An efficient new car and/or a move will typically cost thousands, so there isn't a huge amount of elasticity there. Assuming people can do the numbers, the pain has to be severe before they're forced to change. Also a lot of oil goes to industry, which is even less flexible.
So I'm not expecting prices to decrease. It's going to be months before demand reduction in the West has an effect on price, and it's not clear that China and India won't make up the slack regardless.
People are getting tunnel vision.
BEIJING, April 29 (Xinhua) -- Soaring oil prices have not slowed China's consumption of oil as statistics show that China's apparent consumption of crude oil and refined oil products both hit record highs in the first quarter of the year. According to statistics released Tuesday by the China Petroleum and Chemical Industry Association (CPCIA), China's apparent consumption of oil products composed of gasoline, diesel and kerosene rose by 16.5 percent year on year to 52.73 million tonnes in the first three months, and crude oil, rose by eight percent to91.8 million tonnes. The "apparent consumption" represents the sum of net imports and output and could be taken as an index for the real oil consumption excluding inventory. The growth of oil products consumption was a record high and much higher than the same period of last year, which was only 3.6 percent, said Shu Zhaoxia, professor of the Economics and Development Research Institute of China Petrochemical Corporation (Sinopec Group). Sinopec Group is China's top oil refiner. The growth of crude oil consumption was 2.5 percentage points higher than a year ago. State ceilings on prices of domestic oil products was the major reason contributing to China's surging oil consumption in the first quarter.
BEIJING, April 29 (Xinhua) -- Soaring oil prices have not slowed China's consumption of oil as statistics show that China's apparent consumption of crude oil and refined oil products both hit record highs in the first quarter of the year.
According to statistics released Tuesday by the China Petroleum and Chemical Industry Association (CPCIA), China's apparent consumption of oil products composed of gasoline, diesel and kerosene rose by 16.5 percent year on year to 52.73 million tonnes in the first three months, and crude oil, rose by eight percent to91.8 million tonnes.
The "apparent consumption" represents the sum of net imports and output and could be taken as an index for the real oil consumption excluding inventory.
The growth of oil products consumption was a record high and much higher than the same period of last year, which was only 3.6 percent, said Shu Zhaoxia, professor of the Economics and Development Research Institute of China Petrochemical Corporation (Sinopec Group). Sinopec Group is China's top oil refiner.
The growth of crude oil consumption was 2.5 percentage points higher than a year ago.
State ceilings on prices of domestic oil products was the major reason contributing to China's surging oil consumption in the first quarter.
In the previous energy crises in the U.S., the problem was not one of high prices but of unavailability. It didn't matter how much money you had, there simply wasn't any gas at the gas station.
In that case, the cost of a newer car is irrelevant.
Price controls-> shortages.
There were no price controls during the second oil crisis in 1979, and there were no shortages either. Peak oil is not an energy crisis. It is a liquid fuel crisis.
But then again, absence of price controls creates by-wealth rationing.
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
So you'll get a milder form of by-wealth rationing - one in which the people who are flat out of luck are at least compensated for their being flat out of luck.
Did I miss anything?
After all, no citizen has an innate claim to more of the stuff than any other, given that it's all imported and thus heavilty dependent on public infrastructure and institutions to be available to us... In the long run, we're all dead. John Maynard Keynes
Fairness we get through the progressiveness of the income tax system. Peak oil is not an energy crisis. It is a liquid fuel crisis.
