Clark, the podcast on 3.16.22 dealt with energy prices. You had plenty of blame to go around. You did not mention any policies coming from the White House. Do you believe current federal policies have not contributed to any inflation, or rising energy costs?
You might want to post about this on Clark Stinks so that someone from the show will see it. Clark Stinks is here: Clark Stinks! - Clark Howard
Already did. Hopefully someone on the team will see it here or on Clark stinks….
When I listened to Clark’s 3/16 podcast I didn’t hear him blame anyone for high gas prices. He cited reasons for high prices.
The price of gasoline at your local filling station is not determined by politicians, it is driven by the price of a barrel of oil. And the price of oil is determined by old-fashioned things like real and/or anticipated supply and demand. The big players in that equation are volatile events, like war, weather and rapidly changing conditions. With the exception of war, politicians are slow-moving and low-energy contributors to market conditions.
We recently have gone through some major market jolts that affect supply AND demand for oil. Covid interrupted our transportation system as well as US demand for gasoline. And Putin’s war has caused shock waves throughout the global energy picture.
If you want to blame a politician, blame Putin.
So, politicians shutting down vital domestic pipelines limiting supply has no effect?
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Since 2019 our energy imports have been a net zero, overall we exported more energy than we imported. They peaked in 2006 and have steadily declined since 2008.
It takes time for production, lease sales and things like pipelines to have an impact on the market. It’s a mistake to blame the actions or inactions of legislative events occurring 12-24 months ago to real market energy movements, that’s the way it works.
Politicians have and always will fiddle with elements of free markets. It sometimes results in unintended (or purposeful)consequences.
But the prices we pay at the pump for gasoline are not driven by what one country’s politicians might do in terms of playing around with the energy market, the scale and dynamics of it are far too large for those puny efforts to have a significant impact.
Here’s why:
- The US consumes and produces 17% of the global energy market, we are net zero on total the world market.
- The Keystone Pipeline was intended to import Canadian tar sands oil into the US, we don’t need to import any oil.
- The largest oil exporters are the Saudis and Russia, when they hiccup it shakes up the whole global oil picture.
- Russia just threw up all over the oil picture, from a global oil market perspective, the Keystone Pipeline wasn’t even an eye-blink.
- The pandemic triggered an unprecedented decline in oil demand, recovering from it will cause market volitivity.
Here are some information resources for you. They are better that political scuttlebutt.
https://www.eia.gov/finance/markets/crudeoil/supply-opec.php
https://www.spglobal.com/en/research-insights/featured/moving-mountains-covid-19-and-peak-oil-demand
Moving Mountains: COVID-19 and Peak Oil Demand - S&P Global
Highlights. COVID-19’s impact on the global economy and consumer behaviors has reduced long-term world oil demand by 2.5 million barrels per day, according to S&P Global Platts Analytics Future Energy Outlooks… However, some adjustments to the demand outlook were positive as weaker oil prices make electric vehicles less competitive, reduce the drive for efficiency, and stimulate underlying …
www.spglobal.com
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Energy & Financial Markets - Crudeoil - U.S. Energy Information Administration (EIA)
What drives crude oil prices: Supply OPEC. Crude oil production by the Organization of the Petroleum Exporting Countries (OPEC) is an important factor that affects oil prices. This organization seeks to actively manage oil production in its member countries by setting production targets.
www.eia.gov
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Georgias Governor just suspended a 29.1 cent per gallon state gas tax through May. Lower income consumers of gasoline in Georgia may be happy that a politician took action for some gas price relief.
… expect more potholes on GA roads next year.
If the choice is being able to afford driving to work or a possible pothole. I know what I’m choosing.
We need to complete the Keystone Pipeline, do we not?
I don’t see any reasonable justification for building additional fossil-fuel production infrastructure with a 50-year useful life to import another 700,000 barrels a day when we already produce 100% of what we need. That is especially true in light of the fact that gasoline sales are expected to peak in 2023. 40% of a typical barrel of oil is currently processed into gasoline.
What is your reasoning to support it?
- More oil supply equals lower prices for us, and globally.
- Very few people can afford electric vehicles at this point.
- Energy for EV’s has to come from somewhere, are we going to start building a bunch of nuclear power plants?
- How is EV energy usage going to be sustainable with out more energy capacity?
- Where are all the materials for batteries going to come from?
- Where is all the spent battery material going?
I could go on….
Yes, it’s a global supply and demand issue. In the short term we will likely see US production increase.
The average new car price is $47,000. Here is a link that lists 11 EVs costing less than that.
The strain on the power grid is from peak loads.
For the short term EV charging can be done during off-peak times with no problem. In the long term renewable energy is the answer for electrical power production.
For the short term, from current and traditional sources. For the long term we don’t know. a lot of research is ongoing and covers everything from enhancing current technology to using components from seawater to quantum batteries with 100X the storage and performance of today’s batteries.
Current EV batteries are 100% recyclable after using them in other applications like energy time-shifting after their 10-year EV service. After 20 years of use all components are recycled.
I’d be happy to discuss it.
Ask a low income human if they can afford a 47k vehicle. Short term those who can afford it can drive EV’s in perfect conditions?
Long term, eh we’ll see I guess……
I’m more then happy to build more nuclear capacity, most are not
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