Warbird Information Exchange

I think the end for flying warbirds is soon. Sorry but its gonna be sooner or later. I think a few nails in the coffin are already being hammered. A freeze on grants can not help any museum. Also our state Governor is planning to get rid of our Department of Transportation. Which means my mom will lose her job and she is already planning on moving to Oklahoma. I will not go and stay in Pa. But it will be tough not seeing her anymore. I have somewhat lost a little interest in flying as of late and got bit by an old passion of mine: farming and tractors.

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Shop the Airplane Bunker At
www.warbirdbunker.com

No, the sky isn't falling, but then maybe you like getting ripped off. I don't!

Bela P. Havasreti

Yes, I had the opportunity to buy subsidized fuel on base at close-to-US prices.

My point wasn't about what *I* was paying living in the UK...it was about what all of the other residents in the UK were paying. Prices on the continent were even more.

But the point was that in the US we have no perspective about what the "rest of the world" pays. As someone who HAS seen what is being paid in Europe and elsewhere for a LONG time, reading complaints like I see in this thread makes me laugh about how ignorant we are and how petty our complaints seem in the greater context of world economics.

Seriously...in 2009 when I left the UK, they were paying in excess of $9.00 per US gallon of "regular unleaded" for cars (that was a converted price based on the $ to £ exchange rate and the liter-to-US gallon volumetric conversion).

We have nothing of significance to complain about in comparison.

In addition, while I agree that it's angering to have the price of a vital commodity increase because of what we consumers perceive as non-important factors, that's not the same as being "ripped off". We don't live in a communist society where the collective has a right to products (and thus would have some sort of "fair cost controlled" fuel available). Instead, we are blessed to live in Capitalism, where the market sets the price.

Since people are still buying petrol at basically the same rate, then the price is "right" according to supply-and-demand. Once people ditch their cars for bus passes or bikes, then the price has really hit the point where it's too high.

Just wait until our kids are having the same debate about the cost about the most precious of fluids, water, in a half century.

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Well then I gotta ask: If the cost per barrel is the same here and there, WHY is the final cost so different? Asbestos underwear ON!

Carry on!
Mark

At the risk of sounding insensitive to others around the world (and with apologies), I could care less about
how others have allowed their governments to tax the bejesus out of inelastic commodities like oil, fuel or
energy. You call it ignorant and petty, I say it's calling BS where BS needs to be called! Both my parents
were born in the "old world", I've been there and English is a 2nd language for me (I think I have an
admittedly basic understanding of world economics, who calls the shots, how and why).

So yes, we aren't as bad off in the US as others are around the world, but that doesn't make what's currently
going on right...

In any event, I only *wish* the market would really set the price... In fact, demand is down, and inventories are
at record highs. Basic capitalistic supply vs demand fundementals would have the price going down. All the big oil
producing countries have repeatedly said there is no problem with supply. I'll say it one more time. True supply
& demand-based trading only makes up about 1% of the crude oil contracts traded on Wall Street and via ICE.
The rest is pure speculation by global banks and hedge funds who have no intention of taking delivery of even
one drop of oil. In my humble opinion, *that's* what needs to be fixed, period (and why I posted the link to the
CFTC comment web page). At least we still get to comment on future policy in this country (not that it appears to
do any good!).

I do feel for the youngsters of this world... (what will their lives be like?).

Bela P. Havasreti

Note: "The rest", as you describe it, also happens to be part and parcel of "the market". "Supply and demand" is an overly simplistic way of describing some of the prime movers in capitalist economics, but it is far from a comprehensive description...no more than "suck, squeeze, bang, blow" is an accurate technical description of how a jet engine produces thrust.

As annoying as it is to have speculative traders "artificially" driving up the price of an important commodity, that's how ALL market trading works. There's actually nothing artificial about it. It is neither new, nor unique to petroleum. Most people with other investments like stocks, mutual funds, etc, can also thank at least some of their share price increases to the same behavior applied to every possible venture that can be valued, purchased, traded or sold. Not all share value increases simply due to increased worth of the commodity owned -- some of it just has to do with how "bad" someone else wants it. We're perfectly happy to sell our shares at a gain and not question how the share value got there...

Again, I'll note that behaviors among consumers of petrol products haven't significantly changed yet, meaning that the market price that we're seeing is still fair. All of us are welcome to go buy land, get permits, drill, refine, and consume petrol ourselves if we believe we can bring it to market cheaper.

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Because you don't burn crude oil in your car.

The costs of refinement, transportation, regulation, and distribution differ significantly, just like the other costs of living in different economies.

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I don't think those costs would fill in a 200% difference in the final price, unless wages in the EU are VERY high? My bet is that it's the fees and taxes:

http://en.wikipedia.org/wiki/Fuel_tax (accuracy is highly debatable!)

Kind of difficult to determine exactly what they are saying, but the article mentions that UK taxes are 175% of the cost of the gasoline, or about $5.25 on top of a $3/gal cost of the gasoline, giving a final price of $8.25, where current US taxes are ~46cents/gal or 12 cents/L. Using a final cost of $3.50/gal the US tax rate seems to be about 1/7 or 14%.

The figures mentioned in my equations simply make the math easier - tho local fuel is about $3.50 today (central Texas). But, knowing WHY the fuel cost is so high in the UK does make understanding (why the folks threw all that tea in Boston Harbor way back when) very easy.

I checked into getting a 8000 gal 100LL tanker here on my property for my own use - the final price turned out to be about the same as it was at the local airport once taxes and delivery charges were levied, or about $3.25 at that time. The tanker itself (purchased) would have added another buck/gallon to the cost - hindsight says it would have been a good deal, DANG IT!

Yep, I've got plenty of hindsight....

Carry on!
Mark

Going back to the original post, I think the $8.16 a gallon is a little misleading. That fuel price is at Baltimore Washington International. I coordinate a nationwide tour of several WWII heavy bombers, and I see elevated fuel prices at major airports all of the time. Most of the time it is because the FBO does not want to deal with 100LL burning aircraft, so they will jack the price way up to discourage 100LL aircraft from coming in. There are plenty of airports right in the area (within 20-25 miles) that are more inline with what I am seeing as a nationwide average of about $5-5.25 a gallon. I am not sure there are too many piston aircraft that I would want to fly into BWI to begin with. If they are dealing with really low volumes of 100LL, they may also pay a premium price for their shipments. I would also guess that their "cost" for that gallon of fuel is probably below $4 a gallon.

I arranged the purchase of over 120,000 gallons of 100LL last year. I can tell you that the purchase price of fuel can vary by as much as 20% from one airport to the next airport that is 10-15 miles down the road. For the price conscious pilot, getting a reasonable price on fuel may take some planning, but it can still be done in this economy. I was able to get some the other day for $3.89 a gallon.

Ah, but it is sort of new to petroleum. Global banks successfully lobbied to get the rules changed a
decade or so ago. These banks are saying the "market is perfect / working" because they're making
a boat-load of money off of the deal! I (and a lot of other folks) are saying the rules need to be
changed back to the way they were. Some comments from a 25 year energy trading veteran:

http://www.heatingoil.com/blog/%E2%80%9Cwe%E2%80%99re-all-leveraged-by-the-price-of-crude%E2%80%9D-an-insider-explains-how-the-financial-industry-is-driving-up-gas-and-heating-oil-prices0310/

I agree that perhaps we're not quite to the "demand destruction" level yet, but the 2008 spike certainly
got there. FWIW, I'm in the process of coalating the public comments on position limits from the CFTC
web site. FWIW, my analysis to-date shows an overwhelming percentage of the commenters are saying "Change
the rules back to the way they were"....

Again, people outside of the US have been over bigger hurdles than the current US gasoline price. The US warbird scene itself has been over bigger hurdles too. There's a real question over fuel availability for old internal combustion engines - but it's down the track, and isn't a price issue. Certainly the players may be thinned out by price increases; but it is by definition an area where you've got to have an excess to needs of cash and time to play - it is not an essential.

I'm sorry to hear about your mother. But, with respect, my parents are not only not in the same country, but literally the other side of the globe, while my wife's are in a third, equally distant location. We aren't complaining because we've arranged things that way (how we wanted) and we get on with making what's important to us happen. We'll be in Canada to see her folks in a couple of months, and I'll be taking in a couple of airshows either side in two other countries. I'm not particularly lucky, certainly not rich or privileged, we just decided to be the ones buffeting fate, not the other way around.

Maybe tractors will be where it's at for you Nathan; good luck. But let's remember our choices are just that, not fate. If you really admire your 'greatest generation' adopt their attitude and get on with making things work.

Regards,

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James K

"Switch on the underwater landing lights"
Emilio Largo, Thunderball.

www.VintageAeroWriter.com

time to move to Ca. bro

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"WHAT ME WORRY?"

G'Day Bela,
What Randy's said. I'm not the one crying because the easy ride's a little harder - and still easier than everyone else's in the playgroup.

Of course I don't like getting ripped off. However if I am, it's by capitalists in a capitalist system, the one that's always favoured US gas prices. I'm not bitching about it. Claiming there's some 'better' more pure system (which, of course favours your preferred outcome) is amusing, but irrelevant, unless you can make it work. Good luck. Gas producers have the whiphand; that's capitalist, and the way it is.

If you spent less time disparaging other's experience, you'd could learn something from the example they provide. One fact is that it's evident that fuel prices are simply not as important as people want to believe. Every price hike in the UK foretells the collapse of the UK economy. The economy doesn't collapse (certainly there may be a contraction, but never as major as is expected). More relevantly, from our point of view, the warbird scene in the UK remains stable through whatever fuel price there is, the price of fuel, like the purchase price of a major warbird being high, but not a barrier to the real operators. The factors affecting the number of operators are diverse, but no-one would claim fuel price is the hardest entry-to-play issue.

Like it or not, other civilised societies use less gasoline more smartly to do the same as the average US consumer. In fact, few are as profligate. That's a factor of cheap prices, and is the reverse product of your remark about prices elsewhere. (If I'd lived in the US I'd have budgeted the US way, of course.) However it isn't the only way to budget. We can argue till we are blue in the face about what the price 'should' be and how we 'should' afford it. The latter is absolutely in your control, the former less so, but ignoring them because it used to be better is just completely pointless. Sure, try to bring back the way things were, but also modify behaviour in line with how they are. No one (outside the US) has got any sympathy with bitching about it.

What I like about America and Americans is their focus on a 'can do' attitude and ability to change. No one (outside the US) likes the winging - or has any sympathy. If you can bring gas prices down, good luck to you. Sincerely. (I've lived in two oil producing nations, and never seen petroleum prices as a voting ticket item, by the way. Funny that.) If you can't, I'm sure there'll be changes. You can make 'em or take them, but they'll happen. And they aren't the end of warbirds or the economy.

Regards,

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James K

"Switch on the underwater landing lights"
Emilio Largo, Thunderball.

www.VintageAeroWriter.com

does anybody remember a friendly company named Enron.?

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"WHAT ME WORRY?"

Thank you. Look, this isn't about whining or bitching, it's about calling an Enron an
Enron when you see one! Sure big oil and global banks have the upper hand.
I suppose I'm wasting my time posting here saying "Look, it's another Enron".

We go to the voting booth and (hopefully) cast our votes based upon our
principles / convictions. When elected government represenatives cease
to represent us (in favour of the aforementioned "upper-hand" entities),
we use whatever process we can to attempt to effect change. That's it.

So I could stick my head in the sand and hope it just fixes itself, or I write
to my elected representatives (which I do frequently), call a spade a spade
when I see one and throw my 2 cents in when someone says the system is
fine and it doesn't need fixing.

I've said my piece and realize I won't be changing any minds here....

Bye!