Friday, February 25, 2011

Bubblin' Crude ... Oil That Is

     I have to submit a post about oil. Because it's been in the news. And I'm something of an expert.

     Well, not an expert, exactly. But I did watch "The Beverly Hillbillies" when I was a kid, and I listened to the "Ballad of Jed Clampett" and discovered that if you're out shootin' for food and you find oil instead ... black gold ... Texas tea ... then the first thing you know you're a millionaire -- so rich you could move to Beverly ... Hills, that is ... swimming pools, movie stars ...

     So even as a kid I knew that oil was a valuable commodity. It's better to have some than to need some.

     I also lived through the 1970s. I remember it was the fall of 1973 when I first heard of OPEC. This group of oil-rich countries proudly proclaimed an oil embargo in reaction to U.S. support of Israel during the Yom Kippur War. The price of a barrel of oil quadrupled from about $3  barrel to over $12 a barrel. A gallon of gas jumped from around 30 cents to ... (gasp!) a dollar. The oil embargo lasted six months or so; it made the stock market crumble, dragged the world economy into recession, and scared Americans into rethinking their dependence on foreign oil.

     Well, I'm joking about that last part. Because again in 1979 the Iranian Revolution resulted in a disruption of oil supplies, and the next year Iraq invaded Iran, causing further cuts in the flow of oil. The price of crude rose from about $16 a barrel to $40 a barrel, and a gallon of gas went back up over a dollar and higher. There were lines at the gas pumps. There was talk of gas rationing. Coupons were printed. President Carter said the oil crisis was the "moral equivalent of war." And Detroit responded by inventing the gas-guzzling SUV.
     Now we all know what happened in 2008, with a barrel of oil soaring over $100, and gas prices bubbling up to $4 a gallon. But the point is, if you're over the age of 50, you were probably prepared this time -- because you remember those oil-starved days of the 1970s and you're not surprised to see them come around again, and so now you won't be feeling the pinch of the current surging oil prices.

     You're probably driving a Prius or Honda or Ford Focus, not a Ford Expedition or Hummer. You're probably living in a place where you don't have to drive 40 miles to work, or log in 200 miles a week just to gather your groceries and do your errands. You have also probably insulated your house, and keep the thermostat low in the winter, and go easy on the a/c in the summer. You might even own one of those famous Jimmy Carter cardigan sweaters. And if you're really prescient, you've invested part of your IRA money in a low-cost energy mutual fund or ETF.

     Damn. I wish I had done all those things! Well, I've done some of them, and now I'm resolved to do the rest, because (as Jed Clampett might say) it's sure as shootin' that there will come another time when we have to pay $4, and then $5, for a gallon of regular unleaded gasoline.

     And by the way, that song ain't a bad little piece of Bluegrass music. Enjoy ...



Anonymous said...

Well, I've done all of the above. I even drive a Ford Focus, which BTW gets 44 mpg on the highway. I've insulated the house, live in an energy efficient, new state-of-the art modular home (custom built, of course) and realistically laugh at the $4.50 gas price tag.
Needless to say, however, I still don't want to go there again. $4.50 was hard! But, I'm more prepared to suffer yet once again. We'll just drive less, yet once again and coordinate all trips in the car. Again. Thankfully, I'm near a train station and can get to where I need to go if I limit my car use. Again.

I like your blog. You have a good sense of humor which I find refreshing and a pleasant change.


June said...

I do recall calling in "empty" to work one day in the early 1970s when I didn't have enough gas in the car to wait in the line at the gas station...

I do drive a little bitty Mazda instead of the 4WD Jeep Grand Cherokee that I should and used to drive in the upstate winters, and have thereby considerably honed my winter driving skills . . . and have produced a couple of entertaining blog posts as a byproduct.

A question arises in my mind, however, about all the warring that goes on in the Middle East over oil. If the figures in this table ( are true, what is the justification for all of it?

Sightings said...

Er, "The Beverly Hillbillies" didn't have an episode covering that issue.

But seriously, I'm sure those figures are true, but just b/c we get more oil from Canada and Mexico, doesn't mean the Mideast oil isn't important. Most mid-East oil goes to Europe (b/c it's closer), and probably India and China. But if the Mideast closes off the taps, then Europe and China want more oil from Canada and Mexico, so it affects the U.S. as well.

That's not to say the oil companies don't take advantage of the situation (if that's what you're implying), but that's another subject altogether.

Douglas said...

I drive a Buick. Lucerne. Good highway mileage at 28mpg but not so good in town. Since I no longer commute and all the golf courses are less than 15 minutes away, my fuel efficiency is poor. On the other hand, I only fill up once a month at most. Makes the pain both more acute and less constant. I am busy investing in mortgage funds (am I too late on that?) said...

Apparently, we did not get scared enough in 1973. Here we are again with the gas prices going through the roof. Petrol prices have already begun to affect the UK economy which was hard hit by the BP difficulties last summer. Many British pensions are tied to the fortunes of BP. Pensions in the US are also affected by petroleum prices as are 401k plans which have BP, Shell, Toyota, stocks to name but a few. Perhaps all the unrest today with states buget deficits, underfunded pensions, and union busting is linked to oil.

The world is a complicated place. Counting our chickens before they are hatched is not good. Just as counting on some future benefit is frought with danger.

Nance said...

I recall it all and did, indeed, feel prepared. Also spent a stupid amount of time wondering how people twenty years my junior weren't sharing my memories. I continue to do that about other issues of import, too: women's rights, abortion rights, ground wars in Asia and the Middle East, etc.

I have enough cardigans to share.