Hurricane 'will force consumers to reduce fuel use'

[RamboLiberal]

http://business.timesonline.co.uk/article/0,,9072-1757943,00.html

OIL prices soared to record levels yesterday as nervous traders ignored pledges of additional supplies from Saudi Arabia and instead worked feverishly to calculate the impact of Hurricane Katrina.
The price of a barrel of US light crude touched $70.85 a barrel, five cents higher than Monday’s peak, while Brent in London jumped $3.55 to $68.42 when trading resumed after Bank Holiday Monday. Gas prices in the United States also rose sharply.

The record prices prompted governments in France and Belgium to flag populist measures to protect consumers.

However, the International Energy Agency (IEA), a leading forecaster, and analysts advised against government intervention, saying that the $70 price could provide the much-needed jolt that would force consumers to reduce their oil consumption.

The French Government was in disarray yesterday, with ministers squabbling over a proposal to cut the national speed limit to reduce fuel consumption. Dominique Perben, the Transport Minister, had called for a 115kph (71mph) limit on motorways, down from 130kph at present, saying that it would save motorists €7 on a 500km journey and also reduce the road death rate. His call sparked fierce criticism from within the governing centre-right Union for a Popular Movement. A spokesman for the party said that the measure was “inappropriate”.

Meanwhile Nero Bunnypants Fiddles.

[NYC]

1. What is the problem with reducing the speed limit

to conserve gas and money? (France)

As for the jolt to force consumers to reduce consumption, I don't think that will be avoidable or avoided. Couldn't the government act to reduce the jolt? Weren't there old people on the verge of freezing last winter? Sealing off all but one room of the house, etc?

[Deja Q]

10. Nixon did that in 1973. Clinton nixed it in 1998...

The federal 55mph speed limit, that is.

[AngryAmish]

16. Sammy Hagar was finally listened to

[NYC]

19. And it was a good idea.

Now, we are getting "blended" gasoline? More pollution. Lucky us.

[Strelnikov_]

24. Reduction To 55 mph Could Reduce Oil Consumption By 3.4% In US

The following report estimates a 3.4% reduction in oil consumption.

The more significant impact is that it would reduce transport fuel consumption by 5.1% which is critical considering that the current shortage is in refined product.

Then again, there is the faith based science approach that any measure that may take a bit of sacrifice is worthless and will have no benefit.

Saving Oil in a Hurry: Measures for Rapid Demand Restraint in Transport
International Energy Agency
28 February 2005

http://www.stcwa.org.au/journal/210405/files/background_IEA.pdf

The tables below are from the report following publication and summarize fuel savings from speed reduction to 55 mph.


Table 2-35: Consensus estimate of effect of reducing speed limit to 90 km/hr

US /Canada

Thousand barrels saved per day 727 (672 US 2001 data)
Percent transport fuel saved 6.2% (5.1% @ US 13.1 M bbl/dy)
Percent total fuel saved 4.7% (3.4% @ US 19.5 M bbl/dy)


Table 2-29: Fuel Economy by Speed, based on ORNL
Percent Change In Fuel Economy

55–65 mph 11.0%
65–75 mph 17.7%
55–75 mph 30.6%

Note: Based on Model years 1988–97 automobiles and light trucks, based on tests of 9 vehicles.

[aquart]

2. So. Gouging consumers is a GOOD thing.

[Conservativesux]

6. If you are an oil company exec or a stockholder, why yes it is.

but is you are a poor working slob who has to drive to work, like most people fergetaboutit !

[newswolf56]

3. This is a classic example of the elitist...

friend-of-the-oligarchy thinking that ignores (1) the fact that America's DemoPublican politicians have sold us out to Big Oil by refusing to build adequate public transport, betraying all of us who have to work for a living; and (2) the fact that most American workers cannot "reduce their oil consumption" without being unable to get to work (and therefore losing their jobs).

Alas, the shortages imposed by Katrina plus $5 a gallon gasoline (already predicted by some analysts) will destroy the U.S. economy just as surely as Katrina has destroyed New Orleans itself. Meanwhile -- as we are flung ever deeper into ever more inescapable poverty -- the oligarchy will of course get ever wealthier off our misery. And unlike 1929 -- especially given the additional evidence of outsourcing, downsizing, stagnant wages, looted pensions and destruction of the social-safety net -- this time the destruction will be forever. (Already elderly, I had hoped I would be dead by the time the American work-force was reduced to genuine Third World degradation, but now I suspect we may see it happen within the next few months.)

How ironic that George Bush -- the ultimate disciple of the free-enterprise rat-race -- has made Karl Marx again wholly relevant. What is victimizing us is the savagery of class warfare -- capitalism in its most Tyrannosauric form -- and some of us are finally beginning to wake up.

[Voltaire99]

4. Well said. (nt)

[saigon68]

7. Its time to get out the TORCHES AND THE PITCHFORKS

lol

[lvx35]

5. No shit! well said!

These guys are right that it will reduce consuption, and ultimatly that must occur, but they ignore the fact that the asshats in the white house are two oil company CEO's blocking a positive switch to alternative energies by any means necessary.

[FreeStateDemocrat]

12. The greedy exploitation of working class will lead to a social cataclysm

[DrZeeLit]

14. Excellent! Try living in a rural area where your transportation is

your lifeblood. I'm in Vermont. We have public transportation in the "larger" cities, but much of the working population lives in rural towns. Driving to work is a necessity, using farm and ranch machinery is a necessity, and heating homes in the sub-zero winter is a necessity.

These are not luxuries. When we own a four wheel drive auto, that's a necessity.

Hummers? Expeditions? That huge SUV ploding along in rush hour traffic in LA? Not gonna see too many of them here.

So, we will have an upper class telling minimum wage earners ($7 an hour to work at ski areas in VT) to tighten their belts, while they plow their cigarette boats and yachts and stretch limos into the golden years?

If "everyone" was going to sacrifice, I'd buy it. But I just don't see that happening, do you?

[DoYouEverWonder]

8. So why doesn't the President order the oil companies

to cap gas prices at the level they were at before the storm? Oh I forgot, the oil companies own him so he would never dare do anything that might cut into their profits.

[Deja Q]

11. Isn't capitalism cool?

Oil is just another commodity. Like an American Idol CD. Its value increases with its popularity.

[foo_bar]

23. Bush is just another commodity

A fungible empty suit, like pork bellies and sweet crude.

[AngryAmish]

17. It would cause greater supply shortages

A domestic oil company will not lose money on a transaction. It would be a breach of fiduciary duty to their shareholders.

So, if the President puts a cap on the price the domestic oil companies can get, they will stop buying oil on the international market. Other people in the world will buy the oil instead. This causes shortages in the US.


Price is an allocation system. When prices are kept artificially low (think Soviet Union) there will be less stuff. Prices are artificially high, lots of stuff but few customers.

[no_hypocrisy]

9. There will uneven levels of conservation, if at all.

I can drive less distances, get a bike (and hope I won't get hit by a car), walk more to close distances, turn the heat down to 65 in the winter, cook less, wear sweaters, etc. But my sacrifices and forebearance will be seen by some pockets in the economy as "Good, more for us!" and they will go on heating their McMansions at 72 degrees (all 20 rooms), drive their Hummers, and love the luxury of not having to worry about choosing between filling up and groceries.

You can't force everyone to be sensible and make a group effort unless the stuff ain't there for everyone. And I hope it doesn't come down to that . . . .

[Triana]

13. worked feverishly to calculate...

...how much PROFIT they can make on this disaster. Don'tcha just LOVE bu$hit's oil buddies?

[demo dutch]

15. Could it be possible, that Americans will actually trade in SUV's?

[Hobarticus]

18. Is it time for gas rationing, yet?

I mean, we hear so much about how this war is like WW2...maybe it's time for gas stamps and victory gardens. THAT is sacrifice.

[tazkcmo]

20. Yeah, but....

....who will bear the brunt of the shortage? The poorest will go with out heating oil this winter, the middle class will turn to inadequate mass transit systems and the fake rich will trade in the SUV for BMW sedans while our Congressmen and Senators cruise in those nice stretches.

[rustydad]

21. Trouble is....

In the big cities reducing speeds on the freeways causes more rush hour traffic jams and that increases fuel use because of stop and go. In any case a 55mph speed would only save a few percent of fuel use. What we need we cannot now do. We should have built our cities to be far more fuel efficient, our cars to get 80 mpg minimum, a ban of all vehicles that weigh over one ton (except commercial trucks), tax incentives for rail transport, AND a high gas tax, like almost all other first world countries, which encourages conservation and puts the tax money back into our economy, not ME countries that hate us (rightly so). Bob

[Im_Your_Huckleberry]

22. bring back the double nickel.

[enki23]

25. let's talk about inelastic demand.

.