Electric car hubbub-What you need to know

While everyone seems to be lauding the advent of the electric car (the bid for the first Chevy Volt is reportedly up to $180,000), the cost of the electric car is being underrated. Before you start adding up the numbers at the tank, don’t forget about the cost of charging the battery of your electric car.

Electric car operating costs are translated into an mpg equivalent, or MPGe, using individual states’ electricity costs as calculated by the U.S. Department of Energy. Electric cars’ upstream carbon dioxide emissions are also calculated using DOE data on the electricity source for each state.

According to BeFrugal.com, Washington, Idaho, Kentucky, West Virginia and Arkansas are the states with the lowest electricity rates, making electric cars most economical on a cost-per-mile basis. Vermont, Idaho, Washington, Oregon and New Hampshire are the best states in terms of electric cars’ lowest upstream CO2 emissions per kilowatt-hour.

According to a recent survey by Kelley Blue Book, only 7 percent of shoppers said they are likely to buy or lease an electric vehicle for their next new vehicle purchase.

More than 80 percent of survey respondents said they were concerned about electric vehicles’ range on a single charge and the availability of charging stations.

Kelley Blue Book found that 91 percent of car shoppers think electric vehicles are expensive and 43 percent think electric vehicles won’t retain their value as well as regular gas vehicles.

One problem is being addressed. Cracker Barrel announced they will be on the forefront of building electric vehicle charging infrastructure across the country.

The plan is to install chargers at 24 of their Tennessee stores, including locations at Cookeville, Lebanon, Manchester, Murfreesboro, and in Nashville at Stewart’s Ferry Pike. A dozen of them will have the so-called fast chargers which provide an 80-percent charge in 30 minutes.

On the West Hargett Street sidewalk, next to parking spaces 101 and 102, are two reassuring signs that Raleigh will be ready for a new wave of mass-market cars that can run without a drop of petroleum.

Two electric-car charging stations were installed there last week, in front of the Raleigh Municipal Building. And, who pays for that charging station? Why, the tax payers, of course.

Recall of the Week: Ferrari

Giving the phrase “these cars are hot” a whole new meaning, Ferrari is recalling its new 458 Italia model after several vehicles were reported to have burst into flames.

The luxury supercar is being recalled in order to make modifications to the wheelhouse assembly.

Which begs the question: “Did your car just spontaneously burst into flame?”

“Why, yes, it did.”

“Rough day.”

“Yep.”

“In rare instances the heat shield could become deformed, bringing it too close to the exhaust system and igniting,” a Ferrari spokesperson said.

Ferrari is recalling all its 458 Italia vehicles after five fires were reported in California, Switzerland, China and France.

Deliveries of the car in the U.S. began this summer. It has a 4.5-liter 8-cylinder engine, 7-speed automatic transmission, 570 horsepower and has a base price around $230,000.

Ferrari said the company is asking owners of the cars produced before July 2010 to bring them in to have the glue replaced with mechanical fasteners.

The National Highway Traffic Safety Administration released a statement saying Ferrari’s Italian headquarters had told its North American division about the recall. NHTSA warned that if the adhesive ignites it could “render the vehicle inoperable and possibly result in a crash.”

The NHTSA statement said 303 vehicles are being recalled, and owners could be eligible for reimbursement for if they spent money on repairs related to the problem before the recall was announced.

I’m sure all of those car owners read this blog.

Oil dips as jobless claims soar

Oil dipped toward $75 per barrel on Thursday, paring earlier gains, after a surprise rise in U.S. unemployment claims to a nine-month high was balanced by an upgrading of Germany’s growth forecast by its central bank.

The U.S. jobless figures heightened concerns about the pace of recovery in the U.S., the world’s largest economy. Initial claims for state unemployment benefits increased 12,000 to a seasonally adjusted 500,000 in the week ended August 14, the highest since mid-November, the Labor Department said on Thursday.

Analysts polled by Reuters had forecast claims slipping to 476,000 from the previously reported 484,000 the prior week, which was revised up to 488,000 in Thursday’s report.

A Labor Department official said there was nothing unusual in the state level data. The data covered the survey week for the government’s closely watched employment report for August, scheduled for release early next month.

U.S. September crude was down 6 cents to $75.36 a barrel. ICE front-month Brent fell 23 cents to $76.24.

However, oil found some support from a rally in equity markets in Asia and Europe. European shares rose after Germany’s central bank upgraded its forecast for this year’s economic growth.

Analysts downplayed the effect on oil prices of deepening tensions between Iran and the United States. Ayatollah Ali Khamenei, the country’s supreme leader, said on Wednesday that Iran would not talk with the U.S. in the current climate.

Oil prices at $76

(Reuters) – Oil hovered near $76 a barrel on Thursday after a three-day price slide as robust euro zone growth data were largely eclipsed by lacklustre macroeconomic data that reinforced doubts on the global fuel demand outlook.

Early in the session, prices rallied after news that euro zone gross domestic product (GDP) grew at its fastest pace in more than three years in the second quarter, boosted by strong performances in Germany and France.

But mixed macroeconomic data out of top oil consumer the United States later doused positive sentiment.

By 10:52 a.m. EDT, U.S. crude prices for September were down 15 cents at $75.59 a barrel after rising more than $1.

ICE Brent crude was down 26 cents at $75.26.

“The whole week has been about poor economic data and today’s releases show that the U.S. consumer is still on the mend,” said Harry Tchilinguirian, commodity strategist at BNP Paribas.

“Retail sales disappointed and if consumer confidence in August managed to come in a notch above expectations…it still remains below the June reading.”

U.S. retail sales rebounded in July but showed hints of lingering economic softness while consumer sentiment appeared to have stabilized in August following a sharp drop the previous month.

But earlier strong European data on Friday has helped set a floor beneath prices at least temporarily, analysts said.

The Organization of the Petroleum Exporting Countries said demand for oil would continue to grow slowly in 2011, when world economic expansion is projected to be slightly lower than this year’s, leaving the current supply overhang intact.

STILL CAUTIOUS

Front-month crude was on course for a nearly 6 percent fall for the week, and analysts expected it to stay below the $80 a barrel benchmark.

Oil prices were in a $70-$80 a barrel range, where they have mostly traded since June, barring a brief foray above $80 in August.

“The market is very much in ’08 mode when it was doubting aspects of the recovery. There is an element of suspicion about whether it’s sustainable,” said Barclays Capital oil analyst Amrita Sen.

In the previous session, the number of people filing new jobless claims in the United States unexpectedly rose to its highest level in close to six months, a fresh signal of sluggish economic recovery.

Stocks of oil products in the U.S. including gasoline rose last week even at the height of the summer driving season, according to the U.S. Energy Information Administration.

Exxon profits higher than expected

Exxon Mobil Corp., the world’s largest public energy company reported net income of $7.56 billion, or $1.60 a share, in the second quarter, up 91% from $3.95 billion, or 81 cents a share, in the same period in 2009.

Analysts were expecting earnings of $1.46 a share, according to a survey by Thomson Financial.

The results are linked to improved refining margins, an increase in output, and strong performance in the company’s chemicals business according to Exxon’s CEO.

The ongoing rebound in oil prices helped boost profits in Exxon’s oil production and exploration unit, where earnings rose $1.5 billion to $5.34 billion in the quarter. Oil prices averaged $78 a barrel in the quarter, up from $60 a barrel in the same period last year.

The results included a slight impact from Exxon’s recent purchase of XTO Energy, a natural gas company. The $36 billion deal closed on June 25.

BP’s Hayward takes walk of shame

We all knew it was bound to happen sooner or later. Someone must be blamed for the oil spill, and BP’s CEO Tony Hayward fell on that particular sword today.

Hayward will be replaced by American Robert Dudley effective Oct. 1.

Hayward will receive a year’s salary amounting to $1.6 million but further details of his severance package were not disclosed.

In a cliched twist, Hayward will be nominated him as a non-executive director of Russian oil and gas venture TNK-BP, the oil industry’s way of saying: “You’re banished to Siberia”.

BP has reported a second-quarter loss of $17.2 billion. Robert Dudley is a long-time BP employee with more than 30 years in the oil business. A chemical engineer by training, Dudley was put in charge of the day-to-day leadership of the Gulf Coast clean-up operation in June.

But, don’t worry. It’s not over yet. There’s still plenty of blame to go around, and Hayward won’t be taking that walk of shame alone.

Senate will see a new energy bill

Senate Majority leader Harry Reid will unveil an energy bill that will make offshore drilling safer and convert trucks to run on domestic natural gas.

The full Senate could begin consideration of Reid’s bill on Tuesday and Democrats would like to pass it by the early part of the following week.

With time running short ahead of a month-long recess starting Aug 6, Democrats abandoned efforts last week to put climate-control measures in the bill. Reid said then that he had no Republican votes for items such as carbon caps and mandates requiring utilities to generate some of their power from alternatives sources such as wind and solar.

Democrats would like to revisit climate control in September, but for now, they will compromise with the hope of passing the bill quickly.

If Republicans pick up seats, as expected, the effort to put a price on carbon and cut emissions could be stalled for years, which would also hamper the Obama Administration’s efforts to take a lead role at the world climate talks.

The natural gas trucks incentives could cost the government $4.1 billion, compared to the $19 billion price tag for an earlier bill. The energy efficiency measure known as Home Star will include $5 billion in incentives for plugging window leaks and insulating attics.

To pay for these measures, lawmakers may consider raising taxes on the oil and gas industry.

BP oil leak plugged

Morning in the Gulf of Mexico dawned with a healthy dose of cautious optimism, something that the Gulf hasn’t boasted in 88 days.

BP has successfully capped the oil leak of the Deepwater Horizon well.

BP is still conducting pressure tests to make sure the cap will hold, but so far, it looks like it will. BP is giving the cap another day before they declare the cap a success. Relief wells are still being dug to access the oil still in the well.

Building pressure indicates that the cap is holding. However, BP has cautioned that the leak may only be halted for 48 hours.

While there is no longer any oil leaking into the Gulf, there is still a massive clean up that needs to take place. Several different methods are being implemented in handling the oil that has already escaped.

Chevy Volt will have limited release

Recently, GM started turning a profit for the first time since 2007. It seems they’re trying to keep the ball rolling with the Chevy Volt.

GM will begin sales of its electric car at the end of the year. But, only 10,000 are set to roll of the line. To put that into perspective, GM sold 21,000 Malibus last month alone. In 2012, GM plans on increasing the production of the Volt to 30,000.

When the Volt was revealed as a concept car in 2007, a list was created on the Internet for potential buyers, sign here if you’d buy one. According to reports, the list is up to 53,000 names. But, putting your name on a list is not the same as dropping the cash for the car. GM spokesman Rob Peterson says that demand will almost certainly be higher than production.

Distribution will be in six states and Washington, D.C.

Dealers are preparing for servicing the new cars. The Volt comes with an updated OnStar system. Dealers are prepared to deal with calls addressing issues they’ve never heard before.

Nissan will release its Leaf, an electric car with a 100 mile range, to compete with the Volt. Nissan plans on producing 25,000.

While a price has not been set, dealers are taking deposits already. The expected price is around $40,000, which hits $32,000 after federal taxes credits for electric cars.

BP meets in Abu Dhabi

BP CEO Tony Hayward met with officials from the Abu Dhabi Investment Authority (ADIA) during a routine visit.

Speculation of a stake purchase by a Middle East or Asian sovereign wealth fund gains ground, if BP wants to prevent a takeover after the financial beating they are taking from the oil spill in the Gulf of Mexico. Some say Saudi investors are seeking 10 to 15 percent of  BP.

Hayward said he was merely there to meet with investors.

BP has committed a $20 billion fund for the clean up and costs have already reached $3 billion. Analysts say BP’s stock may have found the floor. BP rose 9% in New York trade and reached their highest point since June 21st in London.

Tar balls have reached Texas, which means every gulf state has been touched by the disaster.