High Gas Prices May Be Permanent
For too long gasoline in the United States has been artificially lower then Europe especially given the fact that much of Europe is a net exporter of oil and gasoline. As reported by MSNBC the middle class of India who drive cars and need petroleum products now exceed the total population of the United States. In a few more years China could double or triple the actual demand of oil now being used in the world. Even if the United States could reduce its oil usage the rest of the world will continue to thirst for more.
The largest oil company in the world, Exxon/Mobil is said to be stopping attempts at further exploration and is going to begin a slow sell off of it’s assets. For several years this corporate giant has actually been reporting less production yearly. Almost all the oil producing countries of the world report that they are now at maximum production.
The United States has not built a nuclear power reactor, a refinery, or substantially increased production of oil for many, many years. Even if we began an emergency drilling program and radically abandoned all environmental concerns experts have predicted it would take 10 to 12 years to see significant yields. We are not only buying raw oil but increasingly buying refined gasoline from abroad. Most of Europe now gets a majority of its everyday electrical power from nuclear power plants.
Realistically its seems to me that gasoline will float up in the United States to European prices of 6 to 8 dollars per gallon. The days of cheap gasoline are likely gone for ever. However if we rely just upon conservation its very likely this will kill our economy because a growing economy demands power at an affordable price. Changes will need to made in our way of life, some compromise will be necessary on environmental concerns, nuclear power plants will need to come online because wind or solar alone cannot suffice but they do need to be maximized, and more money into clean coal burning power plants must occur. Technological innovation will be spurred on by making alternative power sources price competitive to fossil fuels. It is time the government stop talking about temporary measures and admit to the public that the gasoline price hikes are not a temporary aberration.