$200 Oil

[metta]

How do you see increasing oil prices affecting your life today and into the future? Are you going to make adjustments in your life?

The LA Times has a story on the impact of $200 oil: Envisioning a world of $200-a-barrel oil. The story discusses some possible impacts of higher oil prices on consumer behavior, transportation, trade and the workplace (more telecommuting, fewer work days, etc.)

On housing:

As for the ... beleaguered housing market, prices are falling faster in areas requiring long commutes -- such as Lancaster and Palmdale -- than in neighborhoods closer to job centers.

Sky-high gas prices "would basically reorient society to where proximity would be more valuable," said Tom Gilligan, finance professor at USC.​

For trade:

"To put things in perspective, today's extra shipping cost from East Asia is the equivalent of imposing a 9% tariff on East Asian goods entering North America," said Rubin of CIBC World Markets. "At $200 per barrel, the tariff equivalent rate will rise to 15%."​

All the same arguments have been made for $140 oil.

We are already witnessing the decline of the exurban lifestyle. And on trade, Professor Krugman recently noted: The world gets bigger.

For the U.S. auto industry, sales are already close to what one analyst called "Armageddon. Doomsday."

So the impacts discussed in the LA Times story are already happening. $200 per barrel oil will just makes them more severe.

http://www.latimes.com/business/la-fi-oil28-2008jun28,0,5485259.story

"The purchasing power of the American people would be kicked in the teeth so darned hard by $200-a-barrel oil that they won't have the ability to buy much of anything," said S. David Freeman, president of the L.A. Board of Harbor Commissioners and author of the 2007 book "Winning Our Energy Independence."

BIGresearch of Worthington, Ohio, said more than half of Californians in a recent survey said they were driving less because of high gas prices. Almost 42% said they had reduced vacation travel and 40% said they were dining out less.

Nationwide, $200 oil and $7 gasoline would force Americans to take 10 million vehicles off the roads over the next four years, Jeff Rubin, chief economist at CIBC World Markets, wrote in a recent report.

Travelers can also expect much fuller airplanes and much more expensive flights -- when they're available at all. Delta Air Lines Inc., for example, recently said it was cutting about 13% of its flights from Los Angeles International Airport to save fuel.

It takes about 7,000 tons of bunker-fuel to fill the tanks of a 5,000-container cargo ship for a trip from Shanghai to Los Angeles. Over the last year and half, the cost of that fuel has jumped 87% to $552 a ton, according to the World Shipping Council, boosting the cost of a fill-up to more than $3.8 million.

"We're seeing companies go to four-day workweeks, place increased emphasis on working at home, show bigger interest in setting up satellite offices -- anything that gets commute times down and gets people off the road," said analyst Rob Enderle of Enderle Group in San Jose.

Although white-collar workers may be able to telecommute, they could also take a serious financial hit because soaring energy prices tend to wreak havoc on the stock market. The explosion of 401(k) plans and similar retirement accounts in the last few decades -- and the decline of traditional pensions with guaranteed payouts -- have tied workers' financial futures more closely to stocks than they were during the 1970s oil shocks. A prolonged Wall Street downturn could mean a no-frills retirement, or none at all.

In Southern California, with its many natural wonders, theme parks and other attractions, the prospect of a "staycation" may be less disappointing than for a resident of, say, Nebraska. And movies, a staple of the local economy, may prosper as Americans seek escapism and a (relatively) cheap night out.

And spending less time stuck in traffic on the 405? Priceless.

"More carpooling, fewer people on the freeways, more telecommuting -- in many ways, what would happen is what people have been trying to make happen for a long time," USC's Gilligan said.

 

[metta]

For me, I already work from home. I may need to buy a commercial building in the future, but for now, that will have to wait.

I will look at ways to be more energy efficient. I have been reading more about the up and coming technologies coming, such as improvments in solar and fuel cells, which will make me seriously consider working towards moving 'off the grid.' I'm not sure how likely that is to do for an urban/suburban single family home....but when it becomes feasible to do so, it will just make more and more sense to me.

In the mean time, I guess I will do more to cut energy use, where possilbe.

I'm also thinking about building up a sectioni of the hill on the side of my home so that I can create a flat area to grow vegetables. The only thing with that is I don't have the time to take care of it righ tnow and I know that it takes a lot of time. hmmm..

 

[Spiff]

I'm sure everyone will gradually adjust and make changes. It won't be easy, but we won't have a choice. Just don't expect that everyone will adapt overnight.

 

[trawler69]

The rising cost of fuel is the only way to put the brakes on the mad consumerist society we have created, the expectation in the west that it is our God given right to have exactly what we want when we want it and to be able to go wherever we want whenever we want and for it to be affordable to all.

Cost is the only way to focus our greedy minds. I am hoping that we react by becoming more efficient, travelling less, sourcing our food both locally and seasonally and, as a side effect, rebuild our local communities by cooperating with one another, sharing rides, employing local labour etc.

Well I can dream can't I?

In reality we'll probably sue the oil companies, riot and protest that our human rights are being removed and generally behave like petulant kids who are threatened with their toys being taken away

 

[Jersey Domino]

The rising cost of fuel is the only way to put the brakes on the mad consumerist society we have created, the expectation in the west that it is our God given right to have exactly what we want when we want it and to be able to go wherever we want whenever we want and for it to be affordable to all.

Cost is the only way to focus our greedy minds. I am hoping that we react by becoming more efficient, travelling less, sourcing our food both locally and seasonally and, as a side effect, rebuild our local communities by cooperating with one another, sharing rides, employing local labour etc.

Well I can dream can't I?

In reality we'll probably sue the oil companies, riot and protest that our human rights are being removed and generally behave like petulant kids who are threatened with their toys being taken away

Oh come on you dont think people are THAT Idiotic do you?

 

[tbonez]

No one to blame but ourselves not to mention the best thing that could happen IMO.

For decades the advancements in engine technology have been used in Europe to improve flue economy and reduce emissions ...Meanwhile here in NA the achievments have been squandered on fat, lumbering grotesque battle-ships with no regard for the impact on the environment.

 

[tmb1]

So what happens to all those small businesses that Bush says he cares so much about? If we are all consuming less it seems like a snowball affect into a deep recession. I like Obama's idea of raising taxes on the rich to help pay for the millions of jobs created in repairing our failing infrastructure. He also plans to create millions of jobs with seeking to change our oil consumption to green energies. Now that sounds like a vision.

 

[trawler69]

Oh come on you dont think people are THAT Idiotic do you?

I see the evidence daily:

 

[jjc_7]

I see the evidence daily:

^There's another way to cut our use of oil, I don't understand the ridiculous need for water bottles for anyone with access to clean drinking water from the tap.

$140 or $200+ oil will be the best thing to happen to our society. trawler69, I think your first post is bang on.

 

[looseliam]

I used to love road trips. Not so much anymore.

I was going to move into the city, but I'm only 6 miles away from work as it is.

I can't justify the added expense of travel.

Sucks, too. I hate the burbs.

 

[jamie_01930]

If you really would like to see $200 per barrel vote for McCain

 

[trawler69]

The general consciousness of our society has no comprehension the full extent of benefits a cycling-centric infrastructure and design can yield to the population at large.

Or to re-phrase: "The general consciousness of our governments comprehends perfectly the full extent of the detriment a cycling-centric infrastructure and design can yield to its overall income and control.

 

[youngnihilist]

Its probably a good thing, as too many people are acting obnoxiously by living beyond their means, and taking it out on everyone else

 

[tbonez]

Just filled up the car today, $80 for about 55 litres. (About 14 American gallons?)

Consider that in the UK it would have been about $120 (I'd guess)

Here's an interesting site: http://www.nationmaster.com/red/graph/ene_gas_pri-energy-gasoline-prices

Should last us about 2 weeks (Typically does). $40/week dosn't seem outrageous for about 300kms of driving...Just more than we're used to.

 

[frankfrank]

^ It took me a while to figure out what the units were, because it doesn't say. The United States is at 0.77. The only thing that makes sense is Euros per Litre.

It shows Mexico at 1.00, though - what's the deal I heard about Americans driving to Tijuana to fill up for much less? That doesn't make sense either...

With China, Indonesia and India on their way to a standard of living where everybody will want cars, refrigerators and air conditioning, demand for oil isn't going to slack off any time soon.

 

[tbonez]

^ It took me a while to figure out what the units were, because it doesn't say. The United States is at 0.77. The only thing that makes sense is Euros per Litre.

It shows Mexico at 1.00, though - what's the deal I heard about Americans driving to Tijuana to fill up for much less? That doesn't make sense either...

LOL Actually it does, but it's hidden. The "units" are as a percentage of word averages for premium unleaded. In other words, the US pay 77% of the 'average' international price...Mexican pay the average...People in the UK, almost twice the global average.

 

[tbonez]

Here it is:

"Units: Ratio of Gasoline Price to World Average
... Prices have been converted from the local currency to U.S. dollars, and the ratio of the gas price to the world average in the same time period was used in order to normalize the data.

The data is a few years old, but the ratios remain largely the same I'd guess.

 

[metta]

10 Things You Can Like About $4 Gas

http://www.time.com/time/specials/packages/article/0,28804,1819594_1819592_1819590,00.html


Globalized Jobs Return Home

Sprawl Stalls

Four-Day Workweeks

Less Pollution

More Frugality

Fewer Traffic Deaths

Cheaper Insurance

Less Traffic

More Cops on the Beat

Less Obesity

- I would like to add....
1. a push for cleaner and more energy efficient energy/technologies

2. there are taxes on gasoline. The federal government is in desperate need of more money. If the government was a business, we, the governement would be bankrupt. That right folks, the Bush administration has technically bankrupted the United States. They really need to tax more. Increasing gas prices also, from what I have been told, will increase revenue for the governement from gas taxes. The governement will need to do much more in order to recover from the disaster that is the Bush Administration.

 

[954dude]

We're taking too much for granted. It's now being taken from us. A very important lesson can be learned from all of this.

 

[metta]

http://news.yahoo.com/s/nm/20080704/ts_nm/oil_price_dc;_ylt=AoAnE4FZ5Prsz9ohgRNkk51Z.3QA

World must brace for oil beyond $150

Goldman Sachs, the biggest investment bank in the commodities sector, has tipped prices to hit $200 a barrel within two years.

For their part, the Gulf exporters -- which provide almost a quarter of the world's oil -- are suffering rampant inflation, as their dollar-pegged currencies import higher prices.

The dollar's weakness relative to other currencies has been partly responsible for the rise in oil and other dollar-denominated commodities as investors try to hedge against inflation and take shelter from battered stock markets.

"The oil price is not necessarily reflecting the fundamental backdrop at the moment and eventually it will have to as the fundamental backdrop continues to weaken," Batty said. The more bullish analysts argue that even if developed countries change their habits, emerging economies will continue to drive up demand and oil prices, which are arguably still too cheap.