Re: Evolution of petrol prices - OT

On Jun 10, 2:03 pm, "*Hemidactylus*" <ecpho...@xxxxxxxxxxx> wrote:
On Jun 10, 10:53 am, dkomo <dkomo...@xxxxxxxxxxx> wrote:

Mr tiktaalik wrote:
Just as as side issue - petrol is now more than $10 a gallon in the
UK!

And will continue to evolve higher. You ain't seen nothing yet!

One of the main reasons that global demand for oil exceeds supply is
that many Asian countries such as China and India are subsidizing the
price of it, shielding their residents from the full brunt of the price
rise. This, of course, will allow oil demand in these countries to
continue to rise even higher.

So Europeans tax the hell out of petroleum while Asians subsidize it,
and Americans do neither (however, they do indirectly subsidize oil
companies through tax breaks).

I thought there were taxes on gas (petrol) in the US. Isn't that put
towards our rapidly crumbling transportation infrastructure in roads
and bridges? Wasn't that an issue that came up recently as a pander
for votes where candidates pondered eliminating gas taxes?

Here in the U.S. average gasoline price has topped $4 a gallon for the
first time. And after relentless price rises over the last three years,
Americans are finally cutting down on their driving for one of the few
times in history.

I'm not completely up to speed on this but what part of the increase
could be due to speculation on the oil futures market? Is fuel going
up due to a bubble like home prices did? And corn was going up partly
due to ethanol use diversion right?

Or are all prices gonna rise due to fuel related cost-push inflation,
especially via transportation costs and business overhead costs going
to AC, lights, and heating?

Total miles driven has dropped by a few percent.
Demand for gasoline had been amazingly inelastic up until now.

I'd hope that demand for oversized SUV's has dropped like a rock and
automakers see more need in the market for hybrids and alternative
fuel vehicles (substitution effect demand elasticity). Demand for
boats has dropped, which will probably lead to increased unemployment
in the boat manufacturing industry. Nobody wants to take anything more
than a sailboat out anymore and they probably couldn't pay anyone to
take their weekend toy off their hands. Kayaks, canoe, rowboats with
trolling motors, and sailboats may increase in demand.

The irony is that the demand for SUV's is going down but much like the
70's oil crisis the countries developing affordable hybrid technology
are in Asia. One would think that people would learn.

But OTOH the wealthy probably see this as another instance where they
can rise aove the lowly hoi polloi and conspicousy consume, towing
their luxury yachts behind their brand new oversized SUVs. This is
akin to the peacocks feathers. "Hey look at me...I can still afford to
gas up my boat and SUV at 6 bucks a gallon."

.