Departments



Articles

Less

Editorial: Sign Thefts - Fear of the Opposition?
October 14th, 2004

Editorial: Police Arrested a Person
October 7th, 2004

Editorial: Korean Cloud on the Horizon
September 14th, 2004

Editorial: Moratorium Battle Heats Up
August 30th, 2004

Editorial: Orders From the Top
August 12th, 2004

Editorial: On the Value of Art
July 14th, 2004

Editorial: Of Voles and Men
June 24th, 2004

Editorial: Clam Poaching, are We Number One?
June 4th, 2004

Editorial: Leadership Overcomes Flawed Process in Missile Range Decision
May 10th, 2004

Editorial: Bomb Range Inn
April 25th, 2004

Editorial: Is the President Above the Law?
April 8th, 2004

Editorial: The "Good Old Days"
March 15th, 2004

Editorial: Access to Public Records
March 1st, 2004

Editorial: Sunset Park: A Reality?
February 23rd, 2004

Editorial: The "Tree Ordinance"
February 9th, 2004

More

Will Gas Prices Go Up?

Will Gas Prices Go Up?

Editorial

NOAA's prediction for the 2006 hurricane season will be announced May 22. Meanwhile, researchers at Colorado State University have concluded that we'll have seventeen hurricanes, with five of them in the severe category. Seventeen is an increase of six over the 2005 season.

Oil production in 2005 was reduced because oil wells and refineries along the Gulf Coast suffered hurricane damage. Twenty percent of the production is still down. When oil supplies are down gas prices go up. Political instability in Venezuela, Nigeria and Iraq has made oil supply even tighter. Lately a barrel of oil sells for over $70.00. A long range estimate of demand for oil includes more demand from China and India where the economies are booming.

Irrespective of the need to reduce fossil fuel consumption, the oil companies are doing very well. The return on shareholder equity in 2005 for Chevron was 22.5%, BP, 22.0%: Exxon-Mobil, 30.5%. Projections for 2006 indicate another good year for oil companies. That suggests that the profit motive combined with hurricanes and political unrest in the oil producing countries explains high gasoline prices at the pump.

At $3.00 a gallon for gasoline, a round trip from Cedar Key to Chiefland takes $6.00 to $10.00 worth of gas. Round trips from Gainesville to Cedar Key for a seafood dinner require about $14.00 for gas. Even if the hurricanes miss Cedar Key (and they usually do) we feel them at the gas pump.

The good news is that tax payers won't have to bail out the oil companies from bankruptcy. The bad news is that one needs to save $6.00 to justify a trip to the Chiefland WalMart. The recommendation of Cedar Key News is a careful look at the EPA estimate of gas mileage on the sticker next to the price tag when buying a new vehicle.

Click for printer friendly version

Email this article to a friend

 

 

© 2013
Cedar Key News

cedarkeynews@gmail.com