$7-a-gallon gas, 10-million fewer cars by 2012

[Doctor Cynic]

Source: Globe and Mail

A new forecast calls for gasoline prices to hit $7 (U.S.) a gallon in the next two years and oil to soar to $200 a barrel by 2010.

The report by CIBC World Markets also predicts there will be 10 million fewer cars on the road in the United States by 2012.

“Over the next four years, we are likely to witness the greatest mass exodus of vehicles off America's highways in history,” Jeffrey Rubin, the lead author, wrote in Thursday's report.

Economist Benjamin Tal, who co-authored the report with Mr. Rubin, said Canadians can expect to pay about $1.85 to $2.00 per litre of gas at the pumps by 2010.

Read more: http://www.theglobeandmail.com/servlet/story/RTGAM.20080626.wrubin0626/BNStory/Business

---

Get ready for a wild ride, folks.

[DJ13]

1. This forecast reminds me of the forecasts that used to come out for the tech bubble

Almost every report was saying it would go higher just before the bubble burst.

[tama]

39. Wishfull thinking

by trying to compare apples to oranges. There is no positive market hysteria but a situation of beginning depression like the world has never witnessed before and capitalism 101 with supply crunch of physically limited resource that global economy is helplessly addicted to.

In short: the end of growth economy.

[World Traveller]

52. CIBC World Markets - a good forecasting record on oil prices

CIBC World Markets and Jeffrey Rubin were predicting today's oil and gas price increases 3 years ago. They have a good record at forecasting oil prices and were forecasting today's price hikes years ago, at a time when few were.

I've posted an article from 2005, where they lay out the reasons that oil prices will rise significantly in the future and the reasons why it will rise. Take the time to read it and you'll see that the scenario they laid out in 2005 is what we are experiencing today. If anything, their 2005 forecast for future oil prices was on the conservative side.

If they go public with a forecast, it should be seriously considered and their reasons studied.

Their 2005 forecasts and reasons in article below.

http://www.321energy.com/editorials/rubin/rubin041505.html

[no_hypocrisy]

2. I can always sleep on the conference table at work and cut down on commuting I suppose.

[Deja Q]

3. That's horrible news!

I can't speak for anybody else, but rush hour was the best part of my day... and now it won't be so busy. What shall I do in the car instead of sitting in it while it passes gas?








(now that's a proper fart joke!)
:hide:

[CatholicEdHead]

18. Good thing the Twin Cities has a good year-round biking network

[AndyTiedye]

32. Doesn't the Snow Get a Little Deep For That in the Winter?

[daleo]

46. It is possible to winter bike in challenging climates

As long as the snow is cleared, it isn't usually that bad.

You have to dress warmly (though your physical activity level will generate a lot of heat), sometimes use studded tires, equip yourself with adequate bike lights, and exercise good judgment in terms of speed. It can actually be quite a pleasant way to get out in the winter.

I did it for years in Edmonton, Alberta, Canada, which is colder than the twin cities, I believe.

[Psephos]

50. You can even get around quite well on rollerblades, if there's no snow

I can usually blade about a third of the winter here in Michigan.

You're quite right, after the first few minutes, body heat takes over and you're warm, and even better, exhilarated. It's a potent antidote to that cabin-fever dreariness that comes from staying in a heated house or office.

[Robb]

59. Plows run on diesel. /nt

[daleo]

67. They could run on bio-diesel

Or on electricity. There are many possibilities. Assuming fossil fuels become more scarce, they won't disappear overnight. But their use will become more rational - e.g. snowplows over four ton SUVs with one driver.

[Megahurtz]

64. Lol! n/t

[loveable liberal]

4. Good. The buck stops here.

Higher the gas price, the more incentive to create alternative fuels and transportation. I will be suffering along with everyone else. We dont live in the '50's and '60's anymore. The price of gas is not coming down.

We have a chance to free ourselves here people. Lets do it.

[Marrah_G]

35. So exactly how will people keep from freezing while this miraculous change occurs?

Gas and cars are an issue..... but heat in the northern states? It's not a matter of years before this is a serious life threatening issue, it is a matter of months.

[loveable liberal]

37. Its called Cold Weather Protection in Minnesota.

Apply for protection and the gas stays on from 10/15 to 04/15 every year. I spent 10 years with Xcel. Its a relatively easy process. It gets cold here too. All surrounding states had the same guarantee.

[Marrah_G]

42. It just means they can't shut you off in the winter

For people with oil that does no good. And the enormous bill still needs to get paid.

Heating assistance will help, but they will need far more funds then ever before.

[loveable liberal]

44. you asked how people are prevented from freezing to death..

I answered. How people pay for it is a completely different question. No doubt as the taxpayers pick up the tab now (with company assistance of course) the taxpayers will pick up the balance as they always have. There are tons of assistance agencies aside from the state where people can get help. It, as always, is a matter of taking the time to find them. If one agency has funds that are exhausted, they will point people toward another.

[Marrah_G]

57. I've had to use assistance in the past.

Here in the Northeast most people heat with Oil. Gas is not even available to me. Heating assistance gives you a one time grant of between 700-1100. Citizens energy gives you 100 gallons free (it used to be a 40% discount, but the web page now says free). The good neighbor energy fund gives a one time grant of 275 for people in crisis.

With the rising gas costs- Heating oil may well get to 5.00 or 6.00 per gallon this winter. Right now it is 4.69. When I moved in in Sept of 01 it was 1.27 a gallon.

That's 1000.00 for 200 gallons.

200 gallons does not last long during a cold New England winter.

I qualify for assistance. I am a single working mom. Most families in my area will make just to much to qualify for any aid.

I am saving up money to get a new more efficient heater and my parents will match what I can save, but still I will be having to take on a second job to get through the winter.

Those on fixed incomes end up relying on space heaters (because the electric company cant shut you off in the winter) and that creates more house fires and astronomical electric bills to pay off.

It is indeed a crisis in the making here in New England.

http://www.abcnews.go.com/Business/PainAtThePump/story?id=5244680&page=1

[hunter]

60. Energy prices are so high now it would be less expensive to upgrade homes.

It's as reasonable, maybe more reasonable, to subsidize insulation and efficient heating systems as it is to subsidize energy.

[loveable liberal]

62. In Minnesota there are tons of agencies including

Catholic Charities (and every other denomination), the salvation army, etc, etc. Xcel also has a volunteer corp of retiree's who go to peoples houses and patch windows and cover them with 3m film. We were able to afford insulating the attic with cellulose this year and that made a huge, huge difference.

[superconnected]

71. Those charities run out of resources quick when flooded with people

who need them.

The answer is not private charities. That's a bush answer as he's twisted some issues into that - specifically when he cut nearly all social programs and yet gave to republican based charities and said people can get help there. That is NOT reliable help.

Homeless sleep on the street every night in every city because there are not enough facilities to house them - not just beds, there aren't enough public buildings that open up at night to simply let them sleep on the floor. Many people will wave off the homeless with answers that they could go get charity help. That is NOT the case. there are not enough resources. There is no chance there will be for people who just need gas or money to pay for gas.

[Mojorabbit]

69. Have you explored

all the little things I have read that some people do, ie window quilts or only heating one room and kind of living in it till it warms? There was a website I looked at eons ago that had a ton of little things one could do to keep the heating bill down. I can't for the life of me find it right now though.
I live in Florida and have the opposite problem which is keeping cool.I am looking into a solar A/C unit for down the line. It sure is not within my means this year.

[wishlist]

66. In places like Maine people will move south or move in together to save

Cost of heating oil will be exorbitant for those in cold climates who paid only $1 per gallon when Clinton was Pres, compared to over $4 per gallon now and need hundreds or even over 1000 gallons per year. Some areas of the country need heat for 9 months of the year compared to milder climates that only need heat for 6 months. Electric and Gas is going up significantly and wood is only feasible for those with low cost sources and ability to deal with extra work of wood.

[nolabels]

74. With global warming people might need to find ways to travel north to escape the heat

Would make more sense in energy efficiency to follow habitable climates. Us humans just have too much attachment to possessions :shrug

Becoming migratory might actually be easier?

[cornermouse]

5. Get ready for a lot of "let them eat cake" posts.

This is going to literally kill a lot of people who can't keep their house warm enough, can't afford to keep their utilities on, and can't afford to pay the increased food prices.

[Hydra]

6. Thanks for saying that

Gas prices(and high diesel) will price food and transportation outside the realm of people like me unless I get a HUGE raise.

I already couldn't afford to go to work for 2 days last week- empty gas tank.

[Mojorabbit]

8. It is going to happen anyway

The world is running out of affordable oil. If we get a Dem in power then a crash course for alternative fuels is possible. If not it is just putting the pain off for a few more years. Either way it will be painful.

[cornermouse]

21. You may be right.

I've always thought that dying from hunger, exposure to weather temperature extremes, and without running water and electricity probably is quite painful. I can see how little the thought distresses you, though.

[Mojorabbit]

25. It does distress me

but I am not stupid enough to put my head in the sand and pretend we can keep going the way we have been. If you read my post, I said we have a chance if we get a Dem in and start a crash program.
The bureaucracy has a history of moving slowly though and I don't have a lot of hope anything will get done in time. I hope I am wrong but my saying the truth does not somehow mean I am relishing what is going to happen.

[tama]

38. Shoot the messenger

please do, but while you're at it, may I ask you have you heard about the Cassandra syndrome? Cassandra was a Troyan sooth-sayer that correctly predicted that Greeks would sack Troy. Cassandra's tragedy - a curse by gods - was that she knew the future but couldn't get anybody to believe what she was telling and wailing about.

There are three types of predictions, self-fulfilling, neutral and self-negating predictions. For self-negating prediction to work, the oracle needs to get the people to believe in the prediction so they can do something to change their destiny, or rather, stop doing what is causing their destiny.

[cornermouse]

40. I probably heard and read of Cassandra before you were born.

One of my little personal quirks was looking up all the myths and fables that I could find in encyclopedias when I was about 8 or 9. And when I spotted a new name I wrote it down and looked it up next. Nevertheless that doesn't change the fact that there is a whole lot of sneering and smug self superiority that always seems to congregate on these threads. I don't think that falls into the self-negating category. I think that falls into "that's happening to them over there, not wonderful me" category.

[tama]

45. Old geeser above 50 are you?

What I see is mostly frustration by those who have been predicting this for years and decades ahead of endless see of denial - and the anger with all the silly conspiracy theories on top of general whining. Sadly many if not most of those who have known have stopped to talking those in denial, giving up hope.

Very few of any of the worst ilk of gun toting "survivalists" here at DU, from what I've seen.

[cornermouse]

53. geezer not geeser

[tama]

55. Dank yuo

[krabigirl]

22. exactly - horrible news for the working poor AND middle class.

[Jack_DeLeon]

54. The writting has been on the wall for a while...

if people ignored it and havent done anything about it thats not the fault of those of us who have been preparing.

[cliss]

7. I'm already seeing it.

We live close to highway I-5 outside Portland OR. At night, the highway is quiet. You will see the occasional semi truck. Long, quiet periods of no cars at all. Truly amazing.

Before, we used to have trucks running the highway 24/7, I believe something like 70,000 semi trucks go along the I-5 corridor from CA to Canada every single day. That's already changing.

Cars - good riddance.
I read somewhere that there are currently more cars than people in this country. Just couldn't wrap my brain around that statement.
About time.

[Doremus]

20. I just came across a car magazine from 1915 the other day.

It said there was one automobile for every 23 people in the US.

There were a lot fewer people then, 100M according to the site I checked.

[lithiumbomb]

28. on more cars than people

Cars - good riddance.
I read somewhere that there are currently more cars than people in this country. Just couldn't wrap my brain around that statement.
About time.

I think part of that stems from cars becoming significantly more reliable and at least until the fuel prices shot up, cheap to own. Let's say you're a family with multiple drivers. You have a 15 year old Honda, it's worth $2k, it's reasonably reliable, insurance is cheap, tag is cheap. Why sell it? Just keep it as a spare, give it to the kid. Between my girlfriend and myself we have 5 cars and a scooter with the newest vehicle being 10 years old, oldest being 40. But despite that horribly skewed volume of cars, we can only drive one car at a time so it's not really extra cars on the road in our case.

And we're not alone, I know a large number of people that just have spare cars for various reasons. Hobby cars, a spare truck, whatever. Rarely anything fancy, just something older that was paid for long ago.

[JVS]

30. There are also issues like work vehicles.

The bus driver, groundskeeper, mailman, electric crew, paramedics, etc. don't take the vehicle home for personal use.

[Neshanic]

9. Meanwhile in fantasy land Arizona....

http://www.azcentral.com/news/green/articles/2008/06/13/20080613sierraclub0613.html

http://roguecolumnist.typepad.com/rogue_columnist/2008/05/on-transportati.html

[whistle]

10. That would knock out at least one third of the cars in America

[trof]

14. Nope, closer to 5%.

According to wiki and DOT there are approximately 243 million registered 'passenger vehicles' in the U.S.

[whistle]

17. Wow, all driving 15,000 to 20,000 miles per year, that is incredible

...using 92 million barrels of gasoline a day

[kestrel91316]

26. Not me. I drive less than 3000 miles a year.

The 20-yr-old Accord only has 150k miles on it.......

[IDemo]

49. Me too

'93 Toyota with 44k miles. My miles/month will definitely drop since adopting the bicycle commute.

[trof]

29. We may become a 1 car family.

We bought a Prius last fall.
Our other car is an '03 Dodge Caravan.
There's just the two of us now and we're retired.
We can arrange our lives and obligations so that we don't need to be in two different places at the same time.
So we're thinking about selling the minivan.

[AndyTiedye]

48. I Think That's The Average Per Household, Not Per Car. Still Way Too Much, But

How many cars can you drive at a time?

[bluesmail]

11. Oil Movements web site tracks the tankers and they have said

The full tankers are hidden offshore. :shrug: It makes sense to me...

[kimmerspixelated]

15. Exactly!

Good reason not to believe in "Peak Oil". I think the reasoning of a "shortage", is the perfect excuse to jack up the prices! I have read other reports that Iran has had to put tankers out, just cuz they are running out of places to put it!!!

Peak Oil-My Foot!

People forget that it was BIG OIL that put Cap'n Numnutz in the WH in the first place!
Hello? They are raking in every last cent, because they know it's soon to be over for them!

[tama]

41. Hubbert's Peak or PO-theory

was developed in the 60's when King Hubbert correctly predicted that US oil production is going to peak 1970 - as it did. Based on the same model for prediction which looks at the year when peak findings happened and calculates peak production based on that date, geologists arrived at the conclusion that world production is peaking nowabouts. So far the numbers have been consistent with the theory, nothing to do with Bush, except the fact Cheney was informed early on and therefore decided to take over Iraq's oil for the cause of PNAC.

[jaybeat]

68. Speculators are playing their role in Peak Oil

As a resource starts to decline in availability (real OR imagined), if demand doesn't also decline, then the price people are willing to pay goes up. If you're buying and selling, and you know you can sell it, why not promise to pay more? If you don't, some other guy will, and then you won't have any to sell. This keeps going up and up, and since so much of our consumption is NOT discretionary (people can't earn money if they can't get to work, stores can't sell stuff if they can't pay for the stuff to get trucked in, especially as dependent as we are on cheap stuff from everywhere else in the world--smart move, that...) the oil gets sold no matter what the price, until shit really hits the fan, and then people don't have jobs, stores don't have food and the whole mess gets ugly.

http://www.lifeaftertheoilcrash.net/

[Lydia Leftcoast]

33. That rumor circulates during every period of high oil prices

:-)

[Psephos]

51. They're not hiding, they're rendezvousing with UFOs n/t

[kimmerspixelated]

12. The thing is since the oil speculators

have been somewhat exposed, and more is sure to hit the fan shortly, I suspect that there is a good chance that prices will begin to go down to at least 3.00. Regulations will finally be in place!!This will happen around election time( especially if it might help MCPain! But then when Prez Obama puts Al Gore in charge of leading the pack for a renewable kind of energy that is quickly avail, as in now! We will all begin to sigh in relief! Really as nightmareish as it is, I see it as just part of the long 8 year bad dream! Just more bullshit from the Oilmen in the WH! Really, bad , devastating bullshit, but BS just the same!

[krabigirl]

23. agree with you

[Lydia Leftcoast]

13. And if Republicans and other car potatoes hadn't spent the last thirty years

saying "Americans will never go for public transit" and "Trains are 19th-century technology" and "Exurbia means freedom," we'd be ready for this eventuality.

[kimmerspixelated]

16. It's all gonna come back and hit them in the ass, once the

Rethugs and the oil speculators are exposed in kahootz! But I suspect that Prez Obama will help make things better-he must!

[kestrel91316]

27. "Car potatoes." Wish I'D been the clever one to think of that.

[Lydia Leftcoast]

34. Thank you, thank you

:takes bow:

I actually thought it up several years ago, when I was car-free in Portland and kept running into people who told me that three blocks was too far to walk--and they weren't old or disabled, either.

[kestrel91316]

36. I live in Los Angeles where ONE block is considered too far to walk.

So I can totally relate.

[AndyTiedye]

47. One Block of LA Probably Probably Contains a Freeway On-Ramp or Two

seven lanes and no sidewalks. Is it any wonder it's too far to walk?

[kestrel91316]

58. Nah, I'm in the burbs. Only one freeway in the neighborhood, and it's

away from the main drag. You DO have to dodge a number of crazy homeless guys, however. That's a turn-off.

[quakerboy]

79. I was in LA last week

One block is too far. How the hell do yall survive that sun for more than a few days? It made me want to migrate even more north.

[tama]

43. And eventually

and as of now, to tell the truth, Americans need to drop to about 1/10 - 1/20 from current standard of living, to the standard of living of a Chinese farmer.

But guess what, Americans will rather die than accept that - "American way of life is not negotiable!" - so die-off cannot be avoided.

[DogPoundPup]

19. Bush and McCain Happily Presiding Over Massive Transfer of Wealth to Oil Companies

Republicans are funneling billions into the coffers of their oil baron backers; it's no surprise Bush and McCain aren't pushing for renewable energy.
http://www.alternet.org/environment/89426/

posted this alternet article this morning ... http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=115&topic_id=157527&mesg_id=157527

[quakerboy]

80. My question:

Billions of what? As this kills the dollar, which drags other markets down, the money they made presumably becomes worth less and less in absolute terms. So who really profits from this in the end?

[bluevoter4life]

24. $200 by 2010?

Have they not been paying attention? My money is on oil hitting the $200 mark by year's end.

[AndyTiedye]

31. 2010? Try Right After the Election

[GliderGuider]

56. I certainly don't have Mr. Rubin's credentials, but here is what the numbers tell me:

Extrapolating recent price trends for oil hints at a range of $250 to $900 a barrel by 2012. I show the extrapolations here. The two key projections are shown in the following graphs:





If the ratio of the price of crude oil to the price of gasoline holds (and there's no reason to think it wouldn't), that could result in gas selling for $7.50 to $25.00 a gallon in less than four years. The lower end of that range isn't a realistic expectation at this point because the trend it's based on has been decisively broken in the last year and a half. On the other hand, the upper end of the range ($25.00) is also unlikely because such prices would probably induce a global depression. So my bet is on $15.00/gallon, just below the middle of that range.

IMO there is very little speculation built into today's oil prices - it's almost all (say 85%) fundamentals. This is what Peak Oil is all about.

[Beausoleil]

61. Even better

I predict 0 cars on the road on 12/22/2012. And oil will be free.

[Buns_of_Fire]

72. ...which is roughly three months BEFORE I'd be eligible for Social Security...

Figures. :shrug:

[carlyhippy]

63. wow, that would mean I would spend 35.00 a week on gas

as long as I don't have to go anywhere extra, yikes....

[wishlist]

65. So few cars on my formerly busy road tonight I was able to pick up litter safely

I used to never take walks or dare pick up litter in my lower middle income neighborhood on Friday nights (especially since my road became a shortcut to a Walmart Supercenter a few years ago.) But I have noticed a big decline in vehicle traffic, especially on weekends. Seems that pleasure driving and making unnecessary trips has dropped off drastically where I live. In a half hours time, only 3 cars went by instead of the usual 30 on a Friday night.

[Lisa0825]

76. I rarely drive aside from commuting now.

I live about 40 miles south of Houston, and most of my friends live in Houston. I used to think nothing of going up there once or twice a week. Now I figure one round trip costs me $12-15, depending on what part of town, so I only go about once a month instead. I also go grocery shopping on my way home from work, so most weeks I'm just a homebody aside from work. But I am also saving money (probably over $200 a month!) by not going out, so that's a plus!

[superconnected]

70. Far more companies with 4 day work weeks and telecommuting

Is what's going to happen.

The price of gas is driving wages up to so I fear more outsourcing will be in the mix too.

[Fairnessaboveall]

73. Let's nope not

That would be devastating.

[RUMMYisFROSTED]

75. Not so fast!

On TDS, Ted Koppel, having just returned from China, pointed out that the Chinese are putting 9M cars on the road a year and will have 300M cars on the road in a few years.

It's going to get ugly.

[JCMach1]

77. Gas was around $8 in germany!

It took $125 to fill my rental car. :(

[unkachuck]

78. to my....

....untrained eye, I'd say you're about to experience a major cluster-fuck....

"...gasoline prices to hit $7 (U.S.) a gallon...there will be 10 million fewer cars on the road..."

....don't you get it?....the corporate fascists are forcing a global melt-down....why? because you and 80 million more like you are about to retire....and the corporate fascists owe you alot of money....

....capitalists are devaluing your savings, your property, your investments, your neighborhood and even your lifestyle so that they will only have to pay you pennies on the dollar they owe you for the next decade....capitalism is not some fundamental natural organic system, it's a ponzi scheme designed to make corporations and their owners rich and you poor....

....don't be a chump, aren't you tired of playing capitalism yet?....there is a better socialist way....