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Oil shock prediction: $25

Original post made by Sharon, Midtown, on Dec 4, 2008


This will be a huge boost to the economy in terms of cost but will derail most alternative energy initiatives for some time.

It will also impoverish Islamic countries and Russia with profound political effects.Web Link


It does provide an opportunity for new tax revenues for the fed and state on gas taxes as we have become used to $3 gas

Comments (8)

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Posted by annoyed
a resident of another community
on Dec 4, 2008 at 6:38 pm

"It does provide an opportunity for new tax revenues for the fed and state on gas taxes as we have become used to $3 gas"

Speak for yourself about getting used to $3 gas Sharon. I have noticed more people at the stores because now they can afford to since gas prices have dropped. There is an excitement to their voices when I speak to people about the recent drop in price and no one that I talk to got "used" to paying more.

And yes, I do own an SUV but hardly ever drive it to voluntarily save gas by driving a Toyota Corolla and a motorcycle.

And what do we do about the additional tax if the prices rise? Is there a switch in Sacramento that goes on and off whenever the price gets too high. I doubt it since once the tax starts, we will be stuck with it.


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Posted by Sharon
a resident of Midtown
on Dec 4, 2008 at 6:51 pm



I agree that taxes once applied stay for ever, maybe a greater tax on high proof drinks would be a better idea, that sort of booze does no good and a lot of harm.

Unfortunately a dramatic reduction in the price of oil will stop exploration in US and Canada, it takes 10 + years to bring new wells to market.

Sleep is for whimps


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Posted by Outside Observer
a resident of another community
on Dec 4, 2008 at 8:13 pm

Sharon,

$25/barrel oil is good news. Social engineering via taxes based on an acceptance of $3/gallon gas is bad news.

Impoverishing Islamic countries may well reduce terrorism, as the bank roll to support terrorism will no longer be there.

Same for Russia who has become our enemy after the fall of communism based mainly on the financial means to do so. For Russia, I hope their economic collapse will foster another wave of immigration of their best and brightest. We benefited from that in the 90's and I hope we will again..... And actually that desire goes out to the whole world. We certainly aren't making the the engineers and technologists we need to build a better world here.....

Thank you liberals for destroying our education system with PC and making us the bottom educationally of all the developed countries.

We still have a high standard of living, relatively. That was built on the toil and education of our fathers. It's an attractor to the best and brightest world wide. If the liberals ever succeed in destroying that, we should just capitulate to the illegal Mexican invasion and pray for a quick death.

Following up on $25/barrel oil should be a good dose of deflation. Japan went through that a decade ago, and they are stronger for it. Only when things properly represent their intrinsic value will this financial crisis be overcome.






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Posted by Walter_E_Wallis
a resident of Midtown
on Dec 5, 2008 at 10:48 am

Walter_E_Wallis is a registered user.

Every dime we spent for oil over $25 a bbl was a stupidity tax, the price of listening to idiots who failed to consider the essential part of affordable energy to our standard of living as an offset to any adverse effects of energy extraction and distribution. This global market meltdown was brought to you by the Sierra Club, Greenpeace and EarthFirst. All you asthmatics who cannot afford the electricity to run your life saving air conditioning, enjoy the consequences.


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Posted by ten18
a resident of Another Palo Alto neighborhood
on Dec 5, 2008 at 12:18 pm

"It does provide an opportunity for new tax revenues for the fed and state on gas taxes as we have become used to $3 gas"

Aaaaargh!!! What away to accelerate this country's decline into socialism and decay. We would entrust billions upon billions of additional tax dollars to the likes of Nancy Pelosi and Harry Reid? To that band of fools in Sacramento? And that's not to mention Obama's grand (and not very well disguised) vision for our socialist future. OMG!!


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Posted by Walter_E_Wallis
a resident of Midtown
on Dec 6, 2008 at 4:37 am

Walter_E_Wallis is a registered user.

If the money that went into the Department of Energy and state level energy regulators had instead gone into energy production and delivery facilities we would be enjoying 3 cents/KWH electricity, 20 cents/therm gas and dollar a gallon gasoline, all in dollars a lot more valuable than today's depleted scrip.


Like this comment
Posted by Inside
a resident of Charleston Meadows
on Dec 6, 2008 at 12:10 pm

Outside,

"$25/barrel oil is good news." No, disastrous news. Even $50/barrel spells huge troubles because it will lead to volatile, oscillating prices that will further hurt the economy. At $50/barrel, the oil companies are shelving plans, which will lower future production, even as demand spikes again, driving prices back up to $150/barrel.

"Social engineering via taxes based on an acceptance of $3/gallon gas is bad news." It would be a great first step to accommodate ourselves to the new reality. Don't kid yourself: SUV sales are climbing again, but they won't be on the road in 10 years. If government doesn't get around to social engineering now, the market will achieve it soon enough....

If you think Japan's response to their bursting bubble should be emulated, you aren't familiar with that fiasco.


Like this comment
Posted by Donald
a resident of Downtown North
on Dec 6, 2008 at 3:25 pm

Oil is not going down to $25 unless unemployment goes over 10%.


Sorry, but further commenting on this topic has been closed.

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