Could we see $150 per barrel oil soon?

[mtraininjax]

April 16, 2009, President Obama announced his plans for High Speed Rail and at that time, Oil Prices were $50 per barrel. Today, because of unrest in the middle east, we are staring at $100 per barrel and Goldman economists are calling for an oil shortage as a result of middle east revolts. The United States is coming back online from the 2009 recession are seeing for ever 1 cent rise in gas, the citizens lose 1.46 billion in purchasing power for the calendar year. Prices have risen 18 cents over the last week and could reach as high as 50 cents once the March oil Contracts covert over to April contracts soon.

The Gulf of Mexico is still shut down from the disaster last year, and we are seeing that our domestic oil production has been cut from 7 billion barrels to 6 billion, when if we were at 10 billion, none of these issues would be on the table, we would have enough to satisfy our domestic needs, so says John Hofmeister, former head of Shell Oil Operations in the U.S. With the gulf shut, and oil companies not excited about the insurance required to drill, and prices on the rise, what will Obama do in the short term and long term to move the needle for the American consumer?

If you think 140 or 150 a barrel is scary, look at what some "experts" are predicting, from CNBC:
http://www.cnbc.com/id/41752844

[ben says]

I can only hope it goes over $150...

The only thing most American's see is money signs. If the price goes up, maybe some people will start to realize this isn't a renewable source, and we should probably be exploring other options. Plus, we should stop raping the poorest countries in the world for their only natural resources of value.

[PeeJayEss]

I can only hope it goes over $150...

+1.

The low gas prices we've gone through over the past two years are simply the result of the bad economy. They would have continued to go up from their 2008 highs if spending hadn't dropped. Now that the economy is recovering, we're seeing the prices come back up. Add to that the Middle East/Africa situation and things are about to get very interesting.

[BridgeTroll]

No doubt!  $200 or $250 would be even better!

[dougskiles]

This was in the NY Times this morning:

http://www.nytimes.com/2011/02/23/opinion/23friedman.html?_r=2&src=me&ref=general

If Not Now, When?

By THOMAS L. FRIEDMAN

What’s unfolding in the Arab world today is the mother of all wake-up calls. And what the voice on the other end of the line is telling us is clear as a bell:

“America, you have built your house at the foot of a volcano. That volcano is now spewing lava from different cracks and is rumbling like it’s going to blow. Move your house!” In this case, “move your house” means “end your addiction to oil.”

No one is rooting harder for the democracy movements in the Arab world to succeed than I am. But even if things go well, this will be a long and rocky road. The smart thing for us to do right now is to impose a $1-a-gallon gasoline tax, to be phased in at 5 cents a month beginning in 2012, with all the money going to pay down the deficit. Legislating a higher energy price today that takes effect in the future, notes the Princeton economist Alan Blinder, would trigger a shift in buying and investment well before the tax kicks in. With one little gasoline tax, we can make ourselves more economically and strategically secure, help sell more Chevy Volts and free ourselves to openly push for democratic values in the Middle East without worrying anymore that it will harm our oil interests. Yes, it will mean higher gas prices, but prices are going up anyway, folks. Let’s capture some it for ourselves.

It is about time. For the last 50 years, America (and Europe and Asia) have treated the Middle East as if it were just a collection of big gas stations: Saudi station, Iran station, Kuwait station, Bahrain station, Egypt station, Libya station, Iraq station, United Arab Emirates station, etc. Our message to the region has been very consistent: “Guys (it was only guys we spoke with), here’s the deal. Keep your pumps open, your oil prices low, don’t bother the Israelis too much and, as far as we’re concerned, you can do whatever you want out back. You can deprive your people of whatever civil rights you like. You can engage in however much corruption you like. You can preach whatever intolerance from your mosques that you like. You can print whatever conspiracy theories about us in your newspapers that you like. You can keep your women as illiterate as you like. You can create whatever vast welfare-state economies, without any innovative capacity, that you like. You can undereducate your youth as much as you like. Just keep your pumps open, your oil prices low, don’t hassle the Jews too much â€" and you can do whatever you want out back.”

It was that attitude that enabled the Arab world to be insulated from history for the last 50 years â€" to be ruled for decades by the same kings and dictators. Well, history is back. The combination of rising food prices, huge bulges of unemployed youth and social networks that are enabling those youths to organize against their leaders is breaking down all the barriers of fear that kept these kleptocracies in power.

But fasten your seat belts. This is not going to be a joy ride because the lid is being blown off an entire region with frail institutions, scant civil society and virtually no democratic traditions or culture of innovation. The United Nations’ Arab Human Development Report 2002 warned us about all of this, but the Arab League made sure that that report was ignored in the Arab world and the West turned a blind eye. But that report â€" compiled by a group of Arab intellectuals led by Nader Fergany, an Egyptian statistician â€" was prophetic. It merits re-reading today to appreciate just how hard this democratic transition will be.

The report stated that the Arab world is suffering from three huge deficits â€" a deficit of education, a deficit of freedom and a deficit of women’s empowerment. A summary of the report in Middle East Quarterly in the Fall of 2002 detailed the key evidence: the gross domestic product of the entire Arab world combined was less than that of Spain. Per capita expenditure on education in Arab countries dropped from 20 percent of that in industrialized countries in 1980 to 10 percent in the mid-1990s. In terms of the number of scientific papers per unit of population, the average output of the Arab world per million inhabitants was roughly 2 percent of that of an industrialized country.

When the report was compiled, the Arab world translated about 330 books annually, one-fifth of the number that Greece did. Out of seven world regions, the Arab countries had the lowest freedom score in the late 1990s in the rankings of Freedom House. At the dawn of the 21st century, the Arab world had more than 60 million illiterate adults, the majority of whom were women. Yemen could be the first country in the world to run out of water within 10 years.

This is the vaunted “stability” all these dictators provided â€" the stability of societies frozen in time.

Seeing the Arab democracy movements in Egypt and elsewhere succeed in modernizing their countries would be hugely beneficial to them and to the world. We must do whatever we can to help. But no one should have any illusions about how difficult and convulsive the Arabs’ return to history is going to be. Let’s root for it, without being in the middle of it.

[Shwaz]

I can only hope it goes over $150...

The only thing most American's see is money signs. If the price goes up, maybe some people will start to realize this isn't a renewable source, and we should probably be exploring other options. Plus, we should stop raping the poorest countries in the world for their only natural resources of value.

Who doesn't know that oil isn't renewable. This notion that oil will increase to some outrageous magic number and poof the nation never uses another drop is retarded. Like all of sudden commuter rail lines sprout up - Boeing unveils their brand new 747 'Volt' Jet - the government hands out a Segway to every American.

Hoping for a gas crisis is equally dense.

[ben says]

I can only hope it goes over $150...

The only thing most American's see is money signs. If the price goes up, maybe some people will start to realize this isn't a renewable source, and we should probably be exploring other options. Plus, we should stop raping the poorest countries in the world for their only natural resources of value.

Who doesn't know that oil isn't renewable. This notion that oil will increase to some outrageous magic number and poof the nation never uses another drop is retarded. Like all of sudden commuter rail lines sprout up - Boeing unveils their brand new 747 'Volt' Jet - the government hands out a Segway to every American.

Hoping for a gas crisis is equally dense.

Crises spur change, status quo, by definition, does not... Hoping for a temporary crisis is essentially hoping for a catalyst that will bring about permanent change for the better. Noble goal if you ask me.

[Shwaz]

I can only hope it goes over $150...

The only thing most American's see is money signs. If the price goes up, maybe some people will start to realize this isn't a renewable source, and we should probably be exploring other options. Plus, we should stop raping the poorest countries in the world for their only natural resources of value.

Who doesn't know that oil isn't renewable. This notion that oil will increase to some outrageous magic number and poof the nation never uses another drop is retarded. Like all of sudden commuter rail lines sprout up - Boeing unveils their brand new 747 'Volt' Jet - the government hands out a Segway to every American.

Hoping for a gas crisis is equally dense.

Crises spur change, status quo, by definition, does not... Hoping for a temporary crisis is essentially hoping for a catalyst that will bring about permanent change for the better. Noble goal if you ask me.

An oil crisis could be a catalyst.... to a world wide depression. If you want to be 'noble' start working around the clock for a solution instead of praying for a crisis that could cause a nationwide collapse. The infrastructure and technologies needed to be free of oil are not available... and a crisis of any kind would only set us back in making progress towards these goals.

[Captain Zissou]

even if things go well, this will be a long and rocky road. The smart thing for us to do right now is to impose a $1-a-gallon gasoline tax, to be phased in at 5 cents a month beginning in 2012, with all the money going to pay down the deficit.

I'd be fine with this.

An oil crisis could be a catalyst.... to a world wide depression. If you want to be 'noble' start working around the clock for a solution instead of praying for a crisis that could cause a nationwide collapse. The infrastructure and technologies needed to be free of oil are not available... and a crisis of any kind would only set us back in making progress towards these goals.

We already have solutions, but since things aren't that bad there's no reason to implement them.  We could bu oil independent in 5 years if it was absolutely necessary.

[ben says]

If the funding and the demand were there, the technologies would come (many of which are either developed, in development, or waiting for the money to be fully functional).

Your mindset only furthers the notion that the status quo doesn't work. Just like a forest fire (terrible) ends up rebuilding the ecosystem in which it happened (excellent), a crises of nationwide/worldwide proportion (terrible) would *probably* spur progress like we could only dream of.

[ben says]

We already have solutions, but since things aren't that bad there's no reason to implement them.  We could bu oil independent in 5 years if it was absolutely necessary.

+1

[JeffreyS]

I will not hope for that crisis.  Crisis is what it is going to take even today with crisis a real possibility in out immediate future our Governor is looking to kill any mass transit he can.

A fuel crisis will severely damage my business and I employ 26 people whose jobs will be affected.

I will not hope for the crisis but we all new the writing was on the wall the day Reagan symbolically tore the solar panels off the White House.  There will be no diversification of energy until there is a crisis. Hopefully we will never need to diversify because apparently it will take a crisis to change.

I am truly terrified of an oil catastrophe.

[Shwaz]

We already have solutions, but since things aren't that bad there's no reason to implement them.  We could bu oil independent in 5 years if it was absolutely necessary.

+1

And what are the solutions? What exists now that isn't being brought to market?

[ben says]

I'm sure most if not all of us are terrified. I hope my rhetoric does not suggest otherwise. That being said, and you said it yourself, 'the writing is on the wall'. It's not an if, but a when. Will it happen this generation or the next?

[ben says]

We already have solutions, but since things aren't that bad there's no reason to implement them.  We could bu oil independent in 5 years if it was absolutely necessary.

+1

And what are the solutions? What exists now that isn't being brought to market?

Solutions are all over the place. The problem is that we are born and raised to think supply and demand is some god given law. It's not--especially when corporations and the wealthy elite control the supply--and the demand is mainly fictitious. Most people don't have time to worry about changing the status quo (families to feed, businesses to run, bills to pay). There's really no incentive at the top of the system to institute these changes. If the oil is flowing, why change it?