Hodgepodge

I frankly loved filling the minivan up for around $20 these last few weeks, especially with the frequent 400 mile trips to the farm. But you really didn't think it would last did you?

The artificially low price of oil is going up and - possibly in fits and starts - it is going to keep going up. The global economy can only keep oil prices down so long. The real concern is that when it starts moving up the $4 gas we had just this summer may be left in the dust. I would not be surprised if within 12 months oil is $150 a barrel or more.

Don't trade the Prius in for an SUV just yet.

http://money.cnn.com/2008/12/14/news/economy/gas/index.htm?postversion=2008121409&eref=rss_topstories

If anyone is still unclear on how much the price of oil impacts the U.S, economy, this article will correct that.

While the price of gasoline is not the only item here, many things like plastics etc, are directly tied to oil and even the housing slump is in a small way tied to the jump in oil prices.

And don't get complacent about the lower price of oil the last few weeks. I will go up again and probably soon and when it does, it will go much higher than the last spike before coming back down to a higher price than it is now.

This article talks about the two sides in the Alaskan Reserve drilling controversy. I lean toward not developing it now for a couple of reasons:

1. It will be a short term fix - kind of like a junkie getting his next hit.
2. High oil prices spur development of alternative solutions. Yes the pain is great for those struggling to fill the tank but it is the only way it would appear that we will ever get off the oil bandwagon, especially in transportation.
3. As the oil supplies dwindle around the world, controlling such a reserve will a major plus decades in the future.

Just my thoughts, selfish as they may be.

One item in the article I found surprising and I would like to see confirmed is that only 15% of the oil in a barrel is used to turn the wheels of a car. I would expect it to be higher. Of course add in trucks, buses, trains and airplanes and it has got to be way higher. I also suspect that is a worldwide figure and the U.S. is higher. Anyone know?

I was impressed when I first heard T. Boone Pickens talk about wind power replacing natural gas for electricity generation and using the freed-up gas for transportation. I had not realized how much natural gas went into electricity production. What I like about the plan is that it addresses transportation which is where the vast majority of the imported oil goes.

All the politicos are focused on nuclear and other ways to generate electricity as the answer but none of those address a substitute for oil in cars and trucks. The beauty of Pickens' approach is that the technology is available and in use and, with the way natural gas pipelines are spread around the country, tapping them for refueling stations would not be difficult.

You ca read an interview with Pickens here.

While it is encouraging that gas consumption is down and oil prices have dropped in the last few days, I am not getting my hopes up that this is a trend. All it takes is one hiccup and oil will be on the upward spiral again.

The global market is not easing and will in the end drive prices up. IMHO

I understand the need for airlines to cut down on fuel consumption but this is not the way to do it.

As one who has been on a diverted flight more than once or had to circle because of traffic, I definitely am uncomfortable with this idea. Just another reason to drive or take Amtrak.

Everyone hates high gas prices, they hurt the poor the most and the oil companies are getting rich - this is a perfect formula for Congress to 'do something'.

This is the something they came up with.

I suspect that speculators are making a bundle right now, anytime demand outstrips supply on a commodity, speculators profit. Corn prices are a perfect example of this.

Unfortunately none of what Congress is proposing is really going to make a difference. As I have stated before, the only way oil prices come down is when supply exceeds demand. My advice - don't stand on one leg waiting for that - you'll get tired.

Oil production is pretty much maxed out right now and even if new drilling of offshore wells or opening the Alaska reserve or other foreigns producers develop new oil fields, it will be years before they can increase supply. During that time demand will continue to grow, widening the gap between supply and demand and prices will keep going up. That is known as free market economy. The U.S. grew to be the force it is under just such a system and now most of the world is on that same system to a degree.

If major breakthroughs come in electric vehicles, that will have an impact, since the majority of oil, at least in the U.S., is used in vehicles since there is no alternative. Power generation is mostly coal and nuclear so they aren't the major problem. Unfortunately, converting enough vehicles worldwide to non petroleum fuel will take decades, again no help now.

So as depressing as it is, oil prices will continue to go up, probably reach a leveling point somewhere in the next year (I'm not even going to guess where that point will be however) and then prices will stabilize for a while and then probably go up slower as more production trickles in.

What does that mean for those of us who drive a car? It means buying smaller cars and driving less. Period.

I understand that it is expensive to fill the tank these days, but if you see that you are running low, stop and buy more. If you run out, you have to buy it then so what's the deal? And if you don't the money to put more gas in - stay home or use public transportation.

Just be prepared for more stalls on the expressways - just the thing for those morning commutes (I am pleased that I don't have to do that anymore).

This article discusses a desire by India to start working on bringing solar generated electricity from space by the end of the next decade. I have been to a few panels on this topic over the years and also did some minor research into it as this concept is part of a novel I was working on a couple years ago.

I would love to see this happen, but as the article points out the cost of getting the materials to space is just too prohibitive right now. Until we have a space elevator, a moon-based manufacturing site or some yet unknown cheap way to launch heavy payloads from earth this isn't going to happen.

The argument about high oil prices is not going to fly because wind power or ground based solar will be better options still.

It's not everyday you see an oil tycoon invest in non-oil energy, but that's exactly what T. Boone Pickens is doing.

I'm sure there's a significant profit in this for him, but the fact that he sees the foolishness of continuing to use petroleum for power generation says something. I also like that he is not forcing people to put the generators in.

These are small steps to be sure, but the use of wind and solar for power generation are slowly grabbing a foothold and usually these types of changes go faster as they move forward. It may be a long time until we stop using oil fro transportation, but there is certainly no reason we need to use it for power.