$5 Dollar a gallon Gas??? Should we Drill Baby Drill??? (minimum wage, government, income)

[Memphis1979]

Originally Posted by ovcatto

---pulls up a chair

Drilling could lower oil and gas prices.

Maybe 2 cents per gallon is worth it to some, it doesn't to me.

The simple fact of the matter is that the United States doesn't have enough oil reserves to make a difference in the price. If we found our own "Saudi Arabian" type reserves tomorrow, it'd still only effect prices by about 20% overall. So oil would drop from 100 dollars a barrel to 80 dollars a barrel.

I guess what I'm saying is, how would drilling significantly lower oil and gas prices? Significantly meaning a 30% or more decrease.

[shorebaby]

Originally Posted by ovcatto

Your argument assumes no change in behavior of oil consumers.



The U.S. consumes 25% of the world's oil production. That is about 20,000,000 per day. Reduce that amount by 30% brings you to about 14,000,000 b/d a reduction of 6,000,000 b/p. So what we are talking about is 30% of 25% of the world's supply consumed by the U.S., which according to my poor math skills comes out to a whopping 7.5% increase in the total world wide supply of oil.

One other thing that you might consider, this increase in price comes at a time when U.S. demand for oil is and has been in decline. So as a result of relying on just simple supply and demand model ( failed) you also aren't considering the actual factors that have led to the recent upswing in prices, instability in the middle east causing speculation in the oil markets.

Too funny. Of course peoples behavior would change. Since so many would be out of work they certainly wouldn't drive as much.

You really and truly have no idea how commodities markets work do you? US oil demand has actually been flat, but guess what the US isn't the only country that consumes oil. China and India are consuming huge amounts of oil, this accounts for the increase in price.(prior to the lybian situation) If you don't think a 7.5% increase in the oil supply would dramatically reduce the price of oil, you are sadly mistaken.

No, instability in the Middle East is the over riding cause of the increase in oil prices. Guess what Lybia supplies 3% of the worlds oil, and it is their problems that are causing a rise. Can you imagine what a 7.5% increase in oil supplies would do to prices?

[Pretzelogik]

Originally Posted by TXTwizter

Prices at the pump could near $5 a gallon by summer - KXXV-TV News Channel 25 - Central Texas News and Weather for Waco, Temple, Killeen |

With gas expected to reach $5 a gallon by summer, is NOW the time to start drilling here, and the hell with what the environmentalist say or think?

In the words of Sarah Palin, DRILL BABY DRILL!!!

Not according to the COIC. (community organizer in chief)

[ovcatto]

Originally Posted by shorebaby

Too funny. Of course peoples behavior would change. Since so many would be out of work they certainly wouldn't drive as much.

Still don't get it, I see. The idea that you are having such a difficult grasping is that the only way the U.S. will reduce its oil consumption is through changing behavior, e.g., other forms of energy. If you don't change behaviors you will most certainly realize a 30% decline in consumption because there won't be any oil to consume. As of to date the Department of Interior estimates that there is 134 billion barrels of recoverable oil from all domestic sources. That is about a 3 year supply of oil at current rates of consumption. Get it yet?

You really and truly have no idea how commodities markets work do you? US oil demand has actually been flat, but guess what the US isn't the only country that consumes oil. China and India are consuming huge amounts of oil, this accounts for the increase in price.(prior to the lybian situation) If you don't think a 7.5% increase in the oil supply would dramatically reduce the price of oil, you are sadly mistaken.

What is funny how your own post contains its own self-contradiction. U.S. oil consumption is more than flat it has declined, yet that decline has had no effect on price because as you point out, world wide demand has increased:

World crude oil and liquid fuels consumption grew by an estimated 2.4 million bbl/d in 2010, to 86.7 million bbl/d, the second largest annual increase in at least 30 years. This growth more than offset the losses of the previous two years and surpassed the 2007 level of 86.3 million bbl/d reached prior to the economic downturn. EIA expects that world liquid fuels consumption will grow by 1.5 million bbl/d in 2011 and by an additional 1.6 million bbl/d in 2012.

EIA - Short-Term Energy Outlook

This turns your whopping 7.5 increase to marginal (see the economic definition of marginal) 6.5 this year and 5.9 in 2012. Now who doesn't know how commodities markets work?

No, instability in the Middle East is the over riding cause of the increase in oil prices. Guess what Lybia supplies 3% of the worlds oil, and it is their problems that are causing a rise. Can you imagine what a 7.5% increase in oil supplies would do to prices?

Well we certainly don't have a disagreement on your last point.

Oil Rises to 28-Month High on Libya, Middle East Supply Concern - Bloomberg

[shorebaby]

[quote=ovcatto;18022250]Still don't get it, I see. The idea that you are having such a difficult grasping is that the only way the U.S. will reduce its oil consumption is through changing behavior, e.g., other forms of energy. If you don't change behaviors you will most certainly realize a 30% decline in consumption because there won't be any oil to consume. As of to date the Department of Interior estimates that there is 134 billion barrels of recoverable oil from all domestic sources. That is about a 3 year supply of oil at current rates of consumption. Get it yet?[quote]

Why pick 30% why not 50 or 100?you are simply pulling numbers from air. There is no earthly way we could do with 30% less oil.


What is funny how your own post contains its own self-contradiction. U.S. oil consumption is more than flat it has declined, yet that decline has had no effect on price because as you point out, world wide demand has increased:


This gets more comical with each post, I have now disabused you of the notion that the US is the only consumer of oil, prices do fluctuate on supply and demand. Of course an increase of 7.5% in oil supply would decrease the price per barrel of oil significantly. If you woul like to argue otherwise, please explain why you would have us decrease usage by the mythical 30%?

[Mircea]

Originally Posted by Wapasha

What about these high energy costs destroying low income families? Or does your ideology trump your concern for your fellow man?

Those families destroyed themselves through their own ignorance and lack of self-discipline, and um, "high energy costs" (whatever that means) had nothing to do with it.

If energy was free, they'd still be low income.

Originally Posted by RCCCB

If we are not dependent on outside oil or their political games, domestic oil would most certainly keep the prices down.

That's probably because about 40 Million Americans would die.

O Wizened One, why don't you enlighten every one and explain how Plavix, Lipitor and hundreds of other life-saving pharmaceuticals can be manufactured without the organic alcohols that are created exclusively from imported light oil.

And you have to import light oil, because you have practically none (and never had very much -- in fact Louisiana Sour was the first light oil you started pumping).

I smell money here. So what is the Secret?

Do we stare at West Texas Intermediate and it just morphs into Azeri Light (from Azerbaijan)?

Or is there a magic wand that you can wave over California Heavy and it just instantly changes into Tijuana Light (from Venezuela)?

If Justin Timberlake sings to several thousand barrels of East Texas Sour or Illinois Intermediate, will it become Arabian Light or Basra Light (from Saudi Arabia and Kuwait)?

Which songs will Justin sing and how long (in hours, days, weeks, years, centuries) will the transformation or I guess more correctly, the alchemic transmutation take?

Your my hero, please share this wonderful Secret to all.

Originally Posted by lifelongMOgal

Remind yourself that when you go to the grocery store as every increase affects the cost of planting, growing food, and bringing it to market.

Perhaps now would be a really good time to destroy corporate agriculture and return control to local farming communities and local family farmers. You can get rid of the $Billions of tax-payer subsidies for corporate farms as well.

Originally Posted by Chango

There are three "solutions" here:

#1 Do nothing and wait for the inevitable end. We may be able to sustain the current way for a decade or so longer, but eventually it will all fall down in a most dramatic fashion. Afterwards, the survivors could rebuild, probably starting back in the stone age. Considering the majority of the non-renewable resources have already been consumed, it would make a second industrial revolution unlikely, so the human race would most likely stay there for a very long time.

Well, that won't happen. There's a lot of oil out there. The thing about oil (and natural gas and metal ores and non-metallic minerals) is it takes a very long time to lay the infrastructure.

Central Asia has 5-7 times more oil than the Middle East and it is nearly all light oil and the rest is intermediate grade (with a couple of very light fields -- useless for gasoline but great for cosmetics, pharmaceuticals, some plastics, inks and dies and such -- and some heavy oil fields), you just haven't started producing it yet.

Production has been stalled for a number of reasons. The Chevron Conglomerate (Chevron and BP) own 75% of the rights to those fields (it was the UNOCAL Conglomerate -- UNOCAL, Chevron, Amoco and British Petroleum until Chevron bought UNOCAL and BP bought Amoco). Total (a French company) and Gazprom (a Russian company) own the rest of the rights.

The US doesn't want the oil or natural gas being piped through Iran, China or Russia. It wants to run it all through Afghanistan, and as I'm sure you're aware, there's a few problems in Afghanistan right now. Some of those countries are quite angry at the US (Uzbekistan, Tajikistan and Kyrgyzstan in particular) and they have started handing out contracts to French, German, Brazilian, Russian, Italian and Chinese companies to start pipeline construction and those pipelines are running through China and Russia.

It will take 20-25 years to build those pipelines, plus the processing facilities (those are not refineries), plus all of the wells and connect the wells to the main pipeline(s) (and expand the ports to get the oil into tankers) and getting production high enough to have any impact on world oil prices (and don't forget that over the same time period, the Middle East fields and the US fields will have declined significantly in production).

It took Saudi Arabia 40 years to get production up to 9 Million barrels per day, so figure it will take 30-35 years to get the Central Asia fields going.

Originally Posted by Chango

#2 Voluntary cut backs. Everyone realizes the problem and their part in causing it; then voluntarily reduces their consumption and ultimately completely change their lifestyles to truly sustainable levels.

A change in life-style doesn't necessarily mean reducing consumption.

Tide liquid laundry detergent and Chlorox orange-scented Disposable Kitchen Wipes are practically 90% oil, everything from the plastic container to the dyes that color the containers to the inks in the labels, the adhesives, the ingredients themselves.

Americans live in a disposable society, and nearly everything that is disposable is made from oil. It won't kill people or ruin their lives to start using washable dish-cloths instead of disposable wipes, or using powdered laundry detergent instead of liquid.

No one will die if there's only 24 colors of lipstick instead of 256.

So everyone doesn't mean the world, it means Americans. The Japanese only use 4+% of the world's non-oil resources, but who would say the Japanese are living in squalor? No one. If the Japanese can do it, Americans can cut their resource use from 29% to 5%, and in doing so, you'd reduce your oil consumption.

Originally Posted by Chango

#3 Forced cutbacks. If people won't do it willingly, the next best strategy is to create poverty through inflation, jacking up the price of necessities, culling the population with wars and otherwise forcing a contraction on the lifestyles the common man.

That is grossly unfair to the rest of the world, who are not the problem and never have been and they aren't going to put up with it, which is quite obvious from the fact that they aren't putting up with it now.

If you cull the world's population, who will pick your coffee beans in Africa? No one, so you won't be drinking any coffee (or eating any chocolate) for a very long time.

Originally Posted by jetgraphics

Such a solution set ignores many others.
But it is a common mistake of the Zero Sum Game mindset.
They see the earth as a pie, with a growing population forced to fight over their piece of it.

Solution #4 is to bake more pies.

To illustrate: A typical "Green think" slogan is "Environmental Preservation". A wiser solution is "Environmental Expansion" - how can we support more lifeforms per unit of Earth? What would multiply the life bearing capacity?

You can develop rail freight and nuclear power. A real president, a real leader, would create an initiative to move 85% of US freight by rail within 10 years. You wouldn't lose a single job. In fact, you'd create jobs, and more than that, jobs that paid well and couldn't be off-shored.

Obama will never do that, because you can't pull his head out of the arses of the Teamsters Union bosses.

Europeans still make good use of rail freight, but they have been steadily increasing their truck fleets and that has to stop. Both the US and Europe should be helping developing countries develop rail freight so they can avoid the mistake of using trucks.

That won't help with light oil issues, but it will free up intermediate and heavy grade oils for uses other than producing diesel fuel.

Developing countries also use intermediate and heavy oil, and natural gas to fire their electric power plants. Moving to nuclear power will provide more electricity and reduce consumption of intermediate and heavy oils (but not light oils).

Originally Posted by Maineah

Do you understand??? If there is MORE of a comodity than the demand the price goes down....

I understand that while intermediate and light grade oils were selling for $125 to $147 per barrel, that heavy oils were still selling $50-$90 per barrel.

Ask the Canadians, they'll tell you.

The world is awash in heavy oil, and you want to do what, drill in ANWAR and dump more heavy oil on the market?

Well, well, let us see.

The EIA reports that on February 18, Bonny Light from Nigeria was selling for $104/barrel.

How much was Canadian Heavy (Hardisty) selling for?

Survey says.....$65/barrel.

I'm laughing at the superior intellect.

Originally Posted by ovcatto

I might also mention, once again, that oil drilled in the U.S. is NOT dedicated to U.S. markets but rather the highest bidder. Currently the U.S. EXPORTS 2.5 million barrels of petroleum products per day.

Yes, and nearly all of it is California Heavy and Alaskan Heavy.

The US doesn't have a lot of heavy oil refineries, and it is over-capacity so heavy oil in the US is useless. Might as well export it.

Heavy oil is great for tar, asphalt, petroleum jellies, diesel and aviation fuel, and US heavy oil refineries can easily meet domestic demand, so it exports a lot of the tar and petroleum jellies (and paraffins).

You only get 9 gallons of gasoline from heavy oil (and that's spending a lot of money) which is why light oil is preferred since you get 22 gallons of gasoline out of a barrel of light oil.

It's simple math 9 gallons or 22 gallons. Which is cheaper to produce?

Which is cheaper to produce in large quantities to meet the demands of gas-guzzling SUVs?

Originally Posted by LauraC

Yes, and we should quit talking about it and start doing it. If we had done it 10 years ago, we'd be in better shape now.

Prove it.

You don't use West Texas Sour, East Texas Sour or Louisiana Sour to make gasoline, because the sulfur content is too high and it costs too much to remove the sulfur.

Diesel fuel isn't really green-colored, it just has a green dye in it to make it look green, because the EPA says so. Diesel fuel isn't red-colored either, it also has a dye in it to make it look red-colored, because the EPA says so. That's how you can tell the difference between low-sulfur diesel used in trucks, and the high-sulfur diesel that you are allowed to use in your off-road vehicles, like dirt bikes, ATVs, boats and such.

Most of your oil in the Gulf is going to be intermediate grade (which is good) but it will be sour (high sulfur -- and that's bad) oil that you cannot use for gasoline, so that's no help to you.

I'm sure there's a sweet intermediate field somewhere in the Gulf, but drilling 10 years ago wouldn't help you now.

Who would refine that oil for you? Valero? They're maxed out on intermediate grade oils. Murphy? They're maxed out too.

Confused? Oh, that's right. You don't know what you're talking about. The vast majority of oil refineries are independently owned and operated. Some of the refinery operators also drill for oil and own oil fields, but most don't.

Goodway? Hunt? Flint? Marathon? Conoco? Calumet? Hess? They might be able to handle 20%-30% of it. No way BP or Chevron could handle it. They'd have to convert some of the cracking stills at their light oil refineries to handle intermediate grade oil.

Oh, wait, BP and Chevron already did that.

Still confused? I'll clue you in on something. You can't refine intermediate or heavy grade oil at a light oil refinery for the same reason you can't refine light oil at an intermediate or heavy grade refinery.

Originally Posted by steel7

High gas prices = high food & utilities & many people suffering again like 2008. This is all about greed & a president who should of never been elected.

Uh, wut?

Is your electricity delivered by FedEx or something?

You're obviously disoriented. Gasoline prices to not affect the price of utilities and it certainly doesn't affect the price of natural gas.

There's no doubt Obama will go down in history as just another Millard Fillmore, but his election has nothing to do with gasoline prices.

Originally Posted by sailordave

By increasing oil drilling and production here in USA, you reduce the reliance on oil from politically unstable regions like what's going on now.

No you won't. Maybe if you look hard enough you'll find a bald eagle that craps light oil.

Originally Posted by momonkey

Imported oil will remain cheap as long as we can refuse it.

You don't have the moral courage to cut off your imports of light sweet crude oil.

To be sure, you can talk the talk, but you'll never walk the walk.

Originally Posted by NeilVA

Since the US has not built a new refinery in close to 35 years due to NIMBY

Not just NIMBY, but a total lack of leadership in the White House, in Congress, and in the State legislatures.

Do you want to invest a few $Million in a new oil refinery only to find that 10 years later a president has decided everyone is switching to natural gas powered cars?

You don't have a clear energy policy, and that hampers investors.

Originally Posted by sailordave

The UN approved the first Iraq war in 1991. Bush haters always seem to forget that when they scream "war for oil".

I didn't forget it, but I do remember VII Corps units training in Turkey in the eastern desert on the Iraqi border between 1988 and 1990.

Was that because of those tough Czech desert fighters the VII Corps would have to fight its way through on the way to Moscow?

No? Then maybe it was because of the dreaded Polish camel cavalry out there in the Polish high desert.

So in 1988, Reagan and Gorbachev agree to a reduction in forces, and Bush and Gorbachev sign off on the deal and the entire US VII Corps is going to be withdrawn from Germany and deactivated.

But wait, some brilliant bureaucrat decided to spend tax payer money to train two armored divisions, a mechanized infantry division, an armored brigade, a cavalry regiment and the entire VII Corps artillery in desert warfare for 2 years.

Well, gosh, it must be the Mother of all Coincidences, because the US suddenly needs an entire corps trained in desert warfare to fight the evil Saddam and Lo! And Behold! there's an entire corps trained in desert warfare sitting in Germany about to be deactivated.

No wonder VII Corps performed so brilliantly in the Gulf War. They had two years to practice.

I also didn't forget that every telex sent between April Glaspie and Washington DC is classified Top Secret Cosmic and won't be scheduled for declassification review until 2066.

I guess there's something in those telexes they don't want you to see.

Gosh, I wonder if there's a relationship between the still classified telexes and the US making sure it had an entire army corps trained in desert warfare.

Originally Posted by sailordave

Some of the nations that didn't want us to go into Iraq in 2003 (like France, Germany, and Russia) didn't want us to remove Saddam's government because they had sweet oil deals with Saddam and they knew that if Saddam's government was removed, so was their oil contracts.

Smells like "war for oil" to me.

Originally Posted by sailordave

After Saddam's removal and the formation of a new government, the oil fields reverted back to the Iraqi people, not America.

Um, you left out the part about the US switching Iraq's sale of oil from Euros back to US Dollars.

Originally Posted by Lincolnian

I'm watching another "expert" spouting off that $5 gas will not adversely affect our economy. These "experts" are very misguided. As gas nears $4 people's driving habits will cut back, trips to restaurants will be reduced. As it hits $5 and works its way into higher food, clothing, and all the other products people buy they will cut back spending on discretionary items. They will start demanding action from their elected officials and maybe then we will get an energy policy.

Actually there are surveys that show people are negatively impacted at $3/gallon and it gets worse the higher the price rises. The University of Cincinnati did such a study in 2008 as gas prices rose from $3 to near $5 per gallon in some places.

No one will demand action. An energy policy? That's kind of silly. You need a combustion engine policy. Or a transportation policy. Taxing suburbanites would be the best policy. That would reduce suburban sprawl and since they drive farther and more often, they should bear a greater portion of the costs.

Originally Posted by alphamale

Maybe if we start now, we will be out of this mess in 5 years or so.

5 years? Heck it would take that long just to do the assays.

You do know what oil assays are, right?

Oil is not oil, and some oils are more equal than other oils.

Aren't you going to test the oil to see if it has nickel or vanadium in it? Because some oil does, and some oil doesn't. What about mercury?

Some oils are crap. Bach Ho from Vietnam and East Texas Sour are both intermediates and each yields about the same amount of diesel, but you get twice as much naphtha from East Texas. That's what you need for aviation fuel.

Originally Posted by shorebaby

The price of a barrel of oil is the same world wide.

Wow, how dumb is that? Yeah the price of Libyan Es Sider is the same price all over the world, but the price of Ecuadorian Oriente is $23 cheaper than Es Sider...all over the world.

Originally Posted by shorebaby

What neither of the above posters seem to grasp is, OPEC manipulates prices by manipulating supply.

I just blew that nonsense right out of the water. How embarrassing for you.

Ecuador and Libya are both OPEC members....and they charge different prices for oil. By the way Ecuador's production exceeds the OPEC quota, but then so does Qatar, UAE, Kuwait, Algeria, Iran, Angola and Nigeria.

I would also point out that the number of non-OPEC oil-producing countries exceeds the number of OPEC countries, and the production of non-OPEC countries exceeds the production of OPEC countries, so there is no way OPEC is manipulating prices or supply as you claim.

Originally Posted by Wapasha

Inflicting real economic pain on low income families, during already brutal economic times, is not a good plan to obtain some vague notion of "long term benefits". The low income family that loses their home, defaults on loans, and destroys their credit rating, not to mention how this affects their children, is not going to be pretty, and certainly will not earn them appreciation of your vague predictions of "long term benefits".

Enough with the "low-income families" nonsense already.

Any low-income family that defaults on its mortgage because of gasoline prices shouldn't own their own home anyway. I'd explain the common sense logic of that, but the book "Rich Dad, Poor Dad" does a better job of explaining.

Originally Posted by brien51

It takes 3 years to build a refinery on the "fast track"

You definitely misunderstood what you have read. The fast track means you can clear the EPA permit process in 3 years (it is normally 4-5 years).

It takes 5-7 years to build a refinery (depending on its capacity in barrels per day).

5-7 years, plus 3 years on the EPA fast track permit processing means 8-10 years to build a refinery.

I outlined the whole process of building a refinery in another post. It takes about 5 years just to get to the point of being able to get on the EPA fast track process.

No matter how you slice it, it's 15-17 years to build a refinery (and the EPA fast track process does not guarantee that environmental groups will not take legal action to block it).

Originally Posted by brien51

but this US government has not given anyone "permission" to build anymore refineries in the US in more than 25 years.

That's true, but you have omitted a very important "minor detail," and that is no one has applied for a permit.

The government cannot issue permits if no one applies.

Texaco was the last to attempt to build a refinery and after 8 years and more than $100 Million spent they didn't even have a location selected.

Originally Posted by brien51

It's time to switch over the LNG since the infrastructure is already set up, and all we need to do is run a pipe line from the street, into the filling stations, we already have set up for gasoline.

The people of the US are stupid.

No, the stupid people are the ones who don't understand that the LNG infrastructure is "already set up" to supply gas for cooking and heating and industrial use, and that if you want to include automobiles, you're going to need to expand the infrastructure. A lot. And that will take decade. It will take longer than building refineries. You'll need new pipelines and it will take years to do the location surveys, and all the environmental impact studies, and then what about acquiring right of way?

That's going to be really expensive, or do you plan on sneaking in at night laying the pipe?

Originally Posted by shorebaby

Lol, you must be kidding me. You think decreasing the use of oil by 30% would have no effect on the economy?

That depends on which oil you decrease 30%.

Decrease your imported light oil 30% and health care costs will skyrocket because the pharmaceutical drugs made exclusively from light oil and no other will increase in price.

Of course, that might solve a lot of problems. Cut off imported light oil and millions of Americans would die, mostly the old skins who are sucking Medicare and Social Security dry.

So there you go, Medicare and Social Security are now solvent once again until, I don't know, 2066 the same time we get to find out what really happened in the Gulf War.

It would also kill all the fat slobs with Type II Diabetes who suck Medicaid dry. There's three problems solved: Medicaid, Medicare and Social Security.

Oh, and pension plans. A lot of government union pension plans would suddenly become solvent once again. So that's four problems solved.

Cut intermediate oil 30%, well that would be a disaster. Gasoline really would be $10/gallon.

Heavy oil? You can cut your heavy oil use by 30%.

Yes, you surely could. Shifting 85% of all freight to rail would cut it much more than 30%.

And it would create jobs.

Originally Posted by shorebaby

How would cars go, factories run, planes fly?

Planes fly in large part because of the Bernoulli Effect. As far as factories running, if you have Prince Albert in a can, maybe you can let him out and he can chase down the factories.

[shorebaby]

I had to leave the above post intact as it is obviously the product of over consumption of the grape. But I will comment on one little fun fact lest the reader gets confused. This poster like the others before him doesn't get the fact that commodities exchanges set the price of oil based on supply and demand, and their perception of where each are going.

How Oil Prices Are Determined - Factors that Affect Oil Prices

I think what the above poster is clumsily trying to say is, there are a lot of different types of oil used for a lot of different things. So? You can no more say you could cut 30% of one type of oil or another or any combination of types of oil and not do severe damage to the economy.

[Lincolnian]

The average driver uses 750 gallons of gas per year (15,000 miles @ 20 mpg = 750). A $2 increase (from $3 to $5) represents an additional $1500 expense. For a two-driver family this equates to an additional $3000. The Median Household Income was $52,029 (2008 figures). The increase would represent a 5.8% increased expense in fuel alone. Add the pass through costs and it could easily account for a 10% increase in household expenses. If taken off of net income the cost is even higher.

So yes, increased gas costs will cripple our economy's recovery and lead to higher unemployment as people cut discretionary spending which affects the employment levels of the people working in those areas.

The idealist will say cut back on driving, get a more fuel efficient car, or move closer to work. However, many people have to commute quite far to find jobs in their field limiting their choices to drive less, the price of the less fuel efficient vehicle drops while the more fuel efficient increases making buying a different vehicle cost prohibitive, and many houses are worth less than what people paid making it difficult or financially impossible to sell. Additionally, moving closer to work for one spouse may mean a much longer commute for the other.

There are no simple short-term solutions to solve these problems. The fact that we don't have an energy policy is pure lunacy. We don't have free market capitalism especially with oil so the market's invisible hand is not going to solve this problem for the vast majority of American citizens. Boone Picken's Plan has some options that could help. However, it appears that we are more interested in pointing our fingers at each other as opposed to seriously developing a US policy for energy independence. Pickens is right that foreign oil dependence is the biggest threat to our national security.

[Bideshi]

It won't help much. The oil companies will still charge whatever the market will bear. It'll just be our own countrymen gouging us instead of foreigners. It would help employment in the oil industry however, so some working class Americans would benefit.

[summers73]

Originally Posted by shorebaby

You really have no idea there is a difference between supply and price do you?

Raygun was able to manipulate the price by compelling OPEC and other nations to produce more, thus bankrupting the Soviets when their oil exports weren't yielding sufficient profits. OPEC is a cartel and subject to government intervention, and can be used as a tool to prop up or destroy governments throughout the world, simply by changing the flow of the spigot.