Climate change isn’t going to be free.

A report by Point Carbon, an independent consulting company that tracks global carbon and energy markets, estimates that U.S. climate legislation could push the price at the pump 13 cents a gallon higher.

The increase would result from the cost to oil companies for carbon permits, which they can pass along to consumers.

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Last year, the price of gasoline in the United States topped the $4 per gallon mark.

This year in Afghanistan, the price has topped $400.

The stunning revelation emerged Thursday in a report from the Pentagon to House officials. The information conveyed offers new insight into a recent report by the Congressional Research Service, which found that the US spends $1 million per year for each servicemember on the ground in Afghanistan.

Why so much? The cost includes shipping, which sometimes includes the pricetag of a helicopter flight. Sending fuel by helicopter is woefully inefficient, because it uses up almost as much fuel as it carries.

Raw Story

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A new business game from the oil-dealing kingdom would have Western oil guzzlers paying for using less oil. Sounds like the opposite of reality, you say? The Saudis say it’s the only way they’ll be able to afford helping the fight against global warming.

The New York Times frames the Saudi idea as, “if wealthy countries reduce their oil consumption to combat global warming, they should pay compensation to oil producers.”

Saudi climate negotiator, Mohammad al-Sabban, described the position as a “make or break” measure for the oil-heavy kingdom in the lead-up to global climate negotiations in Copenhagen. In an email exchange with the times, al-Sabban said wealthy Western countries like the United States should help the Saudis with “economic diversification” by paying for oil they don’t even use.

Raw Story

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I guess I must be on the wrong page.

A vehicle at 15 mpg and 12,000 miles per year uses 800 gallons a year of gasoline.
A vehicle at 25 mpg and 12,000 miles per year uses 480 gallons a year.

So, the average clunker transaction will reduce
US gasoline consumption by 320 gallons per year.

They claim 700,000 vehicles so thats 224 million gallons / year.
That equates to a bit over 5 million barrels of oil.

5 million barrels of oil is about 1/4 of one days US consumption.
And, 5 million barrels of oil costs about $375 million dollars at $75/bbl.

So, we all contributed to spending $3 billion to save $375 million.

How good a deal was that?

Obamanomics at work, or is it the NEW math?

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Oil legend T. Boone Pickens, now CEO of BP Capital, says oil prices will continue to rise, possibly reaching $300 per barrel.

“Look at the history,” Pickens told Dan Mangru of Moneynews. It proves oil prices will go up, as OPEC revenues increased five times over the last five years, he says.

Supply is stuck permanently at 85 million barrels per day, and demand will keep rising over the long term, Pickens says. By 2019, demand will reach 90 million barrels a day, he predicts.

“The only way if you peak on supply that you can kill demand is with price,” Pickens says. That’s what happened when oil prices hit a high of $147 in 2007.

So, 10 years from now, “the price of oil could well be $300,” he told Mangru.

To reduce our reliance on coal, Pickens suggests a “cash for clunkers”-style plan whereby power companies would get paid to retire coal plants and build natural gas plants instead.

Money News

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