So, gas is "cheap" again. I don't own a car, but I'm curious what this will mean for the global economy, grocery prices (remember when they spiked when gas did?), energy research and how long it will last.
Posted by Lyrhawn (Member # 7039) on :
Grocery prices should go down...but not as quickly as gas prices themselves did.
The US agency in charge of predicting energy supply think we'll be oversupplied for the next two years, which means while the price might tick back up, it'll be a couple years before they head back to the territory they were in back in July.
In the meantime...Canadian tar sands will slow production, but as I understand it, tar sand work is a lot closer to mining than drilling. Most of the investment is initial in the equipment, the rest is pretty efficient, so they'll keep pumping. US shale will slow drilling dramatically so long as the price is below $50. Shale wells go dry quickly, requiring lots of wells drilled frequently. As that dries up, US supply will head back down until the price comes up. That might mean the price settles into the $50-$60 range longterm, as US shale groups are likely to start back up as soon as the price rises.
Energy research, car company research, and the like, won't suffer much. At least not immediately. Car companies have huge CAFE standard increases coming up in a few years that will require a half decade of planning for. They can't just crank out a 50mpg car or EV in a year or two. They will, however, probably readjust their volumes forecasting, which could hurt prices.
Wind and solar are still doing well. Large scale power plants still don't (by and large) run right off oil. They run off coal or gas, or renewables.
Posted by Geraine (Member # 9913) on :
As a carnivore, I can only hope this brings down the price of meat. Especially beef. I did not use my smoker as much as I would have liked to last year....
Posted by Parkour (Member # 12078) on :
Russia will keep being super miserable and broken.
Posted by Goody Scrivener (Member # 6742) on :
I've got the gas price yo-so here. When I went to work on Thursday, the station by home was 1.89. By the time I got home, it was 2.29. This morning, it's 2.17.
And as for how quickly the prices dropped, a year ago I was excited to find gas at 3.69..... and that was at a warehouse club's gas station.
Posted by Elison R. Salazar (Member # 8565) on :
As I understand it, this will absolutely hammer a lot of smaller oil producers and they'll get gobbled up by the bigger ones. I *think* I've heard that it'll screw up Alberta, because their budget was predicated on surplus from tar sand wealth and whelp, deeeeeeeebt and no money for it. Shame they didn't invest that tar sand money into education eh.
Posted by Samprimary (Member # 8561) on :
1.60 this morning in Longmont
Posted by scifibum (Member # 7625) on :
2.01 for premium yesterday, which was something.
Posted by Thesifer (Member # 12890) on :
Lowest we got was about 1.54, back up a bit today due to the rise last week of a couple dollars per barrel. I expect we'll rise back to around $2.00 or so average in Oklahoma, and sit there for a while.
Posted by JanitorBlade (Member # 12343) on :
$1.71 this morning in Glendale. Long-term outlook is still between $50-$60 a barrel. This is looking like the start of a beautiful thing.
Posted by Elison R. Salazar (Member # 8565) on :
Not really, necessity is the mother of invention.
Posted by JanitorBlade (Member # 12343) on :
quote:Originally posted by Elison R. Salazar: Not really, necessity is the mother of invention.
Yep, I'm looking forward to Russian inventing a form of actual government, rather than just being a massive oil conglomerate.
Posted by Lyrhawn (Member # 7039) on :
quote:Originally posted by JanitorBlade:
quote:Originally posted by Elison R. Salazar: Not really, necessity is the mother of invention.
Yep, I'm looking forward to Russian inventing a form of actual government, rather than just being a massive oil conglomerate.
And not a particularly good one at that.
Posted by Dogbreath (Member # 11879) on :
I'm with Elison here, in that I don't really consider low gas prices a good thing long term. There are a little less than 300,000 EVs on the road in the US right now, and I think one of the main selling points of EVs is how incredibly cheap they are to drive in light of out of control gas prices. I understand how lower prices will benefit us short term (bankrupting Russia), but I feel the environmental impact will be pretty negative. I would've preferred slowly but consistently rising energy prices, with gas reaching $7 or $8 a gallon and causing a huge demand for EVs, better public transportation, and more renewable power plants to keep up with the increased power the EVs would be drawing, leading to permanent energy independence for the U.S. As is, it feels like we're just going backwards 10 years.
Posted by ricree101 (Member # 7749) on :
quote:Originally posted by Geraine: As a carnivore, I can only hope this brings down the price of meat. Especially beef. I did not use my smoker as much as I would have liked to last year....
Water was the main limiting issue for beef atm, wasn't it?
Posted by Elison R. Salazar (Member # 8565) on :
Also how is bankrupting Russia going to help? You know which country's economy was in the shitter for a few years?
Weimar Germany.
I feel like people don't realize things can get catastrophically worse.
Posted by stilesbn (Member # 11809) on :
quote:Originally posted by Elison R. Salazar: As I understand it, this will absolutely hammer a lot of smaller oil producers and they'll get gobbled up by the bigger ones. I *think* I've heard that it'll screw up Alberta, because their budget was predicated on surplus from tar sand wealth and whelp, deeeeeeeebt and no money for it. Shame they didn't invest that tar sand money into education eh.
Yeah that would be better. Then they would have debt with no hope of income.
Posted by Mucus (Member # 9735) on :
Our governments probably should have set a minimum gas price via taxes while people were used to high gas prices anyway so that people won't suddenly start wasting gas and going backwards in terms of the cars they buy.
Of course they won't because of votes.
But even as a driver, I have to say that the best times to drive for me were after gas price shocks, when people gave up marginal trips and cleared the traffic congestion a bit.
Posted by Dogbreath (Member # 11879) on :
quote:Originally posted by Mucus: Our governments probably should have set a minimum gas price via taxes while people were used to high gas prices anyway so that people won't suddenly start wasting gas and going backwards in terms of the cars they buy.
Of course they won't because of votes.
But even as a driver, I have to say that the best times to drive for me were after gas price shocks, when people gave up marginal trips and cleared the traffic congestion a bit.
I remember when gas prices skyrocketed for the first time (in my lifetime) around 2008. It went from $1.60 in 2005 to about $4.30 in the summer of 2008, and I was poor enough that I couldn't afford the extra $250 a month. (to put it in perspective, I was paying $250 a month to rent a house with 3 other guys, so the difference in the amount I spent on gas was my entire rent) So I ended up biking everywhere for a year. I'd bike 9 miles each way to work, bike to school, bike to the grocery store (I installed a plastic crate on the back of my cart, hung the rest off the handlebars), etc. If it was raining or snowing, I'd take the bus.
But I saw a pretty big transformation in the city I was living in. Huge number of people on bikes (especially in the summer), workplaces started installing showers for people to rinse off and change after biking to work, the city put in a lot more busses, they started running shuttles from big grocery store parking lots in the suburbs to downtown. High gas prices, while inconvenient, drive the sort of innovation we need to actually effect change - both technologically and socially.
Posted by JanitorBlade (Member # 12343) on :
quote:Originally posted by Elison R. Salazar: Also how is bankrupting Russia going to help?
I feel like people don't realize things can get catastrophically worse.
Help? Look I get that a government collapsing can cause all sorts of horror. Just look at Mao. But Russia is in an awful way right now. There was hope when the USSR collapsed, but gangsters, and oil tycooons stepped in. And now they have a totalitarian state that stays afloat because of oil and because it engages in aggression with its neighbors so as to stoke the flames of patriotism.
Russia could be so much better than it is, and dropping oil prices will force reforms. If it all goes to crap, well, that's their fault.
Posted by Lyrhawn (Member # 7039) on :
I'm not sure the Weimar Republic example really works, too. I mean, people turned to a totalitarian ruler because they felt the Republic had failed them.
Well...Putin already is a totalitarian leader baiting his neighbors and gobbling up territory. Historically when the totalitarian leader can't get stuff done and drives the economy off a cliff, he gets the boot, and then, often times, some sort of democratic reform happens.
So in that sense, we're in for a reverse post Weimar, which doesn't sound so bar.
Incidentally, now is the best time in 10 years to raise gas taxes, and you can probably do it in a way that won't terribly hurt people. Put a floor under a barrel of oil. Say, $55 a barrel. Shale producers can probably stay profitable at that price, so they'll know FOR SURE that they can continue to invest because the money will always be there. Plus, people won't even really realize they've had their taxes raised (except the part where you tell them). We accept a 5-20 cent bump in the course of a few days as an acceptable event. If the price bopped back up to $3.00 tomorrow, we'd all be annoyed (and grateful it's still below $4.00), but ultimately, we'd go about our days with minor adjustments here and there.
So, bump it 50 cents a gallon over a few months (or whatever the bump would be from the floor on oil barrel prices). Take a chunk of that huge windfall and use it to lower the bottom bracket tax rate by a small percentage, enough to ease the yearly pain a little bit.
Then invest billions of it in what the gas tax is supposed to be used for: Infrastructure. Provides a huge shot in the arm to the economy which helps everyone.
Honestly I think they could sell this without an insane amount of trouble. They just haven't tried.
I think what it essentially shakes out to is a tax on imported oil. And I'll sleep just fine at night with that.
Posted by Parkour (Member # 12078) on :
quote:Originally posted by Elison R. Salazar: Also how is bankrupting Russia going to help? You know which country's economy was in the shitter for a few years?
Weimar Germany.
It would be super funny if Russia turned super nationalist because of their corrupt implosion, because by the time this is all over they would be squished like a bug if they tried anything.
Maybe they can get a loan from Ukraine.
Posted by Lyrhawn (Member # 7039) on :
They don't have any regional neighbors, other than China maybe, who could or would squish them.
They might me a lumbering old dinosaur, but they still have teeth, claws and size, even if they're dull and fat.