I see an American working class and senior citizens being bled financially by steadily (and, for the foreseeable future) increasing gasoline and diesel pump prices.

We AGW believers might not care much about the family of five living in the burbs, driving several large vehicles and commuting more than 40 miles each way to the job(s); jobs that keep them out of bankruptcy and foreclosure. Yes, they made their choices based upon what is best for them but we all have to face the raw fact that their financial collapse is our problem to deal with also.

If (when) Congress enacts and the President signs a climate change mitigation Act, it will contain some very expensive subsections and impositions on all of us. R&D programs, mass-transit construction and rehab, tax credits for renewables and authorizing a huge bureaucracy to run the program will need tax revenues to fund all that. Then, imposing carbon caps will cost we consumers more money for fuel and electricity and the consumer goods we need that have energy costs tied into them…regardless of the rosy outlook Env. Defense gives that picture.

I dread a future of increasing vehicle fuel costs coming at the very time we homeowners, apartment building owners and vehicle owners will have to find the capital to retrofit our lives. Americans carry about a trillion dollars in credit card debt and about 9 trillion in mortgage debt. Our personal credit worthiness is already bad (on average) and we are standing in the middle of the decarbonization track.

We are all in this global warming future together and $5-$6 gasoline will not make the lifestyle changes easier. It might feel good to the purest enviros but average Americans will not take the cost of carbon caps quietly if they have no funds to invest in no-carbon, less-carbon alternatives. Who is going to pay for the solution?

John McCormick

are any of those things now more likely, the money having been stolen? no. instead we have greater influence of health insurance companies, greater influence against net neutrality and high broadband standards, greater opposition to decentralizing and cleaning energy supply.

take a look at page two of the big book of capitalism. you already read that price motivates change. now read the part about how relative wealth affects future prospects — people with less income becoming risk averse, people with more, risk-seeking. lots of risks out there for people to seek right now. hope your favorite is the one the big dogs pick. 1000th time’s the charm, they say.

Now biodiesel made from rapeseed is probably a poor, if no outright bad idea. But biodiesel can be made from a wide variety of vegatable oils, for example Jatrophra, which is poisonous so can never be a food.

I see no way to replace the use of the heavier fuels, such as (bio)diesel, for ships, large trucks, construction machinery, and many, if not most, trains.

safersmallcars.com

I used to be a fan of the idea of “peak oil - bring it on”, due to climate change being much worse than declining availability of oil. Unfortunately coal is too much of a substitute good for oil, so declining oil and gas supplies will lead to more coal use and probably more climate change overall.

The only way for the “gas tax holiday” to be even remotely realistic would be if, following its reinstatement, it was to increase by $0.10 a month or two months until it was at least $1. Then everyone would know what was coming and could make appropriate plans. But that increase, at whatever rate, MUST be irrevocable, so that everyone would plan for it and not assume if no one prepared, it would be recinded. But you can imagine the bruhaha over passing such a plan.

Americans are going to have to demand smaller cars (at least for commuting) and change how the choose where to live, like closer to work. Economists have shown that home ownership is a drag on the economy;e.g., people in Michigan will not or cannot move to other states where cars are being built because they cannot sell their homes (at least for what they feel they need, or paid for them if purchased recently).

The future we are choosing for ourselves is starting to look more and more like “Soylent Green” .

2) The Oil Drum has survey of predictions, of which mean & median are shown in solid red.

This has typical Hubbert profile, with a flat-looking plateau, and then drops, and then drops steeper.

Right now, we have:
a) Flat production.
b) Increasing demand 1 (China, India)
c) Increasing demand 2 (Saudi Arabia, Venezuela, etc, subsidizing gas internally)

If the referenced chart is anywhere near close, we’ll keep b) and c), but get:
a) Decreasing production.

3) Regarding gas tax holidays, I recommend Australian economist John Quiggin’s Holiday froim Sanity.

The real problem is gas increases are driving up inflation across the board. Carbon “taxes” don’t make much sense when energy costs are increasing. substitution taxes make some sense — driving up mass transit usage — but to move the country to a level around Chicago — 25% of the workforce using transit — might require a trillion dollar investment and take 25 years. And transit systems like Chicago don’t answer the problem of all the non-communing trips you do in a car. That might require a move to a NYC level — which is frankly impossible.

This makes me think that GS is talking up demand in oil futures so that GS can unload their long positions for a profit and enter into short positions for a coming decline in oil prices.

Oil crashing back down to $60/bbl 3 months from now wouldn’t invalidate peak oil theories at all (not saying anything about >= 3 months from now — could rebound rally to $200/bbl after that).

Now if we suddenly found another 5 Mbd of production capacity and oil permanently fell to

anyway, peak oil is only about the supply-side and only long term.

its not about the short-term. prices can decline purely for technical/sentiment reasons.

its also not about prices directly, since high prices could induce demand to fall which could cause prices to decline.

i would treat the announcement from GS as a contrarian indicator and expect over the course of 3-6 months for oil to fall below its current level.