Toyota to cut domestic output as Prius loses North American mojo

Gas prices below $2 a gallon in Texas, Oklahoma - Yahoo News

 

I have no sympathy for the Saudi or Venezuelan governments, the two main opec exporters to the US. They have done little to diversify there economies from oil.

The Saudi's are using oil as a weapon, but primarily against US adversaries - Russia and Iran. The thing we have to remember is Saudi Arabia is not our friend. By pushing the price under $75/gallon they seek to increase US demand, and reduce US supply, so they later can charge much more.

Most of the oil from bakken and eagleford should be coming out at less than $50/bbl, so even at today's prices they are highly profitable. What may happen though is the value of these oil developments drop a great deal, which may mean much slower development. This favors the majors like exxon and chevron which may be able to buy oil leases more cheaply from the minor explorers, as they can profitably wait decades to make money on the finds. These finds looked like they might be tappped out in 30 years, but producing them more slowly might not be bad for america. The big danger is if oil demand increases because of the lower prices.

Lower opec prices today do allow for a number of things. Other states can slow production and adopt texas's rules for flaring natural gas, where the natural gas is used instead of simply burned off to allow for faster production of oil. A federal oil tax can be implemented to further decouple from opec. We can wait for battery tech prices to come down and ignore an expensive hydrogen boon doggle. We can approve an open standard allowing natural gas to be burned in the auto fleet as methanol.

 

On the plus side, lower gas prices (seemingly) made it pretty easy to negotiate the price for my Prius a couple of weeks ago.

 

Just curious how much are they discounting them?

 

I was able to get my 2015 Prius Two at (from what I understand) invoice. So, $23K for the one I bought which had a $25,700 sticker price (it has a few distributor added options).