oil prices

[wesw]

59.15/barrel this morning.

thoughts?

[oldr_n_wsr]

I am enjoying hte lower prices at the gas pump and will enjoy the lower prices to heat my house this winter. I am sure much of the middle class will use the extra money to purchase Christmas presents and will fret less about the decision to buy presents or eat. And if a few more SUVs are bought rather than Prius, so be it. I just bought a new Subaru Forester and am getting better gas milage then in my PT Cruiser. If greeies are worried about all the new oil wells that came on line polluting the world, they can rest assured that with the low barrel price a lot of them will be mothballed as it has become too expensive to extract that oil.

As others have written before, no other commodity has as far reaching affects on the economy as the price of oil does. Oil is the God commodity. When the price of oil goes up, the price of everything goes up, and visa versa.

[Lord Jim]

I think gas is too cheap, but that doesn't mean I think it should be more expensive...

[oldr_n_wsr]

I think gas is too cheap, but that doesn't mean I think it should be more expensive...

Why do you say gas is too cheap?

[Lord Jim]

It's a joke oldr...

Remember the fellow who said that food was too cheap, but then later said he didn't think it should be made more expensive? (He's also said he'd like to see higher gas prices)

[oldr_n_wsr]

It's a joke oldr...

Remember the fellow who said that food was too cheap, but then later said he didn't think it should be made more expensive? (He's also said he'd like to see higher gas prices)

I missed that joke as you were one of the ones who also that said low gas prices are good for the economy thus my confusion. My bad.

[Lord Jim]

you were one of the ones who also that said low gas prices are good for the economy

Absolutely. Lower gas prices, (and energy costs in general) represent a huge stimulus for the economy that doesn't cost the government a dime. In fact because this boost also creates more jobs, government revenues will actually go up, as the number of taxpayers is increased....(plus the revenue from sales taxes)

In addition, this also means lower costs for every good or service that requires transport, so the money saved at the pump will also go further, and those at the lowest end of the economic spectrum also benefit as a result of lower costs for basic items. (like food)

It's a win-win-win all the way around...

[oldr_n_wsr]

That's why I call it the "God Commodity".
I can't think of anything else that is openly traded that has such influence on the economy.

[oldr_n_wsr]

Who wrote this?

Why cheap gasoline is bad for America

The other day, I heard an elderly couple interviewed on the radio about our current astonishing drop in gas prices. They gave a variation on “we’re on a fixed income, so every little bit of savings counts.” Like many Americans, they don’t have a lot of transit options. An article in The Economist this week said that the price reduction could save the average family $800 a year, or more. That’s no small amount when margins are tight.

Not everyone is broke, though. Low gas prices are putting us in the mood for new cars, sales of which are at their highest point in 11 years. Under these circumstances, we make odd choices, like besotted fools buying more diamond than we can afford. Sound the bells, because Americans are going to start purchasing guzzlers. This is what always happens when gas prices go down. At last, our long national nightmare of driving slightly smaller vehicles with slightly better fuel economy can end; the average efficiency of all new vehicles sold fell last month for the first time in four years. Once again, we can spend freely on our one true love: Gasoline.

We are insane.

Saying “gas is now cheap, so I’m going to buy a bigger car” is like saying “the price of bread went down, so I’m going to get a bigger toaster oven.” The attitude should be, well, gas is cheap, so I’m going to get a more fuel-efficient car and save even more money. But this is an all-you-can-eat gas buffet being offered. We don’t say no to a buffet in this country.

I have a relative —intelligent, liberal-minded, at least vaguely concerned about climate change —who’s well-off enough to buy a Lexus. He was considering an RX hybrid, but decided to go with the regular RX instead, even though all the fixtures were the same. Why? Because of low gas prices. It would take him a lot longer to save the expense, he says, incurred by paying the premium for the hybrid car. He’s probably right. But multiply his decision by a thousand, or ten thousand, or a million, and we’re tap-dancing in carbon heaven. Any trace of environmental concern in America vanishes when the possibility of cheap gas appears.

I’m envious of Germany, so committed to an alternative energy future that it’s coined a word, energiweide, or “energy transition,” to help lead its population into a glorious Teutonic solar-powered age. You can see that reflected in the output of the German carmakers. The Volkswagen group, Mercedes, and BMW are all making enormous leaps in fuel-economy tech and alternative energy cars. Those cars have small market share, and will for a while, but they’re also emerging from a specific set of policies. They represent a different, almost annoying, European idea of what car culture should be.

In the States, we have different priorities. Despite the obvious environmental costs of car emissions, not to mention shale drilling, American politics are committed to the Constitutional principle of fuel-horkitude. Our incoming Congress, which would authorize fracking next to Old Faithful if it could, isn’t going to add one cent onto the current gas tax. If President Obama tried to do that via executive order, there’d be marching on the White House, and the marchers wouldn’t be carrying torches and pitchforks. In such an environment, carmakers aren’t going to do anything they don’t have to. Cheap gas prices make their jobs a lot easier than mandated “energy transitions” do. They know how to make fuel hogs, and we love to drive them, because we’re America.

Believe me, I understand these temptations. My colleague Mark Morford argued this week that “$2 gas is the worst thing to happen to America.” He lives in San Francisco and drives fewer than 6,000 miles a year. I, on the other hand, have occasionally clocked that many miles a month. I just drove from Texas to Arizona and back in a fuel-eating monstrosity. It cost me $90 less than the same trip in 2013. I’m about to drive to Colorado in a huge, ugly car that gets terrible gas mileage, and I’m not that worried about the expense. My wife commutes 250 miles a week to work. We live in a city that just soundly rejected a public-transit ballot proposal. I need to drive and I need to drive a lot. Few people benefit more from cheaper gas than I do. But I still agree with Mr. Morford.

Like gas itself, the temptation smells a little sweet, but is actually a deadly poison. Just because gas is cheap doesn’t mean cheap gas is our birthright. We’re being deliberately led, or maybe we’re leading ourselves, to a dystopian car future that looks pretty much like the present we live in now, except the traffic is even more snarled, the roads and bridges even more degraded (because, once again, we're unwilling to raise the gas tax that pays for their repairs), and the end to our unhealthy dependence on oil nowhere in sight. This is a truly moronic moment. At some point, we’re going to have to back away from the buffet.

Yes, theren are some people who are going to get a larger car less fuel efficient car that they might have had gas wtill been way over $3 a gallon. I recently bought a subaru forester but so far it is getting about 5mpg better than my 2002 PT Cruiser. I do have to question the authors commitment to the environment though. He is driving many many miles in a " fuel-eating monstrosity....... ugly car that gets terrible gas mileage". Sounds like all those "stars" who drive prius' but then each hop on their own private jet to the economic summit.

[MajGenl.Meade]

It was this genius:

$2.40/gallon here in Portage County yesterday and likely to fall (they say). Them. While I feel an uncontrollable urge* to rush out and buy a Hummer (no missus; not that kind) while displaying the illuminated, self-inflated Christmas Jeremy Clarkson on my front lawn, I have discovered the low price of petrol has not suddenly increased my income nor inflated my bank balance to Mr. Clarkson's noble girth. For these reasons, my uncontrollable urge - as with so many others - just died the death.

Who on earth are these people who actually do run out and buy a gas guzzler based on the saving of a dollar a gallon on petrol? It makes no rational sense whatever

*

*

[wesw]

I have a 75 ford that I need (italics). I rarely use it, but when I need it , I need it. I can t hire a handy man, I can t hire a mover or hauler, I can t buy a newer more efficient truck. I can keep "old blue" alive.

I filled it up early last summer and still have 1/2 a tank of gas I think, the gauge is broken.....

its mine, its paid for. if anyone has a problem with that, nah nah nah na nah nah.....

I fabbed a new floor for it about a month ago, next are the cab supports. next spring that is.....

[wesw]

it ll be worth a fortune if we have EMP attack.......

I still need a sheet of lead to encase my electronic ignition tho. I have to stop putting that off.....

[Lord Jim]

Having a relative handful of people who buy larger or less fuel efficient cars than they would have otherwise doesn't amount to fart in hurricane when balanced against the enormous economic benefits of lower fuel costs...

This would be a situation where one could appropriately use the word "tiny"...

[wesw]

actually, keeping an old truck going, saves energy in the long run according to some theories.

I would love an electric or fuel cell car, but it s just not in the cards.....

[Scooter]

I see the economic benefits of lower fuel prices, obviously, but as just as obviously there are some people, who know a lot more about than I do, that do not, because the financial markets are continuing to take a beating as oil prices fall lower. I can understand it in Canada, where resource stocks dominate the exchanges, but why the Dow or the Dax or the FTSE continue to plunge as oil prices drop are dynamics that I confess I do not comprehend, but clearly the business community sees a downside to this that I do not.

[wesw]

they may just be taking profits.

[oldr_n_wsr]

but why the Dow or the Dax or the FTSE continue to plunge as oil prices drop are dynamics that I confess I do not comprehend

Me neither. Maybe some "paper value" of a some companies drops with the oil price so people sell it's stock. I think the stock market was up too high anyway.