Gasoline Prices
In the mid fifties, I was into cars…old cars. I drove a 1938 Plymouth which I bought for $35. It was in constant need of repair. While I was able to do most of the repairs myself, once in a while I needed some expertise. That’s when I would go to Orlin, a mechanic who had a repair shop just a few steps from his home.
Orlin was proud of the fact that he had tinkered with the carburetor on his car and was able to get over 30 miles per gallon of gas. Unheard of in those days. I asked him why he didn’t patent his modification and sell it to Ford or GM. Orlin told me it wouldn’t do any good. “They aren’t interested in saving gasoline. They’ve been bought out by the oil producers.”
I didn’t fully understand what he meant at the time, but now I question the wisdom of our government. Maybe the answer to high gasoline prices is not more production as our President is promoting, but more emphasis on higher effeciency vehicles, and alternative fuels.
President Bush is seeking relief from record-high gas prices and support for Middle East peace as he opens his Texas ranch to Crown Prince Abdullah of Saudi Arabia, the world’s largest oil producer.
April 25th, 2005 at 10:10 am
An understanding of Hubert’s Peak ( one reference would be http://www.hubbertpeak.com/index.html) would lead to the conclusion that it would be folly to expect Arabia to be able to increase their production from 12.5 to 15 mbpd. In general, global increases in oil production will be sopped up by the soaring demands in China and India placing greater pressure on price.
The good news is that we will never run out of oil…..as the price increases other forms of energy will begin to compete. It would be helpful if we would think less in terms of government regulation (a la Carter) and more in terms of free market economics with its automatic checks and balances.
August 22nd, 2005 at 12:20 am
I agree with I & A above. I don’t think there’s much our government can do about energy prices except in the very short term (they could probably lower them in the short term by releasing a large amount of oil from the strategic reserve). With the development in India and China of a middle class who want cars and who demand consumer goods which require energy to produce, the demand for oil will continue to rise. At the same time, most major oil companies are not finding enough new reserves to replace what they are now pumping each year so it is probably impossible for oil supply to keep up with rising demand. While the US is a major consumer, I think the era is over when we dominate world demand and can drop the price by dropping our domestic demand through conservation or increase it much by finding new domestic reserves (such as in the ANWR) . The bottom line is that I think relatively expensive energy is here to stay but if it gets extremely expensive, at some point the cost will stabilize by limiting the demand.
August 25th, 2005 at 12:24 pm
So sad the government has done virtually nothing to decrease the demand for oil in this country—in fact, they have done the reverse. No meaningful increase in the miles-per-gallon (CALF)requirements in years, when the technology is clearly available to do so; tax INCENTIVES for purchasing gas guzzelors; not pushing nuclear energy; failure to take any steps to decrease demand by increasing the gas tax; failure to push alternative fuel sources; caving to political pressure for an increase in the use of agricultural products to produce gasohol, which has been factually shown to use more energy to produce then it saves; tax breaks for the oil industry which have nothing to do with the increased production of enegrgy, etc.etc.etc.
We have tough times ahead due to lack of a sensible energy policy in this country.