January 2nd, 2008
Oil hits $100, Wall Street bulls trample American consumers
It’s a new year but the same old story. Oil’s well that ends well, and the oil boys are at stratospheric prices for their crude to start this U.S. election season. Of course by now we all know the litany. Higher energy prices raises the price of everything trucked to a Wal-mart, everything grown with fertilizer (like corn and soybeans), running anything that uses constant flow of energy (like server farms or my laptop). Guess I need to check into a solar laptop battery.
Here’s the market watchers’ take on the $100 crude price. Of course, people killing one another in Nigeria endangers that oil supply in the traders’ view. The U.S. does not have enough stockpiled petroleum, they claim. But increasingly, the oil markets reflect the price we Americans literally must pay for beggaring our own currency. Marketwatch is explicit:
“The dollar index, which tracks the value of the greenback against a basket of other major currencies, fell more than 8% in 2007. A sliding dollar makes oil cheaper for buyers holding other currencies. These buyers are likely to increase demand and bid up oil prices.”
Weak US dollar equals strong oil prices in America. Vroooom!
There’s more oily news? The U.S. government, at the behest of the state government, has just tested water wells across New Hampshire. Testing for MTBE. To an organic chemist that’s methyl tertiary butyl ether. To you and me thats a gasoline additive once used to make gasoline burn more efficiently but as always the unintended consequences were seriously consequential. MTBE now pollutes our drinking water. Here’s what the U.S. Geological Survey found in New Hampshire.
“The gasoline additive methyl tert-butyl ether (MTBE) is widespread in New Hampshire’s ground water, particularly in four counties — Rockingham, Strafford, Hillsborough and Merrimack. Ground water from these counties was more likely to contain MTBE than were samples from the rest of the state. Across the state, however, the MTBE concentrations were significantly below the state drinking water limit and the federal drinking water advisory.”
Back in 2002 California and many other states began to outlaw MTBE after it showed up in drinking water. Six years ago the NRDC had these recommendations on how to make up for the lost efficiency when MTBE was taken out of gasoline. They called for more hudrogen fuel cell cars, and we really jumped on that one. Better mass transit. Um-hmm. And more efficient energy use by cars. But we know how the EPA feels about California and New York and other states trying to increase fuel efficiency for cars and light trucks. Can’t let these states just go out and make laws! So the states v. feds on car emissions will be one of those on-going green tech stories for 2008, right up there with $4 per gallon gasoline speculation until we finally top that mark. And just today California officially sued the Environmental Pollution Agency over car emissions. Happy New Year!
A newsman since 1969, Harry Fuller has worked for CBS, ABC, CNBC Europe, CNET and was founding news director at TechTV. See his full profile and disclosure of his industry affiliations.
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