On Thu, 01 Sep 2005 22:18:28 -0400, Bill Pitz <dakota@billpitz.com> wrote:
>
> The cost justification is the only thing that's going to save us in
> terms of crude prices. OPEC, et. al. are just like any other greedy
> business in that they want to make as much money as possible. Regardless
> of what gouging and other unsavory practices are going on in the
> post-refinery market here in the U.S., crude prices have been rising to
> record highs. They are well aware of the point at which it will become
> more economical for us to procure our own crude rather than purchase
> theirs. There is a big difference in the actual costs of procurement
> (mainly because the labor in OPEC countries is a lot cheaper than
> ours). Once the prices rise to a certain point, though it becomes
> economical for the U.S. to begin tapping into its own sources of oil, at
> which point OPEC loses business and will make adjustments to bring
> prices down. Think of it as a giant cycle. It's happened before. Gas
> prices were cheap and we gobbled up cars with enormous motors and
> horrible gas mileage. Prices went up and we started buying more
> economical cars. Prices went back down agan and we started buying SUVs,
> trucks, etc. like they were going out of style. We're starting the
> downward slope again...
That is a good pont. But with China coming onboard as a very large
comsumer of fossil fuels, oil prices are going to be high and remain high.
At that point we will be into our sources of fossil fuels again, but it
isn't going to make it as cheap as it was 8 years ago. It will protect us
from foreign influence, however, which will be nice.
-- -Droo
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