Quote:
Originally Posted by Jim in CT
" Pricing is based on both supply and demand. "
I get that, I really do. And I agree 100% that things like tax breaks for rich people to drive electric cars, and for solar panels, will result in a slight reduction for US demand. But the price-per-barrel of oil is based on global supply and demand, not US supply and demand, isn't it? Maybe I'm wrong there. Do Americans pay a different price per barrel than people in other countries?
Here's a chart I found on worldwide oil consumption by year, and that line is only going in one direction.
http://www.indexmundi.com/energy.aspx |
The price is based on supply and demand and our price is prob. the same as others (ignoring taxes and transportation costs, etc). But if you lower demand (any where in the world) the resulting supply/demand relationship will reset. So if every car in the US now gets 10 extra MPG, then the demand will not be as high. If China is using more oil/gas at the same time as our cars are getting more MPG, the demand may be going up or down (whatever factor is larger). So while I assume the link is showing increasing demand, it would have been higher if our cars were getting lower MPG and if our houses where less energy efficient. Add in less demand bc of solar, wind, nukes, etc (US and all over the world) and add in increased supply b/c of fraking and you end up at an all together different price. We are the world's largest consumer of oil and we have used less and less over the last few years. Partly as a result of incr. supply in gas but partly as a result of (mainly) more fuel efficient cars.