Rising Gas Prices

I filled up my car on Wed. this week. I haven’t been paying attention and so was startled to see that gas was nearly $3.50 a gallon. I remember a couple of months ago when the price dropped down under $2.75.

This morning there’s news that oil is expected to pass $106/bbl and that OPEC’s response is that they will not increase the volume they’re extracting – arguing that the rising prices is due to the failing dollar rather than to the law of supply and demand.

This, to me, is just about the best possible news.

America is the world’s largest consumer of imported oil. Clearly we’re going to need to transition from a primarily oil based economy to healthier mix of various energy resources. But as long as oil prices creep up (by shooting up for a few weeks and then dropping down to almost their previous levels) most people haven’t been motivated to start conserving or begin planning to make changes in their lives. But if prices climb and stay high for a long period, people will take notice and start making changes.

It will be hard for the economy and the workforce in the short run. We’re already seeing the pain that increased commuting costs are creating in the outer suburbs here in Phoenix. But perhaps this pain will force us to recognize that it simply doesn’t make sense to commute and hour and a half to work each day – and encourage more people to move back into the city. And high gas prices will motivate people to use our brand new light rail system to get about in the city. And they’ll tune their air-conditioners. And sell their giant cars and buy smaller ones that safer and easier on the environment. etc…

Like I said. Good news.

Author: Nick Knisely

Episcopal bishop, dad, astronomer, erstwhile dancer...

4 thoughts on “Rising Gas Prices”

  1. I think it’s NY Times columnist Thomas Friedman who has been arguing that the US Govt should tax gasoline at a level that keeps the price at the pump above a $3.50 per gallon floor. That, he says, would give investors in alternative technologies some confidence that the oil-producing states won’t suddenly put them out of business by dropping their prices.

  2. reality check.
    i didn’t move out 65 miles from my then-employer because i enjoy a megacommute. i did it because it was the only way i could afford a house. the house i got was roughly half the price of an equivalent home within 30 miles of my office.
    what i’ve done in the meantime to make it more bearable is bought a car that gets 35 miles per gallon, found a job that’s only 50 miles away and almost entirely a highway commute and gotten concessions so that i can work from home two days a week.
    but. that house i bought? oil heat.
    so, more concessions: most of the time, i keep my house at 55 degrees.
    all this is well and good, but the worst part? housing prices have fallen since i bought the house and wiped out the 5% equity I had in it and in fact turned me upside down.
    higher fuel prices hit me smack in the face and have me paying my 30-year-fixed-rate-thank-god-mortgage two weeks late each month and praying that each windfall comes in right as its supposed to and so far, it has. but when i set up my budget to buy this house, fuel was a dollar a gallon cheaper, and i was walking in the door with equity.
    so, whilst the folks glee up at the notion that this will force people to conserve, it might force me into bankruptcy. as it is, i’m not sure where the money is coming from to get me into work next week.

  3. No glee from me Helen. Your story is being played out in the lives of about half my congregation. I guessed right a year ago and bought a small place as close to work as I could afford, but I had options that other people didn’t or don’t have.
    We (society as a whole, and Americans in particular) are going to hit a wall in terms of energy. I think it’s coming sooner than later. Others think we may have a couple of decades yet. Either way it’s going to be a mess for everyone.
    Being forced to conserve is one part of it. Figuring out how to help folks in the position you’re in right now is another separate and more immediate part of it. This is one of the big macro-economic problems that is going to need government involvement. The housing bubble bursting at the same time as the credit crunch at the same time as the rise in energy costs has all the makings of a perfect storm I’m frightened to say. It’s going to effect everything – home life, church life, public policy.
    We’re about to hit something. The best option we’ve got is to try to hit something that’s not going to hurt as much. Which stinks.

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