Monday, May 2, 2011

Gas prices: out of control

On January 24th, 2011, an article was published named “The peak oil catastrophe-in-waiting” by Tam Hunt. In the article, it has been stated that higher prices of oil are to be expected in the future and a decrease in production. Oil prices have been a significant factor of most recessions in the past fifty years, and Tam Hunt wants the public to be aware of this situation. According to the International Energy Agency (IEA), “The world is heading for a catastrophic energy crunch that could cripple a global economic recovery because most of the major oil fields in the world have passed their peak production.” Apart from this, there are additional credible sources such as the German military and U.S. Department of Defense pointing to unbelievably high prices and oil depletion.
I found the article very interesting and very important as Tam Hunt makes one realize how important it is for us to find an alternative or any other backstops. If so many sources are identifying and claiming the peak oil situation then surely it must be true that immediate actions will be necessary. As one may experience these ridiculous gas prices, it makes me worry what will be the gas prices in the future and how a common citizen will be able to commute from one point to another when gas will be very expensive. Apart from the article, the other thing which comes up to mind is that maybe the governments want people to reduce their carbon footprints. For that reason, gas prices are being raised so people find other alternatives to commute such as taking public transportation or riding a bicycle.
--Syed Hussain

2 comments:

  1. Michael BernacchiaMay 16, 2011 at 12:07 AM

    Regarding the theory that the government wants people to reduce their carbon footprint, and is driving up the cost of oil in order to sway people towards using other means of transportation, I disagree. I see the government as being mainly a profit drivin orginization. The government would decide on an oil price that would make them the most money no matter what effect it has on the environment. Low gas prices win votes. When I think about oil prices like an economist, I think that there is currently a demand for something that does not exist. People want, and are willing to pay for a cheaper substitute for oil. A technology that is as efficent as oil, with lower costs would do great in the market.

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  2. I read an article about how 90% of the worlds oil producing countries are past their peak oil production and it is now just a matter of time before we are done with oil and are at a crossroads with the future. I feel like now is the time to buy a pedal bike.

    --T. McCleaf

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