gas prices

Increasing oil production will not substitute as energy solution

Originally posted on the NDN Blog.

Yesterday, Saudi Arabia did what everyone -- including George W. Bush on bended knee -- has been asking it to do for months: agree to increase production. Prices closed up a dollar. The Saudi move and its non-impact on the market shows just how tight supplies remain. While it was designed in large part to offset declines in Nigerian production due to rebel violence in the oil-rich, poverty-stricken Niger Delta, it might have sent a psychological signal of easing supplies but it did not.

Meanwhile, back in Washington, another panel of oil traders told Chair Dingell's House Energy and Commerce Oversight subcommittee that speculation is driving up oil prices and tighter oversight of commodities futures markets could lower prices. Staffers released data to the effect that 70 percent of trades are now speculative, up from 30 percent not long ago.

Americans drove less in April 2008

April 2008 saw another sharp drop in vehicle miles traveled (VMT) according to the Federal Highway Administration's monthly report on "Traffic Volume Trends" (PDF). This follows, "the sharpest yearly drop for any month in FHWA history" in March (see here).

I was compelled to blog on this because of the incredibly astute media coverage by AFP, "worldwide news agency," which wins the "Duh!" award for the month:

Observers surmise a possible link between the declining number of miles driven and rising US gasoline prices.

The GOP disinformation machine settles on an angle

It seems that another way that the GOP will try to win on this issue is by painting carbon pricing as a massive tax increase. This is just dishonest, though politically it’s their best bet (assuming a complete lack of regard for actual outcomes). Let’s all think back to the Lieberman-Warner debate, when Bush did […]

You know things are getting bad …

… when even China is raising fuel prices.

Conservative heads increasingly buried in sand

Andrew Sullivan reads this Jim Manzi post (Conservatives are going to win on climate change! By doing nothing!) and says he’s on board. He then proceeds to blow my freaking mind: The key will be private and public innovation of non-carbon energy, and possibly carbon capture technology. Frankly, however painful it is for many, the […]

Iconic Ford SUV plant to be idled for summer

Ford will close its Michigan Truck Plant in Wayne for nine weeks -- four weeks longer than previously announced -- starting on June 23. Birthplace to Lincoln Navigators and Ford Expeditions, the MTP has come in for hard times due to the plummeting market for SUVs. Since January, Expedition sales are down 31 percent; Navigators, 22 percent. Once bread and butter for American automakers, SUVs have fallen victim to $4-a-gallon gasoline.

To the lay observer, the temporary MTP closure is just another symptom of the shift away from SUVs, but it actually signifies a whole lot more for American automakers: At the height of the SUV boom in the late '90s, the MTP was the most profitable factory, in any industry, anywhere in the world.

Keith Bradsher, Detroit bureau chief of The New York Times from 1996 to 2001, wrote in his book High and Mighty: The Dangerous Rise of the SUV:

Short-term high gas prices (hopefully) mitigate long-term environmental disasters

I have been reading Sean Casten's post on the economics of carbon pricing with interest. After some thought, here's my take. A carbon tax or a cap-and-trade system will, without question, raise the price of energy, at least in the short term. In the long-term, it may well be that technological developments lead us to new energy sources that turn out to be cheaper than anything we have today. But that's pure speculation.

But in the short term, the costs of a carbon tax or the costs of permits in a cap-and-trade system will follow the energy through the system and eventually raise prices at the consumer level. So prices will increase.

But that fact is a distraction. The real issues are, first, how much will prices rise, and second, what will happen if we do nothing?

Public trusts Obama more than McCain on gas prices, global warming, energy

Interesting results from a new ABC/WaPo poll. Who do Americans trust more on the economy? Obama 52%, McCain 36% How about gas prices? Obama 50%, McCain 30% Global warming? Obama 55%, McCain 28% Energy policy? Obama 51%, McCain 36% Issues where McCain is more trusted: international affairs, war in Iraq (by one point), and war […]

Saudis agree with McCain: Cut gasoline taxes!

If anything should put a stake through John McCain's absurd gas tax holiday idea, it's that the Saudi King advocates it, too!

As I have previously noted, the only ones who benefit from the gas tax are the oil companies and the petroleum producers. Case in point, the biggest producer just said:

Next month, the Saudis will be pumping an extra half-a-million barrels of oil a day compared to last month, bringing total Saudi production to 9.7 million barrels a day, their highest ever level. But the world's biggest oil exporters are coupling the increase with an appeal to western Europe to cut fuel taxes to lower the price of petrol to consumers.

Why do they want the West to lower fuel taxes? They want to be able to raise their own prices and/or they want higher demand for their primary product.