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President-Elect Barack Obama thinks we have an oil addiction and he wants to do something about it. That something is developing a plan for energy independence. While that might have seemed easier to discuss when oil was at $147 a barrel, Obama thinks it's even more important to talk about now, with oil hovering around $60. "It may be a little harder politically, but it's more important," Obama told 60 Minutes in his first post-election interview. Obama explained that our addiction to oil causes a mental transition from "shock to trance." As oil and gas prices go up, it creates "a flurry of activity." When the prices go back down, however, people seemingly forget, and "we act like it's not important. And, as a consequence, we never make any progress." He considers it an addiction and knows it needs to be broken. Our next top executive thinks now is the time to break it.

Along with energy independence, Obama also addressed the auto industry bailout, and GM's situation in particular. Acknowledging that a complete collapse would be "a disaster in this kind of environment," but he's not in favor of handing the industry a blank check. He feels that discussions with the Detroit Three should be focused on figuring out what a sustainable U.S. auto industry will look like so that the bridge loans the government is offering lead to a definable goal rather than being open-ended. Unlike some critics, Obama doesn't think the country would be better off if General Motors was allowed to go into bankruptcy. Unlike the situation with the airlines where they could restructure and reorganize and still operate during that process, GM could be cut off completely if it isn't helped out, potentially preventing it from continuing on.

You can read the transcript of the complete interview and watch the video here.

[Source: CBS News]

The US, and in fact the entire civilized world, is knee deep in a financial meltdown. However, crashing stock markets and crumbling banking institutions have led to one pleasant side effect. The price of gas is dropping faster than the NASDAQ. A quick trip through south-east Michigan shows that gas prices have dropped below the $3.00 threshold, and tumbling crude prices show that even cheaper petrol is on the way. A barrel of oil now costs $77.70, which is in stark contrast to the $147 per barrel crude in July that lead to $4.25 per gallon gasoline. That's a drop of nearly $9.00 today alone, and OPEC has scheduled an emergency meeting to try to halt the precipitous drop of black gold. And since we're paying under $3.00 per gallon for oil that was purchased last month, that means we won't bear the fruit of the recent drop in crude until November.

While many of you were with us in praying for this drop, it's coming at a huge price. Gas is becoming more affordable because a set of Texas-sized Brembos put the brakes on energy use, but at least it's cheaper. At this rate, if the get depressed about the economy, we can afford to go for a quick ride without having to take out another loan on our crashing mortgages.

[Source: CNN Money]

Simply put, the U.S. economy is in the crapper. Stocks are yoyoing and our mortgages are a fraction of what they were even a year ago. For all that's fiscally wrong here in the States, there is one pleasant side effect: the price of a barrel of oil is dropping faster than Kimbo Slice against a two bit hack. Oil dropped 6% in trading on Monday, bringing down the price of a barrel of crude to $87.81. Black Gold has been on a downward trajectory since July 11, when it peaked at $147 per barrel. Since then, demand has weakened both in the U.S. and China, with demand slacking so badly that the Communist government hasn't purchased any oil in two months, and it's even selling some of its stockpiles.

While demand for oil is down to where it was eight months ago, OPEC is watching with a wary eye. The oil consortium, which on several occasions has increased oil production over the past year, is likely to slash production when it meets again in December. In the short term, industry experts are predicting that gas prices will drop below the $3 mark by November 1, which will make for one piece of good news in an otherwise lousy news cycle.

[Source: Reuters]

The price of crude oil dropped below $100-a-barrel yesterday (its lowest level since February) as the slowing economy -- bringing with it a reduced demand for oil -- raised concerns. Interestingly enough, the drop in crude didn't affect the price of gasoline as it rose 16 cents per gallon due to refinery closures from Hurricane Ike. The storm only caused moderate damage to oil platforms, but more than a dozen Texas and Louisiana refineries were shut down or idled ahead of the storm. It was just July when crude oil prices peaked at just over $145 per barrel, and gas prices neared $5 in many parts of the country. The high cost of fuel over the summer stymied drivers, who cut back on consumption forcing the price of oil to slowly retreat. Analysts who predicted doom ($200-a-barrel by the end of the year) are now scaling back their forecasts, and some have even predicted crude may eventually drop to $70-a-barrel. While we obviously welcome any drop in the price of crude, it's the volatility -- the sharp fluctuations as a result of market conditions -- that we would also like to see addressed.

[Source: New York Times, Photo by ADEK BERRY/AFP/Getty]

There's been a lot of head-scratching about the exact cause of the meteoric rise in price for a barrel of oil. Are speculators driving it to turn a quick buck? Is it the weakening value of the U.S. dollar? How about increaded worldwide demand? Chances are, all those forces are playing a part in the rise of fuel prices, and no single solution is likely to fix the problem.

Just as it was starting to look like prices would rise on a daily basis for the rest of eternity, the price of a barrel of oil dropped by $16 from Tuesday to Thursday. Economists point to the dismal economic and inflation news as a main factor for the drop. All we know is that ever since gas got more expensive, everything else started to follow suit. That leads us to spend less on things that we don't absolutely need, which probably isn't good for the economy.

With news of the large drop in the price of a barrel of crude, Wall Street got all excited and responded with a couple days of very positive gains in the stock market. Good news, right? Well, oil jumped by over $2 on Friday morning alone, so we'll have to see. Is the $4 per gallon nightmare almost over? Probably not, but we can hope.

[Source: Yahoo, Photo: Getty/Justin Sullivan]

It's a complex issue, this business of oil. With stock markets and unemployment numbers taking their lumps, civilian unrest at oil and food prices, and politicians weighing in with all manner of cures and pronouncements, the Group of Eight nations got together to try and figure something out. The result: they want oil producing companies to produce more oil while they work on creating oil-independent fuel sources.

It's the equivalent of Wimpy saying to Popeye, "For a hamburger today I will gladly pay you on Tuesday." The G8 nations, including the U.S., want more of the black stuff to see them through this rough spot. In the mean time, all countries but Germany pledged to begin exploring nuclear power and building reactors, and examining technology like carbon capture and storage. Think of carbon storage as a sealed, underground landfill for coal plant emissions. If they can get it to work -- and find the space -- they can use more coal without creating more emissions.

An OPEC representative said there would be no decision on any production change until it convenes its next meeting in Vienna on September 9. In the mean time, the retail price of oil has passed $4 nationwide in the U.S. for the first time ever, and you can probably expect to pay more for gas as each week of summer passes.

[Source: Detroit Free Press]

A scientist in the U.S. Department of Energy's science and energy research unit has said "Energy independence is a realistic goal for the United State of America," by 2030. There are, of course, a few caveats to that. First is that by the word "independence," he doesn't mean not using any oil entirely -- he means getting oil consumption down to a point where our usage is "not subject to restraining or directly influenced by others as consequence of the need for oil."

That, Greene says, is an issue of economics, not one of politics or the military (inasmuch as they can be separated). The key is to get the cost of importing oil down to one-percent or less of the U.S. GDP, which, by the way, is where it was during the heady we-can-take-baths-in-oil-there's-so-much-of-it decade of 1990-2000.

Greene thinks the Energy Independence Security Act will be the guide leading the way to this kind of oil independence, due to the CAFE increase, decreased demand for thirsty vehicles, and increased production and demand for biofuels and alternative energy cars. So now that the oil situation is licked, the only thing you'll need to worry about come 2030 is paying $12 for a cob of corn.

[Source: WardsAuto]

Don't like the weather? Just wait, it'll change. Don't like gas prices? Just wait, they'll change, too. But if the weather brings a hurricane, some experts say gas prices could hit as high as $6 a gallon.

NOAA has predicted as many as nine named storms this season, with five of those possibly reaching major status. One expert in a CNN story says that a typical hurricane will shut down an off-shore oil rig and interrupt supply lines for as long as two weeks. If even one of those damages Gulf of Mexico drilling rigs, you can bet the crude markets will go nuts, and today's black gold and $4/gallon gas will seem like a bargain.

The good news? Hurricane season ends Nov. 30. If we make it to December with no major hurricanes, we might see oil and gas prices fall. Maybe.

[Sources: CNN, NOAA]

After months of outrageous oil price spikes, we realize that the shock value of $100 to $105/barrel is fading fast, so we're going to skip ahead to $200/barrel. The finance wizards at Goldman Sachs have raised their outlook for 2008-2012 oil prices by $15 to a high end of $135 per barrel, but a major disruption could make matters much worse. How bad could it get? Goldman Sachs seems to think a spike to $150-$200/barrel is a possibility.

Goldman Sachs correctly predicted in 2005 that oil prices would reach the $50-$105/barrel level, and it thinks there's a chance that prices could drop down again, but inventories would have to rise over a couple years for that to happen. We can hope, but we won't hold our breath.

[Source: MarketWatch]

According to a study by the Energy Watch Group (EWG), all of you Mad Max fans out there might get the chance to live the movie if oil production continues to decline. The oil industry believes Earth's oil reserves can last about another 42 years at current pumping rates. Energy Watch, basing its conclusions on actual rates of production, says that oil production has declined since 2006 and will continue to do so -- by 2030, oil production could be half of what it is today.

The situation we're headed for -- and that some predict as soon as next year -- is called "peak oil." That means that although plenty of oil is still being pumped and sold, there isn't enough of it to go around. And that means the possibility of "widespread blackouts, the virtual collapse of transportation infrastructure in industrialized countries and a shortage of petroleum-based chemical fertilizers necessary to grow most of our food." And that means war, famine, pestilence, and hunger. A situation that is otherwise known as "deep doo-doo."

Of course, the caveat to all of this is that no really knows how this is going to play out. Long-range predictions have a way of being false as often as they're true (paperless office anyone?). We aren't suggesting that EWG is wrong, and we aren't saying that we don't need to be a lot smarter about our resources... but a lot is going to change between now and 2030. Who knows -- if a $30,000 Volt arrives in 2010, we could get another hundred years out of our oil supplies. Nevertheless, in case a Road Warrior future is in store, you might want to start practicing your lines now. Say it with us: You can run, but you can't hide!

[Source: Green Daily]