$50.00 oil or $200.00 oil?
Would $50.00 oil kill the Volt?Despite gas lines popping up in many Southeast US cities, Donald Trump believes that oil prices could drop as low as $20 per barrel very soon. I was running some errands yesterday and overheard Trump on one of the business stations claim that gas prices - the lifeblood of the US economy according to Trump - were set for a huge decline. While Trump did cite speculation, he focused all his blame on OPEC.
Labels: gas prices
posted by Dahcredyns at
11:00 AM
7 Comments:
If prices plummet that low, expect much of the new oil that has come online recently to stop production. Most new oil is not profitable at prices under $100/barrel. When producers have to drill 3 miles down in the ocean, its expensive. How much has Trump invested in the market? He sounds like an idiot to me!
Well, I'd never defend Trump, and I was shocked to hear such a claim. Yet, I've heard a number of oil analysts claim that oil prices are going to go down for a few years. They still believe the long term outlook is bullish and that eventually prices will rise again to well above $100.00. Still, in the short term, many of these analysts believe $50 - $80 oil is possible.
How much, I wonder, would such a decline dampen interest in fuel economy?
This is what worries me about having to wait until the year 2010 for us to get the new hybrids. If gasoline returns to 2 bucks a gallon or less, how many high mpg hybrids and PHEV's will the automakers be compelled to produce? I can just see GM producing 10,000 Volts and then pulling the plug....pun intended.
Personally, I want gas prices to remain as high as possible!
The thing is I don't think GM would pull the plug, but it's not just because of noble intentions.
Each Chevy Volt is going to be worth a significant number of CAFE fuel economy credits, which will not be affected by lower gas prices.
Thus, GM could justify selling 50,000 Volts per year, even at a loss, just for the credits.
Personally, I really don't care what oil prices go to. We have to become energy independent no matter what. For national security as well as for reducing the blackmail price we pay to nations that we get oil from. We need to quit thinking it's all about the price of oil. I'd still buy a EV or at least a hybrid if a gallon of gas went down to $2.00. Eventually, it will go back up. It's in the best interest of the oil producers to keep prices as high as the world economies will tolerate. They're not going to lower prices out of the goodness of their hearts. Most of them hate us. And finally, even if America reduces it's oil imports, the increased consumption of the emerging nations like India and China will more than offset any, and I mean any reduction in American consumption.
anon-
I think we all agree with you, but i don't think most Americans do. Even after 9/11 for instance, most Americans didn't change either their car-buying or gas-consumption habits.
As long as gas is cheap, a majority of Americans will gladly guzzle it.
Even after gas lines in the '70s, it didn't take consumers long to forget and to guzzle more than ever before.
How do we change that disconnect?
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