Add this Page to Facebook!   Submit to Twitter   Submit to Reddit   Submit to Stumble Upon   Pin It!   Fark It!   Tell A Friend  
Printer Friendly Page Save As Favorite Save As Favorite View Article Stats
1 comment

Exclusive to OpEdNews:
OpEdNews Op Eds

Oil burden

By (about the author)     Permalink       (Page 1 of 1 pages)
Related Topic(s): ; ; ; ; ; ; ; , Add Tags Add to My Group(s)

View Ratings | Rate It


opednews.com

Last time the United States had an oil crises of this magnitude was in 1980.  Even when adjusted for inflation, crude oil at $135 a barrel is more expensive than at the peak of the oil spike in 1980. That is an alarming statistic.

Instead of talking about Oil Bubbles we should be talking about Oil Burden: Véronique Riches-Flores of Société Générale measures the “oil burden” – the volume of oil consumed, multiplied by the average price and divided by nominal gross domestic product. This gives the proportion of the world economy devoted to oil and accounts for the way the world has reduced its reliance on oil since 1980.

The oil burden so measured has risen about 75 per cent during the past year, to its highest level in almost 25 years. This must soon have an economic impact if prices do not quickly reverse. But prices would need to reach about $190 before the burden regained its peak of 1980. It is not clear that prices are at a point where demand will fall.

In the The Post-American World, Fareed Zakaria argues that a "post-American" world order is beginning, in which the role of the United States of America will be diminished, but not irrelevant. Economic, diplomatic, and social power is rising in the rest of the world, a phenomenon he calls, "Rise of the Rest". Although the U.S. remains the supreme military power, the spread of capital, labor, innovation, ideas and information continues to bring down the level of influence the U.S. once had in world affairs.

While the oil crisis of 1980 was solved by an American response, America no longer controls the economics of oil consumption.  Take for instance subsidies in the developing world. These may be suppressing economic effects while storing up fiscal problems for governments. Most notably, Chinese consumers are only paying about 10 per cent more for oil than they were 12 months ago, while JPMorgan research suggests consumers in Egypt, Indonesia, Malaysia, Mexico and Vietnam are buying petrol at an even bigger discount than in China.  
Mr. Steve chapman concept of an oil bubble and The Chicago Tribune subsequent editorial is not only misleading, but also irresponsible.    America no longer controls the price of oil, and while it is still its largest per capita consumer, China, India, and other developing countries that subsidize their oil consumption will continue to raise the price of oil.  Most annalists believe that $200/barrel is not out of the question.

We need to solve our oil dependency once and for all. At this junction I consider it to be the highest national threat to our country.  Editorials that speak of “oil bubbles” will hinder our efforts for real solutions.

 

www.carlostmock.com

Travel website: The Pink Agenda. Several Blogs. Weekly newsletter, available upon request. Publications - Fiction: Borrowing Time: A Latino Sexual Odyssey - Floricanto Press 2003. Poetry: The Refined Savage Poetry Review - Refined Savage (more...)
 
Add this Page to Facebook!   Submit to Twitter   Submit to Reddit   Submit to Stumble Upon   Pin It!   Fark It!   Tell A Friend
The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of this website or its editors.

Writers Guidelines

Contact Author Contact Editor View Authors' Articles

Most Popular Articles by this Author:     (View All Most Popular Articles by this Author)

Sexual Addiction

Gay Rights during the Bush Presidency

History of Same Sex Marriage Jurisprudence

TEN THINGS GAY LATINO MEN SHOULD DISCUSS WITH THEIR HEALTH CARE PROVIDERS

Puerto Rico, Past , Present, and "Future"

Did you ever wonder how much it costs a drug company for the active ingredient in prescription medications?

Comments

The time limit for entering new comments on this article has expired.

This limit can be removed. Our paid membership program is designed to give you many benefits, such as removing this time limit. To learn more, please click here.

Comments: Expand   Shrink   Hide  
1 people are discussing this page, with 1 comments
To view all comments:
Expand Comments
(Or you can set your preferences to show all comments, always)

If the dollar were on par with the euro, as it was... by John Sanchez Jr. on Tuesday, Jun 17, 2008 at 9:17:32 AM