Long term OIL

[jaysabi]

Furthermore, the cars are not plug-in hybrids, all electricity generation comes from regenerative braking.

What is regenerative braking? Never heard of this term before. If the electricity is generated while driving itself, then the need for an invertor is eliminated. Also, a cheaper battery will do the trick, instead of an expensive one made out of Lithium and Cobalt.

Regenerative braking uses the kinetic energy from the car to charge the battery. When you're not accelerating, the car uses the momentum already established to charge the batteries through a generator that's attached to the wheels (I believe). The end result is the car doesn't need to be plugged in. The result is the car slows down a bit faster when idling to a stop, nothing overly dramatic, but it's a far more efficient use of that energy, which in normal cars is jut wasted.

[jaysabi]

OPEC's pledges to stick to allocations might not have that much impact, if the US boosts output.
The price seems to be dropping now.
http://www.reuters.com/article/us-global-oil-idUSKBN163059

The American frackers don't have the flexibility which Saudi Arabia and Russia enjoys. Their rigs are located in complicated terrain, and it takes some time to either start, or to shut down the pumping of crude oil. Finding the labor force is another hassle. If they pump crude oil at full speed now, then the oil prices will crash and their revenues will take a hit.

Yes and no.
The US frackers are preparing for trumps US oil independence. Of course they wont be able to compete with the sauds, russia or iran except in the case trump will enact a tariff for importing oil - which he said he will.

Slapping an import tax on foreign oil is going to anger a lot of Americans. It isn't going to make American oil more competitive by magically reducing the cost of it. It's going to drive up the cost of oil domestically because we'll be using more domestic oil which costs more to produce. That cost will go straight to consumers. It's not a practical solution, and if he tries t he's going to find it politically untenable.

[criptix]

OPEC's pledges to stick to allocations might not have that much impact, if the US boosts output.
The price seems to be dropping now.
http://www.reuters.com/article/us-global-oil-idUSKBN163059

The American frackers don't have the flexibility which Saudi Arabia and Russia enjoys. Their rigs are located in complicated terrain, and it takes some time to either start, or to shut down the pumping of crude oil. Finding the labor force is another hassle. If they pump crude oil at full speed now, then the oil prices will crash and their revenues will take a hit.

Yes and no.
The US frackers are preparing for trumps US oil independence. Of course they wont be able to compete with the sauds, russia or iran except in the case trump will enact a tariff for importing oil - which he said he will.

Slapping an import tax on foreign oil is going to anger a lot of Americans. It isn't going to make American oil more competitive by magically reducing the cost of it. It's going to drive up the cost of oil domestically because we'll be using more domestic oil which costs more to produce. That cost will go straight to consumers. It's not a practical solution, and if he tries t he's going to find it politically untenable.

Yes i agree. But that is the only way to archieve US oil independence.
We know that the US has enough oil it is just too expensive to extract.

Edit

He could also remove enviromental safety laws regarding fracking/oil extraction which could further lower the production cost.
If i remember right he wanted to do that too.

[uneng]

Just a doubt. Why is oil still important? Isn't there easier and cheaper methods to generate energy? Like solar and eolic?
With much extraction of oil it can result in a big problem inside the earth and in the oceans. It's probable the oil will become worthless even more, losing value in the future. Do you agree?

[STT]

That should be their strategy if they are planning on using oil.
But i think right now everything points to renewables.
China just bought the biggest cobalt producer of the world in kongo and holds majority of the production now. Cobalt is mainly used for electric car batteries.
The newest energy study says that china is progressing much faster on renewables as anticipated (
https://newclimate.org/2017/02/09/a-turnaround-of-global-greenhouse-gas-emission-trends-on-the-horizon-regardless-of-pres-trump/ )
Looking at the enviromental destruction and contamination china has no choice anyway - they still have like 500 million people who want to drive cars, have smartphones etc. Pp.

I cant think of oil and coal as a choice for them. They have to say goodbye to it in the medium term (until 2050?).

Yes they have to do this.  China is famous for its use of coal and its great smog clouds in cities.  China does have coal of its own btw.
The point with Africa is the use of dollars there to buy assets is far more valuable then holding US treasury bonds and Africa is not so shy about selling vital and unique resources, the west has often denied China from buying up major assets.
Electric cars are not energy by themselves so the cobalt while useful does not solve this problem, only allows for less pollution in cities directly maybe.  The Chinese must still produce electricity, major hydro electric dams partly help this but even after all these efforts China is lacking energy.

It may the next big war is fought over China invading a country with oil assets, their expansion in South China sea could end that way

[deisik]

Just a doubt. Why is oil still important? Isn't there easier and cheaper methods to generate energy? Like solar and eolic?
With much extraction of oil it can result in a big problem inside the earth and in the oceans. It's probable the oil will become worthless even more, losing value in the future. Do you agree?

The problem is not in generating electricity

I guess burning oil for producing electricity (e.g. by using diesel generators) is like burning dollar bills for producing heat. You won't get enough heat anyway but only waste your money. The cheapest mass scale methods of producing electricity are hydroelectric stations and nuclear power plants. The major problem is not generating electricity as such. For example, at night, when there is less overall activity there is abundance of electricity (that's why governments often set different tariffs for day and night electricity consumption). The major problem is storing electricity (or rather energy as such), and this is where oil (and oil products such as gasoline) are beyond competition for most practical purposes

[Sithara007]

OPEC's pledges to stick to allocations might not have that much impact, if the US boosts output.
The price seems to be dropping now.
http://www.reuters.com/article/us-global-oil-idUSKBN163059

The American frackers don't have the flexibility which Saudi Arabia and Russia enjoys. Their rigs are located in complicated terrain, and it takes some time to either start, or to shut down the pumping of crude oil. Finding the labor force is another hassle. If they pump crude oil at full speed now, then the oil prices will crash and their revenues will take a hit.

Yes and no.
The US frackers are preparing for trumps US oil independence. Of course they wont be able to compete with the sauds, russia or iran except in the case trump will enact a tariff for importing oil - which he said he will.

Slapping an import tax on foreign oil is going to anger a lot of Americans. It isn't going to make American oil more competitive by magically reducing the cost of it. It's going to drive up the cost of oil domestically because we'll be using more domestic oil which costs more to produce. That cost will go straight to consumers. It's not a practical solution, and if he tries t he's going to find it politically untenable.

Trump never said anything like this. He said that he may impose a tariff on the imports from Mexico, including crude oil and refined products. But if such a tariff is imposed, then the American consumer will just purchase Canadian crude instead of the Mexican crude.

[criptix]

OPEC's pledges to stick to allocations might not have that much impact, if the US boosts output.
The price seems to be dropping now.
http://www.reuters.com/article/us-global-oil-idUSKBN163059

The American frackers don't have the flexibility which Saudi Arabia and Russia enjoys. Their rigs are located in complicated terrain, and it takes some time to either start, or to shut down the pumping of crude oil. Finding the labor force is another hassle. If they pump crude oil at full speed now, then the oil prices will crash and their revenues will take a hit.

Yes and no.
The US frackers are preparing for trumps US oil independence. Of course they wont be able to compete with the sauds, russia or iran except in the case trump will enact a tariff for importing oil - which he said he will.

Slapping an import tax on foreign oil is going to anger a lot of Americans. It isn't going to make American oil more competitive by magically reducing the cost of it. It's going to drive up the cost of oil domestically because we'll be using more domestic oil which costs more to produce. That cost will go straight to consumers. It's not a practical solution, and if he tries t he's going to find it politically untenable.

Trump never said anything like this. He said that he may impose a tariff on the imports from Mexico, including crude oil and refined products. But if such a tariff is imposed, then the American consumer will just purchase Canadian crude instead of the Mexican crude.

Just look up US oil independency and trump.
And oil tariffs are inevitable for the US oil independency because neither the US(40-50$), Canada(50++$) nor mexico(23$)can compete with opec and russia(1-10$).

[Xester]

Just a doubt. Why is oil still important? Isn't there easier and cheaper methods to generate energy? Like solar and eolic?
With much extraction of oil it can result in a big problem inside the earth and in the oceans. It's probable the oil will become worthless even more, losing value in the future. Do you agree?

It will happen if the government leaders will adopt and support new alternative sustainable energy source to fuel our cars, ships and planes. But if there are no sustainable or alternative source of energy there will be a lesser chance that oil will be replaced. And another thing oil companies has a grip on the government leaders around the globe as they are giving huge amount of bribe money for the politicians then this will be a big hindrance to alternative energy source.

[deisik]

OPEC's pledges to stick to allocations might not have that much impact, if the US boosts output.
The price seems to be dropping now.
http://www.reuters.com/article/us-global-oil-idUSKBN163059

The American frackers don't have the flexibility which Saudi Arabia and Russia enjoys. Their rigs are located in complicated terrain, and it takes some time to either start, or to shut down the pumping of crude oil. Finding the labor force is another hassle. If they pump crude oil at full speed now, then the oil prices will crash and their revenues will take a hit.

Yes and no.
The US frackers are preparing for trumps US oil independence. Of course they wont be able to compete with the sauds, russia or iran except in the case trump will enact a tariff for importing oil - which he said he will.

Slapping an import tax on foreign oil is going to anger a lot of Americans. It isn't going to make American oil more competitive by magically reducing the cost of it. It's going to drive up the cost of oil domestically because we'll be using more domestic oil which costs more to produce. That cost will go straight to consumers. It's not a practical solution, and if he tries t he's going to find it politically untenable.

Trump never said anything like this. He said that he may impose a tariff on the imports from Mexico, including crude oil and refined products. But if such a tariff is imposed, then the American consumer will just purchase Canadian crude instead of the Mexican crude.

Just look up US oil independency and trump.
And oil tariffs are inevitable for the US oil independency because neither the US(40-50$), Canada(50++$) nor mexico(23$)can compete with opec and russia(1-10$)

You are obviously missing at least one important thing

Maybe, you miss even more (everyone is welcome to chime in on this), but to make a valid comparison between costs you should include all costs. More specifically, you forgot to include transportation (delivery) costs as well as the max volume that the cheap oil exporters can provide. Indeed, Mexico (and Venezuela, for that matter) is not very far from the US (its oil processing facilities), but as I get it, they simply can't possibly satisfy all the demand for oil in the US, so the American frackers with their expensive oil can still survive

[criptix]

OPEC's pledges to stick to allocations might not have that much impact, if the US boosts output.
The price seems to be dropping now.
http://www.reuters.com/article/us-global-oil-idUSKBN163059

The American frackers don't have the flexibility which Saudi Arabia and Russia enjoys. Their rigs are located in complicated terrain, and it takes some time to either start, or to shut down the pumping of crude oil. Finding the labor force is another hassle. If they pump crude oil at full speed now, then the oil prices will crash and their revenues will take a hit.

Yes and no.
The US frackers are preparing for trumps US oil independence. Of course they wont be able to compete with the sauds, russia or iran except in the case trump will enact a tariff for importing oil - which he said he will.

Slapping an import tax on foreign oil is going to anger a lot of Americans. It isn't going to make American oil more competitive by magically reducing the cost of it. It's going to drive up the cost of oil domestically because we'll be using more domestic oil which costs more to produce. That cost will go straight to consumers. It's not a practical solution, and if he tries t he's going to find it politically untenable.

Trump never said anything like this. He said that he may impose a tariff on the imports from Mexico, including crude oil and refined products. But if such a tariff is imposed, then the American consumer will just purchase Canadian crude instead of the Mexican crude.

Just look up US oil independency and trump.
And oil tariffs are inevitable for the US oil independency because neither the US(40-50$), Canada(50++$) nor mexico(23$)can compete with opec and russia(1-10$)

You are obviously missing at least one important thing

Maybe, you miss even more (everyone is welcome to chime in on this), but to make a valid comparison between costs you should include all costs. More specifically, you forgot to include transportation (delivery) costs as well as the max volume that the cheap oil exporters can provide. Indeed, Mexico (and Venezuela, for that matter) is not very far from the US (its oil processing facilities), but as I get it, they simply can't possibly satisfy all the demand for oil in the US, so the American frackers with their expensive oil can still survive

Transportation cost is not the problem.
It is really just the difference in production cost here. Depending on compared oil fields we have a 5-50x difference.

The main thing though is that trump wants to stop imports from OPEC and non friendly states.
And without import tariffs he wont be able to do so - russian and middle east oil is just too cheap.

Edit

The world tanker fleet capacity (excluding tankers owned or chartered on long-term basis for military use by governments) was about 280 million deadweight tons in 2002. There are roughly 3,500 tankers available on the international oil transportation market. The cost of hiring a tanker is known as the charter rate. It varies according to the size and characteristics of the tanker, its origin, destination and the availability of ships, although larger ships are preferred due to the economies of scale they confer. About 435 VLCCs account for a third of the oil being carried. Transportation costs account for a small percentage of the total cost of gasoline at the pump. For instance, oil carried from the Middle East to the United States account for about 1 cent per liter at the pump. Transportation costs have conventionally accounted for between 5 to 10% of the added value of oil depending on the market being serviced. The growth in oil prices since 2000 makes the transport costs an even lower component of the total costs, sometimes lower than 5%. Demand for oil is thus not related (inelastic) to its transport costs.

Source

[deisik]

Edit

The world tanker fleet capacity (excluding tankers owned or chartered on long-term basis for military use by governments) was about 280 million deadweight tons in 2002. There are roughly 3,500 tankers available on the international oil transportation market. The cost of hiring a tanker is known as the charter rate. It varies according to the size and characteristics of the tanker, its origin, destination and the availability of ships, although larger ships are preferred due to the economies of scale they confer. About 435 VLCCs account for a third of the oil being carried. Transportation costs account for a small percentage of the total cost of gasoline at the pump. For instance, oil carried from the Middle East to the United States account for about 1 cent per liter at the pump. Transportation costs have conventionally accounted for between 5 to 10% of the added value of oil depending on the market being serviced. The growth in oil prices since 2000 makes the transport costs an even lower component of the total costs, sometimes lower than 5%. Demand for oil is thus not related (inelastic) to its transport costs.

Source

Emphasis cleared and added

Half-truths and deliberate distortions of facts are sometimes even worse than outright lies. The quote you posted talks about the price of gasoline at the pump and the transportation costs relative to that price, but it says basically nothing about the percentage of these costs in the price of crude oil itself (as it is quoted at major exchanges). Further, it talks about percentages when the price of oil had been rising (e.g. in early 2008 it reached 140 dollars per barrel) but since then it collapsed a few times, though I don't think that transportation costs plunges as much (if at all)

[criptix]

Edit

The world tanker fleet capacity (excluding tankers owned or chartered on long-term basis for military use by governments) was about 280 million deadweight tons in 2002. There are roughly 3,500 tankers available on the international oil transportation market. The cost of hiring a tanker is known as the charter rate. It varies according to the size and characteristics of the tanker, its origin, destination and the availability of ships, although larger ships are preferred due to the economies of scale they confer. About 435 VLCCs account for a third of the oil being carried. Transportation costs account for a small percentage of the total cost of gasoline at the pump. For instance, oil carried from the Middle East to the United States account for about 1 cent per liter at the pump. Transportation costs have conventionally accounted for between 5 to 10% of the added value of oil depending on the market being serviced. The growth in oil prices since 2000 makes the transport costs an even lower component of the total costs, sometimes lower than 5%. Demand for oil is thus not related (inelastic) to its transport costs.

Source

Emphasis cleared and added

Half-truths and deliberate distortions of facts are sometimes even worse than outright lies. The quote you posted talks about the price of gasoline at the pump and the transportation costs relative to that price, but it says basically nothing about the percentage of these costs in the price of crude oil itself (as it is quoted at major exchanges). Further, it talks about percentages when the price of oil had been rising (e.g. in early 2008 it reached 140 dollars per barrel) but since then it collapsed a few times, though I don't think that transportation costs plunges as much (if at all)

Uhm you didnt understand what you read.
What you bolded means that transportation cost adds 5-10% to the production cost.
For example if production cost in saudi arabia is 10$ per barrel in field x then transportation to the US would cost around 0.50$ to 1.00$ per barrel.

Lower/higher oil price dont change much on transportation cost (% wise) because you have simultaneously lower/higher energy prices for the transport part.

[jaysabi]

OPEC's pledges to stick to allocations might not have that much impact, if the US boosts output.
The price seems to be dropping now.
http://www.reuters.com/article/us-global-oil-idUSKBN163059

The American frackers don't have the flexibility which Saudi Arabia and Russia enjoys. Their rigs are located in complicated terrain, and it takes some time to either start, or to shut down the pumping of crude oil. Finding the labor force is another hassle. If they pump crude oil at full speed now, then the oil prices will crash and their revenues will take a hit.

Yes and no.
The US frackers are preparing for trumps US oil independence. Of course they wont be able to compete with the sauds, russia or iran except in the case trump will enact a tariff for importing oil - which he said he will.

Slapping an import tax on foreign oil is going to anger a lot of Americans. It isn't going to make American oil more competitive by magically reducing the cost of it. It's going to drive up the cost of oil domestically because we'll be using more domestic oil which costs more to produce. That cost will go straight to consumers. It's not a practical solution, and if he tries t he's going to find it politically untenable.

Yes i agree. But that is the only way to archieve US oil independence.
We know that the US has enough oil it is just too expensive to extract.

Edit

He could also remove enviromental safety laws regarding fracking/oil extraction which could further lower the production cost.
If i remember right he wanted to do that too.

Oil independence at that cost isn't worth it. What is the benefit of not using foreign oil when domestic  gas prices are artificially high because you have a protectionist agenda in place? The country would be oil independent if it put more focus into renewables and you wouldn't have any of the negative consequences to the environment on top of it. Fracking is already incredibly dirty, and that's when companies are following the rules that are in place.

[deisik]

Edit

The world tanker fleet capacity (excluding tankers owned or chartered on long-term basis for military use by governments) was about 280 million deadweight tons in 2002. There are roughly 3,500 tankers available on the international oil transportation market. The cost of hiring a tanker is known as the charter rate. It varies according to the size and characteristics of the tanker, its origin, destination and the availability of ships, although larger ships are preferred due to the economies of scale they confer. About 435 VLCCs account for a third of the oil being carried. Transportation costs account for a small percentage of the total cost of gasoline at the pump. For instance, oil carried from the Middle East to the United States account for about 1 cent per liter at the pump. Transportation costs have conventionally accounted for between 5 to 10% of the added value of oil depending on the market being serviced. The growth in oil prices since 2000 makes the transport costs an even lower component of the total costs, sometimes lower than 5%. Demand for oil is thus not related (inelastic) to its transport costs.

Source

Emphasis cleared and added

Half-truths and deliberate distortions of facts are sometimes even worse than outright lies. The quote you posted talks about the price of gasoline at the pump and the transportation costs relative to that price, but it says basically nothing about the percentage of these costs in the price of crude oil itself (as it is quoted at major exchanges). Further, it talks about percentages when the price of oil had been rising (e.g. in early 2008 it reached 140 dollars per barrel) but since then it collapsed a few times, though I don't think that transportation costs plunges as much (if at all)

Uhm you didnt understand what you read.
What you bolded means that transportation cost adds 5-10% to the production cost.
For example if production cost in saudi arabia is 10$ per barrel in field x then transportation to the US would cost around 0.50$ to 1.00$ per barrel

Obviously, you didn't understand what I wrote

The part you refer to does actually say about 5-10% of transportation costs in the total price of oil. But it says nothing about at which crude oil price these percentages were calculated. It just says that the prices were rising since 2000 (while in fact they have already fallen dramatically as you know yourself). Furthermore (or rather before), it compares the transportation costs with the price of gasoline at the pump which is bullshit since the price of crude oil in the gasoline prices may itself be only a few dozen percentages. Given that (i.e. deliberate misleading by the authors), we can assume that 10% may be calculated from the ATH oil price, i.e. 140 dollars per barrel, and then the transportation costs will amount to over 10 dollars per barrel. Now compare these costs with the oil price from, say, Saudi Arabia and you will see how high the transportation costs might in reality be

[criptix]

Edit

The world tanker fleet capacity (excluding tankers owned or chartered on long-term basis for military use by governments) was about 280 million deadweight tons in 2002. There are roughly 3,500 tankers available on the international oil transportation market. The cost of hiring a tanker is known as the charter rate. It varies according to the size and characteristics of the tanker, its origin, destination and the availability of ships, although larger ships are preferred due to the economies of scale they confer. About 435 VLCCs account for a third of the oil being carried. Transportation costs account for a small percentage of the total cost of gasoline at the pump. For instance, oil carried from the Middle East to the United States account for about 1 cent per liter at the pump. Transportation costs have conventionally accounted for between 5 to 10% of the added value of oil depending on the market being serviced. The growth in oil prices since 2000 makes the transport costs an even lower component of the total costs, sometimes lower than 5%. Demand for oil is thus not related (inelastic) to its transport costs.

Source

Emphasis cleared and added

Half-truths and deliberate distortions of facts are sometimes even worse than outright lies. The quote you posted talks about the price of gasoline at the pump and the transportation costs relative to that price, but it says basically nothing about the percentage of these costs in the price of crude oil itself (as it is quoted at major exchanges). Further, it talks about percentages when the price of oil had been rising (e.g. in early 2008 it reached 140 dollars per barrel) but since then it collapsed a few times, though I don't think that transportation costs plunges as much (if at all)

Uhm you didnt understand what you read.
What you bolded means that transportation cost adds 5-10% to the production cost.
For example if production cost in saudi arabia is 10$ per barrel in field x then transportation to the US would cost around 0.50$ to 1.00$ per barrel

Obviously, you didn't understand what I wrote

The part you refer to does actually say about 5-10% of transportation costs in the total price of oil. But it says nothing about at which crude oil price these percentages were calculated. It just says that the prices were rising since 2000 (while in fact they have already fallen dramatically as you know yourself). Furthermore (or rather before), it compares the transportation costs with the price of gasoline at the pump which is bullshit since the price of crude oil in the gasoline prices may itself be only a few dozen percentages. Given that (i.e. deliberate misleading by the authors), we can assume that 10% may be calculated from the ATH oil price, i.e. 140 dollars per barrel, and then the transportation costs will amount to over 10 dollars per barrel. Now compare these costs with the oil price from, say, Saudi Arabia and you will see how high the transportation costs might in reality be

No you are wrong on everything.
Maybe this is more clear:

http://graphics.wsj.com/oil-barrel-breakdown/

Important note: the transportation cost is even less becauses they added administration cost to transportation cost.
You can see nominal transportation cost is very similiar.
% wise it looks a bit different but the reason should be more then obvious.

[criptix]

OPEC's pledges to stick to allocations might not have that much impact, if the US boosts output.
The price seems to be dropping now.
http://www.reuters.com/article/us-global-oil-idUSKBN163059

The American frackers don't have the flexibility which Saudi Arabia and Russia enjoys. Their rigs are located in complicated terrain, and it takes some time to either start, or to shut down the pumping of crude oil. Finding the labor force is another hassle. If they pump crude oil at full speed now, then the oil prices will crash and their revenues will take a hit.

Yes and no.
The US frackers are preparing for trumps US oil independence. Of course they wont be able to compete with the sauds, russia or iran except in the case trump will enact a tariff for importing oil - which he said he will.

Slapping an import tax on foreign oil is going to anger a lot of Americans. It isn't going to make American oil more competitive by magically reducing the cost of it. It's going to drive up the cost of oil domestically because we'll be using more domestic oil which costs more to produce. That cost will go straight to consumers. It's not a practical solution, and if he tries t he's going to find it politically untenable.

Yes i agree. But that is the only way to archieve US oil independence.
We know that the US has enough oil it is just too expensive to extract.

Edit

He could also remove enviromental safety laws regarding fracking/oil extraction which could further lower the production cost.
If i remember right he wanted to do that too.

Oil independence at that cost isn't worth it. What is the benefit of not using foreign oil when domestic  gas prices are artificially high because you have a protectionist agenda in place? The country would be oil independent if it put more focus into renewables and you wouldn't have any of the negative consequences to the environment on top of it. Fracking is already incredibly dirty, and that's when companies are following the rules that are in place.

Yup, i agree.
But trump doesnt agree. And that is pretty much all he can do if he wants to proceed with his plan.

[deisik]

Emphasis cleared and added

Half-truths and deliberate distortions of facts are sometimes even worse than outright lies. The quote you posted talks about the price of gasoline at the pump and the transportation costs relative to that price, but it says basically nothing about the percentage of these costs in the price of crude oil itself (as it is quoted at major exchanges). Further, it talks about percentages when the price of oil had been rising (e.g. in early 2008 it reached 140 dollars per barrel) but since then it collapsed a few times, though I don't think that transportation costs plunges as much (if at all)

Uhm you didnt understand what you read.
What you bolded means that transportation cost adds 5-10% to the production cost.
For example if production cost in saudi arabia is 10$ per barrel in field x then transportation to the US would cost around 0.50$ to 1.00$ per barrel

Obviously, you didn't understand what I wrote

The part you refer to does actually say about 5-10% of transportation costs in the total price of oil. But it says nothing about at which crude oil price these percentages were calculated. It just says that the prices were rising since 2000 (while in fact they have already fallen dramatically as you know yourself). Furthermore (or rather before), it compares the transportation costs with the price of gasoline at the pump which is bullshit since the price of crude oil in the gasoline prices may itself be only a few dozen percentages. Given that (i.e. deliberate misleading by the authors), we can assume that 10% may be calculated from the ATH oil price, i.e. 140 dollars per barrel, and then the transportation costs will amount to over 10 dollars per barrel. Now compare these costs with the oil price from, say, Saudi Arabia and you will see how high the transportation costs might in reality be

No you are wrong on everything.
Maybe this is more clear:

http://graphics.wsj.com/oil-barrel-breakdown/

Important note: the transportation cost is even less becauses they added administration cost to transportation cost

I'm curious if you actually read that piece

It basically says about transportation (plus administrative) costs as they stand for delivery to their nearest consumers. For Iran it would be China, for Iraq the EU. If Iran (or Saudi Arabia) had to transport their oil to the US, the transportation costs would rise massively. Nevertheless, your link confirms what I suspected, i.e. that the data in the quote you posted earlier is heavily distorted. The transportation costs are nowhere near 5-10% as the authors of that quote claimed. For example, for the KSA they are over 27%, for Iran over 29%, for Iraq over 23% per total cost of oil barrel. As to me, this is a huge percentage

[criptix]

Emphasis cleared and added

Half-truths and deliberate distortions of facts are sometimes even worse than outright lies. The quote you posted talks about the price of gasoline at the pump and the transportation costs relative to that price, but it says basically nothing about the percentage of these costs in the price of crude oil itself (as it is quoted at major exchanges). Further, it talks about percentages when the price of oil had been rising (e.g. in early 2008 it reached 140 dollars per barrel) but since then it collapsed a few times, though I don't think that transportation costs plunges as much (if at all)

Uhm you didnt understand what you read.
What you bolded means that transportation cost adds 5-10% to the production cost.
For example if production cost in saudi arabia is 10$ per barrel in field x then transportation to the US would cost around 0.50$ to 1.00$ per barrel

Obviously, you didn't understand what I wrote

The part you refer to does actually say about 5-10% of transportation costs in the total price of oil. But it says nothing about at which crude oil price these percentages were calculated. It just says that the prices were rising since 2000 (while in fact they have already fallen dramatically as you know yourself). Furthermore (or rather before), it compares the transportation costs with the price of gasoline at the pump which is bullshit since the price of crude oil in the gasoline prices may itself be only a few dozen percentages. Given that (i.e. deliberate misleading by the authors), we can assume that 10% may be calculated from the ATH oil price, i.e. 140 dollars per barrel, and then the transportation costs will amount to over 10 dollars per barrel. Now compare these costs with the oil price from, say, Saudi Arabia and you will see how high the transportation costs might in reality be

No you are wrong on everything.
Maybe this is more clear:

http://graphics.wsj.com/oil-barrel-breakdown/

Important note: the transportation cost is even less becauses they added administration cost to transportation cost

I'm curious if you actually read that piece

It basically says about transportation (plus administrative) costs as they stand for delivery to their nearest consumers. For Iran it would be China, for Iraq the EU. If Iran (or Saudi Arabia) had to transport their oil to the US, the transportation costs would rise massively. Nevertheless, your link confirms what I suspected, i.e. that the data in the quote you posted earlier is heavily distorted. The transportation costs are nowhere near 5-10% as the authors of that quote claimed. For example, for the KSA they are over 27%, for Iran over 29%, for Iraq over 23% per total cost of oil barrel. As to me, this is a huge percentage

Where does it say that this is the transportation cost to the nearest consumer?

The wsj is from 2016 so its obvious that numbers changed from 2008.
Like i said in my last post that nominal the transport cost is very similiar but because of differences in production cost it differs % wise.

For example look at the uk. Transportation+administration cost is just 9,7%.


But lets take an real life example with an exact price from Sep. 2016:

The rates for shipping a tanker-load of crude oil by Very Large Crude Carriers (VLCC) from Rotterdam, Europe’s largest port for the throughput and storage of crude oil, to Singapore, the world’s largest crude oil transshipment center, have dropped another $200,000 since the last assessment, to $2.25 million, according to S&P Global Platts, the lowest level for that route since Platts started tracking VLCC data in 2006.

We have a distance of around 13.000 km (around the same distance from saudi arabia to the USA).
A VLCC usually transports 1,9 - 2,2 million barrels.
At 50$/bbl its worth 100 million $.
Transportation cost is 2,25 million $.

Edit

Btw. The book i quoted is up to date. The newest edition is from 2017.
It is also used in universities.

Edit 2

Shipping prices are extremely volatile. I just looked up the price difference to charter a VLCC between jan. 2016 and sep. 2016. It was a 60+% difference.
But to take the example above even if the shipping price was 4 times higher we would still just barely scratch the 10% mark for transportation cost.

[deisik]

I'm curious if you actually read that piece

It basically says about transportation (plus administrative) costs as they stand for delivery to their nearest consumers. For Iran it would be China, for Iraq the EU. If Iran (or Saudi Arabia) had to transport their oil to the US, the transportation costs would rise massively. Nevertheless, your link confirms what I suspected, i.e. that the data in the quote you posted earlier is heavily distorted. The transportation costs are nowhere near 5-10% as the authors of that quote claimed. For example, for the KSA they are over 27%, for Iran over 29%, for Iraq over 23% per total cost of oil barrel. As to me, this is a huge percentage

Where does it say that this is the transportation cost to the nearest consumer?

The wsj is from 2016 so its obvious that numbers changed from 2008.
Like i said in my last post that nominal the transport cost is very similiar but because of differences in production cost it differs % wise.

For example look at the uk. Transportation+administration cost is just 9,7%.

In fact, I expected you to reply something to this tune

And it seems that you took to your old habit of severely distorting the facts. In this case, you deliberately forget that the UK is next to irrelevant as a crude oil exporter (with measly 2% of total oil exports). We are talking about top oil producers and not just producers but exporters at that, aren't we? And these are SA, Iraq and Iran (after lifting sanctions). Further, regarding nearest consumers, the article doesn't specifically mention that itself but it is common knowledge that China is the largest consumer of Russian, Iranian, and Saudi Arabian oil. Unsurprisingly, that these are the nearest suppliers territorially, so we could well expect that the costs calculated would mostly refer to this shortest route of oil trade