Ready for much higher Gas prices?

mlurp · #1 (**permalink**) 03-06-2010, 12:07 PM

Who is ready for $6.00 to $9.00 at the gas pump?

Quote:

Gas Prices Will Rise No Matter What, Expert Says
HONOLULU (April 4) – Drivers in the United States have to face up to reality: They are about to face painfully higher prices at the gas pump, East-West Center senior researcher Fereidun Fesharaki says.

The only real choice is whether the extra money flows into the pockets of those who find, produce and sell gasoline, or whether it will be kept at home in the form of higher taxes.

From his point of view, Fesharaki said, he’d much rather see the price hike be driven by taxes, which in theory can be used by government to improve alternate forms of transportation and new forms of energy.

Fesharaki is an internationally recognized expert in energy and has advised governments and businesses on fuel and energy policy. It seems clear, he said, that oil-driven energy prices are going to continue to rise, particularly in the United States. While there are many factors behind shifts in the price of oil, the fundamental explanation is one of supply and demand, he said.

“In about five years, demand will outstrip supply and the price will have to go up (even more),” Fesharaki said. “The future is one of an unstoppable force – demand – versus an immovable object – supply limitations.”

The only thing that can give in that situation, Fesharaki said, is price. He foresees gasoline prices at the pump rising to an average of $6 a gallon. While that may seem daunting to American drivers accustomed to cheap gas, it is already the rule of the day in much of the world, including Europe and Asia, he said.

And that is not necessarily altogether a bad thing, he argued. In the United Kingdom, for instance, gasoline is around $9 a gallon, with fully $7 of that price going to taxes. Authorities there recognized that the only way to moderate demand and produce the cash needed to explore alternatives is to impose heavy taxes, he said.

No one likes those high taxes and high prices, he acknowledged, but the balance between supply and demand suggests prices would rise to the edge of consumer tolerance whether the taxes are imposed or not. So why not keep the money at home? “The one thing that could hit right away is something we dislike, which is taxes,” he said.

“But if you don’t increase taxes,” he said, “the market will tax you anyway. In other words, if you don’t do it, somebody else will.”

Regulation may have some value in diminishing demand and holding down prices, Fesharaki said. The U.S., which is the world’s biggest consumer of oil, could save “huge amounts” by mandating more efficient vehicles. But that process is slow and politically difficult, he noted: “People don’t want to give up their cars.

The quickest, if perhaps far from the most politically palatable, approach is to boost prices through new taxes, he said. Higher prices at the pump, whether driven by producers or through taxes, is the most direct way to encourage conservation or the switch to more efficient vehicles, Fesharaki argued.

“One way or another, consumption has to come down,” he said.

.......................MORE AT THE SITE.............................................. ..........
Gas Prices Will Rise

Quote:

March 2, 2010, 6:35 pm
Fuel Taxes Must Rise, Harvard Researchers Say
By SINDYA N. BHANOO
To meet the Obama administration’s targets for cutting greenhouse gas emissions, some researchers say, Americans may have to experience a sobering reality: gas at $7 a gallon.

To reduce carbon dioxide emissions in the transportation sector 14 percent from 2005 levels by 2020, the cost of driving would simply have to increase, according to a report released Thursday by researchers at Harvard’s Belfer Center for Science and International Affairs. The research also appears in the March edition of the journal Energy Policy.

The 14 percent target was set in the Environmental Protection Agency’s budget for fiscal 2010.

.....................................MORE AT THE SITE........................................
Fuel Taxes Must Rise, Harvard Researchers Say - Dot Earth Blog - NYTimes.com

Quote:

$7-A-Gallon Gas Needed to Meet Government’s CO2 Cuts
Posted March 3rd, 2010 at 12:08pm in Energy and Environment with 28 comments Print This Post

As the national average of gasoline creeps to three dollars a gallon, economists are warning that high gas prices in the United States could slow the economic recovery. Other countries’ economies are recovering more quickly and increased production and activity is putting upward pressure on oil prices. That coupled with a relatively weak US dollar spells trouble for American drivers. Throw in carbon dioxide cuts and gasoline prices could reach unprecedented levels:

To meet the Obama administration’s targets for cutting greenhouse gas emissions, some researchers say, Americans may have to experience a sobering reality: gas at $7 a gallon. To reduce carbon dioxide emissions in the transportation sector 14 percent from 2005 levels by 2020, the cost of driving must simply increase, according to a forthcoming report by researchers at Harvard’s Belfer Center for Science and International Affairs. The 14 percent target was set in the Environmental Protection Agency’s budget for fiscal 2010.”

.................................MORE AT THE SITE..........................................

$7-A-Gallon Gas Needed to Meet Government?s CO2 Cuts | The Foundry: Conservative Policy News.

OR this: HoumaToday.com | View topic - Proposed Fix for Global Warming:Tax gasoline to $7/gal

cnredd · #2 (**permalink**) 03-06-2010, 12:14 PM

Quote:

“In about five years, demand will outstrip supply and the price will have to go up (even more),” Fesharaki said. “The future is one of an unstoppable force – demand – versus an immovable object – supply limitations.”

The only thing that can give in that situation, Fesharaki said, is price.

No...

The OTHER thing that can "give in that situation" is to INCREASE SUPPLY...

It is FAR from "immovable" considering the bans we put on our own country that prevent using our own natural resources...

mlurp · #3 (**permalink**) 03-06-2010, 12:21 PM

Quote:

Originally Posted by cnredd

No...

The OTHER thing that can "give in that situation" is to INCREASE SUPPLY...

It is FAR from "immovable" considering the bans we put on our own country that prevent using our own natural resources...

True but I doubt that changes before we see the govt. raise taxes on the product at the pump.
Other wise they ill have to raise our taxes to try to keep up with the debt. IMHO we will see one or both unless Obama and company back it up with more debt.

And back away from the idea of Carbon Emission.

GottaGo · #4 (**permalink**) 03-06-2010, 12:25 PM

Already doing the "you aren't looking" creep around here.... two cents this week, 5 cents last week....

Time to saddle the horse.

mlurp · #5 (**permalink**) 03-06-2010, 01:07 PM

Quote:

Originally Posted by mlurp

True but I doubt that changes before we see the govt. raise taxes on the product at the pump.
Other wise they ill have to raise our taxes to try to keep up with the debt. IMHO we will see one or both unless Obama and company back it up with more debt.

Correction "back away from more debt.... Opps"

And back away from the idea of Carbon Emission.

Sorry about that...

alan · #6 (**permalink**) 03-06-2010, 01:38 PM

So, let's say the government decides that taxing gasoline is the answer to their revenue problems. Then people stop driving gasoline powered vehicles.
Do you think they won't find something else to tax?

Taxing behavior to try and regulate it isn't a wise decision in my opinion,
Tobacco Tax
Bottled Water Tax
Plastic Bag Tax
Income Tax

Spencer Collins · #7 (**permalink**) 03-06-2010, 06:03 PM

I'm still paying $2.57 and that's a lot less painful than the $4.22 I paid two years ago...

If the price goes up I'm sure a "Gas Party" movement will get started and the prices will come back down...

mlurp · #8 (**permalink**) 03-06-2010, 06:06 PM

Quote:

Originally Posted by Spencer Collins

I'm still paying $2.57 and that's a lot less painful than the $4.22 I paid two years ago...

If the price goes up I'm sure a "Gas Party" movement will get started and the prices will come back down...

Ours is $2.59 but I get up to 30 cents off if I spend $300.00 for items in Dillions, one has to eat...

GottaGo · #9 (**permalink**) 03-06-2010, 07:58 PM

Quote:

Originally Posted by Spencer Collins

I'm still paying $2.57 and that's a lot less painful than the $4.22 I paid two years ago...

If the price goes up I'm sure a "Gas Party" movement will get started and the prices will come back down...

Ya just gotta start pokin', don'tcha?

I will ride the neighbor's Highland cattle to work, and don't step in the exhaust!

mlurp · #10 (**permalink**) 03-07-2010, 01:29 PM

Quote:

Originally Posted by mlurp

True but I doubt that changes before we see the govt. raise taxes on the product at the pump.
Other wise they will have to raise our taxes to try to keep up with the debt. IMHO we will see one or both unless Obama and company back it up with more debt.

And back away from the idea of Carbon Emission.

Quote:

Originally Posted by Pat

So, let's say the government decides that taxing gasoline is the answer to their revenue problems. Then people stop driving gasoline powered vehicles.
Do you think they won't find something else to tax?

Taxing behavior to try and regulate it isn't a wise decision in my opinion,
Tobacco Tax
Bottled Water Tax
Plastic Bag Tax
Income Tax

I agree, but look at your list of items taxed. Im surprised they haven't taxed breathing...

In the end I believe we will see both being taxed. Given enough time and the continuing slow recovery and lack of jobs which the Government derives a large portion of it's tax base from.

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