U.S. stopping oil shipments into reserve
In past commentaries I had suggested that dubya might try to do something (other than a tax holiday) to impact gas prices. Comments went like this:
“Can someone explain how the President has any effect on gas prices?â€
He doesn´t. Only an idiot would suggest that he does. Oil prices, and by extension gas prices, are set on a world market. It´s that pesky supply and demand thing.
The sad part is, these idiots are allowed to vote, which is why we get the “leaders†that we do.
My response had to do with the federal strategic oil reserve, that two month supply of oil owned and stored by the feds. In the news last week:
Responding to congressional pressure, the Bush administration on Friday said it is suspending oil deliveries into the government’s Strategic Petroleum Reserve for the remainder of the year.
The move came days after Congress passed legislation requiring President Bush to temporarily halt shipments into the reserve in hopes of lowering gasoline prices. The president is expected to sign the bill.
It remains to be seen what impact this move will have on global prices, if any. Still, congress can tell their constituents they tried.
Meanwhile, in parts of the country (like Chicago) motorists are paying over $4/gallon for self serve and nearly $5/gallon for full serve. Diesel is quite a bit higher. While some can afford to continue filling the tanks on their Escalades many others cannot. The working poor are most impacted but they are also most likely the segment of the population not adverse to taking public transit.
I don’t think stopping shipments to the oil reserve will have much of an impact — about as much as a federal gas tax holiday would. Releasing the millions of gallons of oil in the reserve back onto the market— that could have an impact.
This is our new reality folks. Do we listen to groups like MoDot and build more highways based on their prediction of more trucks or do we realize we must as a society do a better way of getting people and goods from place to place?