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News Flash: We're Running Out of Oil. Get Used to It.

By Warren Brown
Sunday, May 28, 2006

There is no cheap gasoline.

Accept that.

Now get on with your Memorial Day weekend and summer travels, and have a good time.

I'm serious.

End the silliness. Stop worrying about whether gasoline will go up to $4 a gallon. It will. In some California communities, the price is already there. Stop running around all over the place wasting time and the gasoline you have looking for fuel a few cents a gallon cheaper. What's the point? You save 10 cents and lose 10 minutes. You can always find another 10 cents. What about the 10 minutes?

And while you're at it, stop listening to those goofy TV news reports about "price gouging," or "finding the cheapest gasoline," or about worried consumers switching to hybrid cars. It's all ratings hype that has little to do with reality.

Take the hybrid car thing. Gas-electric hybrids constitute barely 1 percent of the nearly 17 million new cars and trucks sold in the United States. They are a marginal percentage of the fleets of Toyota Motor Corp., Honda Motor Co. and Ford Motor Co., the three major car companies that make them. Hybrid battery and related technologies are changing so quickly, the hybrid vehicle you buy today might not be the one you'll want to keep tomorrow.

There is also the matter of fiscal common sense. I've grown weary of people who owe more on their current car than it's worth asking me about the feasibility of trading in their automobile for something more fuel-efficient. Doing that is neither feasible nor sensible. Here's why:

Presumably, your goal in getting a less fuel-thirsty car is to save money. But how can you save money by wasting it? Do you think a dealer is going to give you the new car free? Do you think a bank or financial company is going to forgive the debt on your current car? Do you believe the bank or other financial institution will allow you to roll that existing car debt into a new auto loan at an annual percentage rate that is disadvantageous to the lender? Are you serious? Get real!

Here is the hard truth:

Oil is running out.

It probably will not disappear before many baby boomers and their immediate progeny run out of life. But it will disappear.

Every oil company knows that.

Every major automobile manufacturer knows that.

Every politician who got a decent score on a scholastic aptitude test knows that.

President Bush and Vice President Cheney and all their aides know that.

Oil is running out, and it is running out as global demand for available energy resources is growing rapidly. That means per barrel prices and pump prices are going up and will stay up.

All influencing externalities -- global terrorism, political unrest in oil-producing nations such as Nigeria, refinery disruptions caused by Gulf Coast storms, the odd and often suspicious behavior of oil futures markets -- are important. But not one of them changes the essential fact that oil is running out.

So, stop wasting your time worrying about pump prices. If you don't have enough money to hit the road and buy all of the hamburgers and trinkets you want, sacrifice some of the hamburgers and trinkets. If you are in a vehicle that uses lots of gasoline, look at how much you owe on the thing and do the math. You might be better off keeping it and driving less. Ever consider using the Metro?

Do you have a recreational vehicle, a motor home? I love those things! My fellow RVers love them. You know what? High fuel prices, or not, we're still going to roll this summer. We're just not going to roll as far and as long as we used to roll, but we're going to roll!

And when we get back, we're going to put pressure on Congress to do something real for the American people. Enough of this meaningless showmanship of putting the Federal Trade Commission on the dock in search of "price gouging" that no one ever really expected to find. That's just a ruse. We want something real. We want a national energy policy that deals firmly, fairly, sensibly with the reality that oil is running out.

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