Tag-Archive for » Gas Prices «

Thursday, May 14th, 2009 | Author: matk62

Is it possible that we are actually changing our driving habits?  In a recent Esquire story, Nate Silver makes a convincing argument for “The End of Car Culture”.  A bad economy and high gas prices are not the only factors fueling this change.

Ampelmannchen 'Crosswalk Guy'According to the Federal Highway Administration, Americans have driven less for 15 consecutive months.  Now, I can understand the decline in driving when gas prices spiked last summer, but the trend has continued even after the gas prices fell.  This is a dramatic adjustment from our past behavior.

The bad economy and high unemployment can also be credited with a decline in driving, but there seems to be more at work here.  We seem to be trying to wean ourselves from our car dependency.  For further evidence, just look at the decline in auto sales over the last 18 months.

One other trend to follow is housing prices.  In the last 4 years, cities equipped with superior alternate modes of transportation have seen large gains in the price of housing while cities that are highly dependant on cars have seen sharp declines.

I have been reading a book by Chris Balish entitled “How To Live Well Without Owning A Car”.  Click on this link to read the book through Google books.  It is a good read and he raises some excellent points:

Save money, breathe easier, and get more mileage out of life.

You may be surprised at the actual monthly cost of owning a car and how much you could save without one.  Maybe you are a multiple car family and could get by with one less car?

Well, I hope this trend continues.  Reducing the miles driven has so many positive effects on our daily lives.  Are you driving less than a year ago?  Do you have plans to reduce your driving in the coming months?  I hope so, let me know.

Creative Commons License photo credit: jtriefen

Monday, February 23rd, 2009 | Author: matk62

There is a great article and running discussion on “The Economics of Volatile Oil Prices” at TheOilDrum.com.  The author, Phil Hart, does a very nice job breaking down the change in oil prices over the last few years.  He explains how the basic rules of supply and demand have had a powerful impact on the wild price fluctuations.

In the first comment, a reader points to the YouTube video below called “Gas Prices, Gas Gouging, Peak Oil, Elasticity, Supply Demand”.  This video simply demonstrates how the supply and demand curves have moved to cause the price spike and then recession:

As I read this article and watched the video, I gained a better understanding of the events of the last 3 years.  I also see how this cycle will definitely repeat itself in the next few years.  Once demand returns, prices will spike again.  It seems like we have a window of opportunity now to change our consumption habits before the next spike, but will we do it?

Tuesday, February 17th, 2009 | Author: matk62

We keep hearing on the news that oil prices are slipping, but when you go to fill up your car, the price of gasoline is higher.  Why?

Skyline

According to USA Today, refiners are to blame:

  • Refiners are cutting back on production
  • Performing maintenance to reduce equipment utilization
  • Decreasing the supply of gasoline on the market

The refiners are squeezing supply to match the reduced demand resulting in increased profits.  It is hard to blame them, since every other business would try the same thing, but we are all paying for it.  This just underscores how little control we, the consumer, have over the price of gasoline.

Between the refiners and then the speculators bidding up the price of oil futures, what are we to do?  Well they have control over the supply side, so our control can come from reducing demand.  Aggressively pursuing alternative energy and increased conservation are our only defense.  How do you plan to cut your gasoline consumption this year?

Creative Commons License photo credit: Jacob Garcia

Category: Energy, Red  | Tags: , ,  | Leave a Comment
Tuesday, February 10th, 2009 | Author: matk62

Are low gas prices diametrically opposed to our goal of energy independence?  It would seem so.  When gas prices were over $4/gallon, everyone was clamoring for alternative energy.  Now that gas prices have fallen below and remain under $2/gallon, the clamor has gone very quiet.

In a story from the Indianapolis Star, they say “We Can Only Dream About Low Gas Prices, Independence”.  The writer goes on to explain what it would take to achieve these two goals:

To Get Low Gas Prices

  • Encourage more domestic drilling
  • Give companies incentives to drill where oil is cheap (Middle East, Russia)
  • This would make us even more dependent

To Get Independent

  • Make gas prices really high
  • Large tax would anger many
  • Politicians fear voter backlash

Gas $1.41 per gallon: Afternoon of Dec 6, 2008

Given these assumptions, then yes, these two objectives do seem to be mutually exclusive.  The story goes on to say that we continue to gamble on innovation and technological advances in an attempt to solve these two contradictory goals.  So far we have been unsuccessful.  The electric car is the next such “fix” on the horizon and it faces an uphill battle.  Low gas prices mean that it will take a lot longer to recoup the additional $10,000 you have to spend to purchase one.  The new stimulus package will offer tax breaks, but this ends up costing us all in the long run.

In principle, I agree with this basic premise and it is hard to argue with history.  The problem I have with this thinking is that it never addresses conservation.  Instead of trying to reduce our wasteful consumption, we continue to focus on finding more oil at a cheap price.  We can keep gas prices low and reduce our dependence at the same time by simply cutting our usage.

Click on the links below to see the price tag of our current commuting habits:

Instead of looking for the next “fad diet”, we need to focus on consuming less and conserving more.  For long term weight loss, you need to eat less and exercise, it really is that simple.  Can we curb our voracious appetite for oil and improve our energy efficiency?

Creative Commons License photo credit: Wesley Fryer

Friday, January 09th, 2009 | Author: admin

That's Mr. Vick to you!The Detroit Lions went 0-16 this year, while the auto makers are going 0-3.  Yes, it has been a rough year in Motown.

There is an opinion piece that ran in the NY Times last month by Thomas L Friedman entitled “While Detroit Sleeps”.  Now no one wants to see the auto industry fail, but he poses the question that we may be spending good money after bad.  You get that feeling of losing in Vegas and then trying to make it back on the next spin of the wheel or deal of the cards.  He equates investing in our current auto makers to putting money into other doomed technologies:

Typewriter —> PC’s
Compact Discs —> iPod
Mail Order Catalogs —> eBay
Book Stores —> Amazon

In order for the Big 3 to be a good investment, they need to change their ways.  Since gas prices have fallen so sharply, there is a tendency to delay research on gasoline alternatives.  Unfortunately, we know prices are going to rise again and we need to be better prepared next time oil goes over $100 a barrel.

In a story on Huffington Post called “Is There An Option More Promising Than The Plug-In Electric Vehicle?”, Patrick Takahashi discusses our future options.  He argues for the use of wind and solar energy to charge battery-powered cars.  This will take many years, but we have to make this a priority now.

So what should we do?  Chase our loses while doubling down on a bad hand or quit gambling with foreign oil and make sound investments in gasoline alternatives?  The Detroit Lions fired their GM and coach to change direction from their losing ways.  Sounds like a good strategy that could also be applied to our auto industry.

Creative Commons License photo credit: Dave Hogg

Wednesday, January 07th, 2009 | Author: admin

School BussesAlmost every town is America has an army of school buses for transporting our children.  Just imagine every family having to drive each of our kids to and from school each day.  That would be incredibly inefficient.

The American School Bus Council (ASBC) has some very compelling statistics to illustrate the benefits. Did you know there are almost half a million buses providing rides to over 26 million students every day?  Here are some more numbers that may surprise you:

  School Buses Private Vehicles
Vehicles 480 thousand 17.3 million
Gallons of Fuel 822 million 3.1 billion
Cost of Fuel $3.4 billion $11.4 billion
     
* Based on needing 36 cars to transport the students on one bus

 

Pay4Rides could achieve similar savings if 4 people shared a ride versus 4 individuals driving their own vehicles.  Even if just 2 people share, we still cut their consumption in half.  Multiply that by some of the 250 million drivers in the U.S. and we could save a lot of gas and money every day.

Now there are not the normal car pool issues with kids since they are all on the same schedule.  So yes it is harder to group rides for our daily commutes, but it is not impossible.  We just need to work together to develop creative solutions.

Maybe we can learn a lesson from our children.  Sharing rides while someone else drives is a smart solution to many of today’s problems.  Go ahead, do your homework and let me know what you learn.

Creative Commons License photo credit: krispdk

Tuesday, December 30th, 2008 | Author: admin

gas flyer2I saw this story on Monday that oil futures may rebound from their current low price.  The predicted increase is based on OPEC cutting production and the economy picking up in the second half of 2009.

So oil prices may increase next year?  Well some analysts are predicting that demand will continue to drop which will keep prices low.  Others think demand will rise and oil prices could quickly spike if new investments are not made.  The point is, even the experts do not know, so we should not get comfortable with low prices.  We know that at some point the price of oil will surge again and this will result in high gas prices.

The question is what can we do in the interim?  We have to take the high prices of the summer as a serious warning.  Further reductions in supply or a sudden increase in demand could sharply drive up prices.  We must aggressively seek gasoline alternatives while actively improving our conservation efforts.

Wouldn’t it be great to send a message to the rest of the world that U.S. citizens can curb their appetite for fossil fuels?  We all need work together during a difficult economy to ensure that changes in our daily commuting habits have a long lasting impact.  Passenger Energy is everyone’s chance to make a contribution starting 2009.  Do you agree?

Creative Commons License photo credit: underminingme

Category: Energy, Red  | Tags: , ,  | One Comment
Tuesday, October 28th, 2008 | Author: admin

Gasoline prices across the country are dropping at record rates.  The price has fallen over fifty cents in just the last two weeks.  There are many factors contributing to this record drop including:

  1. Difficult economic conditions
  2. Drop in crude oil price
  3. Reduced demand

There is not much we can do about the first two, but reducing demand is under our control.  Many drivers have already scaled back their driving habits due to the high prices in the summer and now the failing economy.

Unfortunately, we know these price drops will not continue much longer.  OPEC has already said they will cut production and refineries will reduce their output.  The price drop will slow down and then eventually stabilize.  How soon before they then begin their inevitable rise?

We need to aggressively reduce demand to maintain lower prices through Passenger Energy.

Sunday, October 19th, 2008 | Author: admin

In 2008, the price of oil smashed through the $100/barrel mark and has kept on going.  OPEC controls the output which limits the supply and market speculation has also contributed to higher prices.  Gas prices have risen above the $4/gallon price all across the country and analysts worry that $5 is just around the corner.  These prices are deeply felt when it cost over $60 to fill-up at the pump.

TaladroFrom the mid 1980’s until 2003, the price of crude oil remained under $25 per barrel.  Then in 2005, the war in Iraq and Hurricane Katrina helped push the price to over $60.  Since then prices have steadily increased to a high of $147 per barrel in July of 2008.

The price has recently dropped due to the global financial crisis, but this seems to be a temporary reprieve.  If we act together, we can continue to lower demand and keep prices low.

Creative Commons License photo credit: nestor galina

Category: Energy, Red  | Tags: ,  | Leave a Comment
Saturday, September 27th, 2008 | Author: admin

IMG_3127I am sick of high gas prices and want to tell the Middle East we do not need their oil.

Not only do rising gas prices cost me every time I go to the pump, but they are impacting transportation costs of all goods and services.  The only way to reduce the cost is to reduce the demand. 

Pay4Rides is a concept that will dramatically cut our oil addiction and give us time to develop alternative solutions.  We have little or no control over supply so we all need to work together to reduce demand which would result in lower prices.  This is our chance to show the rest of the world how the American people can unite to solve this problem.

Creative Commons License photo credit: slopjop