see if you actually got more for your money. I got the same amount that i usually do when going to Esso – plus the fact the Texaco does not take Magna cards, so your actually better off buying at Esso.

    Quality of gas? I suspect it’s all the same “low quality regular gas” that eventually screws up your engine and forces you to visit the repair shop to get it rebuilt. Hence the smoke coming from the exhaust pipes of many cars, busses and especially those annoying ZR’s. I can’t image what “good quality premium gas” would cost here.

    I don’t quite get the claim that “you get better value at Texaco Wildy”, since your “supposed” to get the same amount wherever you go. Isn’t the price of gas controlled by the govt and all stations charge the same amount?

    In any case….I still thing that Shell station by the airport runway is doing something funny. I wish someone would inspect them.

    BFP: It would be cool if you could follow up on this and make a separate post about it. This post has already gotten buried and I suspect many more people would comment about it if you brought the topic up top. This affects us all and is worth discussing

  17. Liberal

    Gas prices going up simply as a result of the Wall Street speculators.To them is just a numbers game!!! Have you noticed that the possibility of people using less petrol as a result of the increase prices automatically drove the cost of a barrel of oil down by up to USD$3.00?Who buys the Lybiam oil?Not the Europeans?Yet pump prices in USA skyrocketing.Just heard Stephen Worme of BL&P saying that we can expect electricity bills to increase.Didn”t the DLP promise to remove VAT from these? Guess that is now wishfull thinking.

  18. Britty Brat

    @ TWWIFOS
    “I don’t quite get the claim that “you get better value at Texaco Wildy”, since your “supposed” to get the same amount wherever you go.”

    If you really believe this, try Texaco, My Lords Hill; Texaco, Harmony Hall or Shell, Collymore Rock. I really think that the machines at Texaco , Wildey are NOT RIGGED.