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| July 2007 Newsletter |
2007-10-26 |
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Understanding the squeeze at the pumps - Part 2
Motormouth here,
First and foremost a big WELCOME ABOARD to all the brand spanking new Car Connection Club members! What took you so long to join up? Any how we are glad to have you, we really mean that! I have really cooked up a wonderful initiation deal for our “newbies” this time. I figure that since Mamamotormouth has hit her fund raising target of $1000.00 for Feed The Children so now I have to “pony up” and join her in receiving an extreme haircut down to the wood. I was thinking that it would be a very nice gesture on behalf of the “newbies” to join me as well!
Not to worry “newbies”, those who have a shortage of hair tell me that the hair will eventually grow back in! How ever there is a chance it may change color as well as there will be some pretty Goofy looking hair styles in the mean time! I may need to go unde! r cover for a while, if you know what I mean!
I figure this could be a job for several of our Car Connection Ball caps to help to hide the do! I know that there will be a lot of pictures of this deal on our web site as well as a video so stay tuned. I am certain Mamamotormouth will take care of the details so you can see me “BALD” from several angles.
Well folks, here it is July 2007 already! All of us at Car Connection hope that you are getting out there and enjoying all that sunshin e with your families and friends. Be sure to put something nice on the Bar B Q for Axel and I we will be there soon! Mama has been
Snooping around again this month and has uncovered more “Stuff” regarding high fuel prices! So pay close attention I hear that there will be a quiz!
As for me (Motormouth) I can tell you this for sure I feel blessed to have a vehicle that has cccccoooold A/C. I have a couple of more A/C tech tips for you to help ! take good care of that A/C system and help save a few bucks at the pumps as well! Grab a cup of “Joe and stale Donut” and let’s get things rolling!
Understanding the Squeeze at the pumps Part 2
Last month we learnt, that Americans drive more that 2.5 trillion miles a year in cars, light trucks and SUV’s and that our personal vehicles alone use 140 billion gallons of gasoline and diesel fuel per year. The average consumption i n the United States is 20 million barrels of oil per day. 45% of that is used for motor gasoline. The rest is used for distillate fuel oil, jet fuel and other oils. Each barrel equals 42 US gallons/159 L and yields 19 to 20 gallons/75 L of gasoline. In the United States an average of 178 million gallons of gasoline is consumed daily.
The biggest factor is the cost of crude oil. Statistics for April 2007 show that crude oil made up 50%! of the cost of a gallon of gasoline. So if a gallon of gas costs $2.85, crude oil accounts for about $1.43 of that.
This month we will still be exploring crude oil and the role it plays in the cost of gasoline. Since it accounts for half the cost it stands to reason that it would be the biggest influence on the price of gasoline.
You are probably saying to yourself, okay Mamamotormouth, crude oil is crude oil. How can the price possibly fluctuate so much? Wel l, that depends on what kind of crude it is. Oil is classified as heavy or light, and as sweet or sour. Don’t worry; no one actually has the job of tasting the crude oil to determine this, that’s just what they call it. Light, sweet crude is easier and therefore cheaper to refine, but world supplies are starting to run low. There is, however, plenty of heavy, sour available, but the refineries, especially those in the U.S. have to ! undergo expensive re-tooling to handle it.
For every $2.85 gallon of gas you buy, $1.43 goes to the crude-oil suppliers. This is determined by the world’s oil exporting nations, and in particular, the single largest entity impacting the world’s oil supply, The Organization of the Petroleum Exporting Countries (OPEC). The amount of crude oil that these countries produce determines the price of a barrel of oil. Crude oil prices averaged around $37/barrel in 2004. Then, after hur ricane Katrina, some prices were almost double that. In May of 2007, crude oil prices averaged $60.00/barrel.
OPEC is a conglomerate of 12 countries: Algeria, Angola, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. Together these 12 countries are responsible for 40% of the world’s oil production and 2/3 of the world’s oil reserve. So, when OPEC wants to raise the price of cr! ude oil, it simply reduces production. This causes gasoline prices to jump because of the short supply, and also because of the possibility of future reductions. When the oil production dips, gas companies get nervous. Just the threat of oil reductions can raise the gas prices.
In April 2001, OPEC decided to reduce its collective production by one million barrels of oil per day. At the same time the American consumer saw gas prices rise, hitting an average of $1.71 per gallon on May 14, 2001.
OPEC last increased production in June 2005. It raised production to 28 million barrels per day, that was an increase of 500,000 barrels per day. In September of 2005, it made available, all the “spare output” of its member countries, an estimated 2 million barrels per day. However in November 2006, OPEC again reduced its rate of production by 1.7 million barrels per day to keep the price from falling below $50.00 per barrel.
There are several other countries outside of OPEC that contribute to the world’s crude oil supplies including the United States, Mexico, Canada, Equatorial Guinea, Russia and China. In March 2007, The United States imported approximately 2.297 million barrels of crude oil per day from Canada. OPEC tracks the production of these nations and then adjusts its own production to maintain its desired barrel price.
Knowing how much oil the United States imports, it may b e surprising to find out that the United States is the world’s third larges producer of crude oil. The biggest production region is the Gulf of Mexico and the largest producing state is Texas. The Gulf Coast region has two important producing areas: The Permian Basin, located in west-central Texas and eastern New Mexico, and the federal offshore portion of the Gulf. Other large oil producing states include Alaska, Louisiana, California, Oklaho! ma and Arizona.
Even with its large production of oil, the United States is still very heavily dependant on foreign sources. It’s this dependence that crippled the country during the oil embargo of 1973 and 1974. To make sure that this never happens again, the federal government formed the (Strategic Petroleum Reserve (SPR). So, most domestic oil is sent to the refineries and then on to the consumer, but some of it is held back and sent to the SPR.
As of May 2007, the SPR stores about 690 million barrels of oil in underground salt caverns along the Gulf of Mexico. Given that the United States imports about half of its oil, the Strategic Petroleum Reserve holds about a 60 day supply of oil if all imports were suddenly and totally cut off.
Gas Saving Tips
Be smart about your driving.
Plan your errands and do them together! instead of making several separate trips. Perhaps carpooling or using public transit is an option if you are in a rural area.
Keep your car light.
All too often cars become a long-term storage facility on wheels. The extra weight in the trunk or the back seat makes the engine work harder and consumes more fuel.
Stay in Tune.
It’s quite simple really, regular vehicle maintenance sav es gas. Use the recommended oil, replace dirty air filters, keep your tires (including the spare) properly inflated and keep your engine properly tuned.
Remember folks; have a multi point vehicle inspection performed to your vehicle prior to leaving for that favorite vacationing spot that you have picked out this year! Have the spare checked and be sure to take along some extra washer fluid that removes BUG Splatter I hear the black flies and mosquito! s are HUGE this year. It might be a great idea to make sure that your auto club membership is up to date and that you have all the tools
In the trunk to install the spare tire if you had put it on yourself! Oh by the way its construction season so you might want to check your travel route. Drive safe!
Air Conditioning tip # 5 when driving up steep grades turn the blower fan speed down to low and turn off the A/C system just until the vehicle reaches level ground again. This does a couple of things fo r the engine in your vehicle. It provides a major boost of power to the engine just by turning off the A/C and removes a huge drain on the engines horse power. A/C systems generally pull away from the engine up to 10 to 15 % horse power! That is huge folks! You will also gain some fuel economy since the engine will not have to work as hard to pull your vehicle up the inclines on our roadways. Four cylinder engines tend to feel the horse power drain even more. So give your ! engine a bit of a brake and save some $$$ at the pumps!
Air conditioning tip #6 Avoid having your vehicle smell like an old gym locker every time you turn on your vehicles A/C system. Here’s how folks, that A/C odor is not a
manufacturers defect surprised? Don’t be! Learning how to use your vehicles A/C system
properly will prevent a lot of head aches or nose aches! 10 to 15 minutes before arriving at your destination turn the blower speed to low and turn off the A/C system. There will be plenty of cold air coming out of the vents while you locate a parking spot. This allows the evaporator core to defrost and dry up any moisture coating the fins on the evaporator.
The moisture that collects on the evaporator fins tends to attract lint and hair from inside the cabin area. Once that lint and hair gets wet it stays wet for a long time in turn creating a breading ground for mold to grow. Thus the odor and it can be a bear to kill the bacteria witho! ut dismantling half the vehicle to get at the fins on the evaporator core and apply spray designed to kill the bacteria build up! Follow these simple A/C tips and enjoy your vehicles A/C system this summer and for years to come with fewer headaches.
So until next month, keep it under 100 put that coffee on were well on our way!
Your friends,
Motormouth, Mamamotormnouth and Axel.
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