“What costs $80 buckaroos?” you ask. The answer is: The price of a barrel of crude oil, my friends. And isn’t that just wonderful news for all the little people, like you and me?
The price of oil last night broke through the $80 a barrel level for the first time on fears of winter supply shortages. […]
Analysts said the 500,000 barrels per day increase in quotas from November announced by Opec this week had not been enough to outweigh concerns that a fresh wave of hurricanes could hit American oil installations.
Crude oil stockpiles in the United States fell 7.1 million barrels last week to their lowest in eight months, according to the Energy Information Administration. Analysts had expected a fall of 2.4 million barrels.
Let’s see. Health care costs continue to rise at a rate nearly 4 times greater than wages have risen since 2000. Milk prices are also way up, costing more per gallon than gasoline. Income inequality between the rich and everyone else is the highest it’s been since the Depression era. We are in a severe credit crunch thanks in large part to Republican led de-regulation of financial institutions. And after one of the worst economic recoveries in terms of generating jobs and wage growth in US history, economists are finally starting to use the R word to describe the meltdown of the US economy, led by the free fall in the housing market and the mortgage crisis.
I guess we need to cut more of Paris Hilton’s and Bill Gates’ taxes, eh? Obviously we haven’t done enough in that regard. Not to worry though. I’m sure President Bush will find a way to blame all this on the Clintons.
And if that isn’t depressing enough, you didn’t even mention wheat.
The price of everything at the grocery store has gone way up, too. Not just the milk…
The high oil prices bleed into everything else.
Absolutely right. And all the more reason to buy local whenever possible, as there is less of a bleed over factor due to lesser transportation costs over shorter distances.
Sooner or later we as a society are going to have to realize that the goods we buy don’t just incur a monetary cost but an environmental cost and potentially a personal health cost. I think most people know this but our culture puts such a premium on the almighty dollar that the other costs are of little concern to most.
Notably, my CSA (community supported agriculture) farm share is the same price as it was last year, and seeming like more and more of a bargain each month.
I recently read somewhere that something on the order of 85 cents of every food dollar went to transport costs.
I am wondering if the high costs of shipping might start to make importing Chinese goods less appealing. Of course, we owe the Chinese so much money, they have some leverage if we decided to stop buying so much of their crap…what a mess.
Shhh, don’t say that too loudly or some of the free market zealots will start clamoring from the rooftops about the Magical Hand of the Free Market™!
I laugh in the face of free market sealots… 🙂
My mother was shopping yesterday, looking at some Eileen Fisher clothing, wanted it, but wouldn’t buy it because it’s made in China and despite that, it still costs a fortune.
Honestly, if Americans want to cut their consumption down, all they’d have to do is make a rule that they can’t buy anything from China.
Not to worry….we will just use corn meal. …Oh that’s right, I forgot about the ethanol thing. Never mind.
Commodities are going up through the roof. All of this can be traced back in some way to oil and gas prices being so high, because no matter what the commodity or product made from it is, it requires oil to get to the store and your house.
And guess what’s gonna happen to oil prices when Bush hits Iran. You know that “shock that could push the US economy into recession?”
I remember saying to myself when Bush first got “elected” and gas was a buck forty in Minneapolis that winter that “This was insane.” Now I look at two eighty a gallon here in Cincy and go “That’s not too bad.”
I honestly believe Bush’s plan is to make sure that A) the next President is a Democrat and B) make sure that Democrat takes 100% of the blame for the hideous position we’re going to be in by 2010 or so.
Yeah, and no:
http://www.forbes.com/feeds/ap/2007/09/12/ap4111564.html
None of this has anything directly to do with the price of oil. The weakness of the dollar makes our market attractive, I suppose.
Yes, American and Transnational energy corporations profit handily on this, but it won’t last long.
Reason #1. The market is under intense manipulation. By supressing refining capacity, even increases in crude production are limited in their effect on the end consumer products like gasoline. This has been working well for energy companies of all stripes, a form of collusion that everyone can know what to do without having to conspire in a dark room to do so.
Reason #2. The myth of peak oil. There is a false panic out there the we’ve turned the corner on production, that all the oil available is known and we’ve peaked production. This is demonstrably false, from increasing access to Artic deposits to the oceans of not-so-‘sweet and not-so-light oil that have remain untapped because they couldn’t compete price-wise. Until now. It’s a bit counter intuitive, but the higher the price, the higher the overall production volume can grow, thanks to the introduction of new products. In order to convince potential producers to make the HUGE investments necessary to process the lower quality crude, high prices would have to be sustained and not so obvioulsy manipulated.
Reason #3. Geoploitical impact. The negative effects of stable prices above around $68-75 are too great, so while prices may often peak above that range, I think that current oil producers’ and American interests coincide enough to keep prices fixed in the above range for one primary reason, to inhibit production of the other forms of oil besides the ‘sweet’ stuff (easily and cheeply refined). When that stuff starts to go online the whole balance of power in the world would be effected as ‘enemies of America’ like Venezuela’s gov’t would benefit the most. Then again a little pre-emptive coup here or there might fix all of this. Oh wait, we’ve tried that and failed. Oh well, try and try again.
If Chavez falls, Oil prices may have no limit.
lf we’d have paid attention to Carter back in the 70’s, we wouldn’t be in near the mess we’re in today…slow learners.
to put the current prices in perspective:
lTMF’sA