Greed factor boosts the price of oil
In Saturday's Daily Herald, you printed an AP story "The unpredictability of oil, Many unknown factors can inflate crude, gas prices." I would like to make known one of these unknown factors.
It is called the greed factor. It takes less energy to process diesel fuel then gasoline. But the pump price for diesel can be over 50 cents a gallon over that of regular unleaded gas.
In recent memory, the price of diesel was always under the price of regular gas. China, India, or the value of the euro has nothing to do with this phenomenon.
President Bush said as almost an afterthought at the end of his State of the Union address, that he was ordering the doubling up of the strategic oil supply.
Has this been completed or are we still filling a hole in the ground with crude oil with the present crude shortage?
One alleged oil expert pointed out we are using less crude oil this year then last year. The rapid price increase is due to the declining value of the dollar to the euro. He never mentioned ethanol for the decline in usage.
Isn't it the war and the cost of oil causing the dollar to lose value?
When President Bush was in Brazil, he mentioned they were willing to ship sugarcane based ethanol to us for about 42 cents a gallon less then we can process it here. Why isn't this being done??
As the Herald pointed out, the bad news with our corn-based ethanol is higher food prices. The question is, who has the guts to ask our members of Congress why they chose corn, a couple of grasses and wood chips as the basis for processing ethanol?
Years ago when I worked at an edible oil refinery, the cheapest oils were lard and tallow. This was followed by soybean oil, by far the key oil in volume. Then cottonseed and coconut was followed by the most expensive -- corn.
Finally, let no adult be left behind. If Exxon Mobil loads a tanker full of Alaska crude, and I am looking at the ceiling, I would guess the cost at about 35 cents a gallon or $14.70 a barrel. When does the oil become over $110 a barrel and who benefits?
Less then 50 percent of our oil comes from OPEC countries. Yet the cost becomes 100 percent of the market price.
Are the streets of Alaska or Canada paved with gold? Who is getting the big bucks?
Wally Miller
Prospect Heights