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The Specter of Gasoline At $5 a Gallon
Hugh Pickens writes "The NY Times reports that gas prices are already at record highs for the winter months — averaging $4.32 in California and $3.73 a gallon nationally. As summer approaches, demand for gasoline rises, typically pushing prices up around 20 cents a gallon. But gas prices could rise another 50 cents a gallon or more, analysts say, if the diplomatic and economic standoff over Iran's nuclear ambitions escalates into military conflict or there is some other major supply disruption. 'If we get some kind of explosion — like an Israeli attack or some local Iranian revolutionary guard decides to take matters in his own hands and attacks a tanker — than we'd see oil prices push up 20 to 25 percent higher and another 50 cents a gallon at the pump,' says Michael C. Lynch, president of Strategic Energy and Economic Research. A sharp rise in the prices of oil and gas would crimp the nation's budding economic recovery would cause big political problems at home for President Obama, who is already being attacked by Republican presidential candidates over gas prices and his overall energy policies. On the other hand, environmentalists see high gas prices as a helpful step toward the development of alternative energy. Secretary Treasury Steven Chu notably said in 2008 'we have to figure out how to boost the price of gasoline to the levels in Europe' to make Americans trade in their 'love affair with the automobile' for a marriage to mass transit. In the meantime President Obama is in a bind because any success in tightening sanctions on Iran could squeeze global oil supplies, pushing up prices and causing serious economic repercussions at home and abroad."
Most of us would love to use a viable and convenient mass transit system, and thus use as little fuel as you are able, but it's simply not practical.
I've tried to use the bus system in my city - I can drive 15 minutes to work, or I can bus for about an hour and fifteen minutes. It's not worth losing an hour each way.
Unfortunately, cities here are focused on building massively expensive 'boutique' mass transit that only gives current riders fancier options, and doesn't actually introduce new riders who used to be driving.
We really need more subways here in US cities, but even those might have limited use as so many people live in suburbs where an underground probably wouldn't run anyway.
There is a difference of scale.
How far do you in the U.K. drive in an average work day?
Here in the states, some days I drive 400+ (~640km) miles, especially when prospecting for new clients. Even when not prospecting the distance is around 100 miles per day (~160km) because I live in a rural suburb.
Any differences in price of gasoline (petrol :) might be partially accounted for by sales volume.
The United States is a big frikkin' place.
Australia is a similarly big country, with a much greater amount of vast empty wasteland and having to travel 100miles plus to a doctor (flying doctors normally cover an area around the size of the UK each).
http://www.fuelwatch.wa.gov.au/fuelwatch/pages/home.jspx
The prices are AU$ per litre. Multiply by 3.8 (ish) to get US Gallons. Hint: Diesel's gonna cost ya over 5 AU$ which is more than 5 US$.
If the US price were really hit that bad by petrol prices, you'd have rural petrol subsidies and/or inner-city petrol taxes to compensate.
The US may finally have to live in the real world regarding petrol prices and why European engines are "small" and yet can still do 70mph with a family of kids in the back and towing a caravan without even struggling.
I agree. Voters and governments in Europe have made the choice to tax themselves up the wazoo on fuel. It's more tolerable there given their denser population, better public transit and "leaner" lifestyles. But the spot price of gasoline at the port in Rotterdam is almost exactly the same as it is in New York Harbor or the Gulf Coast. Europeans don't have to pay $8/gallon. Unrelated: It's also interesting to note that after years of $8 fuel in Europe, they have adapted with small diesels. There is little to no sign of the renewable fuels you hear being pitched by politicians on both sides of the pond.
here in Rochester, NY the buses run relatively on-time, they're not over crowded, text or email the bus stop number to the transit authority and you'll get a reply with the next arrival time, most of the stations in the city have lighted signs indicating arrivals and departures, and it costs a buck, and has for 20 years. Add to that the day passes, electronic passes, and the fact that the system extends to all the suburbs you find many people riding these buses.
Many of the problems you mention still exist, the hour long commute most obviously, but it's not the worst place in the world to catch a bus.
What's that?? Us English shout and scream every time the Government raise petrol tax. Occasionally we protest too.
As far as I know we're already diluting regular unleaded with up to (by law) 5% ethanol - with the resultant loss in MPG, and there's moves to increase this to 10%. Alas figuring out who's diluting regular petrol with this crap and selling it for 5p more than my current supermarket petrol is difficult.
I'm talking about a tank of fuel that one fill up takes 35mpg from station, to 25 from another ... same journeys, same weather. same week.
I drive a good 130 miles a day to work and back currently. Though in the UK that's not a normal commute.
Is it any wonder why mass transit is mostly a big fail in the US? In Europe, we pay for it with taxes. You need to get over the idea that you have to drive your big SUV everywhere and use taxes to build the infrastructure to support a working mass transit system.
Gas is only going to get more expensive, at what point do you get off the gas-addiction wagon?
Disclaimer: As an American living abroad, let me say my view of the US has radically changed in just over 10 years. We were raised in the US that we were the best country in the world at practically everything. Let me tell you, most of it was dead wrong. Yes, there are some really good things about the US but on the whole, I have to say I'm happier, less overworked and enjoying life more in Europe. I would not move back the the US permanently at this point, it would be a downgrade in practically every category.
The problem most people don't understand is that all the "easy" oil in the world has already been claimed. That's why the industry is looking at fracking. That's why they are drilling in the deep ocean. A friend of mine works at Exxon and they tapped a site that had like 30% sulfur (sour crude). Refining crude with heavy sulfur can be done but it's costlier to remove. Sulfur with high concentrations of H2S will mix with water and can be corrosive. An older engineer told her that 30 years ago, they would have capped that well and moved on. These days they have no choice to use it.
Well, there's spam egg sausage and spam, that's not got much spam in it.