GL: The High Price of Fuel These Days

[Ralph Yost]

Reducing demand is definitely part of the equation. As prices increase 
beyond the consumer's tolerance level, the consumer changes behavior (ie 
drives his boat slower, less often, or not at all). I drive my car slower to 
work now (as an example).
Alternate energy solutions didnt make the oil commodities trading drop $8 in 
two days last week, but supply and demand data and EXPECTATIONS about them 
did. Markets trade on the FUTURE EXPECTATION and are highly influenced by 
political situations and expected political situations. They also react to 
future expectations of SUPPLY which is what additional drilling and 
additional refining capacity would do. So the markets show complete 
disagreement with the statement "The only remedy is for the US to reduce its 
demand for oil (that is, use less by increasing price) and start working on 
alternative energy options." Add into the oil market the fact that oil is 
traded in US dollars and therefore directly effected by the currency trading 
of the US dollar.

 Not many people talk about what is required to bring on additional refining 
capacity. Now that the Democrats have made the big oil companies out to be 
villains of society in their class warfare politics, do you think anyone in 
Congress would be willing to offer legislation that would induce the 
building of new refineries? Yet, refined products are traded in commodities 
also and as such are subject to SUPPLY and demand data. See it each week at
http://www.eia.doe.gov/oil_gas/petroleum/info_glance/petroleum.html

So our boating lives are not just effected by the supply and demand on the 
crude oil system, its REFINED products we live on.
R.

----- Original Message ----- 
From: "Anthony Van Vugt" <anthonyvanvugt at gmail.com>
Subject: RE: GL: The High Price of Fuel These Days


> With due respect to the author and supporter(s) of the post that suggests
> that just talk would "drastically effect today's oil commodity trading", 
> as
> a former petroleum economist I have to comment that this is total 
> nonsense.
>
> The only remedy is for the US to reduce its demand for oil (that is, use
> less by increasing price) and start working on alternative energy options.
>
> The days that the US, with 5 % of the world's population, can lay claim to
> 25 % of available resources are over; especially, given the rising 
> economic
> power of China, India and Brazil and the decline of US influence and
> prestige in the world.
>
> The only way to really reduce demand is to increase prices; probably at 
> par
> with those in advanced European economies, that is, to about US10 per US
> gallon.
>
> This topic is relevant to this group in that it will guide boaters to make
> better informed decisions about buying, selling and operating power boats.