What Is The Accepted Ceiling On The Consumer Price For A Gallon Of Gas?

If we take the lack of consumer and media outburst, it appears to be quite acceptable that we are about to (or in most parts of the USA) willing to pay $4.00 or more for a gallon of gas. One can only take from this that “we” are destined to accept whatever price is posted at the pump. We’ll just pay what it says to pay.

A new book entitled “The End of Energy” by Michael J. Gaetz (MIT) sets the stage for a very detailed understanding as to how the US continues to ask the same question: “Are we paying too much for energy, too little, or just paying the wrong people”. Over the past five decades, there has been continuous instability in the Middle East where more than 50% of our petroleum products are captured to refine into oil and gas and shipped here. We are reminded again and again over these past few months that Libya has helped to drive the cost of a gallon of regular gas close to $4.00. That Moammar Gadhafi has shaken the world oil markets.

From a simple analysis and layman perspective, the US and its closest neighbor to the north, Canada, along with our 49th state, Alaska, and certainly the Gulf of Mexico, combined, are more capable of replacing our dependence of crude oil coming from the Middle East.

So what gives? The major theme of “The End of Energy” is a factual look at how we use energy now and what is in store for us going forward. The overriding them is that “the end of energy as we knew it” is set for us to accept the challenge that we must look at what we can do and begin to do it now so that we can move quickly pass all of the rhetoric (political or otherwise) and all of the claims of responsibility we have for our overseas partners in Saudi Arabia, and the like.

What we do know is that through the 1960’s, the US had produced sufficient petroleum product to meets all of its energy needs. Then in the early 1970’s, the era of “energy independence” ended, replaced by an era of ineffectual bipartisan promises to restore it. Said another way, we “blinked” and lost the ability to be self-contained. The other tidbit is that there appears to be a belief that the US government refuses to pass on the cost burden to its citizenship for us to cover the full (real) cost of our energy use. Items that affect this claim include:

  • Cost of Greenhouse Gas Emissions
  • Cost of Military Protection of Persian Gulf Supply Routes
  • Cost of Combating Terrorism in which petro-payments are made to ensure uninterrupted movement and delivery

 
The automotive industry is finally waking up, certainly in the past seven (7) years, to manufacture replacement engines that will deliver forty (40) plus miles on a single gallon of gas along with and other dependable alternatives including Hybrid electrical vehicles and the options list goes on and on.

Thoughts On Petroleum Prices in USA

What is the real simple idea here? Must we drive less, use less energy, to accommodate any price increase that is going to happen no matter what we do—or do we begin to find more progressive and disciplined ways to use energy to its maximum benefit. We know that the US economy depends on people’s mobility. Does the parent (i.e. soccer mom) drive the kids to all of their events if they are all scheduled on the same day or find a means to share the “carpooling” so that she is on the road twice a week versus three to five times per week?

Or is there a smarter, more practical way to accept this reality. If a parent knows they get, on average, two hundred and forty miles (240) on a tank of gas, should they map out and plan their movements more carefully to maximize their travel time getting the most out of a tank of gas. For example, do they go to the grocery store once a week and do all of the required shopping or do they continue to go two or three times a week on as needed or on impulse?

The same with the teenager in the house. They all love to drive and make many trips to the friend’s house or just places to hang out. Does this now need to become a “ride-share” proposition to manage the cost of energy to maximize the fuel use in their car or truck tank? And we know that the head of household must commute to work. What are the options that conserve petrol? Bus? Car Pool? Train? Other?

It would seem that finding the most practical and ‘economical’ ways is one way to do this. The other is having much more responsive transportation vehicles (or transportation systems) at our fingertips that would ‘open up’ one’s ability to get around as much and as often as one likes, versus having to reduce and manage one’s transportation efforts.

The Questions To Ponder

Let’s see what options are available if, for some unknown reason, say for the next five years, we are caught between a rock and a hard place through which the US must and will continue to be held hostage with a good percentage of its petroleum products coming from overseas. And that we cannot just build a new transportation infrastructure overnight as that takes time and billions of tax dollars to do so. But then, if we have less dependence on outsourced fuel supplies, which dependence does provide an alternative use of funds to potentially build a more robust transportation system. So,

  • What simple alternative might be offered that has not been thought of or presented before?
  • If it is a simple alternative, how does one go about demonstrating that it can be put forward in a positive and constructive way where everyone (oil companies, countries, politics, consumers) wins?
  • Are we stuck in a quagmire to which there is no simple answer except to acknowledge that the automotive and truck engines are dinosaurs and must be replaced with a completely new product that is not combustible?

 
Feel free to tackle these as you deem will create a real thought starter. The topic of energy development and energy conservation has run on many courses, but at present, we do not, it would seem, to have a proper direction to take. We are, from all intent and purpose, making baby steps versus giant steps.

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