109 dollar oil!
03-13-2008 | 08:51 AM
#82
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From: The Beginnings
You're right about ethanol (corn, switch grass, or magic beans) will never be a replacement for oil. I'm not aware of any alternative products that are anywhere near as good as oil.
In our lifetimes, the most likely scenario will be oil derived from shale, tar sands, and coal liquification. All of these are dirty, labor intensive, expensive, and undesirable on many levels. However, barring some sort of "Star Trek" solution, oil is going to be the power of the future. Oil is just that important.
This WILL encourage alternative half-solutions to help mitigate the cost (environmental and monetary). . . ethanol blends, hybrid cars, that sort of thing. But we're a long way from anything like a unified energy strategy.
For example . . . natural gas could very easily be used to power things like cars. It has the same problems as gas . . . non-renewable and most of it foreign based to name two. And yet, in the US, we're STILL building NEW natural gas fired electric plants! It's insanity, but there you have it.
In our lifetimes, the most likely scenario will be oil derived from shale, tar sands, and coal liquification. All of these are dirty, labor intensive, expensive, and undesirable on many levels. However, barring some sort of "Star Trek" solution, oil is going to be the power of the future. Oil is just that important.
This WILL encourage alternative half-solutions to help mitigate the cost (environmental and monetary). . . ethanol blends, hybrid cars, that sort of thing. But we're a long way from anything like a unified energy strategy.
For example . . . natural gas could very easily be used to power things like cars. It has the same problems as gas . . . non-renewable and most of it foreign based to name two. And yet, in the US, we're STILL building NEW natural gas fired electric plants! It's insanity, but there you have it.
03-13-2008 | 09:14 AM
#83
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Oil was a replacement for ethanol and biodiesel. The ICE was originally made to be powered by ethanol. The diesel engine was also originally designed to be run on biodiesel so that farmers could grow their own fuel.
Interesting stuff.
"Fuel of the Future
When Henry Ford told a New York Times reporter that ethyl alcohol was "the fuel of the future" in 1925, he was expressing an opinion that was widely shared in the automotive industry. "The fuel of the future is going to come from fruit like that sumach out by the road, or from apples, weeds, sawdust -- almost anything," he said. "There is fuel in every bit of vegetable matter that can be fermented. There's enough alcohol in one year's yield of an acre of potatoes to drive the machinery necessary to cultivate the fields for a hundred years.
Ford recognized the utility of the hemp plant. He constructed a car of resin stiffened hemp fiber, and even ran the car on ethanol made from hemp. Ford knew that hemp could produce vast economic resources if widely cultivated. "
When Henry Ford told a New York Times reporter that ethyl alcohol was "the fuel of the future" in 1925, he was expressing an opinion that was widely shared in the automotive industry. "The fuel of the future is going to come from fruit like that sumach out by the road, or from apples, weeds, sawdust -- almost anything," he said. "There is fuel in every bit of vegetable matter that can be fermented. There's enough alcohol in one year's yield of an acre of potatoes to drive the machinery necessary to cultivate the fields for a hundred years.
Ford recognized the utility of the hemp plant. He constructed a car of resin stiffened hemp fiber, and even ran the car on ethanol made from hemp. Ford knew that hemp could produce vast economic resources if widely cultivated. "
"Indeed, when Henry Ford designed the Model T, it was his expectation that ethanol, made from renewable biological materials, would be a major automobile fuel. However, gasoline emerged as the dominant transportation fuel in the early twentieth century because of the ease of operation of gasoline engines with the materials then available for engine construction, a growing supply of cheaper petroleum from oil field discoveries, and intense lobbying by petroleum companies for the federal government to maintain steep alcohol taxes."
[source]
[source]
Interesting stuff.
03-13-2008 | 09:20 AM
#84
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You're right about ethanol (corn, switch grass, or magic beans) will never be a replacement for oil. I'm not aware of any alternative products that are anywhere near as good as oil.
In our lifetimes, the most likely scenario will be oil derived from shale, tar sands, and coal liquification. All of these are dirty, labor intensive, expensive, and undesirable on many levels. However, barring some sort of "Star Trek" solution, oil is going to be the power of the future. Oil is just that important.
This WILL encourage alternative half-solutions to help mitigate the cost (environmental and monetary). . . ethanol blends, hybrid cars, that sort of thing. But we're a long way from anything like a unified energy strategy.
For example . . . natural gas could very easily be used to power things like cars. It has the same problems as gas . . . non-renewable and most of it foreign based to name two. And yet, in the US, we're STILL building NEW natural gas fired electric plants! It's insanity, but there you have it.
In our lifetimes, the most likely scenario will be oil derived from shale, tar sands, and coal liquification. All of these are dirty, labor intensive, expensive, and undesirable on many levels. However, barring some sort of "Star Trek" solution, oil is going to be the power of the future. Oil is just that important.
This WILL encourage alternative half-solutions to help mitigate the cost (environmental and monetary). . . ethanol blends, hybrid cars, that sort of thing. But we're a long way from anything like a unified energy strategy.
For example . . . natural gas could very easily be used to power things like cars. It has the same problems as gas . . . non-renewable and most of it foreign based to name two. And yet, in the US, we're STILL building NEW natural gas fired electric plants! It's insanity, but there you have it.
03-13-2008 | 09:32 AM
#85
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Electric cars also just aren't practical for the average American. While we drive 20-30 miles round trip every day we also like to pack up our stuff and drive across the country. A pure electric car is not the answer. Personally I think a hybrid that goes 20-30 miles on a charge with a diesel standby powered by biodiesel is the perfect solution until batteries or charging can be perfected to allow the ability to get rid of the diesel/ICE engine altogether. The Chevy Volt is trying to capitalize on this but they are still using an ICE instead of a diesel. And no one really knows the cost of it at current market prices. Chances are it will be cost prohibitive at current gas prices when you can go buy a brand new econobox for under $10k.
03-13-2008 | 10:40 AM
#86
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From: The Beginnings
Not going to happen if cars stop taking gas that means alot of jobs electric cars require almost no mx no more jiffy lube no more conner mx shops no pep boys no avanced auto parts no tech schools the only thing left would be the tire industry the benifit has yet to out way the cost as far as the gov't goes. Unemployment lines would be around the conner. Its alot bigger than how much it cost to fill up the Griswald wood-grian panel family cruiser. They have always known how much is in the ground across the world they have always known that it would come to this 3.26 a gallon they know its going to be 10.00$ - 15.00$ dollars a gal.
Electric cars have significant challenges as well. Batteries are extremely toxic and would eventually head to the landfill. Ditto the chemicals left over after their manufacture. More importantly, if every car in the US switched to electric tomorrow, where would you get the electricity from? Nuclear? (no new plants since 1980). Hydroelectric dams? (the greens are actually fighting to have dams removed as leases expire) Coal? (Dirty and emit CO2) Wind/Solar/Geothermal? (you've got to be kidding) Natural Gas? (ok, but most of the proven reserves are in OPEC countries or Russia)
Tricky problem. No easy solutions. And based on the US response over the past 40 years, it's not very encouraging.
03-13-2008 | 10:47 AM
#87
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Trade deficit
We import 3.67 billion barrels of oil a year. At $100/barrel, that is $367 billion US dollars that goes overseas. Sounds like our trade deficit is hugely due to importing oil.
Airlines slowing down hiring
Yes, aviation is very cyclical. But the fact is that $100+ a barrel oil is the primary, absolute biggest reason why airlines are not growing as much as they should. Why hiring has slowed down. Why pilots are not getting year 2000 type contracts. Ask Expressjet. Ask Skywest. Ask the majors like United, who, for every $1 a barrel increase in the price of oil costs them $45 million dollars a year in revenue (so $40/barrel rise in 12 months means $1.8 BILLION dollars a year). The airlines can't raise fares fast enough because it will scare away some passengers. Why won't passengers pay extra for their tickets?? Because the economy is hurting due to... high energy prices.
Economy
Of course high oil prices are slowing down the economy. I don't even feel like I need to argue that one.
Tax Cuts
You are right. Tax cuts do stimulate the economy. But why does the economy have to be stimulated??? High energy prices. I would rather see lower energy prices stimulating the economy and tax money lowering the US budget deficit.
The fact is that high energy prices hurt the United States so much. You just have to think about it.
We import 3.67 billion barrels of oil a year. At $100/barrel, that is $367 billion US dollars that goes overseas. Sounds like our trade deficit is hugely due to importing oil.
Airlines slowing down hiring
Yes, aviation is very cyclical. But the fact is that $100+ a barrel oil is the primary, absolute biggest reason why airlines are not growing as much as they should. Why hiring has slowed down. Why pilots are not getting year 2000 type contracts. Ask Expressjet. Ask Skywest. Ask the majors like United, who, for every $1 a barrel increase in the price of oil costs them $45 million dollars a year in revenue (so $40/barrel rise in 12 months means $1.8 BILLION dollars a year). The airlines can't raise fares fast enough because it will scare away some passengers. Why won't passengers pay extra for their tickets?? Because the economy is hurting due to... high energy prices.
Economy
Of course high oil prices are slowing down the economy. I don't even feel like I need to argue that one.
Tax Cuts
You are right. Tax cuts do stimulate the economy. But why does the economy have to be stimulated??? High energy prices. I would rather see lower energy prices stimulating the economy and tax money lowering the US budget deficit.
The fact is that high energy prices hurt the United States so much. You just have to think about it.
If you have no doubt that oil has nowhere to go but to go up, up and up, then I would highly recommend you invest every nickle of your net worth into oil as you will inevitably be a very wealthy man one day.
As for implicating trade deficts as one of the main drivers of high oil, thats completely a huge stretch.
Trade deficits are perhaps the single most misunderstood statistic in all of economics and international business. I can't remember the exact years, but I believe America has shown a trade deficit for the past 200 years or nearly so.
Anyway, In short, trade deficit reflect the flow of capital across borders, flows that are determined by national rates of savings/investment and should not cause a need for worry. A trade deficit reflects a fact that America (or any other country) remains a place attractive enough for foreign investment. If you want to reduce the trade deficit then a recession is the best way to do that.
You cannot blame negatives of unemployment, high oil, slow growth of the airline industry, unfair trade practices abroad or declines in industrial competitiveness on the trade deficit.
International trade or trade deficits is NOT a zero sum game, one country is a winner- and one country is a looser. Nope, that is not how it works contrary to what protectionism politicians, Lou Dobbs and college professiors try to spout. If a country is buying more goods and services from abroad than its selling, then the country must also be selling more assets to the rest of the world than its buys.
First step to correcting this unnecessary and pridicable situation is that American government must stop bleeding the devaluation of USD. Secondly, big government social spending needs to come to a quick stop and "magically" you will start establishing sound monetary policy.
Only after this is accomplished, can we start to figure out how to reduce oil dependence without again destroying the currency, economy and prestige of America in the process.
EAHINC
03-13-2008 | 10:58 AM
#88
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According to the book "Plug In Hybrids: The cars that will recharge America" no new electric capacity will be needed until the first 50% of all passenger cars switch to plug in cars because they will be charging at off peak times. It'll take a decade or more to do that, so we've got time. It's better to be building electric output than buying more oil in my mind.
03-13-2008 | 11:05 AM
#89
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This is simple greed and capitalism at its usual level by many that is causing this spike and nothing else.
Don't forget that OPEC even pointed to the fact that oil should only be $80.00 a barrel recently (don't forget, we get 40% of our oil from Canada and not Saudi). Demand in not really exceeding demand right now. Speculation in the market is creating this "bubble" of prices right now and should hit a bursting point. As to when and at what price is what most are trying to figure out right now. History repeats itself-look at the tech and housing bubbles for the most recent example of people trying to make a quick buck.
Nobody cares about this until it hits the pocketbook.
Don't forget that OPEC even pointed to the fact that oil should only be $80.00 a barrel recently (don't forget, we get 40% of our oil from Canada and not Saudi). Demand in not really exceeding demand right now. Speculation in the market is creating this "bubble" of prices right now and should hit a bursting point. As to when and at what price is what most are trying to figure out right now. History repeats itself-look at the tech and housing bubbles for the most recent example of people trying to make a quick buck.
Nobody cares about this until it hits the pocketbook.
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