It seems like many people in Southeast Volusia have a quick fix to the gasoline crisis. One popular solution being circulated by my friends Ken Taylor and Walter Glenn and others here in New Smyrna Beach involves boycotting Exxon. According to their theory, this would force Exxon to drop their price and then everyone else would have to do likewise.
The problem with the gas prices is caused by a number of factors none of which can be addressed easily.
First, China and India have developed a hunger for oil which affects the whole world market.
What we have is a shortage of oil coming to market.
Another problem has to do with the inflation of the dollar. If the U.S. Treasury can quit inflating the dollar, that would help lower the cost of gasoline.
Returning to the problem of scarcity, notice that many of the world’s big producers of oil are working at well below capacity because of inefficiency.
It is no surprise that the nationalized Mexican and Russian oil companies are very inefficient.
Oil production in China and India and many other countries is below what it could be.
You look around the globe and you see plenty of oil that is bound up in inept production.
In fact, it is the abundance of oil around the globe that keeps us from exploiting the tar sands and shale oil right here in North America .
Tar sands and shale oil cost between $30 and $50 a barrel to produce.
The world still has plenty of $6 oil. So no one is investing in facilities for extracting 50 dollar oil.
While many sources of oil are hindered by incompetence here in America we are hampered by stupidity and selfishness. We aren’t allowed to drill in ANWAR in Alaska. We can’t drill in the gulf of Mexico and we aren’t allowed to build any more refineries.
One of our greatest alternative sources of energy is nuclear.
We may soon start on the first new nuclear power station in decades. Other than nuclear, most of the alternative sources are a long way off from being really useful.
I personally think that solar energy could be the first really useful source of alternative energy besides nuclear.
Most people now realize that ethanol is a big scam. If it takes as much or more gasoline to produce an equal amount of ethanol, how can anyone claim that using ethanol for fuel helps the environment or saves oil?
We should be demanding from our legislators that this ethanol scam be ended immediately.
It is amazing how the market works. The high price of gasoline makes people take steps to counteract it.
First, we become more careful about what trips we take and second the sales of gas guzzling SUVs has dropped off.
Nothing works for conservation like high prices.
One thing that will not help matters is to put extra punitive taxes on the oil companies.
Extra taxes will drive prices higher and deter people from investing in oil production.
If they could actually force oil companies to give every last penny of their profits, there would be no incentive to produce gasoline.
Think what that would do for us.
As a final thought, it is amusing to see how quick politicians are to point at the oil companies for problems that they themselves have created.
The politicians have not produced one drop of gasoline but they are there to hold inquiries if things aren’t going well.
You can almost bank on it that those most responsible for the problems are the first to call for an investigation.