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With all the news lately about the price of oil climbing, I would like to make a contrarian point – I believe oil is cheap.
I realize American’s can’t afford to take their driving vacations, people in Europe are protesting, the economy is hit hard, and people are complaining.
My view is that cheap oil was an anomaly, a relatively short-term gift that we really never did deserve, and whether you agree with that statement or not, we can’t replicate it. So we’d better get over it and move on, and get our energy in new ways. We need to start making those new ways inexpensively, and if we make them sustainable, then they’ll last, and finally, we’ll deserve it.
Okay, let me give you some numbers. Let’s say a barrel of oil costs $143, about what it is now. That barrel of oil is equal to 1,640 kilowatt hours, or 1,640,000 watts for one hour. A human, working hard, can put out about 75 watts an hour, and that’s not easy. Lance Armstrong, when he was younger, could do about 500 watts for one hour. So us regular people, working all day – if we even could – at 75 watts per hour, would have a hard time powering our lifestyles. It would take us nearly 22,000 hours to equal one barrel of oil. Even at today’s minimum wage of $6.55 in the US, that barrel of oil is really worth $143,226 to us! In other words, it’s 1,000 times more valuable than it costs.
We expect our energy to be nearly free, and that’s why we complain – because it no longer is. But we should face those facts, realized how this unbelievably discounted energy we have had – and still have – is what makes us comfortable and productive. Since it’s only going to go up in price due to supply and demand (the demand side especially from China and India) if we want to continue our lifestyles, we’d better make the renewable stuff scale fast and become competitively priced. At these prices of oil, it’s starting to get easy, or should I say, possible. Rather than wishing for something that’s impossible – nearly free fossil fuel based energy again – we should focus on the R&D to make the renewable stuff work.
I totally agree with your view. The resources of Oil are limited while the demand is going up. We are required to make alternative provision for future. We have seen it from the past that inventions have driven the economy of country. May it be computers, micro processors, operating systems etc. If US R&D sector manages to peep into other resources such as biofuel, ethylene or any other substite and develops an efficient engine to work on it, the auto industry, aviation industry will get a new life. This will definately cut the future demand for oil and also so called “high price” associated with it.
McCain proposes new fuel rules, $300-million reward for innovative battery
http://www.freep.com/apps/pbcs.dll/article?AID=/20080623/BUSINESS01/80623066
If implemented, will Idealab be the winner of the award?
It’s amazing that the US Govt didn’t continue when the first crisis happened in the 70’s. The power of the sun is everywhere and we should all be taking advantage of it!
Nothing should move so fastas has the price of oil. Everybody has their opinion on what caused it to fit in their own little world. Did you ever look into the Oil Price Speculation comm (6(29/08), by the House Energy & Commerce Subcommittee. There was four witnesses sworn in from Masters Capital Management giving testimony on why the high oil prices. It’s impossible to cover it in this reply, but given the witnesses were sworn in the testimony they gave was very, very strong blaming the speculators, hedgefunds, etc. If the SEC would just change some rules the price of oil would drop fifty percent within two months. As ridiculs as this seems so do the reasons given as to demand and running out of oil seem. This country has enough energy resouorces to last a long time and with planning ahead we can overcome our problems without dirupting the economy and peoples lives. I feel strongly greed has a big part in our current problem.
With all the talk surrounding the presidential election, the American people don’t seem to realize that with our democracy, the president is limited in what change he or she can actually affect. While all the talk about change and reform is good, the American people should look to the Congress and Senate for the root of our current energy crisis as well as, a lot of other problems that we are currently facing. If there is to be real change in Washington, taxpayers need to look at who they are ultimately electing to represent them in Washington.
Getting back to the discussion at hand. I disagree with the notion that oil is cheap. Oil was cheap when I paid .17 cents a gallon. I refuse to accept the notion that just because Europeans are paying absorbent prices, we should accept that our oil is cheap.
I think that most Americans would agree that we need alternative energy solutions and that we should be investing in the ones that make the best sense and have the greatest probability of succeeding. However, I disagree with the way our legislators are going about it. While our politicians on the left of the Isle are playing games and holding the American people hostage by not allowing drilling in those areas that are proven to produce the greatest amount of oil, people of the Middle East are laughing all the way to the bank at our inability to free our self from oil dependency. We are just helping them achieve their ultimate goal of destroying our economy and our great nation.
As soon as the congress and senate pass a bipartisan bill to open drilling in Anwar and offshore (within the 50 mile limit), watch energy prices fall and you know what, even if they don’t fall, we will have a back up plan… Oil in a few years, lower energy prices, a vibrant economy and most of all, energy independence. In the mean time let’s invest in clean alternative sources. It’s a no brainer…
1. Start drilling.
2. Invest in alternative energy
3. Gain control of our own destiny.
It’s such a no brainer; even the Democrat’s should be able to figure it out.
There ARE barrels and barrels and metric tons and tons of Oil and Gas that we are not tapping into because of environmental regulation and red tape. Lets get off our duffs and vote the bums out of congress that require all the stupid regulations and red tape, that holds our country back from moving ahead with getting Energy. Besides Oil and Natural Gas. Lets get the Nukes fired up, as they are the most efficient source of energy. What good is “preserving everything” if we don’t have the money, or the fuel to get us there to enjoy it….I have never been to Alaska, and I would like to go there, and if I happen to see a Oil or Natural Gas Pipeline along the way …Great!! that means I may get there cheaper!! After all, we see highways, and aren’t they beautiful too?? wHAT IS THE DIFFERENCE- A HIGHWAY OR A PIPELINE.?NONE.
Can someone explain the implications of the new solar tax credits passed by congress with the bailout? I’m trying to determine if there is a minimum investment for the credit or what restrictions exist? It’s not very easy to interpret in the writing of the legislation and I don’t want to guess. Any input would be great.
Will Johnston
The Store for Sustainable Living
http://www.growandmake.com