Gasoline Spikes to Record $4.49, Just in Time for Summer Driving Season. Crude Oil Jumps. Not going to Help CPI in May

Make that $6.55 for regular at my San Francisco gas station from heck.

By Wolf Richter for WOLF STREET.

Over the past seven days, the average price of all grades of gasoline spiked by another 16 cents to a record $4.49 per gallon on Monday, May 16, the fourth week in a row of increases, and was up 48.3% from a year ago, according to the US Energy Department’s EIA late Monday, based on its surveys of gas stations conducted during the day. This comes just in time for summer driving season.

Not good for CPI inflation: In the still red-hot CPI for April, released last week, there was some slight cooling from March, and one of the contributors to that slight cooling was the CPI for gasoline which fell 6.1% in April from March. Well, OK, that was then and this is now.

Since the end of April, the price of gasoline has jumped by 9.3%. So, gasoline will provide some additional and totally unneeded oomph for the inflation rate in May.

Gasoline futures also rose to new record on Monday, closing above $4 for the first time, and were up by 16% from the end of April (chart via Investing.com):

The average price of No. 2 highway diesel at the pump, after spiking by 12 cents in the prior week, dipped by a penny on Monday to $5.61 per gallon, the second highest ever, but on the long-term chart it seems the same as in the prior week. Year-over-year, the price of diesel has spiked by 73%!

Consumers get to pay for diesel prices sooner or later via higher costs of the goods they’re buying since nearly all goods are sooner or later transported by truck for at least part of the way, and fuel price increases are eventually passed on.

Crude oil WTI futures have now broken out of their trading range that prevailed since mid-March, following the spike in early March, and are currently at $113.82 a barrel, the highest since the brief spike in early March, but well below the tippy-top of the spike in July 2008, which maxed out for a brief moment at $150 a barrel.

Note the chaos in April 2020, when WTI futures dropped to minus $37 a barrel for a moment, in a market that had gone completely haywire.

Adjusted for CPI inflation, all of these prices remain well below their peaks in July 2008: Gasoline back then peaked at $4.11, which would amount to about $5.37 a gallon in today’s dollars. Diesel peaked at $4.76 a gallon in July 2008, which would be $6.22 in today’s dollars. WTI’s $150 a barrel top in July 2008 would be $196 in today’s dollars.

In 2008, demand destruction had set in largely because of the Financial Crisis which was starting to break the financial system. Bear Stearns had already collapsed by July 2008, and Lehman collapsed in September 2008. The whole economy froze in shock, and large-scale demand destruction set in that cause the price of crude oil and gasoline to plunge. Today, large scale demand destruction has not yet set in. And instead there’s raging inflation, and this jump in gasoline prices doesn’t help.

For your amusement, here is my San Francisco tourist-trap gas station from heck this evening, where the price of regular has now reached the proud record of $6.55 a gallon, while, per EIA, the average price in all of San Francisco has risen to $5.91, and in all of California to  $5.79. Even in Colorado, the cheapest of the major states, the average price of regular rose above $4 for the first time.

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  194 comments for “Gasoline Spikes to Record $4.49, Just in Time for Summer Driving Season. Crude Oil Jumps. Not going to Help CPI in May

  1. Island Teal says:

    WOW….”that’s too damn much!!”.

    • James says:

      In New Zealand, it’s over $7 per US gallon. The Government recommends cycling or Public Transport. That doesn’t work for a Trade landscaper,driving 25000 miles for jobs.

      • joedidee says:

        I remember back in 2008, people started parking low mileage vehicles on weekends
        might be weak staycation summer coming up

    • Swamp Creature says:

      I think when gas reaches $10/Gallon Wolf is going to have to change his “Gas Station from Heck” to “Gas Station from Hell”.

      • Cookdoggie says:

        I noticed today that most gas station signs don’t have enough space for another digit unless they remove the stupid 9/10 cent add on. So when gas hits $10 maybe something good will come out of it.

  2. Twinkytwonk says:

    Bargain. Comparative UK price is $7.50 for a U.S gallon and that’s for e10 petrol. For diesel add another 10%.

    Considering the roads are the busiest i have ever seen them it doesn’t seem to be stopping people driving.

    • Just worked it out; here in the UK diesel is $9.28 (£1.80 per litre).

    • Digger Dave says:

      People have no choice. Especially if you have started mimicking the American sprawling development pattern. The chickens are coming home to roost. Most people, when they should have been prioritize efficiency have instead gone for bigger is better as far as vehicle choice goes. I had a V6 daily driver in 2006 that got 30+mpg. The average mpg now for passenger vehicles is still under 26mpg. My daily driver now gets 50mpg. My work truck (I’m a self employed tradesmen) gets less than 10mpg (on paper it gets more but it almost never goes anywhere unless it’s hauling, pushing or towing something. Most of the work I do requires a couple of tool bags. No need for the truck, the 50mpg wagon does the job. My wife’s car averages somewhere north of 75mpg when you factor electricity rates (plug-in hybrid). I’m hardly the greenest person on the planet. Just like putting as much of my gross income as possible in my pocket and not giving it to the auto and fuel industries.

      • Cas127 says:

        Agreed…it is kinda stupid for 15 MPG trucks/SUVs to be the highest sellers (by *far*) in a world where 45 MPG hybrids have been around for over 20 years.

        Some have to use low MPG trucks/SUVs…but for many (most?) it is a (mostly foolish) choice.

        To such a point that domestic *car* production is increasingly extinct.

        Goofy.

        • Jay says:

          Love my 2012 Prius getting upwards of 50 MPG! Sweet!

          Glad I don’t live in SFO for a lot of reasons beyond the cost of petrol.

        • Lily Von Schtupp says:

          Not a fan of the land yachts, but the USA isn’t all flat as Kansas. Good luck getting up our steep North East hills & mountains in winter in anything that’s not AWD. Certainly the terrain of the Rockies and PNW aren’t kind to hybrids.

          Besides, even where its flat, without big pickup trucks sporting fifty flags on the bed and hitch testicles, how else would you know the driver is toting a light switch in his trousers? Can you put a gun rack on a Prius?

        • Wisdom Seeker says:

          A year ago we ditched our 18 year old 18-20 mpg midsize SUV and replaced it with a 35-40 MPG slightly-smaller hybrid SUV. That was a great choice. Hybrid SUVs like the Honda CR-V or Toyota RAV4 hybrids aren’t plug-ins, and they’re not tiny cars. Inside they feel just like the regular vehicle of the same name, and they’re fueled with gas in the usual way, but the hybrid system delivers much better efficiency and thus better range. Also more zip when accelerating! The gas savings is far more than enough to pay for the eventual replacement of the hybrid battery. And they hybrid battery is much smaller than an EV battery, much less cost/hassle to replace. For those looking to save money without compromising lifestyle or going full EV, they’re a very good choice.

        • Wisdom Seeker says:

          P.S. For Lily – Many hybrid SUVs are AWD and do just fine on unpaved mountain “rocky roads”. Might want to upgrade to all-terrain tires for snowy/icy winters though.

        • Anthony says:

          Lily Von Schtupp

          Electric cars, if they can sort out better batteries, will make fantastic AWD’s as electric motors are amazingly powerful, in fact the Jaguar electric is AWD and can drive through shallow streams and climb really steep mountain hills. The all electric Land Rover or Range Rover will zoom up any hill. The same for most large AWD’s from most companies when they go electric…

        • SOL says:

          I’ll take my 2012 camry hybrid where most dudes don’t go in their trucks. I’m thoroughly impressed with its capabilities in the forest access roads of the Cascades

        • Lily Von Schtupp says:

          Anthony, Land Rovers and Range Rovers are fine machines no doubt, for those who can afford them. Many aren’t in the position to upgrade their existing ride to a new *anything*, much less luxury brands.

          It’ll happen eventually of course but the tech needs to trickle down to the unwashed masses first.

      • TK says:

        At least you thought it through. So did we. But I see 1 person in most vehicles including the gas hogs, when I drive on the highway. The big pickups are shiny so they look nice, but no cargo. When people go to the auto dealer, I don’t think they consider that the cost of fuel will be higher than the cost of the vehicle. We don’t seem to be very smart about that.

        • Marcus Aurelius says:

          Others have different priorities.

          I do not care about the price of gasoline or food.

          I would think there is something wrong with ME if I had to be concerned.

          I spend my time NOT buying all the items I do not need or getting the item for a lower prices. I buy clothes at “Goodwill” type places. I buy in bulk when the item I need is on sale. I haven’t bought a bath towel in probably 10 years.

          So, I WASTE money on gas? No. That is what I want. I don’t need nor want any shoe over $39. Any T-shirt over $7.99. I never buy name, nor “style”, but only the basics. $69 for shoes is a waste. $15 T -Shirt is a waste. Cokes, potato chips, wheat products, condiments, salad dressings…these are all a waste, and they slowly poison you to death as well.

          Anyway, by all my calculations, Gas today is cheaper than when I was a kid. My dad never came home and got upset because gas was 28 cents a gallon and his big DeSoto got 9 miles to the gallon.

        • Harrold says:

          Not everyone wants to live like a medieval monk.

        • elysianfield says:

          “Not everyone wants to live like a medieval monk.”

          Harrold,
          Never said anything about not getting laid….

        • Harrold says:

          If they were anything like the current day clergy, I don’t think that was an issue.

        • Matt says:

          According to a 2019 article on The Drive:

          “Truck owners might protest that they are slightly less likely than owners of other categories to use their vehicle as primary transport (83% vs. 95%), limiting the miles and gallons. And they might also protest that trucks provide capabilities that other vehicles lack. But, as it turns out, a significant portion of truck owners never use their trucks for these capabilities. According to Edwards’ data, 75 percent of truck owners use their truck for towing one time a year or less (meaning, never). Nearly 70 percent of truck owners go off-road one time a year or less. And a full 35 percent of truck owners use their truck for hauling—putting something in the bed, its ostensible raison d’être—once a year or less.”

          “When asked for attributes that are important to them,” Edwards says, “truck owners oversample in ones like: the ability to outperform others, to look good while driving, to present a tough image, to have their car act as extension of their personality, and to stand out in a crowd.” Trucks deliver on all of that. At a price.

        • Einhal says:

          Matt, so in other words, most pickup truck drivers are driving them to compensate for their small members?

        • Wolf Richter says:

          Einhal,

          Women love to own and drive trucks. Lots of them do. What about them? Do you see why your question is total nonsense?

    • A/C in SD says:

      True that. Just drove through San Diego metro yesterday. Traffic at rush hour, 3-5PM was horrendous.

    • dishonest says:

      How is public transport in Blighty?

  3. Miatadon says:

    It’s not just “supply and demand” that is making fuel prices so high.
    From economist Robert Reich on Facebook:

    “Oil giant Shell raked in a staggering $9.1 billion in the first quarter of 2022, nearly triple its profits from this time last year. The company announced it would increase its stock buybacks in the second quarter, from $4 billion to $4.5 billion.

    Yes: while you pay through the nose at the gas pump, Shell is boasting record profits and using them to line the pockets of its executives and shareholders with stock buybacks. It’s the same story across the industry: Chevron’s profit more than *quadrupled* in the first quarter and ExxonMobil’s more than doubled. Exxon, just like Shell, will use those profits to buy back $30 billion in shares of its own stock, up from the $10 billion it announced three months ago.

    This is a direct redistribution from consumers getting hit with sky-high prices at the pump to Big Oil’s investors and top executives. It’s far past time to rein in Big Oil’s outrageous price gouging. It’s time for a windfall profits tax.”

    • Anthony says:

      Just shows you how oil was a rotten investment the last three years……

    • fajensen says:

      So What!?

      The Truck-People wanted to have Capitalism, not Socialism (and they are getting it good and hard).

      • MiTurn says:

        So, per your logic, socialist countries have been spared high fuel prices? Um…

        • Andrew says:

          A Slightly more “socialist” (but hardly) solution would be to have the government be a large (maybe majority? I’m not fleshing it out) shareholder of critical industries (utilities perhaps?), and from there, have some level of public representation on the boards.

          Quick insane example: Gov’t becomes 51% owner of XOM. PGE is next. However, our representatives at this point are already shareholders, so, yeah.

          Lufthansa is a good example of a gov’t bailout where the government took a large stake in the company as part of the “bailout” terms. Food for thought.

          It’s easy to point out problems and criticize others’ solutions– coming up with ideas is the hard part.

        • Kurtismayfield says:

          No, but they get more output per gallon/liter of gas.. and can withstand price fluctuations because of efficiency policies

          Truck culture just gets to whine.

        • COWG says:

          “ Truck culture just gets to whine.”

          So do their tires….

          Jeez, those things are loud…

        • Wisdom Seeker says:

          @Andrew – They tried that sort of thing in Mexico, Venezuela, the UK and various other places. It didn’t work out – it creates even more corruption and less efficiency, driving up costs. You never get to genuine “public representation”, you get fascist cronyism. Not worth trying it here.

          @Miatadon: Robert Reich is always a hoot. The cure for high prices is high prices. Those profits attract competition and are a far more powerful driver for developing better alternatives than any government policy or subsidy.

        • intosh says:

          “A Slightly more “socialist” (but hardly) solution would be to have the government be a large […] shareholder of critical industries”

          The USA gov already plays a large role in the gas industry. Why do you think it put its nose on all affairs around the world (mostly in places where there is oil)? For freedom and democracy?

      • Steverino says:

        Yippee, they deserve it !

    • Rohry says:

      Reich is a lawyer, not an economist. His prescriptions (price controls, windfall profits tax, and higher fuel taxes) will bring back the long gas lines and restrictions on when you are allowed to get in line. In other words, the 70s,

      • Hardigatti says:

        Yes, price controls always result in shortages. But the politicians think it plays well at the polls. Plain old demagoguery.

      • Augustus Frost says:

        I’d describe Reich as a populist demagogue. Most economists seem to be primarily apologists for a particular political ideology where they use some economic theory to advocate for it.

        A real economist should study and describe how the economy works. A form of “science” to the extent it can be scientific at all.

    • Einhal says:

      Isn’t that true for every industry? Every CEO on earnings call is boasting “record profits,” and how they are able to pass every increase and then some in their costs on to consumers. Every bit of this inflation seems to be ending up in the pockets of the capital class.

    • SpencerG says:

      What did Robert Reich have to say five years ago when oil fracking companies were going bankrupt and the majors were barely profitable? It should come as no surprise that oil companies do better when the price of a barrel of oil goes up. That doesn’t mean that they are the ones making it go up.

    • Jan de Jong says:

      A good part of these profits would have gone to capex in the past. Not anymore – too risky.

      • COWG says:

        “ A good part of these profits would have gone to capex in the past. Not anymore – too risky.”

        It is…

        For the stock prices and c-suite compensation…

    • TK says:

      Same goes for Saudi Aramco. The oil Companies are simply taking their cut from the massive stimulus. It will be different when the stimulus wears off.

      • Harrold says:

        Stimulus is long gone.

        • Viewat30k says:

          In application but not effect! Takes time for it to flush out… states spending big now. Corp ppp money spent..but heavy in cheap borrow money.
          More ole minions are broke…

          Just got to be patient grasshopper…winter will arrive…with avengence!

    • Flea says:

      Just proves who’s in charge and it isn’t the govt, but politicians are probably getting pockets lined pretty well

    • Wolf Richter says:

      Inflation is in part a psychological phenomenon, the inflationary mindset, as I call it, and when it sets in, businesses and consumers start paying higher prices instead of going on buyers’ strike. This allows higher prices to persist. The only protection against higher prices is for enough market participants to refuse to accept them. It’s called demand destruction, or as I prefer to call it, buyers’ strike.

      • Jay says:

        AKA recession. There will not be widespread demand destruction until there’s a recession. When that happens, no body knows, but JPowell is doing his best to push it out as far as possible with dinky 50 basis point increases to the FFR and what will be over the near-term, unachievable MBS QT.

      • Harry Houndstooth says:

        Pure unadulterated wisdom dispensed daily. Demand destruction directly ahead. This small bounce off the lows gives us a chance to profit off the subsequent fall. Any higher prints gives us an opportuntity to profit.

      • Sams says:

        Well, around here there was signs that at least farmers did go on a buyer strike. High prices on fuel and fertilizer made them cut purchase of fertilizer and start to plan for reduced production.

        Now, if all farmers in the USA did the same? Would they be able to push down the price of fuel and fertilizer? How large would the cut in purchase be to make an impact?

        At least the fertilizer they should stand a chance to push down the price as it is mostly farmers that buy that product.

        Then, next season they may be able to themselves reduce price if the consumers buying agricultural products go on a buyers strike too.

    • David Hall says:

      Over 100 oil and gas companies went out of business during the pandemic – Houston Chronicle.

      Other companies took on massive debt in order to survive the crisis. If an oil company can not earn a profit, they can not increase delivery of gasoline or diesel.

    • Augustus Frost says:

      How? Through price controls? A windfall profits tax?

      Both of those have been used before. There will be less supply if used again.

      The remnants of the “seven sisters” (Exxon, Shell, Mobil, BP, Chevron, Texaco, and Gulf), though everyone’s favorite targets anytime gas prices spike, are a lot less dominant than in the past. Many developing country competitors around now which weren’t a factor before.

      US oil majors don’t control the price of crude oil or gasoline (it’s traded on the futures markets). To my knowledge, they don’t necessarily even own most of the gas stations with their brands on the signage either. They also aren’t social services organizations which exist to provide consumers with low cost energy.

    • Massbytes says:

      If you wish to cap oil company profits then you need to cap their losses also. Many, many oil companies lost money and went broke in the years of low prices. Are you prepared to do that?

  4. ru82 says:

    Mush had and interesting post. The Fed intends to let a lot of MBS mature and run off their balance sheet.

    Fed:
    For agency debt and agency mortgage-backed securities, the cap will initially be set at $17.5 billion per month and after three months will increase to $35 billion per month.

    Reality:

    Duration Mismatch

    Check out the duration of Treasuries and MBS in my lead chart. There is room for Treasury runoffs.

    But as of May 12, MBS looks like this.

    Fed’s MBS Balance Sheet Holdings

    Within 15 Days: $0
    16-90 days: $1 Million
    91 days to 1 year: $53 Million
    Over 1 year to 5 Years: 2.1 Billion
    Over 5 Years to 10 Years: $62.6 Billion
    Over 10 Years $2.65 Trillion

    Based onto this info. They will not meet the lie target of $150 billion MBS run off. It may only be $53 million?

    • KPL says:

      Lying is not something new to the Fed.

      • Wolf Richter says:

        Someone (ru82) posts some uninformed BS, and another (KPL) stacks more uninformed BS on top of it.

        See explanation below.

        KPL see my reply to your idiotic comment (prior article) about Williams and MBS.

        This tightening denier BS is really getting old.

    • John H. says:

      Ru82-

      Do your numbers include the scheduled monthly principle payments, or total repayments due to home sales?

      As I understand it, mortgage repayment rates do pay off faster than their maturity dates suggest, though the exact rate is unknowable in advance…

      • John H. says:

        Said “mortgage repayment rate do pay off…”

        SHOULD have said “underlying mortgages do pay off faster than their maturity suggests…”

      • curiouscat says:

        Like the weather, everyone talks about the Fed but no one ever does anything about it. 😃

    • joe2 says:

      Thank you, that’s illuminating. And if you could, show how the Fed will retire Treasuries. I assume the Treasury Department will pay them off at maturity without selling more Treasuries to the Fed to raise the cash to do so.

      It’s clear the system is being destroyed systematically while the carnival barkers distract the audience with shiny talk.

      • Wolf Richter says:

        joe2,

        No, it’s not “illuminating.” It’s uninformed BS about MBS and how they work. See below for an explanation.

        I have written many times about how MBS and QT work, but some commenters prefer not get informed and instead post BS to mislead others.

        • joe2 says:

          Wolf, my comment was on rolling off Treasuries, not MBS. Sure the mortgage holders can payoff mortgages in a rising RE market.

          But is the US Treasury so trustworthy and solvent?

          Your reference quote:
          “In order to maintain the balance of Treasury securities at the current level, as maturing securities come off the balance sheet, the Fed buys new Treasury securities in the amounts needed to replace the maturing securities.” (read your references)

          So how do they retire the Treasures instead of maintaining them? Explain where the US Treasury gets the cash to redeem the Treasuries “rolling off” the Fed balance sheet.

          And I still see RU82’s comment on timing mismatch as relevant as the Fed has no control over how/when mortgages are paid off.

        • Wolf Richter says:

          joe2,

          When the Treasury securities on the Fed’s balance sheet mature, the Treasury Dept. pays the Fed for them, and they come off the Fed’s balance sheet. This is routine for the Treasury Dept., only this time, it’s the Fed not me or you or a bond fund who redeems the Treasury securities. The Treasury Dept does what it always does, it uses its cash in the Treasury General Account to pay off maturing securities. It doesn’t matter who holds them.

          The Treasury General Account is the checking account of the US government. You can look at the daily balance online. The money to pay off maturing securities and to pay for anything else, from fighter jets to Powell’s salary, comes from a variety of taxes and fees, and the remainder is borrowed by issuing new Treasury securities.

        • joe2 says:

          Wolf, I understand:
          “The money to pay off maturing securities and to pay for anything else, from fighter jets to Powell’s salary, comes from a variety of taxes and fees, and the remainder is borrowed by issuing new Treasury securities.”

          And I suppose the answer to my question is that you are confident that the general fund can redeem the Fed securities without requiring that new Treasuries be bought by the Fed in spite of your Wazoo chart.

          So I suppose foreign and US public will be buying lots of Treasuries in the future. Or stocks might be rotated to Treasuries.

          Tax receipts have been good recently and Treasury purchases have been slightly reduced, but if the US heads into a downturn that will end.

          So I guess it depends on how you see the economy in the next few years. Sounds like we disagree. Wanna bet a beer? If you are right, I will be able to afford it.

        • Wolf Richter says:

          What I’m saying is that it doesn’t matter to the Treasury Department who holds the Treasury securities, whether it’s the Fed or you or me or the Chinese: they’re all dealt with the same when they mature. It’s just a routine process. The Treasuries that the Fed holds are included in the $30.5 trillion in debt that government has issued.

          What will happen as the Fed steps away is that yields will continue to rise. And that’s the purpose for the Fed — it’s what “tightening” financial conditions is supposed to do. Higher yields bring in more buyers. At some point when the yield is high enough, I’m going to buy some 10-year Treasuries. I already bought some 2-years and getting ready to buy some 1-years. Yield fixes all demand problems.

          I’m working on the update as to who holds the $30.5 trillion in debt. It may be out tomorrow, make sure to look at it.

    • Wolf Richter says:

      ru82,

      Totally misinformed BS. With MBS, maturities don’t matter — passthrough principal payments do. Why don’t you read the articles I write about this, instead of dragging nonsense into here?

      MBS come off the balance sheet via pass-through principal payments when mortgages are paid off (such as when the home is sold or when the mortgage is refinanced) or are paid down (regular monthly payments). The principal portion of those payments is forwarded to (“passed through to”) MBS holders, such as the Fed, and the balance of the MBS shrinks. To keep the balance flat (as right now), the Fed buys new MBS to replace them. These pass-through principal payments amounted to about $80 billion a month before the increase in mortgage rates. Now they have slowed but are still very large.

      So when the Fed stops buying MBS to replace the passthrough principal payments, the MBS balance on the Fed’s books will shrink rapidly, but the Fed said it will cap the shrinkage to $35 billion a month. So that’s QT. And it starts in June.

      Over time, when a lot of the MBS are gone from the Fed’s balance sheet, these passthrough principal payments will slow down, and fall below the Fed’s cap of $35 billion a month. This is when the Fed will be considering outright “sales” of MBS to get rid of them.

      https://wolfstreet.com/2022/05/04/powell-confident-in-softish-landing-for-the-economy-but-we-may-keep-inflation-markets-can-figure-out-their-own-landing/

      https://wolfstreet.com/2022/04/21/peak-balance-sheet-feds-assets-dip-to-5-weeks-ago-level-end-of-qe-end-of-an-era/

      • Einhal says:

        What happens to the interest payments made by the homeowners? Do they not get passed through too?

      • ru82 says:

        Okay. I admit that the data I posted was wrong. I got the information at Mishtalk. In the past Mish’s data is solid but maybe not these days.

        Your right. pass through payments and the rate of payment I think is called CPR (Conditional Prepayment Rates) will probably be 6-to 8%. So on $2.5 trillion in MBS, that will be substantial.

  5. Nicko2 says:

    As others have noted, US still has very low gasoline prices when compared globally.

    Oil is a finite resource, it’s causing climate change….it should be expensive! If you want to drive, buy an EV vehicle.

    • Brant Lee says:

      Sounds like you have it all figured out.

    • Tronald Dumpf says:

      Here in Canada, any non-luxury EV that’s worth a penny (i.e not tesla), is back ordered by 18+ months). Luckily I can afford to be choosy, but mass adoption isn’t coming soon.

      • The Real Tony says:

        Virtually everything in Canada was sold to the Americans as no one could afford a car even when the price of oil was negative. Car insurance is the big killer in Canada. When the price of oil was spiking car prices weren’t rising much here due to no demand then someone got the brilliant idea let’s just sell everything to the Americans. So now nothing is on the lots in Canada. Where I live 80 percent of the vehicles on the road are SUV’s.

    • otishertz says:

      The logic behind spending $80k on a new super golf cart to save $3-5k per year on gas, to save the Earth by burning electricity and digging lithium mines, has always escaped me. Same thing with leasing a new car every three years.

      The average new car contains something like 775 pounds of plastic which is made from oil. Plastic is forever. The nice thing to do for the environment is to buy an old car, not bring new plastic and another new car into this cruel cruel world, where the poor vehicle has only environmental destruction to look forward to in life.

      New cars are always telling you what to do while embracing and distracting you in toxic media and too much information. I laugh every time I see a huge monitor humped on to a dashboard. That looks really dumb and will not age well in the annals of design. In 2024 new cars will have a big brother kill switch.

      I’d rather “recycle” a living work of art in the form of an old analog, naturally aspirated Chevy to do my part to save the environment from itself. When you think about it, “recycling” an old gas guzzler is much more environmentally friendly than buying/leasing yet another plastic mediamobile every three years.

      • phleep says:

        Yes, Green Fraud has been a growth industry for awhile now. Along with inserting distractions which is a kind of theft, a kind of violation of personal sanctity. I can’t believe the folks who put up with this, and actually pay for it.

        • phleep says:

          The only actual green thing is: consume fewer resources. And voila, gravely wounded nature tries to spring back, to bring us its infinite beauty. Where you live ceases to be such a heck-hole to be escaped in a vanity-wagon.

      • Prairies says:

        The big brother kill switch already exists in Chevy models, has been around for almost 10 years. It’s called OnStar, other brands have their own versions.

        • El Katz says:

          OnStar has been around since 1996….. The older version doesn’t work anymore due to it operating on CDMA cellular service which has been shut down. 2013ish it went to 4G.

      • TheAltonRoute says:

        Remember when someone was pushing the idea of shutting down all the Teslas in Russia? John Deere did that with tractors and combines that had been taken from the Ukraine.

      • Depth Charge says:

        I do the math on brand new full size diesel trucks and laugh. Americans drive, on average, 14,000 miles per year. $90,000 is the going rate for a brand new diesel truck, since they are mostly loaded with features. Let’s assume a 6 year note on the truck, at 0% to make the math as pocketbook friendly as possible. Registration is going to run you an average of $750 a year (it’s much higher here). Full coverage insurance is going to be $120 per month, but many pay much more. With 20% down – $18,000 – your truck payment is essentially $1,000 per month. If you are paying interest, it only goes up. So,

        Truck: $1,000
        Insurance: $125
        Licensing: $62.50
        Fuel: $467.50 (does not include DEF)
        Maintenance: $$46.67

        All in, $1,697 per month to drive the thing, and that doesn’t even take into consideration tires, etc. How many people have $20,000 after tax income to spend on a truck every year? Not many.

        COULD GET UGLY OUT THERE.

        • Anthony A. says:

          You forgot to add in the cost of a lift kit, cowcatcher, 32″ wheels, special tint, and a motorized bed cover. Add about $20,000 more.

        • Anthony A. says:

          Woops! Forgot to mention the diesel particulate emission filter elimination kit, software and tuning chip.

          Add $1,800 more.

        • The Colorado Kid says:

          It’s already getting ugly for my friend whose husband just died. They live in a rural area where trucks are a status symbol, so that’s what she now has. Now with just one income and retired, she can no longer afford to go see her grandkids a couple of hundred miles away, which is very important to her (can’t afford to move). Wants to sell it, but still owes too much and it’s not as sellable now with the price of gas. Never understood why they bought it (new). They had to replace the engine at 80k miles.

        • The Colorado Kid says:

          I’ll add that my friend is short and is having to add running boards because she’s having back surgery and won’t be able to get in and out of the thing.

        • Jdog says:

          Your ego is always the most expensive thing you will ever try to support….

    • Moosy says:

      Well Nicko2,

      So where is that electricity coming from at night when you plug your Tesla in the wall socket?

      And if you want to be cute and told to pge that you want green energy (at an extra premium price): other states are very happy to sell their solar bird fryer energy , they just generate some more using coal for themselves . So your beautiful Tesla in effect runs on coal.

      And nothing wrong with coal, it is very sustainable biomass, just million year old vegitation.

      But the real beauty of your EV is that it makes coal compete in the transportation energy business.

      • Massbytes says:

        A Tesla runs on less fossil fuel than any ICE vehicle and is 4 times more efficient at using it. I pay 12 cents a KWH making my fuel cost around 4 cents a mile. An EV, is in fact, cheaper to own over the life of the the vehicle than your ICE vehicle and it is faster and more fun to drive. Coal is the dirtiest fuel we can use for electricity in the US or anywhere. In the US it is only used for electricity less than 20 percent of the fuel mix. I guess you didn’t notice all of the auto makers are now going EV.

    • joe2 says:

      We are lucky (?) to get a preview of the future in Sri Lanka. The Sri Lankans not so much. The government just said there is one day of fuel left in the country. The tankers sitting off the coast cannot unload as there are no foreign currency reserves to pay them.

      But it’s not clear how EVs will play out. It does look like it will take the same track as air travel: if you want to fly, buy a private jet.

      • COWG says:

        “ if you want to fly, buy a private jet.”

        Better pre-plan..

        Saw a report from Naples, FL ( Foo-Foo Land, as I call it), poor rich wanting jet charters have a 3-4 months waiting list…

    • Marcus Aurelius says:

      Oil is not finite. Oil is infinite, just controlled and restricted, like Diamonds, etc.

      Oil does not cause climate change. Climate changes because of numerous substantial reasons that have nothing to do with Oil.

      An EV costs more to buy, to run, to build, to own, to repair and to dispose of, and all this causes Climate Change, right?

      • Harrold says:

        I’ve discovered that instead of ‘climate change’ use the words ‘extreme weather event’ and people will understand.

      • Massbytes says:

        No, oil is not infinite in the quantities we use. Far from it. And it does contribute to climate change. Maybe you could name any major climate tracking agency that agrees with you. EVs are cheaper to own over the life of the vehicle compared to ICE. Nothing in your post is correct.

      • james wordsworth says:

        And in what alternate reality do you live?

        How do you get there?

        The histrionic ravings of “freedumb” loving Yanks get really tiresome.

  6. JGarbo says:

    The US is now “enjoying” a European standard of living. Bon appétit, mes amis…
    In Thailand, today, Diesel $4.80/gal, E85 $5.36/gal (rough conversion). And we export gas and oil!
    Bicycles are selling well…

    • Kurtismayfield says:

      If I was enjoying a European standard of living, I would have more life expectancy, better infant mortality rates, better public transportation, and actual supports from the government for working families.

      No I live in a third world country called the USA, where the corruption is so overt no one hides it anymore.

      • Escierto says:

        Well stated. Americans do not travel and therefore they do not realize that their country is actually a sh!thole. Fat slobs sitting on their sofas chanting USA Number 1 when the only things it is Number 1 are things like opioid deaths, covid deaths, number of prisoners per capita, number of mass killings etc.

        • Kurtismayfield says:

          Bridges falling apart.

          Highways crumbling before my eyes.

          Healthcare industry that has become essentially end of life wealth extraction.

          Congress so corrupt that there are ETF’s that mimic their stock trades.

          And entire economy that is so dependant on rising housing values that when the cash outs stop it slips into recession.

          1 million “excess deaths” in two years.

          Lol first world USA

      • Nemo 300 BLK says:

        Nobody is stopping you from moving to those failed ancient empires. I hear a lot of people in the US are moving to Portugal to live in 600sq 70 yo apartments that are notorious for leaking roofs.

        • Kurtismayfield says:

          No at this point I would rather move West. Watching this old ancient Republic rot from the inside is getting old.

        • InExcess says:

          True maybe.
          But a bottle of wine is $5.
          2 bottles at dinner and the leaky roof doesn’t matter 😊

      • Marcus Aurelius says:

        If I was enjoying a European Standard of Living, I’d be sitting on a nude beach right about now……………..

      • intosh says:

        Better food too.

        Average north americans who’ve never stepped outside the continent don’t understand how bad their food is, compared to many parts of the world.

  7. Michael Engel says:

    1) XLE is the energy sector ETF. In late 2019 XLE:SPY was the worst index in the last twenty five years. “Experts” recommended XOM, CVX, SLB…as a long term investment. U can’t lose, because they shrunk so much. They are value investment. If u listen to them u entered a waterfall.
    2) Delta, American Airlines… were struggling in Q3 2019. “Experts” recommended airlines as a good LT investment before Xmas, in 2019. Delta with it’s hubs and refinery is best. If u listened to them, Steve Menuchine, the violinist got u. Menuchine saved the airlines, a critical industry, in exchange for their 40% common stocks, paying 10% annual dividends, converting them to gov entity to collecting income and influence. Suspicious crumbs, 50% of the US population, cannot fly this summer.
    3) Trillions of dollars were spent on small businesses and critical industries, before they expire, not after they died, like GM in 2008/09.
    4) Some are zombies. Some are making tons of money, profiteering, buying back shares, paying executive perks co, – while the rest of the country don’t have enough for food. Tax them. Make these greedy scams pay.

    • Island Teal says:

      Steve Munchkin ☺️☺️ a name from the past. Most people have no clue what he did prior to Sec of Treasury and made the infamous “Cash in the hands of the American people within days” in regard to unleasing the Stimmies. Least we also forget his fine work with the IndyMac gang 💸💸🤑🤑

      • Harrold says:

        I remember when Mnuchin used a government jet so him and his new actress wife could go see an eclipse.

  8. Franz Beckenbauer says:

    You know, i was wondering what suddenly changed in the markets so fundamentally that we are basically in liquidation mode now where everything sells off.

    It certainly could not be that laughable “interest rate imcrease” by the Fud. I mean, come on. They telegraphed it so loudly and prematurely, of course everybody was hedged and prepared. That’s what hedges are for. So that could not have been it.

    Then i thought, maybe the collapse of the chinese economy could be it. Yeah, could be. Lots of liquidity gone, real estate developers defaulting on their loans (all of’em), yeah. Okay. But somehow it also did not quite pass the smell test.

    Then i read the 10-Q of Coinbase.

    Bingo.

  9. Angela says:

    CAD$2.299 per litre in Vancouver BC

    • InExcess says:

      Ah can’t understand the complaints.
      Housing went up approximately 500k in 2 years.
      They should be able to pay $20 a liter and still be waaay ahead

  10. Brant Lee says:

    I thought the national oil reserves were opened to drive down the gas price. I don’t know how much oil that is but it’s going to have to be replaced at $115 and upperds.

    I think I can cut my 25-mile round trips to town for essentials to once a week almost, 100 miles per month. That’s a gas fill-up about once every three months. I’ll never buy tires again. Can you get auto insurance by the mile? Fast food and restaurants just keep jacking up prices anyway.

    I’ve been through this in the 70s, 2008. This time it’s serious.

    • joe2 says:

      Yeah. In the 70s we all assumed it was transitory. Of course we had a Volker back then and politicians that seemed to care, or at least be worried, about what the people thought.

      Now it seems more planned. Politicians that just lie and don’t care if you believe them. Thinking they can adjust some theoretical factors in line with their dogma without any unforeseen consequences.

      Results so far are not promising.

      • TheAltonRoute says:

        That Kelton lady has it all figured out. Don’t worry.

        • joe2 says:

          I emailed her once on how taxes are used in MMT to decrease inflation, never heard back. My guess is that the plan is just to raise taxes until no one can buy anything.
          QED: inflation problem solved.

      • Jdog says:

        Oh the consequences are seen alright, they are just not in line with the best interests of the American people.

    • COWG says:

      “ Can you get auto insurance by the mile”

      Allstate has (had) a program for that…

    • Anthony A. says:

      The crude oil released from the SPR is sold worldwide as it’s a commodity. It takes a good bit of time to sell and distribute over 100 million barrels of crude oil. Some of this oil was bought by foreign entities and is a trade vehicle by oil brokers. The SPR release was a political move by Big Joe.

      The SPR oil won’t make it into retail gas and diesel pumps for months after being sold.

    • Nemo 300 BLK says:

      Nope. Out US emergency reserves were sent to the EU to help with their inflation instead.

      https://www.bloomberg.com/news/articles/2022-04-18/texas-port-sends-strategic-u-s-oil-to-europe-amid-supply-crunch

    • Nathan Dumbrowski says:

      I think that was last news cycle. The new news is that they are re-filling the SPR…
      05 May 2022

      President Joe Biden’s administration has released a plan for refilling the US Strategic Petroleum Reserve (SPR) in “future years” through a series of crude purchases intended to offer a long-term price signal for investment in production.

    • Gomp says:

      Just heard that some of strategic reserves were sold to foreign countries.

  11. Mike T. says:

    I can report this morning the local Shell station just off I-91 in MA has gas at $4.59 and diesel at $6.33. Looking at the price of WTI oil this morning $5/gallon may be not far off.

  12. Janna says:

    Our gas station was confused yesterday. It went from $4.19 to $4.49. Then, about an hour later, it went back to $4.29. You know it’s bad when the gas station can’t even keep their prices straight:-)

    • John H. says:

      Pardon the melodrama, but intraday gasoline price updating is eerily similar to the twice per day wage payments made to some employees during the Weimar inflation because the currency was depreciating so fast:

      “In the weeks preceding the monetary reform, for example, it made a difference to the workman whether he received his wage in the morning or the afternoon.”
      – Constantino Bresciani-Turroni, The Economics of Inflation – A Study of Currency Depreciation In Weimar Germany (1937), p. 303

      Not at all claiming we have reached the dreaded hyper-inflationary state, but studying Germany’s experience provides interesting insights.

      Another interesting parallel: Bresciani-Turroni identifies a main cause of German currency destruction to be uncontrolled deficit spending. Food for thought for the MMT crowd.

      • Marcus Aurelius says:

        One of my favorite restaurants no longer has a “normal” menu.

        They have the type where you slid in menu sheets beneath the clear plastic.

        They can change their menu with a stroke of a pen, literally.

        Hell, now they can change the prices twice a day.

        • Wolf Richter says:

          Lots of restaurants in San Francisco use QR codes (those square matrix barcodes). You scan them with your phone and it pulls up the menu from the internet, and you read the menu on your phone. This became the thing to do during the pandemic, people have gotten used to it, and it stays.

        • Josh says:

          I always love looking at menus to find price inconsistencies like it being cheaper to order pancakes and a side of eggs instead of pancakes with eggs. A few years back McDonald’s started moving to a digital screen that only showed part of the menu at a time and rotated pretty quickly. It made it much harder for me to find the best value (e.g. buying a meal vs. individual parts). I assume they moved to digital on purpose to make comparison harder and to more easily update to the prices.

        • Jdog says:

          Whenever I go to a restaurant with QR codes instead of regular menus, I leave and never return. The whole point of a restaurant is service, and if they do not provide it, what is the point?

  13. David Hall says:

    In 2008 conventional oil fields were becoming depleted. People worried about terminal declines in global oil production. Some shale is porous with oil in the pores, but it has low permeability, that means the oil is trapped and does not flow. Drillers started drilling horizontal wells in this type shale and fracked/cracked the rock with pressure. The Haynesville Shale yielded natural gas this way. Fracking tech was improving with some shale formations yielding oil and natural gas causing a resurgence in Texas oil production. Conventional oil wells in Saudi Arabia flowed for decades. Shale oil wells produce most of their oil in the first two years.

  14. Publius says:

    I don’t envy you the $6.55 gas, Wolf, but I do wish we had 10-cent increments between grades rather than 30-cent increments!

  15. MiTurn says:

    Isn’t over-the-road diesel fuel basically the same thing as heating oil? There’s a thought! Stock up before winter?

    • VintageVNvet says:

      Huge fine if any on road vehicle, car, pick up or semi is caught with anything other than the ”green” diesel these days MT.
      Special permit was needed in the farming county we lived in in flyover central area, and it was red color, as opposed to the green color of the on road fuel.
      What you suggest ”used to work.”

      • Cookdoggie says:

        Between 10-15% of cars I sample have expired tabs in WA state. I’d take the chance on heating oil, the police clearly have other priorities. Welcome to Greece.

    • Anthony A. says:

      Heating oil traditionally contained too much sulfur as the over the road diesel is limited to 15 parts per million. Refineries run over the road diesel thru a sulfur recovery unit to reduce sulfur content adding to the cost.

      In recent years, many states have written laws lowering the sulfur content to 15 PPM vs. the older 500 – 2000 PPM limits. Heating oil is not governed by the Clean Air Act.

      • Brent says:

        Ultra-low and low sulphur diesel is bad for diesel engines (and, ipso facto, very good for repair shops and for banks issuing credit cards with 24% APR).

        Article:

        “Loss of Lubricity in Diesel Fuel.
        Why Loss of Lubricity in Diesel is Proving Fatal to Marine”

        Except for size marine diesel engines are not much different from truck diesel engines.

        Bottom line:

        1.Buy/rent/borrow/steal diesel lubricity checking device mentioned therein.

        2.Restore diesel fuel lubricity by adding sulphur-containing “Love Potion #9” 😀

        • Marcus Aurelius says:

          Sulfur has an interesting history with Oil.

          When oil was being discovered in Illinois (or Indiana, I can’t remember which) the partners of John D. Rockefeller did not want anything to do with it due to the high sulfur content.

          Mr. Rockefeller, being optimistic, bought up the leases on his own account and waited till technology caught up with the problem.

          Well, well, well…a guy named Goodyear was fanatically trying to turn rubber, back then an awful product, into something more useful and developed the process called Vulcanization.

          Guess what? It was combining Sulfur to the basic rubber (carbon). The Sulfur atom combined with (I think I recall) 7 Carbon atoms and allowed for the flexibility we enjoy today. (I read about all this years ago, so the story is correct, but the data may be off).

          Now a profitable use was found for Sulfur. Mr. Goodyear claims he got the idea in a dream. Dreams are a very common source of information for those inventors who are so obsessed with their goals that they, at times, “dream” about it.

          PS: The German scientist who discovered the “Benzene Ring” (maybe it was Herr Benzene?) of 6 carbons connected in a ring….an extremely basic and important Organic molecule….dreamed about the structure. He claimed he dreamed of a snake biting it’s own tail, and thus the structure.

        • Wolf Richter says:

          Marcus Aurelius,

          “maybe it was Herr Benzene?”

          No, it was Herr Ben Zene (pronounced Tseenee)

        • Anthony A. says:

          When I had my diesels, I added a lubricity additive with each fill up. I also drove them 40,000 miles per year!

          I’m over diesels now and just drive a 4 cylinder, direct injected and turbo charged small SUV and an old Mustang convertible.

          But being retired, I only drive around 10,000 miles per year anymore and most of that is to doctor’s offices and the grocery store. Damn, what a boring life…

        • Brent says:

          @Marcus Aurelius

          Oil was discovered in Titusville,Western PA by Col Edwin Drake. John D was located nearby in Cleveland working as merchandise broker.Then he saw an opportunity in oil and seized it with both hands.

          Benzene ring was revealed by God of Chemistry to August Kekule during his hight sleep.I was so impressed with this fact during HS chemistry class that I never missed the opportunity to doze off ever since. Nothing was revealed to me as of today 😀

        • Brent says:

          @Anthony A.

          I drove a big rig during the late 80’s, made 170,000 miles my first year.Was bored out of my wits, only CB channel 19 kept me sane.

          Marmon truck with Lipa transmission are indestructible, still see them driving by.

          On the other hand I never saw so much brand new disabled trucks on the side of the road starting around 2010.

          EGR, ULSD, 2 surveillance cameras inside cab, lane control alarm, speed governed at 65mph – let’em recruit jail birds for this kind of BS.

        • Anthony A. says:

          @Brent:

          “EGR, ULSD, 2 surveillance cameras inside cab, lane control alarm, speed governed at 65mph – let’em recruit jail birds for this kind of BS.”

          I have to agree….

  16. SpencerG says:

    At some point Wolf’s “Tourist Trap” gas station becomes a “Tourist Attraction.”

  17. Andrew says:

    Gasoline is the Economics textbook example of inelastic demand curve. This means that price generally doesn’t make as much of a difference in demand as it would for other products. So, anyways… good luck everyone!

  18. Bead says:

    The guvnor has promised to give you back somebody’s tax money to make this awful inflation less painful. Very paternal of him.

  19. Yukon canada up to 2.43 per litre which is almost 11 bucks a gallon . I’m calculating 35 bucks an hour with my one ton which I can’t escape unless I stop working.

    Only out for me is more product per load which involves lifestyle changes like living on the jobsite instead of returning home for night which I used to enjoy.

    • The Real Tony says:

      It’s about $2.10 a liter in Toronto, Ontario and the surrounding areas today. A lot higher in the province of British Columbia.

  20. The Real Tony says:

    QE and rate cuts did nothing but louse up the entire world since 2009.

  21. DR DOOM says:

    This is my un-qualified opinion of inflation and CPI. Other than beak flapping the Fed nor Congress nor the Executive really gives a shit about inflation. The Constant War Uniparty is firmly entrenched with its control of media and the money. The dumb ass electorate are firmly politically split and at each other’s throats. The Fed does not even recognize that the money supply and thus aggressive monetary removing via a Friedman,Volker move as credible. Powell successfully and un-challenged by State Media spewed bull shit separating his “bromance” with Volker to not include Volkers actual importance of killing inflation using 2 recessions and interest rates greater than the inflation Volker wanted to kill. Powell is a Keynesean bitch of Wall Street and the political class and is a political hack and vain. If he was not vain he would have resigned because he has failed,miserably.The hope that something changes due to the mid-terms bring to mind the coarse but true quip of “hope in one hand and shit in the other and see which one fills up first”. Here is a personal hope of mine. At a minimum,I hope I get entertained by the clown show.

  22. SoCalBeachDude says:

    PRICE GOUGING.

  23. Marcus Aurelius says:

    $6.55 would be about 30 cents, which was the price of gas from around 1920 to 1964.

    $6.55 is a very good price.

  24. SoCalBeachDude says:

    Saudi Aramco is now the world’s most valuable company based on its market capitalization and the profits of all of the major oil companies are up by tens of billions of dollars in the first quarter of 2022 and will be up by even more in the second quarter of 2022, so this massive price gouging is wonderful for the profits of big oil and notion of ‘capitalism.’

  25. COWG says:

    “ Anything that adds to inflation bites the Fed’s hands”

    10% COLA is going to force the Fed’s hand…

    Very soon nothing else will matter…

    The closer you get to COLA, the more the Fed will be forced to act more aggressively before and after the COLA…

    They absolutely cannot allow a 26% per cent COLA raise over a 3 year period…

    The Fed will be responsible for the USG outlay for SSI, Govt, military and retiree compensation increasing by a quarter…

    They are going to find out what being political means…

    And remember, that increase will never be rolled back and future inflation will be added on top of that…

    If you don’t see this coming and are not adjusting your life for it, you deserve the pain you’re going to get…

  26. Depth Charge says:

    Mass speculation by pigmen run amok, courtesy of the FED, and billionaire globalists playing games of “feel my power” with each other, which could consequently end with some real big mushroom clouds.

    I saw that the Bernanke came out and threw Powell and Co. under the bus a couple days ago, saying they “made a mistake” not raising rates sooner. This was pretty rich considering he is as responsible as them, if not more, for the current state of affairs.

    • InExcess says:

      “Pot calling kettle black” is an old phrase we use.
      I saw that and remember the utter nonsense about “liftoff” from both him and Yellen.
      We kept hearing those words and they still haven’t “liftoff” as yet.

    • island teal says:

      DC….Nicely said.
      Bernack, Summers, Fellen, Powell are ALL RESPONSIBLE for not doing the job that they had/have the authority to do.
      🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♂️🤷‍♀️🤷‍♀️🤷‍♀️🤷‍♀️

    • Augustus Frost says:

      The biggest asset bubble of all time temporarily made his theories feasible and “work”. There is nothing revolutionary in “printing” and it doesn’t create one cent of real wealth.

      Due to his position as FRB chairman, he had the ability to fulfill his dream of implementing what is actually economic quackery.

  27. Michael Engel says:

    1) An attack on AAPL is attack on all. Let’s enter Casino Royal for
    entertainment and fun :
    2) Player #1 : when AAPL hit $3T it was a golden opportunity to make money on the way to $4T. Player #1 was waiting, watching AAPL rising
    vertically up, hesitating, he is not going to miss the next move up.
    3) AAPL turned around, #1 couldn’t sleep all night, finally he gave up
    on Jan 24.
    4) On Jan 4 player #2 bought SPX, as an opportunity for a long term investment, but Feb 2/ 9 divergence screwed it all. SPX turned around, his unrealized profit turned into a small loss. He got out, before accumulating larger losses.
    5) Player #3 bought AAPL, when AAPL candle was large green on average volume, twice as large, but volume was not as high. AAPL Turned around, showing a small unrealized loss, but #3 didn’t care, because he loves AAPl.
    6) AAPL moved up until the end of Mar and turned around showing a Major Weakness. His stop loss was hit on May 11.
    7) On Mar 12 player #4 was hooked on AAPl sexy leggs. Options :
    8) A bullish option : click few AAPL shares, before AAPL reach the resistance zone at around : dma50, dma200, a downtrend from Jan 4 to Feb 9 highs, and May 4/5 open gap. Full steam on all uhe got, on May 12 test.
    9) A bearish option : short AAPL at the resistance zone, because SPX is a megaphone. May low is not low enough. SPX is a complex system.
    AAPL might infect us all, especially the big old boys.

    • Propheticus says:

      Semiconductors are up.
      The VIX is down.
      Walmart “thackamuffled.”

      • Anthony A. says:

        Walmart “thackamuffled.”

        This in the face of all the big price increases in their store merchandise.

        • Dan Romig says:

          Target reports quarterly earnings before market open tomorrow.

          The man in charge, Brian Cornell, is very good at steering the ship, and seeing what’s coming on the horizon; IMO.

          Target has done a better job, so far anyway, at keeping prices down in their produce and grocery departments than the large supermarket chain in the Twin Cities, Cub Foods.

        • Wolf Richter says:

          Target is making hay with its ecommerce division. Target is the 6th largest ecommerce retailer in the US.

        • Dan Romig says:

          Well, that was one heck of a hit after earnings report.

          TGT is @ $160. A dip of 25%.

  28. Kunal says:

    We all know that inflation will be sticky. Fed also knows this. Countless of smart folks have been predicting this for years now. The real question is will Fed do anything about it. Fed does not need any more signal to act, when inflation is already at 8.5% and their mandate if 2%. Looking at the state of affairs I will bet the farm that unless US goes down like Argentina and Venezuela Fed will not act hard on inflation and keep attempting soft landing, i.e. they will never crash the stock and asset bubble, like really crash that causes bond write-offs and bankruptcies not paper losses. And therefore inflation will persist. It is a sad state of affairs but true. There is enough proof that this is not gonna change.

    • Augustus Frost says:

      Us is nowhere near either Argentina or Venezuela, economically at least. Both those countries experienced hyperinflation because they were shut out of the international credit markets and fiscal mismanagement limited local borrowing.

    • Iona says:

      Buy AARK if you believe the nonsense you write, let us know how that works out. Maybe you’re Kathy wood?

    • John H. says:

      Kunal-

      1. If your time frame for this bet is “never” (i.e. ever), I’m interested in contracting this bet, subject to 2, below.

      2. How many acres is your farm, and where is it located.

  29. Brendan says:

    BUT WAIT! There’s a snack shop.

  30. Jdog says:

    We do not have a oil shortage as some commits would lead people to believe. What we have is an intelligence shortage in Washington DC which makes drilling and refining oil much more expensive than it should be based upon some uninformed opinions that oil can easily be replaced. Just watch what happens to Europe over the next year as they find that out first hand.

  31. unamused says:

    The Bentley runs on hydrogen. You guys can do what you want.

  32. Michael Engel says:

    Option #3 : AAPL become KKAKI, in Japanese.

  33. All of this gnashing of teeth is just a meaningless psychological phenomenon.

    The price just sounds high, thus the stress.

    An easy solution is to price the product in ounces and it will sound cheap!

    Only $0.0505 at Wolf’s place.

    Cheap! Basically free!

  34. Jdog says:

    If you think gas prices are bad, just wait a few months and see what happens to a basket of groceries……

  35. Michael Engel says:

    1) One million people people stopped driving. They are not buying cars. They expired in the last two years.
    2) Most of them are old and impaired. The gov don’t care. They saved
    twenty years of health care and social security.
    3) The Boomers deflated. Their large population is falling.
    4) The woke population, the young, will get their RE for cheap, after their death, after the plunge.
    5) The gov don’t care. They will collect taxes to feed themselves. They will not repair roads and bridges, because 20% of the major cities are vacant
    anyway.

  36. unamused says:

    Rep. McMorris Rodgers (R) yesterday (5/16) claimed that making it illegal for oil companies to price gouge is “socialism,” something that’s done in places like “Soviet Russia,” not in America.

    You get what you vote for. A lot of people very much approve of getting screwed.

    • John H. says:

      Una-

      “ You get what you vote for”

      With respect, I hope to get what I vote for:

      – Market prices determined by willing (un-coerced) transactants; no government thumb on the price scale

      – Profit incentives to private individuals and companies that provide for the demands of private consumers

      – Elimination of government subsidies; real consequences for private business failure

      – Smaller government, especially given the government’s ability to muck things up (e.g. money/banking; post retirement financial security (Soc. Sec.); healthcare; military; scientific research; education (k-12 and higher ed.); housing; homeland security; Intlligence (haha!); immigration; energy; etc., etc.)

      • unamused says:

        “With respect, I hope to get what I vote for”

        And hope can be such a cruel, cruel thing.

        You vote for what your candidates are likely to do. They’re not interested in your unrealistic wish list.

        • John H. says:

          I’m alternately hopeful, idealistic, and scared out of my wits. Like many throughout history, I suppose.

          “Men hoped vaguely for heaven, but vividly feared hell.
          – Will and Ariel Durant, Age of Faith

    • Jdog says:

      Price gouging is a phenomena created by socialism when supply is curtailed and monopolies are subsidized by government regulations.
      Corporate monopolies are created by socialism, not true capitalism.

      • unamused says:

        Jdog, you managed to squeeze a Straw Man fallacy, a False Conversion fallacy, a Circular Argument Fallacy, a False Cause fallacy, a Positive Conclusion From Negative Premise fallacy, and an abusive Argumentum ad Hominem fallacy into a single tidy paragraph. That’s a new record.

        Minus sixty. Congratulations.

        Don’t piss on my leg and tell me it’s raining. It’s unseemly.

        • Jdog says:

          Sorry if you do not understand economics. Perhaps cooking is more your speed.
          You would not know a fallacy if it smashed you in the mouth.

      • Swamp Creature says:

        Comcast which I have is an example of a Corporate monopoly. A complete crooked dishonest Woke company. If I could get rid of them I would but I have no choice but to use them and pay them for their. services. Same could be said about AT&T and Verizon which I am forced to use for my business and personal use. The future of American is 6 large multinational corporations running everything in the country similar to the PRC. The government will outsource nearly all their functions to these 6 behemiths.

  37. Capitalist says:

    I wonder if Government keeps stimulating the economy by sending checks, forgiving loans, enacting large welfare programs, will Fed be able to control inflation by itself? What will the Fed do in this case?

    • Jdog says:

      The question is what “can” the Fed do. There is a limit to what the Fed can do because of the impact on the Federal budget. To raise interest rates to a point where they would stifle inflation at this point would increase the Federal debt interest payments to a unacceptable level.
      The only realistic way to reduce inflation at this point is to induce a economic recession / depression and rely upon demand destruction to do what the Fed can no longer do.
      In every economic cycle, there is the time when the sheep are sheered. That time appears to be now.

    • unamused says:

      “What will the Fed do in this case?”

      The Fed will get trolls to post comments on finance/economics websites to deflect attention away from the fact that it’s been fueling inflation since the last time they blew up the economy.

  38. Ben Sargent says:

    Crack spreads have skyrocketed because of a global disruption of refined product production.

    Equivalent oil price based on historical crack spreads is 250 usd/bbl so refining margins have increased 3x from historical crack spread.

    No investment in new refining capacity as a result of decking margins. Refineries need upgrades and other capital investments to continue to operate at a profit. No incentive to build new refineries because no one wants a refinery in their back yard.

    In addition the largest east coast refinery had a fire in 2019 and did not rebuild rather took he insurance money and closed.

    I don’t know what the global refinery capacity is but the USA capacity to refine is dropping creating the shortages not because of price gouging or any other artificial means but strike you because of reduced investment and forecasts for California for instance zero ICE in the near future.

    Zero incentive to build new refineries means the exiting ones will profit until they too are shut down. No one operates at a loss. These refineries turn off the switch quickly depending on their capital funding.

    I don’t hear about any private equity buying out the numerous refineries that become available over the years.

    https://www.eia.gov/petroleum/refinerycapacity/table13.pdf

    • Jdog says:

      It is hard to get people to invest in refineries when the government continues to tell everyone that they are going to eliminate what the refineries produce.
      The world is being pushed into economic collapse by adopting energy policies that will drive the cost of energy to levels that will drastically reduce productivity. But then, that has been the plan all along.

  39. Swamp Creature says:

    Just filled up my tank and my local Liberty Station. It was half full and I topped it off. Cost $32. Price $4.99/Gallon. No problem for me since the only place I got for entertainment is a watering hole (Irish Pub) a few miles from me. A dude was on CNBC this morning and said gas was heading much higher from here, and people will pay for it because they have to have the gas to get to work and earn a living. I see the administration panicking very soon and imposing price controls on gasoline at the retail level. Look forward to gas lines worse than the Jimmy Carter era.

  40. Lj hoke says:

    Well…it seems if people were smart (not so much) they might buy fuel efficient vehicles, and the wealthier would buy electric cars.

  41. Swamp Creature says:

    I predict price controls on retail gasoline and manditory allocations are already being formulated by this brain dead administration. The Red states will get shortchanged and the Blue states will get all the gas they need. Look forward to gas lines and an average $8/gallon for regular gasoline nationwide with some states/cities over $10/gallon. You can take this prediction and put it in the bank.

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