Don't think so...we have very sophisticated computer modeling not available in 1970---this same technology allowed us to zero in on global warming. Prior to advanced computer modeling, most "predictions" were from think tanks, not science. There's definitely going to be an oil shortage but there are too many unknowns still in the equation to put the dates on solid ground I think. Besides, other energy sources might make the oil shortage less of a problem and prolong the use of it.
Computer modeling has been available since at least the 1940's. Computer modeling is no more accurate than the garbage that get fed into it. Human brain happens to be a great modelling computer. The Hubbart's curve is derived from the "logistic funtion." All the "sophisticated computer modelling" has done since the 1970's has been "curve fitting," which is no more valid than selective sampling of data by hand.
Seriously, if you believe that computer modeling discovered something new, it must have been something that was discovered since 2000 . . . 'cuz oil was trading in the lower teens and the world looked like awash in oil for the forseeable future; Economist magazine even fulfilled the "magazie cover prophesy" rule by nailing the bottom with their error (a cover showing a globe drowning in oil), just like Newsweek nailed the global temperature bottom with their "global cooling" cover in 1975, and probably having done it again regarding "global warming" with their retraction in Octoer 2006. Now, tell me, does 3gigHz vs. 1gigHz really make that much of a difference?
Well of course it's garbage in, garbage out...but the point is that ducking one's head in the sand is a lot worse of an idea than bad computer modeling might be....the tricky thing about the future is that if you have no clarity, the future gives you that clarity with unpleasant suddenness. History is rife with prime examples.
I think the President's cabinet should have a Secretary of the Future (not my idea) and that's his/her job. Right now we don't even have a Secretary for the next two weeks.
pretending that we don't have a problem won't make it go away
We do have a problem. The problem is called global monetary inflation. Oil is only one of many many commodities that have gone up in price dramaticly since the year 2000. The reason why the lay person is so fixated on oil price is because oil is the only thing that a consumer purchase that is anywhere close to commodity form. Everything else is made into pretty morsels or shiny packages, where by the manufacturing content exceeds the commodity content; the manufacturers eat the increased commodity cost component by shipping manufacturing overseas and reduce labor cost component.
If consumers were to buy other commodities in their basic forms, they'd notice that the price of copper, iron, aluminum, uranium, silver, gold, and just about every other commodity have gone up in price at a comparable pace to oil, and in some cases faster than oil. What exhaustion or middleast unrest would explain that? They are not even produced in the middleast. Gold does not even have real industrial demand; there's enough of the stuff to last decades even without any new gold being mind from the ground. So why are the prices going up like gang-busters? Because the fiat money is debasing. Too much fiat money is being printed to support the overgrown government, which is getting in the way of economic efficiency.
The social engineering solutions like regulations and taxes would only make the fiat money worth even less, and exacerbate the commodity price problem. To the consumers, it would mean even higher oil price. In other words, many of the proposed "solutions" are not solutions at all, but the problem itself.
The market place has long discovered that predicting the future by popularity contest is just about the worst possible future predicting mechanism. Popular opinions usually mark the tops and the bottoms of the market place; they are called contrarian indicators.
Well if you think some kind of libertarian utopia is going to solve the energy problems of the future, good luck to that!
Oil needs to be more regulated as a commodity, not less. Fact is, too many hands grabbing for too little oil (or oil that IS there but hard to get) is very VERY dangerous.
Right now you and I are held hostage to....RUMOR...we don't even need a real shortage of oil to be pounded economically as individuals.
Don't you all out there feel like an oil hostage? I do! Gee, I wonder if someday it'll be like that with solar energy...people will threaten to put huge sunglasses on your house....
Let's set aside the "-ism" labels for a moment, let's look at the facts: iron prices, copper prices, aluminum prices, uranium prices, silver prices and gold prices have gone up just as much oil if not more so. Since we can't live without iron, copper and aluminum, and our national security can not survive without uranium, do we have an iron problem, aluminum problem, copper problem, uranium problem, and should we regulate them all??
BTW, some countries do have a Secretary of the Future. It's called central planning. Luck would have it that Chavez down in Venezuela just installed such a clown in the last few weeks. Apparently, they are experiencing run-away inflation despite gasoline price being capped by the government at a few cents a gallon. The high taxation and regulation envrionment down there apparently is causing a "chicken problem," "clothing problem," "rice problem," "bread problem," etc. etc. Chavez answer seems to be everything should be regulated. Guess how successful that will be.
let's look at the facts: iron prices, copper prices, aluminum prices, uranium prices, silver prices and gold prices have gone up just as much oil if not more so.
Has anybody ever mentioned why those prices have gone up?
Don't you regulate your family's resources? Seems like basic sanity to me....
That's the classic pitfall of Confucianism (being an ethnic Chinese myself I should know :-) Pretending that millions of grown adults were under-age kids in a family unit may fool a few in short run and enable a dictatorship, but can't really escape economic and social catastrophy eventually.
BTW, even in a family with more than perhaps half a dozen siblings, it would become obvious that the siblings would have interest in engratiating themselves to the dictatorial "father" than making something out of themselves and perhaps bring more bread home. That's why successful parenting of large family involves a hands-off approach :-)
Oil is approaching $100/bbl. Gasoline is lagging behind at only $3/gal. We're experiencing a fortunate disconnect between oil prices and gas prices.
Gas should be $3.50/gal. right now, climbing toward $4. The talking heads agree that it will be within a few months.
Remember January 2007 when gas dropped to $2, but by July it was well over $3? Now, apply that ratio to our current situation. Can anyone deny that $4.50 gas is looming?
The U.S. economy has done a remarkable job of absorbing high gas prices so far. But $4 could be a breaking point.
When SUV owners who commute to work find themselves spending as much each month for gasoline as they do on their car payments, they'll break.
When pickup owners start paying $100 to fill their gas tanks, they'll break.
When business owners receive employee demands for raises just to pay for gasoline, they'll break.
It's great not having car payments. Then you can absorb nasty realities like the rising price of gasoline. It's the working poor or those who are financially maxed-out that will suffer. I feel for the poor guy, but not the idiot with $600+ payments on the SUV, maxed-out cards, and a resetting ARM on his suburban McMansion, and a HELOC in excess of his home's equity.
Realistically gas going to $4/gallon would only cost most people $10 a week extra. Look at it in relation to other bills its really not that big of an expense. I most likely pay more in one mortgage payment than I do all year in gas. My kid can probably go 5K miles on one months rent.
I pay more for food each week than I do for gas.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
...I was traveling in Ontario. At that time the price of gas worked out to almost exactly four bucks a gallon. And folks were driving like maniacs... old Ford F150's doing 80 mph, Hummers everywhere... so I don't think that we will see much of change down here in the States. OTOH, I'd guess that those Hummers will experience a rather rapid rate of depreciation.
I'll be driving my '88 Buick Park Avenue and be able to see the road ahead as all the SUVs that would've been in front of me would be gone.
$4/gallon gas probably won't change my driving habits much, because I pretty much changed once prices started staying consisently above $2/gallon.
I'd say the only thing that would make me change would be if my commute to work suddenly changed...either from switching jobs or buying another house. And I don't see either happening anytime soon.
I'm currently putting maybe 4,000 miles per year on my '85 Silverado. I figure it might average 13 mpg. So, 307 gallons per year. For prices to rise from $3 to $4, it would cost me another $307 per year. Or about $25 per month.
what everyone is saying? I think it's a consensus: there is NO breaking point for people with regard to gas prices. People won't notice because it is likely that prices will rise more rapidly than before but evenly, giving people time to adjust. And many won't even notice when five years from now there are all these things they can't afford to do any more because the prices of gas and transported commodities like foodstuffs have gone up so much that they are all they can afford any longer...
When I filled up on Thursday night, the person before me had pumped $106 worth of gas. YIKES. In my little car, I only needed $25, but that's a fill-up I could have done for $15 just two years and a few short months ago, the summer before Katrina (2005). There is nothing else in my life that I purchase even semi-regularly that has gone up 40% in two years and 3 months. Not even my out-of-control health insurance premiums. :-/
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
There is nothing else in my life that I purchase even semi-regularly that has gone up 40% in two years and 3 months. Not even my out-of-control health insurance premiums. :-/
I can think of a few things that have gone up that much, if not more, in 2 years and 3 months. However, most of them are energy related. :sick:
Home heating oil: In 2005 I paid $1.799/gal for the stuff. Last week I just locked into my new contract. Market price, with a cap of $3.559/gal. OUCH!
Electricity: went up 50% in June 2006. However, at the last minute they built in a deferral that made it only go up 15%. Deferral went away in June 2007 though, so now we're paying the ful 50% increase.
Co-pay on my insurance: I think it was $20 in 2005. Went up to $30 in 2006, and $40 in 2007. Prescription cost went up too, but I forget how much. What they take out of my paycheck has gone up too, but I forget how much it was back in 2005. It's $25 every two weeks now.
Milk: I picked up a gallon of Vitamin D whole this morning. It was on sale for $3.79. Usually it's $3.99. Seems like not that long ago, it was around $2.65-2.75. I think Costco sometimes has it for around $2.75-3 per gallon these days, but I'm not running all the way up there just for a gallon of milk.
In contrast, I got a 5% raise in 2006, and a 6.7% raise in 2007.
I think it's a consensus: there is NO breaking point for people with regard to gas prices. People won't notice because it is likely that prices will rise more rapidly than before but evenly, giving people time to adjust.
I wonder though, if some people, already "broke", back when gas started consistently getting above $2 per gallon? I know in my case I did. I quit driving my old cars as often, started driving more gently, and cut down on unnecessary driving. As I recall, once fuel prices started shooting up in '04, it was enough to start impacting sales of thirstier vehicles like the big SUVs, trucks, etc. It wasn't enough of a rise to make the thirstier markets extinct, such as how the '73-74 oil embargo set into motion events that would ultimately lead to the demise of the "traditional" full-sized car and the big-block engine.
When I filled up on Thursday night, the person before me had pumped $106 worth of gas. YIKES.
OUCH. Now that would be pretty painful! Most of the fill-ups in my cars tend to be in the $30-40 range, which will usually get 250-350 miles out of my Intrepid, depending on how it's driven. Somewhat...ummm, less, with my older vehicles.
Fill-ups for the Park Avenue and the LaCrosse are in the $36 dollar range if I let them go practically empty. A fill-up for my Seville is quite expensive, so I rarely let it go below the half-empty mark. The Brougham? Well, just to fill it from empty requires a handful of twenties and enough time to make and eat a sandwich.
I think the biggest tank I have is in my '67 Catalina: something like 25-26 gallons. So, if I let it run dry and refilled, I'd be close to $80. I should probably take that car on a good long run, even if it's just a bunch of aimless driving around the neighborhood. I doubt if it's gone 50 miles this year, and probably not more than 100 last year.
I think my '76 LeMans has a 22 gallon tank, and the DeSoto and New Yorkers have a 21 gallon. The Intrepid is 17 (usually takes 13-14 when I fill up), and the truck's is only 16 gallons. It originally had dual tanks for 32 gallons total, but both of them went bad in 2005. I only had the money to fix one of them, so I had them disable the other. It's not like I ever take that truck on long trips, anyway, so I don't need the cruising range. When I took it up to PA a couple weeks ago, it was able to make that round trip (~228 miles) plus maybe 10-15 miles local driving, on about 13.5-14 gallons. I got about 17.8 mpg on that tank. Not bad I guess, for a 23 year old truck that's only rated 12/15 under the new EPA rating system!
It's the people whose GALLONAGE is high that will "break" at $4 a gallon. Those who drive 400 miles a week in a 14 mpg SUV will break a lot faster than those who drive 400 miles a week in an Echo. But those who drive 400 miles a week in a Corvette in 6th gear won't break because the gallonage on that car is "reasonable" to begin with.
So it's not really the size or type of car you drive that determines if you'll break at $4, but the optimal MPG you can achieve and the number of miles you drive.
The 14 mpg SUV driver can't do anything to get better mileage, and he cant' drive less, and so when gas goes to $4, he is automatically in the hole for another $1,200 a year. That's his entire annual insurance payment and then some.
And to make up that $1,200, he has to earn probably an additional $1,600, which he can't do because he's dancing as fast as he can.
It's an ugly spiral for the middle class I tell you.
...that gas always spikes in the spring and the fall because they are switching fuel blends? Anybody remember this? It just happened 6 months ago. And 6 months before that...
Everybody should just ease up on the doom and gloom for a little while.
It's not gonna happen this time. Last year in early November, I was paying just above 2 bucks, and it dropped to $1.99 briefly just before Thanksgiving and again in mid-January.
But this year, with $100 oil in sight, there will be no such decline.
it's not doom or gloom, it's just looking at the facts as they appear to be on the table. Wishing for $2 gas is kind of magical thinking, based on disregarding historical records these past few years, but dreading $4 has some basis in reality I think.
it's not like I'm WISHING for it, but it's certainly plausible if you plot it out against these last 24 months.
It's not the cost of gas I'm worried about, it's that $4 a gallon will suck huge, mind-boggling amounts of money out of the economy. That's more troubling than my 15% bump in monthly gas bill.\
Everyday I pass a gas station with $3.62 on the sign. Your fear is my reality.
...that gas always spikes in the spring and the fall because they are switching fuel blends? Anybody remember this? It just happened 6 months ago. And 6 months before that...
Yeah, in the fall the price of gas drops (or has in the past) as the refiners switch to a less costly winter blend. But this year is different. Gas inventories are extremely low. And now with maybe 1.6 mmbpd of oil shut in from Mexico, we can expect a continued drop in our petroleum reserves as well (last week it fell by 3.9 million barrels but is still above the average for this time of year).
On October 22, the Energy Watch Group issued a very bleak report on the state of the global oil supply. This group was commissioned by the German Government to perform this study.
Likewise Fatif Birol, the chief economist for the International Energy Agency, stated that their next report would be more downcast than previous reports. He said that he'd experience a kind of intellectual earthquake about global decline rates for petroleum production and the inability of new projects coming online to manage to make up for the declines and add additional capacity to the global supply:
Most of us give little pause about the wonders of being able to fill up their rig and go. One calculation that I saw somewhere suggested that one gallon of gas is the equivalent of 330 hours of hard physical work by a healthy male ...ah... make that "person".
So even at five bucks a gallon, I'll consider it a privilege to be able to fill it up and go.
If you guys think $4/gallon is high go to France and rent a car for a few weeks. The 1.29 price on the signs at their gas stations might look good at first but that's in euros and per liter. After converting from liters and the euro the price of gas is easily over $5/gallon.
They do have an excellent mass transit system that people actually use. I can see why.
Yes, but their gas prices haven't doubled in three years and change, they have been that high for ages, gradually ramping up over time. Not the same situation.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
They've had 40 years to adapt to high fuel prices. They didn't have to redesign their cars from the bottom up in terms of size and fuel efficiency. So their cars are more evolutionary than revolutionary, at least in space design I mean.
And of course their diesel fuel costs considerably less---well, not in all of Europe, but in most countries you get a decent discount if you drive a diesel car.
If you take a 3 year snapshot of gas prices the increase does seem pretty dramatic. If you look at the past 40 years then gas prices have only risen slightly faster than inflation. When you consider that vehicles get significantly better fuel efficiency than they did 40 years ago the bottom line is that the average person is paying about the same percentage of his income for gasoline as he did in the 60's. Maybe not the guy in a 14 mpg SUV but his pain was self induced.
People need to realize that when we were paying $1/gallon for gas several years ago that represented a historic low when adjusted for inflation. It was an anomaly, not the norm and shouldn't be used as some benchmark for what gas prices should be.
If you rate the price of gas in comparison to minimum wage it is much more expensive. 1960 minimum wage was $1.25 per hour. Gas wars were common selling regular for 19 cents per gallon. In that light gas now is closer to double 1960. 1977 to 1981 is still the toughest time historically for gas buyers, with long lines, high prices & gas guzzing cars.
Maybe not the guy in a 14 mpg SUV but his pain was self induced.
Not to throw your own argument back. I like to think of it as the comfort premium I pay for driving a gas guzzling SUV. I would rather have it get 30 MPG with a smaller diesel engine. But I am not sure that premium would be worth the extra cost. NOW is the time to buy that luxury SUV you have always wanted. $4k under invoice will buy a LOT of gas. Even at $4 per gallon.
NOW is the time to buy that luxury SUV you have always wanted. $4k under invoice will buy a LOT of gas
I think you're right. I'm not interested in an SUV but I've been thinking the same thing in regards to a full sized truck. I personally don't like driving trucks but there are about 15-20 times a year that I could use a truck's utility. I'm sure there are a lot of people out there that bought a truck as their daily driver and they are now eager to unload.
Boring Brit here. Current diesel prices in U.K. are between £7.5 and $8.0 per USG equiv. Diesel is slightly more expensive than gasoline but the MPG is better - so that's alright then !
Hopefully the big SUVs will have an energy efficient Diesel engine. Along with that a decent supply of GTL to feed it. I will probably enjoy the comfort and ease of ingress and egress even more in 5 years, than I do now. Current sedans are not designed for older folks to get in and out of. That is why the demographic of vehicles like the Scion xB are much different than Toyota anticipated. CUVs also fill the bill to a certain extent.
Nice idea but he's a Scot. Most of the race has one major problem : short arms and long pockets. Not going to happen. How do you get a Scot to buy a round of drinks ? Everyone else has to leave the bar. The UK motorist is a great cash cow and we're really nice people who'll moan at our wives/friends/colleagues but won't get out there and actively complain.
Hey, it just clicked ! What you guys get as the Nissan Rogue, we get as the Nissan Qashqai.........almost sounds like Cashcow. Scary.
Yes, but if your analysis is going to be that in-depth, then take it to its logical conclusion: those low low gas prices prior to three years ago had existed for about 15 years. That's how SUVs got so popular in the first place.
So there was a 15-year lull, more than enough time for any reasonable person to come to the conclusion that they could count on low gas prices. Then came Katrina right on top of increasing world demand on top of spiralling problems in the very countries that supply so much of the oil. A triple threat that knocked that old thinking for a loop.
I can understand why people had figured low gas prices that were well-moderated would be the norm indefinitely. And all the folks that had that way of thinking are feeling the pinch, believe me. It would have been much better for lots of folks if gas prices had risen slowly but steadily since 1990.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
QashQai is a funny name. I love the way Brits are resolved to the status quo. I learned some about the way your government evolved reading about William Wilberforce. Too bad we don't have any politicians with that kind of integrity. We will learn to survive with $4 or $6 gas as you have.
So they popped over the $97 mark for a while today:
"Light, sweet crude for December delivery rose $2.61 to $96.59 a barrel on the New York Mercantile Exchange Tuesday after earlier rising as high as $97.10, a new trading record."
Immediate causes were bombings in Afghanistan and an attack on a Yemeni oil pipeline, apparently.
"It doesn't cost big oil companies anywhere near $90 to produce a barrel of crude. But they buy more crude than they pump, so the rising cost of a barrel cuts both ways."
Comments
Seriously, if you believe that computer modeling discovered something new, it must have been something that was discovered since 2000 . . . 'cuz oil was trading in the lower teens and the world looked like awash in oil for the forseeable future; Economist magazine even fulfilled the "magazie cover prophesy" rule by nailing the bottom with their error (a cover showing a globe drowning in oil), just like Newsweek nailed the global temperature bottom with their "global cooling" cover in 1975, and probably having done it again regarding "global warming" with their retraction in Octoer 2006. Now, tell me, does 3gigHz vs. 1gigHz really make that much of a difference?
I think the President's cabinet should have a Secretary of the Future (not my idea) and that's his/her job. Right now we don't even have a Secretary for the next two weeks.
We do have a problem. The problem is called global monetary inflation. Oil is only one of many many commodities that have gone up in price dramaticly since the year 2000. The reason why the lay person is so fixated on oil price is because oil is the only thing that a consumer purchase that is anywhere close to commodity form. Everything else is made into pretty morsels or shiny packages, where by the manufacturing content exceeds the commodity content; the manufacturers eat the increased commodity cost component by shipping manufacturing overseas and reduce labor cost component.
If consumers were to buy other commodities in their basic forms, they'd notice that the price of copper, iron, aluminum, uranium, silver, gold, and just about every other commodity have gone up in price at a comparable pace to oil, and in some cases faster than oil. What exhaustion or middleast unrest would explain that? They are not even produced in the middleast. Gold does not even have real industrial demand; there's enough of the stuff to last decades even without any new gold being mind from the ground. So why are the prices going up like gang-busters? Because the fiat money is debasing. Too much fiat money is being printed to support the overgrown government, which is getting in the way of economic efficiency.
The social engineering solutions like regulations and taxes would only make the fiat money worth even less, and exacerbate the commodity price problem. To the consumers, it would mean even higher oil price. In other words, many of the proposed "solutions" are not solutions at all, but the problem itself.
Oil needs to be more regulated as a commodity, not less. Fact is, too many hands grabbing for too little oil (or oil that IS there but hard to get) is very VERY dangerous.
Right now you and I are held hostage to....RUMOR...we don't even need a real shortage of oil to be pounded economically as individuals.
Don't you all out there feel like an oil hostage? I do! Gee, I wonder if someday it'll be like that with solar energy...people will threaten to put huge sunglasses on your house....
Visiting Host
BTW, some countries do have a Secretary of the Future. It's called central planning. Luck would have it that Chavez down in Venezuela just installed such a clown in the last few weeks. Apparently, they are experiencing run-away inflation despite gasoline price being capped by the government at a few cents a gallon. The high taxation and regulation envrionment down there apparently is causing a "chicken problem," "clothing problem," "rice problem," "bread problem," etc. etc. Chavez answer seems to be everything should be regulated. Guess how successful that will be.
Has anybody ever mentioned why those prices have gone up?
That's the classic pitfall of Confucianism (being an ethnic Chinese myself I should know :-) Pretending that millions of grown adults were under-age kids in a family unit may fool a few in short run and enable a dictatorship, but can't really escape economic and social catastrophy eventually.
BTW, even in a family with more than perhaps half a dozen siblings, it would become obvious that the siblings would have interest in engratiating themselves to the dictatorial "father" than making something out of themselves and perhaps bring more bread home. That's why successful parenting of large family involves a hands-off approach :-)
Next will be indoctrination into National Socialist or Communist dogma...
We'll revisit the issue when gas does indeed approach $4 a gallon.
Gas should be $3.50/gal. right now, climbing toward $4. The talking heads agree that it will be within a few months.
Remember January 2007 when gas dropped to $2, but by July it was well over $3? Now, apply that ratio to our current situation. Can anyone deny that $4.50 gas is looming?
The U.S. economy has done a remarkable job of absorbing high gas prices so far. But $4 could be a breaking point.
When SUV owners who commute to work find themselves spending as much each month for gasoline as they do on their car payments, they'll break.
When pickup owners start paying $100 to fill their gas tanks, they'll break.
When business owners receive employee demands for raises just to pay for gasoline, they'll break.
What's YOUR breaking point?
I'll be driving my '88 Buick Park Avenue and be able to see the road ahead as all the SUVs that would've been in front of me would be gone.
Yeah but the talking heads two years ago were talking $5./gallon within 6 months (or 18 months ago).
When SUV owners who commute to work find themselves spending as much each month for gasoline as they do on their car payments, they'll break.
I am already spending more per month for gas than I am in car payments....wait my cars are paid off
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I pay more for food each week than I do for gas.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Now five bucks is another story.
I'll be driving my '88 Buick Park Avenue and be able to see the road ahead as all the SUVs that would've been in front of me would be gone.
$4/gallon gas probably won't change my driving habits much, because I pretty much changed once prices started staying consisently above $2/gallon.
I'd say the only thing that would make me change would be if my commute to work suddenly changed...either from switching jobs or buying another house. And I don't see either happening anytime soon.
I'm currently putting maybe 4,000 miles per year on my '85 Silverado. I figure it might average 13 mpg. So, 307 gallons per year. For prices to rise from $3 to $4, it would cost me another $307 per year. Or about $25 per month.
When I filled up on Thursday night, the person before me had pumped $106 worth of gas. YIKES. In my little car, I only needed $25, but that's a fill-up I could have done for $15 just two years and a few short months ago, the summer before Katrina (2005). There is nothing else in my life that I purchase even semi-regularly that has gone up 40% in two years and 3 months. Not even my out-of-control health insurance premiums. :-/
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
I can think of a few things that have gone up that much, if not more, in 2 years and 3 months. However, most of them are energy related. :sick:
Home heating oil: In 2005 I paid $1.799/gal for the stuff. Last week I just locked into my new contract. Market price, with a cap of $3.559/gal. OUCH!
Electricity: went up 50% in June 2006. However, at the last minute they built in a deferral that made it only go up 15%. Deferral went away in June 2007 though, so now we're paying the ful 50% increase.
Co-pay on my insurance: I think it was $20 in 2005. Went up to $30 in 2006, and $40 in 2007. Prescription cost went up too, but I forget how much. What they take out of my paycheck has gone up too, but I forget how much it was back in 2005. It's $25 every two weeks now.
Milk: I picked up a gallon of Vitamin D whole this morning. It was on sale for $3.79. Usually it's $3.99. Seems like not that long ago, it was around $2.65-2.75. I think Costco sometimes has it for around $2.75-3 per gallon these days, but I'm not running all the way up there just for a gallon of milk.
In contrast, I got a 5% raise in 2006, and a 6.7% raise in 2007.
I think it's a consensus: there is NO breaking point for people with regard to gas prices. People won't notice because it is likely that prices will rise more rapidly than before but evenly, giving people time to adjust.
I wonder though, if some people, already "broke", back when gas started consistently getting above $2 per gallon? I know in my case I did. I quit driving my old cars as often, started driving more gently, and cut down on unnecessary driving. As I recall, once fuel prices started shooting up in '04, it was enough to start impacting sales of thirstier vehicles like the big SUVs, trucks, etc. It wasn't enough of a rise to make the thirstier markets extinct, such as how the '73-74 oil embargo set into motion events that would ultimately lead to the demise of the "traditional" full-sized car and the big-block engine.
When I filled up on Thursday night, the person before me had pumped $106 worth of gas. YIKES.
OUCH. Now that would be pretty painful! Most of the fill-ups in my cars tend to be in the $30-40 range, which will usually get 250-350 miles out of my Intrepid, depending on how it's driven. Somewhat...ummm, less, with my older vehicles.
I think my '76 LeMans has a 22 gallon tank, and the DeSoto and New Yorkers have a 21 gallon. The Intrepid is 17 (usually takes 13-14 when I fill up), and the truck's is only 16 gallons. It originally had dual tanks for 32 gallons total, but both of them went bad in 2005. I only had the money to fix one of them, so I had them disable the other. It's not like I ever take that truck on long trips, anyway, so I don't need the cruising range. When I took it up to PA a couple weeks ago, it was able to make that round trip (~228 miles) plus maybe 10-15 miles local driving, on about 13.5-14 gallons. I got about 17.8 mpg on that tank. Not bad I guess, for a 23 year old truck that's only rated 12/15 under the new EPA rating system!
So it's not really the size or type of car you drive that determines if you'll break at $4, but the optimal MPG you can achieve and the number of miles you drive.
The 14 mpg SUV driver can't do anything to get better mileage, and he cant' drive less, and so when gas goes to $4, he is automatically in the hole for another $1,200 a year. That's his entire annual insurance payment and then some.
And to make up that $1,200, he has to earn probably an additional $1,600, which he can't do because he's dancing as fast as he can.
It's an ugly spiral for the middle class I tell you.
Everybody should just ease up on the doom and gloom for a little while.
But this year, with $100 oil in sight, there will be no such decline.
james
it's not like I'm WISHING for it, but it's certainly plausible if you plot it out against these last 24 months.
It's not the cost of gas I'm worried about, it's that $4 a gallon will suck huge, mind-boggling amounts of money out of the economy. That's more troubling than my 15% bump in monthly gas bill.\
Everyday I pass a gas station with $3.62 on the sign. Your fear is my reality.
And where does that money go? We import about 60% of our oil, so a significant amount of the increase is going out of the country.
There are lots of peripheral effects. I can't think of any good ones. :lemon:
james
I can already feel things slowing down, or perhaps shifting might be a better word. Everyone's starting to sit on their money.
Yeah, in the fall the price of gas drops (or has in the past) as the refiners switch to a less costly winter blend. But this year is different. Gas inventories are extremely low. And now with maybe 1.6 mmbpd of oil shut in from Mexico, we can expect a continued drop in our petroleum reserves as well (last week it fell by 3.9 million barrels but is still above the average for this time of year).
On October 22, the Energy Watch Group issued a very bleak report on the state of the global oil supply. This group was commissioned by the German Government to perform this study.
You can download it here:
http://www.energywatchgroup.org/Oil-report.32+M5d637b1e38d.0.html
Likewise Fatif Birol, the chief economist for the International Energy Agency, stated that their next report would be more downcast than previous reports. He said that he'd experience a kind of intellectual earthquake about global decline rates for petroleum production and the inability of new projects coming online to manage to make up for the declines and add additional capacity to the global supply:
http://www.energywatchgroup.org/Oil-report.32+M5d637b1e38d.0.html
Most of us give little pause about the wonders of being able to fill up their rig and go. One calculation that I saw somewhere suggested that one gallon of gas is the equivalent of 330 hours of hard physical work by a healthy
male...ah... make that "person".So even at five bucks a gallon, I'll consider it a privilege to be able to fill it up and go.
I helped my mom buy a car this year and the dollar's exchange rate against the Brazilian Real is pathetic, about half of its peak. :sick:
They do have an excellent mass transit system that people actually use. I can see why.
Do the subways still smell like pee though, or did they clean up their act? :surprise:
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
And of course their diesel fuel costs considerably less---well, not in all of Europe, but in most countries you get a decent discount if you drive a diesel car.
People need to realize that when we were paying $1/gallon for gas several years ago that represented a historic low when adjusted for inflation. It was an anomaly, not the norm and shouldn't be used as some benchmark for what gas prices should be.
Maybe not the guy in a 14 mpg SUV but his pain was self induced.
Not to throw your own argument back. I like to think of it as the comfort premium I pay for driving a gas guzzling SUV. I would rather have it get 30 MPG with a smaller diesel engine. But I am not sure that premium would be worth the extra cost. NOW is the time to buy that luxury SUV you have always wanted. $4k under invoice will buy a LOT of gas. Even at $4 per gallon.
I think you're right. I'm not interested in an SUV but I've been thinking the same thing in regards to a full sized truck. I personally don't like driving trucks but there are about 15-20 times a year that I could use a truck's utility. I'm sure there are a lot of people out there that bought a truck as their daily driver and they are now eager to unload.
Wow! Write that down, then go back and look at it in 5 years. It should be good for a chuckle.
james
Aaaaarrrrggggghhhhh !!
Hey, it just clicked ! What you guys get as the Nissan Rogue, we get as the Nissan Qashqai.........almost sounds like Cashcow. Scary.
So there was a 15-year lull, more than enough time for any reasonable person to come to the conclusion that they could count on low gas prices. Then came Katrina right on top of increasing world demand on top of spiralling problems in the very countries that supply so much of the oil. A triple threat that knocked that old thinking for a loop.
I can understand why people had figured low gas prices that were well-moderated would be the norm indefinitely. And all the folks that had that way of thinking are feeling the pinch, believe me. It would have been much better for lots of folks if gas prices had risen slowly but steadily since 1990.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
Good timing for Nissan - a fuel efficient compact crossover will be bought by more than a few downsizing from their SUVs.
"Light, sweet crude for December delivery rose $2.61 to $96.59 a barrel on the New York Mercantile Exchange Tuesday after earlier rising as high as $97.10, a new trading record."
Immediate causes were bombings in Afghanistan and an attack on a Yemeni oil pipeline, apparently.
$100, here we come! :sick:
http://www.nytimes.com/aponline/business/AP-Oil-Prices.html?_r=1&ref=business&or- ef=slogin
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
"It doesn't cost big oil companies anywhere near $90 to produce a barrel of crude. But they buy more crude than they pump, so the rising cost of a barrel cuts both ways."
How much Exxon pays for oil (CNN)