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When I first started my current job as a newswriter for a tech-based website, we covered a lot of general business. One of my regular beats was the oil business. I don't write the stuff for them anymore so I can do a bit more with it here, although I've not so far.
Oil continues to skyrocket as Iranian problems continue to hang around the hostages at a Nigerian oil rig remain in captivity. The price remains over $68 a barrel and doesn't show any promise of retreating despite oil, gas and natural gas levels being up in last weeks government energy report.
Heating oil prices continue to fluctuate, running right now around $1.86-a-gallon mark and gasoline running for about $1.79-a-gallon. Natural gas prices are dropping somewhat on the unsually mild winter. The problem though is this is supposed to be the slow time fo gasoline. While the summer driving season is still five months away, these prices don't bode well for the summer.
Some argue that ANWR would help but even if ANWR were started right now, it would take years before it was ready to produce oil and then it wouldn't last long in all honesty. Based on U.S. consumption levels, it wouldn't last long at all.
They say the hurricanes created great problems and I'll grant them that... they do cause problems. But those problems weren't there they entire year. Some say the supply is stretched so thin they can't help the price. They say any little tremor in the market cause a disruption. A refinery goes down, some government gets pissy, it's one excuse after another as to why oil prices are so high. The White House is occupied by oil men, both POTUS and the VP. Men who made money in the energy business. Yet they maintain they can't do anything. I'm calling BULLSHIT on this.
You can't tell me the market wasn't manipulated. When Congress threatened hearings, the prices went down almost immediately. The oil companies were turning in record profits for any business. The federal government also gave these companies massive subsidies for growth and exploration. These companies were making more money than any company in this history of America. WHAT? They need subsidies?
The natural gas companies cheat the federal government out of nearly a billlion dollars a year in royalty fees because they were allowed to write the laws governing such behavior.
But lets look at the real damage to our economy. Our economy is built on one basic concept: consumption. We consume everything and the rest of the world exists to feed us our good and services. So we raise the price of oil, gas, heating oil, natural gas etc. Lots of things go up in price as a result. We can't consume those goods and services and that will hurt the economy.
Many people in this country commute to work. People have to drive anywhere from 30 minutes to two hours or more in some cases as part of their job. If you live in a state like mine, mass transit isn't an option unless you live inside the city limits of Louisville or Lexington and Lexington's not great because the buses don't have the frequency needed for many people. So... in the last year, fuel costs have nearly doubled on average. Over the summer, gas prices hit $3+ a gallon and with prices teetering near the $70 mark, they're crawling up again. So an expense that once cost workers maybe $100-$175 is now $225-$300 a month or more.
That's trips to restaurants, vacation times cut back, spending less on electronics and all kinds of other goods. Maybe that's fewer trips to nail salon, not so many trips to the bookstore...all these go into those categories. Not so much to spend on services. Most of those services come from the disposable income category. Not so much disposable income anymore. But wait...aren't we a service-based economy? We don't have the need for so many services anymore. Since we bought everything on credit anyway, we're spending all the money we made paying off all the credit cards we can't declare bankruptcy on. But oil prices continues to climb.
So, no one can afford to buy anything now. Everyone's home has already been refinanced 10 times in two years as rates dropped. The building boom is stopping. Lots of things start slowing up or dissappearing because no one can afford the good and services... certainly not those who are just above the poverty line. This should finish them off.
Now this isn't just a Republican problem, although they are in this quite deeply. It's everyone's problem because we don't have suitable alternatives to fossil fuels. We're at the whim of many countries we don't get along with like Venezuela or countries that are politicall unstable. It's not a pretty picture for a nation who relies so much on oil. And I've not even gotten into people freezing to death because they can't afford to heat their homes.
We've got two do two things. One is find alternative sources of energy and the other is to wrest power from those energy companies of which I'll discuss more later.
Technorati Tags: oil prices, energy costs, natural gas, crude oil, gasoline, heating oil
posted by Stithmeister @ 11:32 PM
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I'm currently working in the telecomm industry but one of my passions is still politics.
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