Filed under: AutoblogGreen Exclusive, Green Daily, At Witz End
At Witz' End - Gas Prices - What To Do, What To Do?
Left: "We can't drill our way out of this!"Right: "We can't conserve our way out of this!"
Chorus: "We must innovate our way out of this!"
(Maybe, but how long will that take? What will it cost? Who will pay?)
Democrats: "Big Oil's fault! Confiscate their profits!"
Republicans: "Environmentalists' fault! Drill here, drill now, pay less!"
Chorus: "Speculators' fault! Pass a law!"
(So, investing in things -- stocks, bonds, collector cars, commodities such as oil -- that may, or may not, increase in value in the future should be illegal?)
The price of just about anything is mostly about supply and demand. This is Rule #1 of Economics 101 -- which they made me take, along with English, history and a few other useful things, in engineering school:
- Demand goes up, supply doesn't: price goes up
- Demand goes down, supply doesn't: price goes down
- Supply goes up, demand doesn't: price goes down
Petroleum products are not just in transportation tanks; they are in almost all consumer products. Take off your jacket, check your watch, dial your phone, boot up your computer, plug in your iPod – these things and nearly everything else contain them as fundamental elements.
Most things consume oil as they are manufactured, and all things consume it as fuel in shipment to market. And so, as we have been learning all too painfully lately, as the price of oil goes up, the price of everything follows in the same direction. So, given that the price of oil depends mostly on supply and demand, what can we do to drag it back down? Reduce demand? Increase supply? Yes, and yes! Anyone who thinks we can make enough difference by working just one end of that equation is wishfully thinking.
Continue reading after the jump.
Reducing demand
Accelerating both conservation and development of alternatives will reduce demand. Conservation is mostly up to us, and we can accelerate now by turning down our thermostats, unloading our vehicles (fuel economy is mostly about weight and aero drag) and driving them more gently (egg under the pedal) and more slowly (energy = speed2). We can also trade them in for more fuel-efficient ones. But don't make the common mistake of treating fuel economy as your only priority – you'll be investing a lot in that new little car, and living with it for a long time.
Actually, America - through increasing efficiency, conservation and growing use of alternatives - has already been doing a pretty good job of cutting back on petroleum usage despite our fast-growing population and a vehicle fleet that swells by some 10 million a year. So has Europe, Japan and most other developed countries. But the developing world has not.
Myriad other countries, beginning with such hugely populated ones as China and India, have been working hard to pull their people out of poverty by growing their economies, which by definition means growing their consumption of energy, especially oil. So, unfortunately, we Americans can conserve our proverbial brains out with little real impact on global demand.
And, where conservation and growing alternatives means moving toward more expensive energy sources (and most transportation-suitable ones are also more expensive) or reducing economic activity, how much more can our economy take? How many more jobs can we afford to lose? These are questions I'll get to in the coming weeks. In my next column: which energy and transportation alternatives should America pursue? And how aggressively should we address the supply side of that supply/demand equation?
In future columns, we'll explore the pros and cons of battery EVs, hybrids, fuel cells and much more and revisit such emotional subjects as global warming and the competitiveness of domestic vehicles and U.S. automakers. Some of you skewered me (but not my facts) severely for my (fact-based) opinions on those subjects last time; yet some of you (surprisingly) agreed. We'll keep the discussion going.
I'll present more facts, data and opinions for your consideration, and I'll respond to your specific points down the road. I'll also keep in mind what a few of you reminded me in no uncertain terms: whenever my opinions differ from yours, I must be a moron.
Until then, be well, and stay green!
Reader Comments (Page 1 of 2)
Neil 7:44PM (7/03/2008)
"whenever my opinions differ from yours, I must be a moron."
Only on the internet where they don't have to look you in the eye (or get punched in the nose). It's amazing how brave and rude anon people will get.
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Don 7:53PM (7/03/2008)
What a spoiled country we are, to think we deserve to pay $1 per gallon in perpetuity while other nations are choking on $8 per gallon fuel.
Suck it up, America...learn to build cars OTHER than the Lambda quads!
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jpm100 9:14PM (7/03/2008)
Other countries pay $8 because of taxes. Not because of devious plotting on the part of the CIA.
Pauly Shore 10:46PM (7/03/2008)
Actually China pays $2.50 a gallon. Mexico pays $2.85. Hugo Chavez's socialist warriors pay 80 cents a gallon. Choke on that.....
Anonymous 8:17PM (7/03/2008)
"So, unfortunately, we Americans can conserve our proverbial brains out with little real impact on global demand."
This just doesn't make any sense. The USA consumes an inordinate amount of fuel compared to other nations. We are the biggest polluter in the G8 and we are doing nothing to change our ways. Of course conservation would have a dramatic affect on global supply and global prices. And the argument that "China is not conserving so we should not conserve" is so ... Kindergarten.
His falacy that 'going green' will have a negative affect on jobs. New technology creates jobs. Green technology will create substantial new jobs throughout the world. Only Witz wants us to import solar panels from China instead of making them in the USA.
Gary Witzenburg is an idiot. Please, stop featuring this asshole on Autoblog Green.
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Gary Witzenburg 12:02AM (7/04/2008)
Sorry, Charlie, you're wrong on almost every point. Latest figures show the U.S. consumes 21% of worldwide energy, still too much, but well down from 25% not long ago. That ties Europe's 21% and trails China's 24%. If we reduce our usage to, say, 19%, while China's grows to 26%, how does that affect global demand? And we are hardly "the biggest polluter." America has been doing a better job of controlling and cleaning our pollution than anyone for many years.
Did I say we should not conserve? Quite the opposite. Only that U.S. conservation alone will not have much affect on global oil prices. Is an "idiot a..hole" dumber than a moron?
Joce03 7:12PM (7/05/2008)
To Mr. Witzenburg:
China might use 3% more energy than America, but their population about 3x that of America. And, if China's consumption goes up but America's (or any other country) consumption goes down, that will decrease the rate at which the global demand goes up.
And, lets not kid ourselves. One of the reasons why China's consumption is so high is because the are making a lot of the crap that we consume! So if we reduced our consumption (cars, tires, oil, DVD players, big screen TVs, clothing, food) THEY would use less energy making our stuff and WE would spend less energy shipping it around.
Finding more oil is not the way to go. It sounds dumb, but if you really take the time to think about it, Reduce, Re-use, Recycle can do a lot for our demand of oil as well as our destruction of the environment (because the two go hand-in-hand).
Keeks 7:29PM (7/08/2008)
No, we don't need to resort to name-calling, but we do need to compare oranges to oranges. Thank you Joce for making clear the importance of comparing the usage percentages to each area's total population numbers.
Also, I don't ever hear anyone mention the fact that petroleum sources will expire completely within 50-100 years. Read your Geology 101 textbook. Drilling will *not* solve the underlying problem -- that we are running out of that particular type of fuel. Without even looking at the exhaust problems, we need to be developing new methods of combustion/propulsion!
fnc 8:55PM (7/03/2008)
"and most transportation-suitable ones are also more expensive"
Is he talking about batteries? You're paying a large upfront cost for storage capacity with them, but over time you will see reduced operating expenses because you fill that storage capacity with electrons instead of ever more expensive hydrocarbons. They aren't going to magically fix all of our transportation ills (probably be a long time before long distance road travel is electrified), but on the whole we can't discount them out of hand for upfront cost. Particularly not if we're going to get out of the oil quagmire.
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Michael Hoexter 12:09AM (7/04/2008)
On the latest post on my blog (www.greenthoughts.us), I suggest that if we engage in building of electric transport infrastructure we can use on-grid vehicles (electric trains, trolley powered vehicles) for many tasks that we now use petroleum-fueled vehicles. I call them a "Parachute for a $140/barrel Oil Society".
At some point in the future, once mobile energy storage gets cheaper and more powerful per unit weight and volume, we can go back to wireless.
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Snow 3:27AM (7/04/2008)
Anonymous calls a spade a spade and Witz again pulls out his lies. Look at the statistics:
http://www.nationmaster.com/graph/ene_oil_con-energy-oil-consumption
USA consumes 3 times the amount of oil that China consumes and yet USA has 1/4 of China's population. If you do the math that means the average citizen in the USA is consuming 12 times the oil that the average citizen in China is consuming.
The World Wildlife Fund released a new report today which declares that the "U.S. Is Worst of the G8 on Climate Change". Maybe if Witz reads autobloggreen more often he will learn that the USA has shown incredibly weak leadership on climate change under Bush.
http://earth2tech.com/2008/07/03/us-is-worst-of-the-g8-on-climate-change/
And Pauly Shore, gasoline in China is $3.30 a gallon compared with an average income of $2100 a year. Gasoline in the USA is $4.50 per gallon compared with an average income of $26,000. Who has cheaper gas?
But I digress. Gary Witzenburg is what is commonly referred to on the Internet as a Troll. He is here just to spread his lies and piss people off. I agree. Ban Witzenburg from posting articles on autobloggreen.
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JStoked 10:37AM (7/04/2008)
I think these recent high prices in gas is just the kick in the ass America needs. Think of it as Pearl Harbor - December 7th, 1941. The day that will live "infamy".
Now we have to act. No longer can we go back to the old days. The world is different. We are no longer the main user of the world's oil and natural resources. We have to share now with India, China and the rest of the developing world. They are growing up too. They no longer want to be in the 3rd world. They have TV's and Internet and they want what we have. I do not blame them.
But don't worry America. We still lead in technology and innovation. Bio fuels, ethanol, natural gas, hybrid and electric and others are NOW MOVING AT A RAPID PACE!
There is no turning back now.
I think in the long term - not only will America survive its gas crises but it will thrive in it.
I see a lot of good things coming out of these high oil prices.
I now read AutoBlogGreen everyday and I see hope and a great future for America. Different new and cleaner fuels, less smog, more American jobs and less sending of our Green Backs to terrorist infiltrated foreign regimes that hate us. Lets keep our gas dollars and American jobs in the US.
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Netcaretaker 12:02PM (7/04/2008)
$15 in London, I paid $4 in France 15 years ago, 4 bucks a gallon has not even slowed me down, it is like breathing, I will continue to do it :)
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JStoked 5:06PM (7/04/2008)
I think these recent high prices in gas is just the kick in the ass America needs. Think of it as Pearl Harbor - December 7th, 1941. The day that will live "infamy".
Now we have to act. No longer can we go back to the old days. The world is different. We are no longer the main user of the world's oil and natural resources. We have to share now with India, China and the rest of the developing world. They are growing up too. They no longer want to be in the 3rd world. They have TV's and Internet and they want what we have. I do not blame them.
But don't worry America. We still lead in technology and innovation. Bio fuels, ethanol, natural gas, hybrid and electric and others are NOW MOVING AT A RAPID PACE!
There is no turning back now.
I think in the long term - not only will America survive its gas crises but it will thrive in it.
I see a lot of good things coming out of these high oil prices.
I now read AutoBlogGreen everyday and I see hope and a great future for America. Different new and cleaner fuels, less smog, more American jobs and less sending of our Green Backs to terrorist infiltrated foreign regimes that hate us. Lets keep our gas dollars and American jobs in the US.
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Boxman 10:05PM (7/04/2008)
Gary, nice attempt at obfuscation. You say "Latest figures show the U.S. consumes 21% of worldwide energy, still too much, but well down from 25% not long ago. That ties Europe's 21% and trails China's 24%."
Except this article isn't about ENERGY usage, it's about OIL usage and gas prices. And besides, even if you count total energy usage instead of oil, you're still bullshitting us: China's estimated total energy usage is still well behind the U.S. Where are you getting these figures? From your ass, perhaps?
I also can't help but note an inherent contradiction in your article. You say we shouldn't bother trying to reduce demand because rising world demand will negate any reduction we might achieve. Then you say we should expand drilling even though it's well established that increased domestic drilling cannot begin to offset the increasing global demand for oil. WTF?? Sounds to me like you're arguing against yourself.
The solution is clear: the ONLY solution to high gas & diesel prices is to STOP USING GAS & DIESEL.
You do this by transitioning to hybrids & eventually pure-battery-electric vehicles, biodiesels, and new forms of ethanol that actually make economic sense (as opposed to the current, rediculous corn ethanol in use today). We take the lead and eventually the whole world is doing the same.
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Jessica 1:10PM (7/05/2008)
The reason we are still using oil as our main source of energy is because our country's leaders own the oil companies and they are reaping the benefits of the current "oil crisis". Back in 1941 a man named Poge (last name) created a car that could get 240 miles to the gallon. why was this never mass produced? The oil companies would loose billions..or millions back then...if people only had to fill up their gas tanks once every couple of months. The pantent for that car still exists but it will never be made because there is no money to be made on it. its very sad that we posses the technology to change our current dependence on foreign oil ( the hydra car that 'mysteriously' got recalled...there was nothing wrong with them!) but because of the the greed of the wealthy, we have to suffer with astronomical gas prices and the deaths of our friends, sons and daughters, brothers and sisters who are fighting for "freedom" *coughoilcough*. What a country America has turned into.
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Earl 2:05PM (7/05/2008)
Once again, this Witz character has his facts all wrong. America is by far the largest petroleum consumer in the world. 20 million bbd compared to China's 6 million bbd.
http://en.wikipedia.org/wiki/Image:EIA_petroleum_consumption_of_selected_nations_1960-2005.png
Please Autobloggreen, don't allow him to post his right wing propoganda anymore, this isn't a News Corp. website!!!!
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Earl 2:18PM (7/05/2008)
How does turning down the thermostat in your house decrease oil demand when petroleum only accounts for 1.6% of our electricity production?
http://www.eia.doe.gov/cneaf/electricity/epa/figes1.html
Witz really needs to research topics before he writes articles on them.
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Steve 12:39PM (7/06/2008)
I think people are missing the point of the article... which, to me, seems to be about effecting compromise within solutions.
Compromise is a necessary component of every important interaction that takes place... Your relationships, your interactions with co-workers, international relationals, the decisions you make when budgeting your time or money, etc. Those who walk through the world muttering that they, and only they, are right and know the 'best' solutions tend to be marginalized, despite the high esteems they may hold of themselves.
Even the name of this blog, "Autobloggreen" reflects a compromise: it's about finding a co-existence of environmentally responsible thinking and desirable automobile design. Period. It's not "RidethebusGreen" or "IhateAmericaLetsSendItBacktotheDarkAgesbyReducingGDPthroughPoorlyThoughtOutGreenPolicies".
As such, it appears me, Witz simply wants to discuss the merits and drawbacks of different solutions for continued responsible automobile use that fits the needs and desires of the 21st century. Because, when it comes down to it, only the most widely understood and accepted solutions are going to be the ones implemented. It won't be a surprise when some commenters, especially those who are inflexible in their opinions, provide resistance to points or criticisms that does not support their pet concern or favored solution.
But I'd like to think that many of us are here to learn and discuss (even if it means reading views or facts that challenge our previously held facts and viewpoints), not point fingers, toss around convenient but contrived names, labels and insults, or otherwise remain inflexible or intolerant.
To address some points...
Earl @#16, Let's consider those 2005 figures you've provided, and ignore the ~7% increase China has seen in consumption each of the past three years. The numbers you point to leads us to believe the US consumes 333% the oil China does. Wikipedia's listing of countries ranked by 2007 GDP shows the US GDP to be 425% of China's GDP. Reconciling your numbes against my numbers, we see that we're consuming three times the oil China does, but being more than four times as productive as China, with the US being ~30% more efficient. As such, what is your solution? Reduce productivity? And suffer the consequences of reduced GDP through energy policies that strangle the economy? And what point does quality of life become affected and deter the implementation of green policy?
Joce3 @#7 points out that that China has 3x the population, but how many of those lucky citizens have the luxury of opining on internet blogs, using laptops made from, shipped via, and priced by the availability of cheap petroleum?
These are complex issues, let's put forth the critical thinking and analysis they deserve.
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Gary Witzenburg 4:44PM (7/06/2008)
Thank you for your unusually astute analysis! I think most reasonable people will agree that there is no single "magic bullet" solution. We must work all possible solutions, and no amount of left/right vitriol and name calling will get it done.