http://www.garynorth.com/y2k/detail_.cfm/7180

As if we didn't already know.....

-- bardou (Bardou@baloney.com), January 26, 2000

Answers

I wonder if all the apparent problems in the "oil patch" are unusual, or somehow magnified by the intense scrutiny of Y2K. troll@underthebridge

-- Willis L Supri (wlsupri@earthlink.net), January 26, 2000.

Link.

-- Mad Monk (madmonk@hawaiian.net), January 26, 2000.

For the webtv folks, here's a paste:

Date: 2000-01-25 13:06:11 Subject: Oil Industry Heading for a Crisis Link: http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&S... Comment: This is bad news for the stock marklet bubble.

This is from PRNEWSWIRE (Jan. 24).

* * * * * * * * * *

The oil industry may be heading for a crisis this spring as refiners are unprepared to meet consumer gasoline demand in the United States, according to Argus Global Markets, the authoritative weekly energy newsletter published by Petroleum Argus.

Last week's surge in heating oil prices in New England are only a foretaste of the crisis looming in the gasoline market. Oil prices in the United States have risen to over $30/barrel, their highest levels in almost a decade, and heating oil prices have soared as frigid temperatures sweep across the northeast. The oil industry has been drained of product stocks by Opec's prolonged cuts in oil production and was ill-prepared for the unexpected surge in winter demand. But last week was just a hint of an even deeper crisis that looms over gasoline, Argus Global Markets warns in its lead editorial.

U.S. and European gasoline stocks are at their lowest levels of the past decade. The industry has little capacity to supply much more gasoline, particularly with crude stocks depleted and distillate demand high. Runaway prices for gasoline will affect almost everyone in the U.S. Petroleum Argus notes that in an election year, this could mean political uproar.

Spot gasoline prices in the U.S. are already as high as in 1996, when President Clinton speeded up a draw-down from the Strategic Petroleum Reserve to calm markets and boost his re-election campaign. Gasoline demand this year will approach 8.5 million barrels per day, 7 percent higher than in 1996, yet stocks are lower, providing less cover. It may already be too late to rebuild stocks in time to cushion peak demand, and this threatens regional shortages and price spikes.

The oil crisis will come to a head this year in the U.S. gasoline market, notes Petroleum Argus. Opec seems unaware of the danger, because it is watching the wrong end of the supply chain. When the crisis hits, it will be too late for oil producers or refiners to do much about it. Opec will lose credibility. But oil companies will receive most of the flak from consumers and regulators. In the end, the whole industry relies on consumers. To arouse their anger is commercially reckless and politically inept.

For a free copy of the full article or the Argus Global Markets, contact: Daniel Massey, President, or John Donnelly, Senior Editor Americas, both of Petroleum Argus, 713-622-3996. Or email at pai@petroleumargus.com. Web site: http://www.petroleumargus.com.

Link: http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&S...

-- Hokie (Hokie_@hotmail.com), January 26, 2000.

I've said it before but it bears worth repeating. We didn't learn much from the oil embargo in the 70s. Did we reduce our dependence on foreign oil - NO. In fact, we increased it by a huge percentage. Result, the consumer is going to get hit hard.

I own two Geo Metros, one stick and one auto. BTW, they drive extremely well in the snow and ice with studded snow tires. I live in the land of giant SUVs though. I also work at home - no commute. If gas goes to $2.00 I'll be pissed but it won't be too painful. Maybe this summer tourism will be greatly reduced if gas skyrockets. Especially hard hit will be the big trucks pulling fifth wheels. But I guess if you own a $100,000 motor home, $3.00 a gallon gas wouldn't be a big deal either.

-- Guy Daley (guydaley@bwn.net), January 26, 2000.

Hokie,

Thanks, but "Webtv folks" not only can go to the links, we can paste an article in and submit.

-- greeneyes (new@last.sight), January 26, 2000.