Spring Break
Letter: Student advocates government aid for a sustainable American future
Issue date: 3/10/09 Section: Editorial/Opinion
03/10/09 -To the Cigar,
A habit occurs within all human beings when we become dependent upon the luxury of a system with minimal pain. We observed this during the oil and gasoline crisis of the 1970s and again just last year when crude oil prices reached $141 a barrel, which caused the price of gasoline to rise.
Nationwide, there was mass concern over who was benefitting from the extreme prices Americans were paying for gas. There was a demand for alternative energies and for the government to prosecute CEOs of major oil/gas corporations.
But now, the situation is very different. The price of oil stands at $40 a barrel and the price of gas has fallen below $2 a gallon. With regard to this aspect of our economy, it could be classified that times are good in comparison to last year's crisis. However, it must be remembered that the current trend of oil and gas prices are at the behest of the recession and the tremendous fiscal problems we are facing.
Furthermore, we must realize how the market works and prepare ourselves for the times when the situation could get worse. As I mentioned, the current price of oil is roughly $40 a barrel, down $101 from where it was almost a year ago. What will happen if the price of oil reaches somewhere from $175 to $300 a barrel? This is not an unrealistic question to ask.
As of now, the current bid or contract for crude oil is $38.10 and next year's bid is set at $50.26. Bids or contracts for this particular market item are set some time in advance.
There are many factors which can influence the price of oil. One of which is the continual demand from high growth areas such as the United States, China and India. Another guiding force within this future dilemma will be the enormous demand for oil from Organization of Petroleum Exporting Countries, that recently cut production. Also, the supply they have been trading is running low.
It can be anticipated that as our national economy begins to recover we may observe an increased demand for oil. Discussion will return of using our own reserves and exploring the Arctic Circle.
A habit occurs within all human beings when we become dependent upon the luxury of a system with minimal pain. We observed this during the oil and gasoline crisis of the 1970s and again just last year when crude oil prices reached $141 a barrel, which caused the price of gasoline to rise.
Nationwide, there was mass concern over who was benefitting from the extreme prices Americans were paying for gas. There was a demand for alternative energies and for the government to prosecute CEOs of major oil/gas corporations.
But now, the situation is very different. The price of oil stands at $40 a barrel and the price of gas has fallen below $2 a gallon. With regard to this aspect of our economy, it could be classified that times are good in comparison to last year's crisis. However, it must be remembered that the current trend of oil and gas prices are at the behest of the recession and the tremendous fiscal problems we are facing.
Furthermore, we must realize how the market works and prepare ourselves for the times when the situation could get worse. As I mentioned, the current price of oil is roughly $40 a barrel, down $101 from where it was almost a year ago. What will happen if the price of oil reaches somewhere from $175 to $300 a barrel? This is not an unrealistic question to ask.
As of now, the current bid or contract for crude oil is $38.10 and next year's bid is set at $50.26. Bids or contracts for this particular market item are set some time in advance.
There are many factors which can influence the price of oil. One of which is the continual demand from high growth areas such as the United States, China and India. Another guiding force within this future dilemma will be the enormous demand for oil from Organization of Petroleum Exporting Countries, that recently cut production. Also, the supply they have been trading is running low.
It can be anticipated that as our national economy begins to recover we may observe an increased demand for oil. Discussion will return of using our own reserves and exploring the Arctic Circle.
