WHITE PLAINS CITIZENETREPORTER SETS RECORD VISITS FOR YEAR 7,017,658 VISITS! 2,098,003 VISITORS MADE 6 VISITS A DAY EVERY DAY. 63,330 UNIQUE VISITORS MADE 133,730 VISITS IN DECEMBER. WPCNR AVERAGED 17,284 VISITORS A WEEK, VISITING 31,270 TIMES.

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WPCNR Quill & Eyeshade.  By John F. Bailey. June 19, 2008 UPDATED WITH RETAIL CHART 12:15 P.M. EDT:  White Plains residents who heat with oil should plan now to handle a startling 50% increase in the cost of local fuel oil.

 

White Plains residents who heat their homes with oil got “a bit of bad news” this week. About this time of year, homeowners who purchase home heating oil on a monthly budget plan get their new contract from their fuel oil dealer.  They are in for a shock. Heating oil for next year will cost you more than a gallon of gas. The bill above provides No. 2 Fuel Oil for the “bargain” of $906 a month for 10 months, $9,060 a Year.

Feed Me, Seymour:

Homeowners will be burning 50% more money in their oil burners this year.

 

The cost of a gallon of heating oil has  jumped 50%  to $4.70 a gallon (more than the $4.40 for a gallon of regular gasoline) . The sharp increase is due to the runup in crude oil prices, and the export of oil distillate (from which heating oil and diesel fuel is made) from U.S. refineries to foreign markets, according to the U.S. Government Energy Information Agency..

The price of No. 2 Fuel Oil quadruples in 4 years.

Four years ago, a typical monthly contract for fuel oil was $210 a month in 2005-2006. It rose to $400 in 2006-2007; it rose 50% this year to $600 to this week’s shocker, $906 a month for 2008-2009.

 There is no relief seen because the worldwide demand for oil continues to soar. Even, says one economist, U.S. conservation of oil will not make a difference because world demand for oil will suck up whatever the U.S. does not use. If the state and county and city authorities are not looking at this. They should consider its possible impacts on the homeowner and apartment dweller.

 

$1500 a Tank.

If you fill up a 340 gallon oil tank it will cost you about  $1,600 today. If crude oil continues its upward track homeowners not on contract can face one-time fill ups of $1,600 and up.

 On a typical budget plan you will pay $906 a month for heating oil over the next 10 months. Heaven help you if the price of heating oil hits $5 a gallon and up in the next 10 months (where diesel fuel is already). You will have to pay the difference (more) next June to settle up.

 A typical median home  in White Plains reports their fuel bill is up from $600 a month one year ago from their provider. If you’re running a mortgage of $2,400  a month,  and just making ends meet, you have a big problem. You have to come up with an extra $300 a month (a total of $900 a month)  to heat your home next winter, while paying the gasoline price to drive to work whatever the gas may reach. 

Just a reminder: this latest horror from the oil world makes the estimate of White Plains School District utilities going up 3.82%  look way low now.

Refineries Export 80% More Heating Oil, Diesel Than last Year.

The heating oil increase predominantly affects the Northeast region. Eight million U.S. .households use heating oil and 78% of them are in the Northeast. As of January, heating oil was priced at $4.30 a gallon, now it has reached $4.70  a gallon.

This  runup  is due in part to the increase in crude oil prices, but mostly  because, according to This Week In Petroleum, (published by the Energy Information Administration), “world distillate markets have been tight, and U.S. distillate prices (distillate is the crude oil derivative from which heating oils and diesel fuel are refined),  have been drawing distillate from the United States. First Quarter exports in 2008 averaged 365,000 barrels per day, the highest first quarter exports ever. Last year, first quarter exports of distillate from U.S. refineries were 203,000 barrels a day. (WPCNR notes this is an 80% increase in distillate export.)

  TWIP reports refineries make more profit on diesel and heating oil (the distillate products) than they do on gasoline —  5 cents profit a gallon  for gasoline between spot and wholesale compared to a juicy 70 cents a gallon between spot and wholesale on distillates. (Access the latest price information and the TWIP newsletter at http://tonto.eia.doe.gov/oog/info/gdu/gasdiesel.asp)

U.S. Refineries Go Where the Profit Is — Overseas

This has caused a shift in the second quarter  of 2008 by U.S. refineries to double the production of distillates (heating oil and diesel) in this second quarter of 08 over the first quarter. TWIP reports “refiners appear to have reduced crude (oil) inputs and adjusted their product slate to favor distillate production relative to gasoline.”

TWIP writes “adding volumes (of distillates) could reduce the U.S. spread (between spot and wholesale prices) somewhat. Still, even with lower distillate (price) spreads, distillate prices (of diesel and home heating oil)  would remain high, pushed up by crude oil price.”

Crude Oil Drives the Market.

Crude Oil, peaking at $140 a barrel (42 gallons), (percolating at $136 a barrel Thursday morning) last week has been described as the villain. WPCNR asked Dr. Lutz Kilian, Associate Professor of Economics at the University of Michigan about this relationship. Professor Kilian has published numerous studies on oil price fluctuations over the years, which may be located at www.econ.lsa.umich.edu/econ/detail/0,2,4849760%255Fpeople%255F88738703,00 .

WPCNR asked why India and China are reportedly contributing to the run-up in gasoline prices. Dr. Killian said,  “Emerging economies such as India and China have contributed to high crude oil prices (and other industrial commodity prices) in recent years, as their economies grew at a record pace. Those high crude prices are one factor driving high gas prices in the U.S., although U.S. refinery shortages certainly  have contributed as well.”

Asked if he felt the India-China demand was excessive compared to the U.S. market, he said, “I would not call that Asian demand excessive any more than I would call U.S. demand excessive.”

I asked him if price controls could be designed in such a way that they would work to the consumer advantage. Dr. Kilian demurred, saying, “You are mixing oil price controls and gas price controls. Oil price controls were put in place only for oil produced in the U.S. domestically. Gasoline price controls mainly created lines at U.S. gas stations.

“The problem with setting a price ceiling is that there is not enough gas for all customers interested in buying at that price. Hence,  those who come late will have to wait in line. The same principle was responsible for the bread lines in the Soviet Union. Instead of being productive citizens, people spend a good chunk of their lives waiting in line. We know that this experiment failed miserably. Economists do not believe in the efficacy of price controls. I am no exception.”

The professor placed no faith in any artificial control of gas prices: “Historically, price controls have not worked. They always have had unintended consequences and they always have been costly. You are asking how to fix the unfixable.”

I asked if we had not regressed back to a situation approximating the Rockefeller Standard Oil Trust in the late nineteenth century when a centrally controlled string of oil companies and their suppliers manipulated rates to maintain prices artificially high.

Professor Kilian noted, “What’s the evidence of such manipulation of crude oil prices? Why would U.S. oil companies want to cooperate with foreign oil suppliers to raise crude oil prices? What’s in it for them?

“Oil is traded in spot markets. Nobody is fixing prices in these markets. What is the evidence that the price is artificially high? Why do you think this is not the right price to reflect the current scarcity of oil?

Nor is there evidence that quantities are being fixed. Has the supply of crude oil fallen? No.  The only thing that has changed is that more customers want to buy oil.”

Crude’s Role in Driving $4.40 a Gallon Gas and $4.70 a Gallon Heating Oil.

In a gallon of regular gasoline in April, 2008,  the price of crude oil made up 73% of it, Refining, 10%, Distribution & Marketing 6% and Taxes (State and Federal), 11%

Let’s apply it to the $4.36 per gallon cost WPNCR’s Mobile Unit paid for regular this week. The following figures are approximate:

$3.18  of the $4.36 was the cost for Crude Oil

48 cents for Taxes (State & Federal) New York State charges 41.4 cents excise tax per gallon.

44 cents for Refining

26 cents for Distribution & Marketing & Profits.

 

The profit per gallon out of that 26 cents is difficult to pin down.

A Barrel of Crude and where it goes

Oil companies extract  21.5 gallons of gasoline and 6.4 gallons of distillate from each 42 gallon barrel of crude oil, plus various other products. The list  of products below and the percentage they make up of the 42 gallons is from the California Energy Commission. A total of 48.43 gallons of products are made from each 42 gallon barrel of crude oil.

 

So at the cost of $134 a barrel of crude oil bought by an oil company today the cost per gallon of gasoline and distillate is $2.77.  ($134 divided by 48.43 gallons) Source: California Energy Commission

 

Crude Oil accounts for 60% of the price of heating oil, Refining, 16% and Marketing & Distribution & Profits, 24%.

Let’s again see how that breaks down on the $4.70 price per gallon paid by the typical median homeowner for heating oil this week.

Crude Oil — $2.82

Marketing & Distribution (Profits)– $1.12

Refining —  0.75

Total: $4.69

Statistics from Energy Information Administration.

Crude oil cost Drives Cost of Everything.

The price of crude drives the cost of all other goods. Consumers who heat in White Plains should think carefully about how to manage their heating this fall. If they are not on a budget plan, they should investigate its possibilities or look at one time payments of $1500 and up for each home fuel tank fill up. Rents on apartments may have to go up.  Con Edison has the right to run up their cost per kilowatt hour based on the costs of energy.

The lower chart shows as the cost of crude oil went up the last two years, retail stocks went down. Top Chart shows as the price of crude oil rose (blue line) gas prices fluctuated up in the last quarter of 2007. Bottom chart shows that as crude oil rose (bottom dark line, retail stocks plunged. (Reuters)

More directly the cost of gasoline prices inversely affects retail sales. The higher gas goes, the more retail sales are affected.

 

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WPCNR REAL ESTATE NEWS. From City of White Plains Department of Planning. June 16, 2008: In another proactive effort to aid White Plains homeowners and persons interested in the White Plains market, the City of White Plains and Westchester Residential Oppportunities will sponsor a free workshop at White Plains High School June 24, from 7 PM to 8:30 PM to discuss critical issues in White Plains housing today. Interested persons will learn about what to do and how to handle the issues in today’s White Plains: 

First Time Home Buyer?

       

Accessibility in your Home

       

Questions about Mortgage Default/Foreclosure?                                                                                                  

                                  

For more information call:

(914) 428 – 4507

   (914) 835 -1512

 

Westchester Residential Opportunities Inc.

and

The City of White Plains

 

Invite you to attend a Free Workshop:

 

Date:  Tuesday, June 24, 2008

 

Location:   White Plains High School

 

Time:  7:00 PM – 8:30 PM

 

 

En Espanol:

 

 

¿Compradores por primera vez?

 

Acesibilidad en su casa

 

Preguntas acerca de incumplimiento de Hipoteca/Juicio hipotecario

 

Para mas informacion llame al (914) 428 – 4507

 

 

Westchester Residential Opportunities, Inc.

y

La Ciudad de White Plains

 

 

Les invita a asistir a un taller gratis

 

Dia: Martes, 24 de Junio, 2008

 

Lugar: White Plains High School

 

Hora: 7:00pm – 8:30pm

 

 

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WPCNR WEST SIDE STORY. June 16, 2008: City Hall reported Friday that the White Plains Kensington LLC senior assisted living complex planned for Maple Avenue adjacent to the White Plains Hospital Center Dickstein Cancer complex is expected to break ground July 2, “as soon as the parking garage is completed,” according to city hall spokesperson Melissa Lopez. The parking garage is shown rising below. the assisted living complex is expected to be built in front of the garage.

White Plains Kensington LLC parking garage, approximately 700 spaces, which will be shared by White Plains  Hospital Medical Center nears completion on Maple Avenue.

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WPCNR Homeland Security News. June 13, 2008: The unfolding flood disaster in the Middle West is being responded to more quickly by the federal government. Here is an update of Federal Emergency Management Agency efforts now underway, taken from the Department of Homeland Security website:

Federal Response To Midwest Storms

WASHINGTON, D.C. — The Department of Homeland Security’s (DHS) Federal Emergency Management Agency (FEMA) continues to support the states impacted by tornados and floods.

In each case, state and local resources are addressing the most immediate needs as federal resources support their efforts. FEMA is coordinating activities in Indiana, Wisconsin, Illinois, Minnesota, Iowa, and Kansas.

FEMA Administrator David Paulison noted these activities are an example of the New FEMA’s commitment to “Engaged Partnerships” between federal, state and local governments, volunteer organizations and the private sector. “I have reached out to governors and local leaders to make sure we are responding to them quickly and efficiently. I am personally visiting some of the affected areas to make sure they are getting the support they need,” said Paulison. Paulison was in Iowa this morning with Governor Culver, Office of Management and Budget Director Jim Nussle, Acting Small Business Administrator Jovita Carranza and members of the Iowa Congressional delegation. Paulison also will travel to Indiana and Wisconsin.

To date, federal representatives from the affected regions and across the nation have responded to deliver immediate aid and coordination efforts under the combined federal response led by FEMA. The American Red Cross is also deploying disaster assessment teams to flooded areas.

Specifically, efforts undertaken include:

In Iowa, FEMA and partners are providing for more than 4,000 evacuees in the Cedar Rapids area. The American Red Cross (ARC) opened 10 shelters which served 461 residents last night. More than 6,000 meals have been served, with more than 115,000 meals on-hand. FEMA has provided six truckloads of water, has 20 truckloads on-hand and an additional 10 en route to affected areas. Altogether, more than 738,000 liters will be delivered. Three trucks of meals (MREs) are also on the way to supplement current supplies. Through contracts with the Defense Logistics Agency (DLA) and U.S. Army Corps of Engineers (USACE), FEMA can provide additional water and meals as necessary. FEMA has 20 teams standing by to conduct Preliminary Damage Assessments (PDAs). FEMA is coordinating the efforts of a housing assistance task force to review emergency housing needs and available housing alternatives.

In Indiana, FEMA continues to coordinate the federal response to earlier flooding. The federal disaster declaration for Indiana has been amended to extend the incident period for damages to May 30 and expanded to include assistance for individuals and households in additional affected communities. The first Mobile Disaster Recovery Center opened this morning and residents are encouraged to register for assistance. FEMA is delivering over 100,000 liters of water to support the towns of Linton and Vincennes. Three USACE flood fighting teams are actively engaged in assessing levee/dam conditions. The ARC also continues to provide shelter, meals and snacks to the displaced populations in the state.

In Wisconsin, PDA’s are already underway. The state is also under a flood watch and additional flooding is possible. National Guard engineers continue to provide engineering expertise to other officials through aerial and ground assessments. The Guard completed delivery of 20,000 sandbags to Dodge County, and delivered 10,000 sandbags to Mukwonago.

In Kansas, Rapid Needs Assessments are underway or completed in communities hit by tornadoes in recent days. Most response activities are being conducted at the local and state level, though federal resources have been prepositioned to meet any request for assistance.

In Illinois, planning is being conducted in anticipation of flooding that may occur along the Mississippi River as waters from states already impacted flow through the state.

In Minnesota, PDA’s are underway in conjunction with state and local authorities following earlier flooding.

Federal agencies have responded in a coordinated fashion:

• The U.S. Army Corps of Engineers is working with state and local authorities to coordinate flood-fighting activities in Iowa, Indiana, Illinois, Wisconsin, as well as Kansas, and Minnesota. A total of 1,816,700 sandbags and 82 pumps have been issued to support state requests for assistance. Currently, there are 151 employees are directly involved with flood fight efforts. The Corps is providing technical assistance for dam inspections, debris, and housing. In addition, the Corps is working with local and state officials in Iowa to provide temporary power to critical public facilities and to plan for commodity ordering, delivery and distribution. The Corps is monitoring river conditions in the affected area. Currently, seven locks and dams along the Upper Mississippi River have closed or will close in the near future, severely affecting navigation. With many rivers not expected to crest until tomorrow or later, the Corps anticipates more levee and dam over toppings and breaches.
  
• The Department of Defense’s U.S. Northern Command has deployed a Defense Coordinating Officer and a Defense Coordinating Element to assess the impact of the flood conditions and to identify assets that could be used in mitigating the effects of that flooding. The Department of Defense anticipates additional support based on current and future weather predications, and is standing by to assist in local and state response efforts.
  
• The American Red Cross is sheltering and feeding those impacted by the recent severe weather. The ARC has deployed 58 emergency response vehicles to support these activities. Through the “Safe and Well” Web site, accessible through RedCross.org, the Red Cross provides an easy way to assist people in locating loved ones who evacuate their homes or communities.
  
• The U.S. Department of Transportation is surveying the interstate highways, bridges and other roads impacted by the storms. Five rail bridges have been identified as being damaged and one airport closed in Wisconsin due to flooding. A section of interstate highway between Chicago and Minneapolis/St. Paul is currently closed. Rail service may also be affected.
  
• The National Oceanic and Atmospheric Administration (NOAA) is providing forecast information and reviews and comparisons involving previous storms. NOAA aircraft, satellites and survey vessels on the great lakes are also supporting these activities. NOAA has personnel on the ground in key state locations to provide immediate forecast information and to support local actions.
  
• The U.S. Department of Health and Human Services has deployed seven Regional Emergency Coordinators to support initial and ongoing health needs assessments. The National Disaster Medical System Office has pre-identified teams that are on stand-by to deploy if the states request assistance. The Centers for Disease Control and Prevention (CDC) has provided approximately 10,000 does of tetanus vaccine to the Indiana. The CDC’s Emergency Communication System has reached out to senior public affairs and communication specialists in affected areas to provide a list of key public health information and messages related to floods and power outages.
  
• The U.S. Geological Survey is using equipment to monitor flood levels. Of note, they are installing streamgages in the Cedar Rapids area in order to track water levels along the river.
  
• The Nuclear Regulatory Commission has sent staff to the Duane Arnold nuclear power plant in Iowa and to the Kansas State University research reactor to ensure both facilities respond properly to the effects of recent storms and flooding.
  
• The U.S. Department of Agriculture has issued a consumer alert to the affected region on keeping food safe during an emergency and issued a notice to field offices yesterday extending crop reporting dates and other extensions due in part to the Midwest flooding.
  
• The U.S. Environmental Protection Agency (EPA) is staging resources and personnel and making full preparations for cleanup when the flooding abates. EPA will then work with its federal, state and local partners to ensure household and hazardous waste cleanup and assessment of possible impacts on drinking water and sewage treatment facilities.
  
• The Federal Bureau of Investigation (FBI) is assisting state and local agencies in the performance of law enforcement functions within the affected areas. The FBI is also coordinating with the command post set up by the state and local agencies in terms of where they need assistance.

FEMA coordinates the federal government’s role in preparing for, preventing, mitigating the effects of, responding to, and recovering from all domestic disasters, whether natural or man-made, including acts of terror.