You Want Price Controls?
FT.com / World / Asia-Pacific – Beijing defends stance on petrol prices
Take a look at China.
China has defended its refusal to lift pump prices to keep pace with rises in the global oil market over the last 12 months, saying further increases would damage local industries, the military and the economy.
Zhang Guobao, vice-chairman of the National Development and Reform Commission, the chief economic planning body that is also responsible for energy policy, acknowledged that Chinese rises had been allowed to fall behind the world, but said the issue was “complicated”.
The NDRC has mandated three increases since May this year, increasing pump prices by a total of about 25 per cent, compared with rises in global crude of about 65 per cent since the start of the year.
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China, especially in the south, has experienced oil shortages in recent months, partly because of the NDRC’s price controls. The local oil majors all but stopped selling imported crude because of the huge losses they were incurring.
Price controls ALWAYS cause shortages. Price controls do not address demand, and it certainly doesn’t address supply. It only creates an artificial incentive to consume and empty the reserves.
Yet we have a sizeable portion of the electorate who somehow thinks the President (or the Government in general) has the means to reduce gas prices.
Drill. Refine. Repeat.
Filed under: Politics
Drill. Refine. Repeat.
How about:
Research, Alternative, Fund…
Lets eliminate our dependance on a non-renewable resource controlled by countries that do not have our best interest in mind.
Who will fund? The Feds? How will the Feds pick the best technology? Look what they do with Ethanol subsidies…I can’t imagine a bunch of competing techs huddling up to the Federal trough for money.
I’m all for alternative fuels (see earlier posts on that), but the transition will take a lot of time and money. How do you retrofit or replace 300 million vehicles? How do you establish the fuel stations when no one is driving the altfuel vehicles? It is a chicken/egg problem.
And despite the high costs of gas, altfuels still aren’t financially viable yet. We’re getting closer, but do we want to lock in the equivalent of $4-5 a gallon in altfuel costs? At the moment, hybrids are the best way to go, but you still need gas to run them.
By all means, continue the private sector altfuel work. But today, you need more fossil fuels. That reality isn’t going to change. We could reduce our dependence if we would drill more, and not just in ANWR. And build more refineries….
You look at the long term strategy – something government doesn’t do well because they generally think in 4 year terms.
You don’t worry about retrofitting or replacing current vehicles – not enough benefit for the effort. You focus on replacing them and let time work for you as eventually they will wear out.
As for the chicken/egg issue – well how do you think gas vehicles were introduced in the first place! Horses didn’t use gas stations.
There are hybrids out there that do not use gas. They just haven’t gotten the attention like gas/elec. hybrids such as the Prius.
Build more refineries right now. From what I’ve read, we don’t need to drill more – we have plenty of raw material fuel availible. The issue has been lack of refinery power.
I don’t have the answers, but I firmly believe that gas powered engines need to be replaced sooner then the current process is allowing for.
http://www.wtop.com/index.php?sid=569563&nid=25
ANNAPOLIS, Md. — If you live there you know — Maryland is one of the five most expensive states in the country when it comes to filling up the gas tank.
And Maryland lawmakers are calling on the oil industry for answers.
Drew Cobbs, with the Petroleum Council, says major pipelines that were disrupted by Katrina are serving Maryland again. And the supply situation is improving.
“I think the laws of supply and demand will work.”
But lawmakers and many others question the price surge. One of them is Lon Anderson with Triple-A Mid-Atlantic.
“So far, I haven’t heard any good explanations why Maryland has some of the most expensive gas in the nation.”
Lawmakers are looking into legislation against price-gouging.
Great reading, keep up the great posts.
Peace, JiggaDigga