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Pastimes : Home on the range where the buffalo roam -- Ignore unavailable to you. Want to Upgrade?

To: tripperd2 who wrote (489)	5/12/2001 8:55:38 PM
From: pbull	Read Replies (1) \| Respond to of 13815

The short answer is, I don't know. But sure, there are global political issues here, regulatory issues, energy philosophy, just a whole bunch of things in addition to supply and demand. The media just wants someone to tell them why the price of this or that is going up. They usually don't have time to do their own research, because they have deadlines and other stories they need to do. Besides, they wouldn't understand it, anyway. An energy shortage is not difficult to create, even though there's plenty of crude oil in the world. Russia has vast, vast oil reserves, for example. And in the Gulf of Mexico, in deep water, there are vast quantities of oil. A lot of things interfere with free-market principles. Consolidation among energy producers has played a role, along with deregulation. Different states have deregulated utilities in different ways (or not at all), and different parts of the country are required to use different forms of gasoline under EPA rules. I think there are 40 different blends of gasoline in the U.S., so a shutdown at any one refinery causes more problems systemwide than it used to. And in California, it's my understanding the state is buying power wherever and whenever it can. California's a big place, so that contributes to distorted markets in other parts of the country. As an aside, the price of diesel fuel directly affects everything you buy at the grocery store, because everything in a grocery store is delivered by truck. My mom is hopping mad because the price of her favorite crackers just rose by 60 cents a box. So, again, A.G. can cut interest rates all he wants, but that doesn't help people who have to eat (all of us, obviously), people who commute to work, and so on. Is the current administration influencing the price of energy? Through appointments to the EPA, the Federal Energy Regulatory Commission (FERC), in congressional committees where policy is being drafted, and in other ways, I would say, yes, certainly. In fact, a big part of the problem here is most all of the new power plants that have come on-line in the last several years burn natural gas, so there's been a big increase in demand without a corresponding increase in the infrastructure needed to deliver that gas. We have plenty of natural gas, but the pipelines aren't big enough. By the way, I'm fairly certain you'll see Congress pass some tax breaks for alternative energy, and soon. These are complex issues, for sure, but maybe that helps you understand a bit more about why you are seeing what you are seeing at the gasoline pump and in other places. PB