posted cynicism, oil edition
Oil prices, hence gasoline prices, are sure to go up even higher than the recent record-breaking heights. With so much money misappropriated, misused, lost and diverted, one has to wonder why we are not promoting & researching reasonable & viable energy options to curb our dependency on the finitude & volatility of oil.
The reasons for oil prices going up are myriad and complex. Getting more oil into our tanks will not lower prices, contrary to what many folks believe. There is a shortage of refineries in the U.S. which means that companies cannot keep up with demand as the population grows. Part of the reason there is a shortage of refineries is due to environmental groups & legislation which has forced companies into longer processes in order to build new refineries (which scares away investors who do not want to wait seven years to use their money). Of course, the current administration continues to push to acquire more oil by circumventing environmental law. Recent studies have shown how American infrastructure is going down the tubes, worse than the last survey conducted. The deterioration of national infrastructure contributes to energy waste and adds to the costs of the citizenry. Bureaucracy and distribution costs add 10-20% to gasoline prices because of an overabundance of different kinds of gasoline. Distribution costs are also affected by global demands, particularly those of China & India, two countries with ballooning populations and significant economic growth; the demand for tankers with a limited supply of transport options increases competition, thus prices, leading to higher fuel costs (good for the tanker industry, bad for the consumer). With so much money misappropriated & lost, one wonders how much of the money siphoned by companies like Halliburton could be used to fix our national infrastructure (or Iraq's for that matter since much of the money lost was supposed to be used to that effect).
One cynical remark I overheard is that one of the main reasons new refineries have not been built is because there is little political reason to bother and many dollars to be reaped. Why invest in building new infrastructure when we can just limit supply as demand increases, keeping prices high while continuing to enforced a perceived need for the product? I think this assessment misses the mark but it certainly touches on some issues that are sure to be on the backs of the minds of those in charge.
In our dualistic culture of complaint & complacency, I doubt that much will come of all this reportage. Things are as things go. It takes very little time to write or call one's elected representatives; better to complain to those responsible for the so-called big picture than to complain to one's neighbors or self. Complacency is an unnecessary risk and pursued at one's own peril.
The reasons for oil prices going up are myriad and complex. Getting more oil into our tanks will not lower prices, contrary to what many folks believe. There is a shortage of refineries in the U.S. which means that companies cannot keep up with demand as the population grows. Part of the reason there is a shortage of refineries is due to environmental groups & legislation which has forced companies into longer processes in order to build new refineries (which scares away investors who do not want to wait seven years to use their money). Of course, the current administration continues to push to acquire more oil by circumventing environmental law. Recent studies have shown how American infrastructure is going down the tubes, worse than the last survey conducted. The deterioration of national infrastructure contributes to energy waste and adds to the costs of the citizenry. Bureaucracy and distribution costs add 10-20% to gasoline prices because of an overabundance of different kinds of gasoline. Distribution costs are also affected by global demands, particularly those of China & India, two countries with ballooning populations and significant economic growth; the demand for tankers with a limited supply of transport options increases competition, thus prices, leading to higher fuel costs (good for the tanker industry, bad for the consumer). With so much money misappropriated & lost, one wonders how much of the money siphoned by companies like Halliburton could be used to fix our national infrastructure (or Iraq's for that matter since much of the money lost was supposed to be used to that effect).
One cynical remark I overheard is that one of the main reasons new refineries have not been built is because there is little political reason to bother and many dollars to be reaped. Why invest in building new infrastructure when we can just limit supply as demand increases, keeping prices high while continuing to enforced a perceived need for the product? I think this assessment misses the mark but it certainly touches on some issues that are sure to be on the backs of the minds of those in charge.
In our dualistic culture of complaint & complacency, I doubt that much will come of all this reportage. Things are as things go. It takes very little time to write or call one's elected representatives; better to complain to those responsible for the so-called big picture than to complain to one's neighbors or self. Complacency is an unnecessary risk and pursued at one's own peril.
posted by Ismael Ricardo Archbold at 3/15/2005 10:55:00 AM
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