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Gold/Mining/Energy : Oil & Gas Price Economics -- Ignore unavailable to you. Want to Upgrade?

To: Ed Ajootian who wrote (236)	9/4/2000 5:45:29 PM
From: rajaggs	Read Replies (2) \| Respond to of 350

Sheik Yamani misses the spotlight .. and the point. Just go to cera.com and you'll find some simple but telling facts on why the price of oil and gasoline in the USA (and Canada) are NOT too high, in real terms. Without reciting too many of the figures and boring everyone to sleep, here are a few facts to bear in mind. 1- The real price of gasoline in the US, was lower at the end of 1998 than it had ever been. That is because inflation has been greater than the rise in the price of fuel. 2-In the industrialised world, (G7) all drivers pay more for gasoline than does the American motorist, who makes the most noise when oil hits $30/bbl. Britain, France, Italy, Germany and Japan, all major competitiors of the USA, pay about the same or little more, for a barrel of oil but their motorists pay a lot more for gasoline. 3-If you think gasoline is expensive at $1.60/gallon, then why don't you complain about the price of mouthwash at $18/gallon. On one hand we have a finite resource being rapidly depleted at fire-sale prices and on the other hand, we have a limitless, perfumed, water-based product with little real function, selling for 10 times the price of gasoline, ... and no one is complaining. If the reason for that is the true worth and necessity for gasoline and oil based products then we should all be taking bloody better care to use oil more efficiently and making it last longer. OPEC controls the price of oil through regulating supply but there are 60% of the world's suppliers outside of OPEC. If the price gets to be exhorbitant, the outsiders will increase production and reduce the rate of price increase. If the USA did not rely on cheap oil from the Middle East and supplied more of its own needs, then it would benefit the USA and other nations. Yamani's remark about the ending of the Stone Age, goes to show that he is still living there. We did not burn stones to keep warm and if we had we would never have advanced very far, since there are enough rocks around to keep us going for a million years. There is NOT enough oil around to keep us going for more than 200 years. His other silly comment, is about technology sweeping away the need for oil in the near future. He is dreaming on that one. Our local Honda dealer has had a hybrid gasoline/electric car on their lot for 6 months now but I've never seen one on the road. The price of oil would have to hit $60/bbl before these vehicles will become an economic proposition. The only ones sold are in LA County and they are subsidised up to the eyeballs. The solution in the USA for making oil last longer for all of us, is higher taxes on gasoline and tax at time of vehicle purchase on engine size or vehicle weight, because the results will be; 1-motorists will use less fuel. 2-the price will then moderate. 3-the oil reserves, unknown in total, will last longer. 4-the USA will not be perceived by others, as gobbling up an unfair portion of the world's oil. 5-the air will be less polluted and our water cleaner. Everyone, including Sheik Yamani, will benefit from that.