Gas Pains
Friday, August 8th, 2008
Mandatory disclaimer: I’m not an economist. Having said that, I’m a bit concerned looking at this whole offshore drilling thing. Not just for safety and environmental reasons, but for economic ones as well.
First off, as has already been widely reported (in sources that lean both left and right), the impact on the price of gas will be minimal, and will take about ten years to register, if at all. Second, oil rigs cost money to build and operate. Tons. Given that oil companies–especially Exxon-Mobil–have been posting profits that could charitably be called “ridiculous,” they’re not likely to want to cut into those profits and piss off shareholders, meaning that the price of construction is likely to be passed on to consumers in the form of higher prices on fuel and anything that relies on that fuel to be transported, which is pretty much everything.
Third, the United States lacks the refinery capacity to deal with current levels of production. If new refineries are to be built, those too will cost money, and that cost will probably likewise be passed on to consumers/taxpayers. And this, we’re told, is a bargain.
A lot has been made of our dependence on foreign oil. The larger problem, though, is our reliance on fossil fuels, regardless of where they’ve originated. It’s time to find alternatives… I’m sure someone will find a way to charge an arm and a leg for those as well, so it’s not as though there’s no money to be made; have we lost the creativity and the will to change?
