If so, stick a fork in Detroit. And federal mpg regulators will look like geniuses, as the free market stampedes to high mileage vehicles. As Captain Picard might say, what will make it so? Writing for The New York Sun, Dan Dorfman relies on three analysts for his, uh, analysis. First up, Troy Green of the American Automobile Association. The trip-A guy's forecast "calls for" (perhaps not the best choice of words) a jump to between $7 and $10 a gallon in two to three years, based on $200 a barrel crude. The chairman of Houston-based Dune Energy is slightly more optimistic. Alan Gaines sees gas rising to $7 to $8 a gallon on Arrakis. I mean, stateside. Weiss Research commodities trader Sean Brodrick projects $8 to $10 a gallon gas. Like any good financial pundit, Dorfman hedges his cred. "His [Gaines] latest prediction of $200 oil is open to question, since it would undoubtedly create considerable global economic distress. Further, just about every energy expert I talk to cautions me to expect a sizable pullback in oil prices, maybe to between $50 and $70 a barrel, especially if there's a global economic slowdown." [thanks to jthorner for the link]
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I’m sure people in Sequoias won’t be the only ones hurting when gas reaches $10/gal
“and the unwillingness of SUV-loving Americans to trim their unquenchable thirst for foreign oil.”
Dorf, many of have unwillingness to change to more fuel efficient vehicles because it costs money. The resale value on SUVs is lower these days and many people don’t want to take a loss.
But hey, by your picture, and your aol.com email address, I can clearly see that your qualified to speak on the subject.
The United States is in so much trouble! Falling dollar = rising gas prices, Rising gas prices = falling dollar. Looks like the chickens are coming home to roost for all of that borrowing we have been doing. Thank you, Clinton/Bush administration.
I have been getting very nervous about gasoline being $6.00 + per gallon. Automakers need lead time to adjust to market realities. In 2009/10, cars will come out designed back in 2004/05, when gas prices were at most $2.50-3.00/gallon. 35mpg cars may not be enough for 2010!
I don’t know about $10/gal, but I’m willing to bet that we’ll see $5/gal this summer. The only way we’ll see gas @ $10/gal is if the neo-conmen in Washington get their way and actually bomb Iran. If not, expect gas to go back down somewhat, I’m guessing that $3.00-$3.50 is the new “normal” range.
The sad part about this is that somebody will still think we’re not paying enough because by then Europeans will be paying $20/gal.
I say BS. This would assume, what? That the world economy keeps growing like it has been and people keep buying vehicles like they have been, and supply disruptions keep continuing like they have been?
It is POSSIBLE. But I say the economies of the world and the drivers of the world will change their habits long before oil could ever reach these prices, and may actually result in a good decrease in its price.
Supply and demand works. The more it costs, the less we’re going to use, driving down the price.
I say no way to this. But it makes good headlines.
The effects of this level of increase would really cause problems, not only directly but in various credit markets. About a year ago, the local bird cage liner had an article on a chain supermarket manager who got a promotion and small salary increase. The bad news was that his commute went from several miles to around 60 miles one way. He kept driving his full sized Dodge pick up. His finances were so closely balanced that the extra 6-8 gallons per day put him into foreclosure. Over a year, at $2.50 per gallon, that was $3750 to $5000 after taxes outlay. You don’t even have to project levels near what has been mentioned to cause real pain.
Some people will see this and take the hit to dump the gas pig for a high mileage commuter, but many will initially be like the frog in the pot when the heat gets turned up. At the time, this was a somewhat newsworthy story; I wonder if that will be so in a year when it becomes more common?
If the commidities markets are not regulated in some way, this is a possibility, because right now, the price of oil and gas is being determined by day traders and speculators who are playing the market to drive the price up so they can make $$$$.
Supply and demand went out the window a year ago.
Essentially, more or less everything is going totally haywire.
Went to do some shopping and there was absolutely no bulk rice at the store. People are panicking because on the coasts, they are rationing it, so folks must be just grabbing extra and putting it up “for a rainy day” or something.
Usually in situations where you see a currency under threat and profits down, you would expect to see Wall Street down and gold up. It’s the opposite right now.
There is a lot more going on out there in the real world, which is going to put a major dent in our pocketbooks, and in our favorite industry the auto industry, too.
$20 per gallon equivalent in the UK and Europe? Sure – IF you can buy petrol or diesel, that might be the case soon, or by next year.
$10 per gallon equivalent in the US and Canada? Probably by next year, and I think all of these news reports and forecasts are being pushed by the powers that be (as suddenly out of nowhere, they are appearing in the major wire feeds) to prepare folks for the inevitable.
The inevitable is that everything is getting out of control, because we Americans are collectively in a Titanic going full bore through icefields, with total incompetents at the wheel. And I’m not just talking Bush (and Clinton).
If you think I’m being partisan, I’m not. Look at the facts.
It took from 1776 to 1980 for the United States to become $1 trillion in debt.
It took from 1980 to 1988 for the US to double that debt (thanks, Ronald Reagan) who promised in 1979 to shave and reduce US debt (typical lying politician, eh?)
It took from 1988 to 2000 to add another $2 trillion in debt.
It has taken 7 1/2 years to add another $5 trillion in debt.
To save you taking your shoes off, I’ll total that up for you – $9 TRILLION IN DEBT.
From what I am reading in the Daily Reckoning, we have gone past the point where 100% TAXATION can pay back the debt.
The rest of the nations of the world are slowly waking up and will soon refuse dollars, refuse dollars for oil, refuse to buy dollar debts, refuse to work with us at all.
The obvious potential for a total meltdown is obvious, including obviously enough, the automotive industry.
So bearing in mind that we currently only supply about 45% of our own oil needs from US supplies, and that a good portion of that is needed to produce and move food, is it too far fetched to say that gasoline for automotive use might be restricted to about 35% of the current totals once all of this happens?
But of course, if “it” happens, some 50% of us won’t be needing to drive to work any more anyway…
It’s getting kind of scary for those folks who have not read ahead to the end of The Book to see how it all ends.
National average retail price according to AAA is $3.60/gal. Oil is trading at about $118/barrel. A barrel of oil makes somewhere around 40 gallons of gasoline. So, you can model gasoline prices as $2.95 for the oil + $0.65 for fixed costs.
Using the above, $200/barrel oil would give $5 for the oil and $0.65 for the fixed costs. Even California would only barely see $6 in this scenario.
Calculating without any fixed costs… $200/$118 * $3.60 = $6.10. Still not even close.
To see $7+ based on the cost of oil, we’ll need $240/barrel. If oil merely reaches $200/barrel, we’ll need a refining mishap or [additional] governmental stupidity in order to add an additional dollar to the price of a gallon.
If most other developed countries weren’t in even deeper debt per capita I’d be worried we’d sink.
You owe the bank 9 million dollars, you’re the one whose worried about how to pay.
You owe the bank 9 trillion dollars, the bank is the one who is scared.
A couple things:
1) If speculators really had the kind of control Rodriguez says they do, why don’t they just drive the price to $200/bbl today or tomorrow or next week? They’d make their money sooner that way.
2) All the previous rebounds in oil price came before China and India came online as consumer nations. Things might be different this time around.
3) Can we please not have the “End Of Days” talk? Only one post, and already it’s tiresome.
What the diverging price ranges from analysts tell us if that said analysts have no more clues than the rest of us as to where prices will go within a few years.
Once you factor in the huge number of variables, from consumers habits in a dizzying array of countries to global growth (there again, country by country) to potential future political instability (or not) in each producing country, to new discoveries of oil fields, to OPEC’s production decision, well, no surprise nobody can venture more than a guess.
only one thing is sure: the era of cheap gas is over. Even if oil prices go back down to $60 a barrel, gas will be, at the least at $1.80, more likely $2.00. That would still be cheap, but not $1.00-cheap.
As for Europeans, they’re currently far less affected than Americans, since oil prices are set in $ and therefore fall with the dollar, making it easier for countries with strong currencies (Japan and Europe, mostly) to afford the stuff. That may change if the euro dips down (unintended consequence of the populist talk of Nicholas Sarkozy and Silvio Berlusconi, who want a lower euro).
@A-Rod: Speculation can’t go on forever, regulation or no. Sooner or later, either 1) the speculators were right, and the market clears at the price they need/predicted, in which case the market worked; 2) the price was in fact artificially high and the market “corrects” itself, leaving the speculators with massive losses. Either way, the market worked.
And anyway, there are regulations on the commodities market. Tons of them.
@Sunnyvale: Right on. And that $0.65 fixed cost dovetails nicely with the oil company profit per gallon (about $0.09/gal) and gas taxes (varies by state, but averages about $0.50/gal total).
Hi toxicroach. You wrote “You owe the bank 9 million dollars, you’re the one whose worried about how to pay.
You owe the bank 9 trillion dollars, the bank is the one who is scared.”
True enough. But when you’re entire nation is set-up to only enable it to function with an ongoing injection of monies from overseas to service new debt, and that money isn’t forthcoming, which is starting to happen at this time, it is going to mean that the Fed will simply crank up the electronic printing presses (i.e. they won’t even counterfeit US dollars at the Fed – they’ll conjure them out of thin air). This will produce hyperinflation. Look up what happened in the Weimar Republic of Germany in the 1920’s. You know what (and “who”) followed that don’t you?
Furthermore, EVERY nation – underline EVERY nation which has ever had fiat money (“promises, promises, lies”) not based upon real commodities (such as gold and/or silver) has historically gone through phases leading up to economic collapse. Even the Roman Empire.
This is not “just” an American problem, either, since “every” world currency is now fiat currency.
Before Al Gore invented the internet, doomsday purveyors like this were confined to spreading their “Repent or Perish” with sandwich boards on the street corners. Give an idiot an audience of idiots and this is what you get.
At $10/gal it becomes highly economical for alternative sources of gasoline. Albertan tar sand. Coal liquefication. Hell, even Beeswax might be economical to convert to gasoline at those prices. Personally, I hope we develop and scale up a domestic, sustainable gasoline source that will ultimately drop and stabilize the price.
As far as vehicles go, I’m holding out for a gen3 Prius with plug-in and lithium batteries.
Hey, how about a caption on the great image.
Looks like a Banksy painting to me.
I’m glad it’s not my job to predict these things. Or worry about them.
detroit1701 :
The United States is in so much trouble! Falling dollar = rising gas prices, Rising gas prices = falling dollar. Looks like the chickens are coming home to roost for all of that borrowing we have been doing. Thank you, Clinton/Bush administration.
That should be “thank you Nixon/Ford/Carter/Reagan/Bush/Clinton/Bush administration”.
Maybe we wouldn’t need to borrow so much if we didn’t spend nearly $1 trillion per year on the military?
Sunnyvale’s math saying that 1bbl of oil = 40 gallons of gas is quite wrong. 1bbl of oil yields about 19.5 gallons, however refining by-products are also produced and sold, which is why gas is not $118/19.5gal or $6/gal + refining costs.
“One barrel of crude oil makes about 19½ gallons of gasoline, 9 gallons of fuel oil, 4 gallons of jet fuel, and 11 gallons of other products, including lubricants, kerosene, asphalt, and petrochemical feedstocks to make plastics”
Based on this chart from the California DOE, oil at $118 = 87 octane gas at $3.85. If oil goes up to $200, then the oil part of the price would increase by $1.95/gal and the sales tax portion would increase by 20 cents for a total Spring price of $6 even for 87 octane.
During summer profits and refining margins increase, so more like $6.40 during the summer months, or $6.60 for me since I use 91 octane.
http://www.energy.ca.gov/gasoline/margins/index.html
This assumes, however, that refinery costs don’t increase. Stronger environmental regulations, higher maintenance costs, and higher skilled labor costs would probably add another 10-20 cents to the price.
A few facts:
1. There are no large domestic sources anymore. There are no easy oil deposits anymore. There is no easy supply answer anymore. New developments are expensive and risky which lead to higher oil prices.
2. The world demand keeps going up. USA uses a lot, but it is “only” 25% of world consumption. Just because US demand decreases doesn’t mean global demand will decrease. North Americans are unique in that we drive big vehicles. The rest of the world does not have the option to downsize because they are busy up sizing from a bicycle or scooter to a small car.
3. The US dollar is screwed. So many points to consider here, too many to list. Read NY Times, Economist, etc, etc; article DAILY to support this fact.
4. Just because the USA goes into a recession does not mean that the world will enter a recession. It may, but it may not. Things are different than 20 years ago.
bfg9k: maybe we wouldn’t need to borrow so much if the government wasn’t wasting $2-3 trillion a year on other crap they don’t have the Constitutional authority for.
gsp:
ANWR, FL/GA Atlantic coasts, FL gulf coasts, Caribbean south of the Keys…all “easy” as in traditional sources, all off-limits due to self-inflicted limitations by the watermelons (green on the outside, red on the inside).
I actually feel sorry for Shell. Really.
Imagine being an oil executive; prices are going through the roof; and you have “a 6 percent fall in oil production”?
Imagine the reverse announcement: “This year Shell production rose 60% from development of their ultra-giant discovery in the Blubber formation.”
I think that we need to look at where tax breaks and fuel tax money ends up…and I’m waiting for the flame replies.
Everyone gives the “if we lived like Europeans” example. Guess what. Paris has sprawl. London is huge. Berlin since 1990 has grown. The German autobahn system is clogged in places. What’s keeping them from total gridlock like Los Angeles, Tokyo, and Sao Paulo? The mass transit has reached out to the suburbs.
I lived in the DC-Northern VA area for a number of years and saw a solution that worked. There is no way we are getting people out of their cars, but we can reduce the number of miles driven. Plop the subway/train lines alongside the freeways and build massive parking structures on both sides of the freeway. People drive from their subdevelopment to the freeway, park, and cruise the rest of the way. What if my office park isn’t close to my stop? Easy. Most cities/counties had bus/van service and the larger cities had their own Metro-bus service. It’s like the hub-spoke method. When I worked in the Tyson’s Corner area, I had to bail at one of the Falls Church stops, but there would be a bus or shuttle within 5-10 minutes that would get me the rest of the way. They even promised a ride home or to a station if hours changed at the last second.
It’s worked too well as anyone crushed on the Orange and Blue Virginia lines can testify to.
I’ve seen this in Chicago and even (gasp) Los Angeles! I just read the LA Times and ridership keeps rising.
It is WAY too much to ask to have every American change their suburban lifestyle overnight. It just cannot happen. We can’t become walk-everywhere citizens like Paris or London or Rome. However with the new migration back into the cities along with the new political will to explore more ways to move people without their cars, use the right-of-ways that we already have.
Now picture NYC, Chicago, Philadelphia and DC without a working subway/train system. Ouch…
Allocate the hopefully vanished tax break money to big oil and allocate “x” number of dollars to each region to add to or start mass transit lines.
If you use existing right of ways with freeways and existing tracks (like Philadelphia’s SEPTA and regional “R” lines, and the MetroLink Los Angeles lines,) the NIMBY factor can be reduced.
Personally I miss riding the Metro in DC – it was just great to relax and read the paper or catch up on some sleep or work.
Gas isn’t getting cheaper and I’m hoping the new administration in 2009 gives this a serious look.
cdotson :
gsp:
ANWR, FL/GA Atlantic coasts, FL gulf coasts, Caribbean south of the Keys…all “easy” as in traditional sources, all off-limits due to self-inflicted limitations by the watermelons (green on the outside, red on the inside).
Again, that means it is not easy. Other areas are also not easy because of unstable politics, China competing with big dollars for development to secure oil, not enough skilled oil workers,… There is always something.
Hibernia (the worlds largest oil rig)in Newfoundland was the last huge North American development . It started as a effort in the 1980’s and started to produce in 1997. Although it is now extremely profitable, it was only undertaken as a project with the economic backing of the Government of Canada. Risky. Not easy. Expensive. These are things that any corporation does not like to hear.
In any event, it is like Alaska. Corporations might want to develop every pristine area in sight, but it is not like you are going to find another Saudi Arabia underneath. At best it will be a band aid.
Prices are going up.
I love that accompanying illustration! Maybe TTAC should offer it on a poster or T-shirt. Though I suppose the rights to the Gulf trademark may be a problem.
Yes, I love the picture too. If you put that on a t-shirt (with or without the Gulf logo)I will buy one.
The public transit hub-spoke system seems to work in Perth, Western Australia too. On the north of the city are miles and miles of suburbs, growing like crazy. There is a public transport rail line along the freeway, with stations about 5 miles apart. Each station has a large commuter parking lot.
Once the train arrives in the city, there are free public buses that do loops downtown (called CATs). So you can catch a CAT to your office from the central station. Also, any bus is free downtown. So if a CAT isn’t close enough, just walk on any bus.
The suburban train stations also have bike lockers for those that want to bike to the train from home. However, you can not bring your bike on the train during rush hours.
The stations also have kiss-n-drop car lanes for those who have a spouse drop them off/pick them up.
This is sooooo funny.
I told my wife last night not to tell me any more doom and gloom news she has gotten from the TV.
She, like the rest of you, just fall for this crap all the time.
Nothing is going right in Iraq.
The earth is nearly at it end because of us damned humans.
All children are in danger of being shot in school.
It NEVER ENDS!
Please relax folks.
The price of gasoline is all out of control due to speculators…these same panic stricken dorfs that make the stock market look feel like a day at Six Flags!
Well, relax…and this winter seems to be lasting through fall.
So much for global warming.
I was so hoping for a warmer Chicago!
I agree that the litany of bad news is tiresome, ppellico, but then again putting your head into the sand is liable to see you get shot in the nether regions. Or something like that.
Being alert to possibilities and using discernment with all of the lies and deceats out in the world, however, is just being smarter than the average bear, isn’t it?
Sure there is SOME truth to the speculators bringing up prices.
But being that you’re writing on TTAC, I’m going to assume you’re a car guy and thus kind of keep up with the news (automotively speaking)?
Like, the fact that the Chinese are moving from mopeds and small motorcycles to automobiles? Like the fact that TATA is going to start churning out $2500 cars for the Indians so they don’t have 5 people on one 50cc scooter on family outings?
And that these vehicles all require fuel in greater quantities than the scooters which they are replacing?
And that there is only so much oil to go around?
BTW, there is “some chance” that the US could pay off all its debts. There has been a precident in the recent past.
It was called the Weimar Republic. The victors of World War I declared that Germany owed them God only knows how many millions of marks for war reparations.
“If it is marks they want, it is marks that they will get.” (“Krrrank up ze prrrrinting prezzes!”)
It’s called monetarizing the debt. AKA hyperinflation. Look at Zimbabwe.
So, yeah, looking around with discernment is not such a dumb thing to do.
Now, if only the Detroit auto executives had yanked their heads of out their – whoops this is a family friendly site – out of the sand…
Alan is just gambling that if he is right, he will make a bunch of money off his supposed ability to forecast the market. OTOH, if he is wrong, few folks will remember.
$6 tops.
gregw: Actually, I think my math is quite right. It’s my over-simplification that causes your objection. As you note, there are other products produced in refining a barrel of oil. I should have stated: “About 20 gallons of gasoline are produced from a barrel of oil, but other products are also produced from that barrel. Those other products have about the same value as the gasoline. Accordingly, about 1/2 the cost of a barrel of oil goes into making 20 gallons of fuel. Simplifying: the oil cost of a gallon of gasoline is 1/2 * barrel cost / 20 = barrel cost / 40.”
You note that $200/barrel will yield $6 gas (not counting increased taxes or increased refining costs). I used two different calculations to reach the numbers $5.65 and $6.10–right within your range. The $6.10 figure assumes all costs scale the same as the change in oil cost.
You are absolutely correct that refining margins increase with gasoline demand (which usually occurs in the summer). However, demand decreases with high prices. Thus oil prices are negatively correlated with refining costs, as can be seen quite clearly on the AAA website. I’m not sure that the refining margin can get any smaller, but I don’t see it getting larger with $200/barrel oil either.
As for increased taxes, the federal tax is a fixed amount. No increase there. States are going to feel the pressure to lower/freeze/stop taxes on fuel, as it will somewhat relieve their constituents at the expense of people in other states. I came up with the $6.10 figure based on no fixed costs. i.e.: $3.60 * 200/118 = $6.10. You need taxes to scale more than linearly to exceed $6.10. Also, 2 out of 3 presidential candidates want to cut the federal tax.
As for higher costs related to stronger environmental regulations, you are right again but miss an important point: because of higher costs associated with stronger regulations, we won’t see stronger regulations! During the Katrina incident, G.W.B. actually demanded that the EPA temporarily lower regulations for the specific purpose of reducing fuel costs.
So… I think $7/gallon will come, but not in the next few years if oil “only” goes to $200. We’ll need oil at $230 or we’ll need another Katrina.
Anything can happen. Ok, that’s out of the way.
California has been consuming less gasoline, month over month, for over 18 months now. While the media will always highlight the (real) plight of specific folks from the working poor sector to humanize the story, there is still non-essential demand that can be wrung out of the buy side as prices rise, while longer term shifts in the fleet composition materialize. More to the point, there is still plenty of non-essential consumer spending that can shift to energy without seriously affecting people, other than their mood. So $10 gasoline in the US is unlikely in the time-window warned.
But if it does materialize, even that’s not a wholly dark development. Long before $240 oil, oil moving north of $160 brings progressively more unconventional energy sources within viability. At $118, shale oil can’t be economically brought to market, but at $200+ it can, and continental US shale oil deposits are estimated at up to 12X all the oil in Saudi Arabia. Coal liquification, clean coal, synthetic fuels, mass-scale solar all change the supply side , which can either push fuel prices back down some, or ensure sustainability of domestic sources. More to the point, consider what happens to the dollar if most of the cash we ship out to buy foreign oil instead stays within the US economy? You don’t even have to get into shale oil to get that benefit. Offshore drilling, safe ANWR extraction, expanded nuclear power, mass-scale clean coal, domestic solar farming all can displace a substantial portion of oil imports.
The situation instigating the hand-wringing here is far from unmanageable.
The world now has deeply interconnected interests. The Chinese might not be devastated by a deep US recession, but you can be sure they do not want to lose the American market. Same for India and the EU. Our primary current economic crisis, housing and related credit, isn’t propelled by energy inflation. And even now, for most people automotive fuel is more affordable than it was in 1981. It’s just that too many people got accustomed to 1999.
Until comprehensive supply side reaction to new demand pressure asserts itself, we’ll see temporal and locational price volatility. We’re as likely to see $2.00 gasoline again in the US as we are to see $6.50. But for the majority of people, if they’re really honest with themselves, this run-up requires an adjustment quite different from being an emergency.
A very well-off friend commented this morning that driving to Coachella and back this weekend cost him $200. He’s very well off and that expense was meaningless. But it still made him think about the cost. He mused that “this is going to start affecting people’s choices about when and where they drive.” Yeah, perhaps, and there’s no doubt it’s easy to wound the consumer psychology of Americans through their perception of what fuel should cost. Or other things. Locally, restaurant waiters are noticing that tips are getting smaller again, and as one server was quoted in an LA Times article, “Big men are ordering littler steaks than they used to.” No doubt these price surges ripple.
But unless the jobs machine completely unravels, we are facing problems well within our prior experience, with more knowledge and tools for managing them if people with memory pre-dating Bill Clinton have their hands on the wheel.
It’s entirely possible that we will not see true recession conditions this year. Scant to no-growth for a quarter or two, sure. But export markets out-scale the economic activity suppressed by the housing dive. Even (artificially-driven) energy inflation has the silver lining of triggering expansion of unconventional supply.
The New York media is especially adroit at talking us into a crisis out of scale with reality. Pay less attention to that.
Phil
Phil Ressler:
The New York media is especially adroit at talking us into a crisis out of scale with reality. Pay less attention to that.
As a daily reader of the opinion section of the NYT on-line, I could not agree more.
Its as if they represent people that live in a different country. Everything is a crisis that will end the world as we know it. There seems to be a delusional amnesia that makes their writers forget what it was that was going to doom mankind last year, or twenty years ago for that matter.
OK.
So by disagreeing with the scare tactic crowd, I get acused of putting head in the sand.
So be it.
This has always been the come back.
But there is no way to strike back.
I cannot confront blind faith. Nothing is harder to deal with than the True Believer….
But I will insist that global warming, although Gore Faithful keep shouting, has not been proven as damaging or even as confrontable as shouted.
Let alone proven that BAD MANKIND is responsible.
And I recently heard more experts warning of an actual cooling of the Earth that actually spells greater trouble.
Hmmm…what to do and whom to believe!?
Oil shortage?
Brazil just discovered two of the worlds largest oil fields IN HISTORY.
OK…what now?
I listened to experts on the news today trying to explain that there was actually plenty of fuel to meet todays demand and they simply could not explain the speculation.
Yes, I am sorry…but speculation is MORE than a small part in the oil price today.
That, and the fact that every spring the refineries find a reason to shut down facilities for maintenance.
And another sorry government interference note…we actually would have MORE refineries IF the do-gooders would NOT have placed so many obsticles (read restrictions) into the construction.
It has become, like our nuclear plants, ridiculously expensive to build with their regulations.
Yes, heating oil would be cheeper IF we had more nuclear power…thus gas would be as well.
So, thank you weirdos.
Thanks again to all those crying wolf yesteryear and today…when they actually play(ed) a huge part in the entire affair that we have.
As a side note…how many are aware that there have been five…yes 5…periods in earth’s history where nearly the entire population (95%)of life had been wipe clean off its surface.
Really, makes you feel really powerful, right?
Panic, everybody!!!
One more thing…
Yes, like everybody who reads TTAC, I am a really sick car nut.
I actually have 5 cars and am always on the look out for another.
Really looking forward to the new diesels coming in.
By the way…one more big big shout out to the do-gooders that placed such restrictions on the diesels , thus forcing them off the market.
Thanks, really.
And one more thing yet again…
p
Please somebody tell me what the government tax on fuel or gas is in Europe.
I understand THIS plays the biggest part of the pricing in the socialistic states they have.
PLUS…why, if they are so environmentally aware, do THEY get diesels and not us!?
It’s as if they represent people that live in a different country.
I live in Los Angeles, but I am from the east coast, through the first decade of my working career. In March I attended a conference in New York City; Manhattan. The morning I left from LAX, a headline broke on latimes.com saying that UCLA’s econometrics group forecasts no recession in 2008. This is a group that has an excellent track record for economic prognostication over the last 15 – 20 years. They did outline a number of threats that could derail their forecast, but the gist was that we’d avoid quarter-over-quarter decline. It might feel like recession to some people but overall, no recession.
I boarded a JetBlue flight (first time; yeah, the ads oversell it) and for the next four hours flipped around the usual array of financial news channels, most coming out of New York. The reporting and commentary was saturated with gloom. The newspapers were just as negative when I landed. Oh, yeah, the Eliot Spitzer hooker story was breaking too.
By the time I landed at JFK, the crumbling mood was palpable. I slipped into a cab, immediately engaged by my Russian immigrant cab driver on the sorry state of the economy.
“What you think; will U.S. survive this?” Huh?
“Bush, Congress do nothing. Eight years ago, it cost me dollar gallon to fill my tank in my cab. Now over three dollars!”
I pointed out that eight years ago, gasoline was cheaper in real dollars than it was in 1969. That wasn’t a sustainable reality so no use pining for $1 gas in 2008. He shrugged. “You have point.”
I asked my driver whether he’d be better off driving a cab now in Moscow or in New York. Would he have a better life in Russia? “New York of course! Moscow worse in every way!”
I said I think the U.S. will survive this situation; I’d seen worse before.
By the time we rolled up to my hotel, my driver’s mood had shifted a bit. “You say you fly from L.A.? Maybe should move there. Everybody I drive from there seem more — what do you say — optimistic.”
Yeah. Maybe. Did I mention that gasoline in California costs even more than it does in New York?
Phil
Phil,
Your comment makes me think that maybe the economic news is even worsely exagerated than usual because right now it’s NY itself looking at hard times due to the financials all laying off to recover from their lunacy. So much of our news comes from NY.