Gas Prices continue so soar

[TotallyOz]

As the summer travel months are in full force, the price of gas just keeps on increasing. In many parts of the country it is 4.00 USD a gallon. Some analysis's predict it will top 5 before year's end.

Continental is the latest airline to cut costs because of sky rocketing fuel prices. It says it will cut 3,000 jobs from its 45,000 employee roster.

Food prices keep going up as most items are linked to trucks getting food to the shelves.

I recently tried to get a package shipped from California to friends in Michigan and the costs were crazy expensive. They said they had increased 20 percent in the last 2 months.

I spoke to my cousin who is a 18 wheel trucker who transports logs from one state to another and he said that he is down on business as the rates some companies pay are just not enough to cover the costs of the trip.

When on a recent stint in LA, I noticed a great number of people using their bikes to get to work. If I were in LA permanently, I would do the same. They have great bike paths and bike lanes in the streets just for this. Unfortunately, most cities do not have as extensive of a bike network as LA does.

It seems like ever sector of the economy is dependent on oil and gas. Is there an end in sight?

[TampaYankee]

It seems like ever sector of the economy is dependent on oil and gas. Is there an end in sight?

Not through my telescope. Welcome to the World of Globalization and wreckless international adventurism, not to mention our long-term head-in-the-sand perspective supported by energy industry lobbyists. I believe we are looking at the beginning of a paradigm shift in energy resource utilization and its impact on society.

I doubt that things will ever be quite the same again. Consider that the appearance of a hurricane within 1000 miles of the US or a minor bellicose action or remarks from some third world countries causes the energy futures market to quake.

On the plus side, eventually the dollar will regain some, maybe much of its former value -- maybe. That will help lower the price of oil, possibly by an appreciable fraction, but nowhere back to where it was. We still must compete with growing appetities of China and India for overseas oil sources. To the extent that oil costs decrease, the price pressure on food and other commodities will decrease.

We will accommodate circumstances over the long run, not without pain, with more conservation efforts and efficient autos and home heating units and, if we come to our senses, nuclear power; as well as affordable effective fuel cell technology. Other alternative energy sources will come on line because they will finally be competitive with the high cost of fossil fuels acquistion and use.

Over the longer term, without a breakthrough in battery and fuel cell cost and efficacy, there will be a shift back to cities, big and not so big, where long commutes will give way to public transportation. On the other hand, companies will come under pressure to accommodate more online work from home. Casual air travel will become a memory for many.

I wish we could go home again... but this isn't Kansas anymore. What factors got us into this predicament and which of those factors are reversable? The dollar is reversable if we choose to make it so. Will Iraq and Iran become free of turmoil and be happy peaceful producers with oil spickets wide open? How long will Saudi Arabia remain free of strife? What is the future of Venezeula and Mexico as accommodating oil producers? Will OPEC open the spickets for the good of all? Will China and India go into permanent recession thereby removing pressure on world energy sources. Will the Gulf of Mexico become a hurricane-free zone? It seems that we have reached a tipping point with so many factors that can potentially impact the acquistion of oil that a problem with one of them causes impact to world oil prices beyond its proportion.

IMO things will get better but not good -- if we get our dollar back from the brink of bankruptcy-- good as defined by a year ago. But any improvements will have a limited shelf life as the economic and political pressures outlined above continue to affect the markets.

Only development of alternative energy sources can help to allieviate permanently the long-term pressure on the markets. Additional drilling can help in the short term, but this is a patch at best, definitely not a long-term solution. If viewed as the latter we are doomed to repeat the past when the oil embargo of the 70s demonstrated our precariousness with respect to energy supply when we thumped our breasts in concern then buried our heads in the sand.

My advice: sell the SUV yesterday and start a garden today.

I know this sounds like the sky is falling but for some, like long-haul truckers, layed-off airline employees and moms feeding families, it is. For many others it just represents a notable decrease in the standard of living.

I hope I am proven wrong.

[Guest StuCotts]

Some cases in point: regular gas @ 3.85 in Ft Lee, NJ (cheapest I've heard of anywhere), and 4.50 in the Newport Beach area of Orange County, CA. The price of everything I buy at the supermarket is up, without exception, radically so in some cases.

I'd love to think it's a momentary glitch, but can't.

[TampaYankee]

Oil up another $11/barrel in one day and headed to $150/barrel by July. Will the good news never end?

I am happy that my commuting days are behind me. The bad news... I heat with propane, the price of which virtually tracks with gasoline. Electric space heaters are in my future once again. Fifteen years ago I removed expensive electric home heating in favor of cheap propane. What's old is new again.

[AdamSmith]

Some cases in point: regular gas @ 3.85 in Ft Lee, NJ (cheapest I've heard of anywhere), and 4.50 in the Newport Beach area of Orange County, CA. The price of everything I buy at the supermarket is up, without exception, radically so in some cases.

I'd love to think it's a momentary glitch, but can't.

Tomorrow's NY Times Book Review has a cheerful ad for The End of Food, newest tome from the author of The End of Oil. On top of the looming global crisis over potable water.

Apres nous, le deluge. Or lack thereof, as may be.

[lookin]

Is there an end in sight?

The price of gas is definitely in the news these days, but what’s more interesting to me is “What are we going to do about it?â€. Last year, I concluded that my next car will be a hybrid that averages at least 40mpg. This year, for the first time ever, I started calculating the cost of gas when I was planning a discretionary trip. It’s about time I started thinking differently. Europeans have been doing it for decades.

We’ve had a cheap gas policy in the U.S. forever. Most countries have a long history of taxing the hell out of gas in order to affect consumer decisions, and to fund alternative transportation as well as social programs. And a few countries subsidize gas even today.

Recent gas prices ($/gallon):

Norway 10.37

Netherlands 9.73

Denmark 9.31

Italy 8.78

Germany 8.74

Sweden 8.71

United Kingdom 8.56

Hong Kong 8.33

France 8.06

Israel 7.95

Spain 7.34

Switzerland 7.12

Singapore 6.06

Brazil 6.02

Japan 5.83

Canada 5.49

India 5.15

South Africa 4.66

Thailand 4.47

Pakistan 4.01

United States 3.99

Russia 3.79

China 2.80

Kuwait .79

Venezuela .19

Source: Wikipedia

Compared with the rest of the world, we’ve still got cheap gas, primarily because we don’t tax it very much - about 15%.

It’s possible things will cool down in the Middle East, and speculators will get their wings clipped, but I’m not counting on it. If everything breaks our way, prices may stabilize for a while, but I don’t see how they could ever return to the $2.00 a gallon we paid in 2005. If we want to keep our gas budget where it was a couple of years ago, we’ll have to cut our gas usage in half.

That’s what the rest of the world is doing, and now it’s our turn. The good news is we can do it if we want to, and I think we’re finally starting to want to.

[boiworship]

The only good thing about higher gas prices is that the traffic on the freeways out here in Southern California has gotten noticeably better and all the new cars are small, not the hulking SUV's and trucks. I work from home mostly so the price is an irritant rather than an economic disaster. That said, the US has an oversized belt that will allow for a lot of tightening and hopefully the era of high energy prices will lead to investment in solar and wind power, among other viable energy sources. As a frequent traveler to Europe, I always wondered why those wonderful 1.2 litre turbo diesels that I always enjoyed zipping along the autostrade in were never imported to the US.

[Guest Conway]

The only good thing about higher gas prices is that the traffic on the freeways out here in Southern California has gotten noticeably better and all the new cars are small, not the hulking SUV's and trucks. I work from home mostly so the price is an irritant rather than an economic disaster. That said, the US has an oversized belt that will allow for a lot of tightening and hopefully the era of high energy prices will lead to investment in solar and wind power, among other viable energy sources. As a frequent traveler to Europe, I always wondered why those wonderful 1.2 litre turbo diesels that I always enjoyed zipping along the autostrade in were never imported to the US.

One of the reasons that industry hasn't developed alternative energy methods, especially for transportation, is that we, as Americans, hadn't been subjected to enough financial stress historically to demand it. Now, with a tank of gas approaching $110 for SUV driving mommies, there's a market for reliable automobiles that run on alternative fuel sources and can haul loads of their screaming miscreants around.

I love my fast, gas guzzling 325 horsepower Infiniti. But, with $5 gas not far away on the horizon here in Obamaland (I paid $4.75 today), my next car will likely be a fuel sipper.

[OneFinger]

Electric space heaters are in my future once again.

TY, just a suggestion on electric space heaters. Rather than using the kind with an exposed heating element and air, I'm using the kind that looks like a small, old fashioned radiator. I found these much safer and economical than other heaters.

I usually keep my home thermostat to 63 degrees and then use space heaters for the specific room I'm in. Has really saved on my heating bills.

Now, on the cost of oil, I've got to agree that it's going to raise prices in many areas. I personally believe that this is going to be a very long-term problem that's not going to get quickly resolved by whomever moves into the White House.

One area that you may not think is affected by oil prices is road construction. The availability of asphalt is becoming scare. I believe the feds and state gov't get priority on available asphalt for freeways and state roads. That means that city and towns will have a difficult time being able to resurface their roads or even fix pot holes.

I know the road in my neighborhood is already crumbing from years of neglect by the city. It's only going to get worse.

Another problem with road work is availability of concrete. Many of the freeways in my area are concrete. But with the construction boom in China, the availability of concrete in the USA is very scarce. Plus the cost is rising due to the limited supply.