What’s wrong with cheaper oil?

After months of record prices the cost of oil has been falling, today the oil producers’ group OPEC has announced its cutting production in order to stop the plunge.

On Newshour today we want your reaction – The price of oil has dropped but have you seen a difference at the pump? Is OPEC justified in its decision? What’s wrong with cheaper oil?
We’d like to record your comments and questions for our lunchtime programme. Let us know if you’d like to get involved.

36 Responses to “What’s wrong with cheaper oil?”

  1. 1 rick
    September 10, 2008 at 10:04

    the only thing that has ever reduced consumption of gas/petrol is high prices. All the preaching about climate change has done nothing. So long as it’s cheap, there will be no change in our habits.

    bring on $200 a barrel and save the planet.

    or we could continue to conserve and find alternatives and really stuff OPEC up.

  2. 2 Pangolin- California
    September 10, 2008 at 10:05

    Cheap oil is like cheap ice cream. You use to much when you would be better off learning how to do without.

  3. 3 rick
    September 10, 2008 at 10:08

    high prices are the only thing that reduces consumption

    bring on $200 a barrel so we get serious about alternatives and leave OPEC behind

  4. 4 Bob in Queensland
    September 10, 2008 at 10:23

    The other thing about more expensive oil is that it makes alternative energy sources far more economically viable. If oil gets too cheap the incentive to develop other sources just isn’t there…and I have little faith in mankind to stop using oil just because it’s a good idea.

    To answer the other half of your question, the pump price here in Queensland is fairly reactive to the crude oil price. At our local petrol stations, from a high of around $1.60 per litre we’re back down to about $1.38. This isn’t quite the full 1/3 off but of course a fair chunk of the price is a flat rate tax that doesn’t change.

  5. 5 Jack Hughes
    September 10, 2008 at 10:27

    What’s with you people ?

    Bring on cheaper oil. Yes please. Yes sir.

    Feel free to pay more yourselves or stop using it – but cheap oil gets my vote.

  6. 6 rick
    September 10, 2008 at 11:29

    @Jack Hughes
    so what’s the point of me stoping if you just carry on sucking it up? We only got one planet. Your polution is my polution the same as China’s polution belongs to everyone who buys Chineze made crap.
    The only thing people understand their own hip pocket.

    So why do YOU think cheap oil is a good thing?

  7. 7 Bob in Queensland
    September 10, 2008 at 11:39

    @ Jack Hughes

    I’m afraid “cheap oil” isn’t on the ballot paper. The actual choice is between “expensive oil” and “even more expensive oil”.

    We may as well get used to it and, as quickly as possible, find ways not to use it at all.

  8. 8 Jessica in NYC
    September 10, 2008 at 11:58

    I am thankful that I live in NYC and do not have to directly deal with daily fuel cost as my fellow Americans who have cars. New Yorkers feel the effects in our pockets with our food and goods cost as they keep increasing.

    I welcome lower oil prices, but not at the expense of our planet or creating alternative energy sources.

    @ Pangolin, Rick and Bob— LOL

  9. 9 steve
    September 10, 2008 at 12:15

    “the only thing that has ever reduced consumption of gas/petrol is high prices. All the preaching about climate change has done nothing. So long as it’s cheap, there will be no change in our habits.

    bring on $200 a barrel and save the planet.

    or we could continue to conserve and find alternatives and really stuff OPEC up.”

    Yes, and a destroyed economy and mass unemployment is going to help who exactly? I know you might think greenhouse gasses are the worst thing never, but say goodbye to international travel, business, industry, everything. Price you are prepared to pay?

  10. September 10, 2008 at 12:46

    Lower oil prices would be disastrous for Iran which is already broke. Over-expenditure, waste of precious Forex revenues, rising cost of oil exploration and lack of foreign investment have drastically reduced national oil income, Iran’s only source of foreign currency. Oil and gas revenues for the financial year ending March 2008 totalled US $78.8 million, not much for a nation of 72 million. The government i supposed to feed, clothe and house the entire nation with this money. Without any any other source of Forex revenues, how is it going to do that?
    Having said that, the private sector can make ends meet and find Forex to pay for imports but not the government. No money, no government, it is as simple as that. Government owns 80% of industry, much of it at a standstill. Government employs 35% of the work force, including Armed Forces, teachers, hospital staff etc.. They haven’t been paid for the last six months. Ministries have been ordered to sell property and real estate in order to generate liquidity.
    There is little supervision or efficiency in the oil and gas sectors. Many agencies, including the Guards Corps, the Leader and various foundations run their own independent drilling, refining and sales operations, pocketing the proceeds.
    Finally, clumsy and outdated buy-back oil contracts have failed to generate interest and lure oil majors to Iran. Tehran may get by a little longer by selling oil on the spot market, but only if prices remain high.

  11. September 10, 2008 at 12:52

    Whats wrong with cheaper oil….. hhhhmmm…..

    Less of a financial incentive to live more efficient lifestyles. The cheaper the oil, the more idiotic ways we’ll waste it (See 90’s-2000’s and the SUV / Truck market, see suburban sprawl, see the ignoring of rail infrastructure and emphasis on road transport).
    The more expensive the oil, the more people will be motivated to get off their bums and change the way they live (take a look at current gas prices and the correlation between urban housing prices, even with the housing debaucle, take a look at the sales of Prius and other hybrids as opposed to when they were first introduced to the US market).
    “Oh but people will change on their own free will, we need to keep oil cheap and buy time for people to change” Yea, we waited those 3 decades after the last scare, all we did was get complacent and stupid in our use of resources.

  12. September 10, 2008 at 12:57

    *looks forward to holiday time and seeing gas prices shoot through the roof 🙂 *

  13. 13 Lauren
    September 10, 2008 at 15:52

    The world has become more aware and accepting of the global warming argument so the recent push for alternative fuel, energy, etc isn’t solely related to cost. The hybrid car trend is already here and most car companies are utilizing that technology in the newer car models- cheaper oil doesn’t necessarily mean that gas guzzlers will be back in style. Less gas used (no matter how cheap) still saves you money.

    Also, the increase in oil prices has lead to an increase in food costs which everyone is feeling. Sure the oil industry may feel a “pinch”(the cost per barrel jumped from around $40.00 in 2000 to $120.00 in 08′ so I’m sure they’re suffering financially right now!) but consider all the businesses that had to cut jobs, scale back (or just went out of business) to cut costs. The economic crisis started when oil costs sky rocketed so I have to call into question how preventing the cost of oil from dropping will fix anything.

  14. 14 Taban Alfred David
    September 10, 2008 at 16:40

    It is good News to the users of the oil but a big blow to the oil manufactures,
    Like Midol East, Eastern Asia and Northern Africa, I
    like it to get more cheaper then that, to enanble transportation to its lower ticket

    Sudan/ Juba

  15. 15 Jens
    September 10, 2008 at 17:01

    when will we have a fuel efficient $WD, since i need one. the current ones are OK, but at a substantyial crazy price, but not much better than what i get right now……

  16. 16 Dennis @ OCC
    September 10, 2008 at 17:25

    I have no problem with cheap oil….


  17. 17 Bert
    September 10, 2008 at 19:59

    Lots wrong with cheaper oil, most importantly that it gets people to behave in their customary, self-indulgent, waste-with-abandon, who-cares-about-tomorrow ways. And oil is very slow at regenerating itself, so it should be conserved. For practical purposes, it is a non renewable resource.

    And it makes us reliant on unsavory regimes, with unreliable poltical systems and an undereducated citizenry.

    I don’t buy the global warming argument, though. Yes, global warming is apparently occurring. No, the human contribution to the overall daily exchange of CO2 in the atmosphere seems way too small to be making a difference. Look it up. Not to mention, CO2 is perhaps not even the right gas to be worrying about.

    And don’t be misled by those who just assume that CO2 levels cause global warming, as opposed to the other way around. Or those who assume that a warming trend, after the industrial revolution started, was caused by the industrial revolution, as opposed to being a very long term cycle that has occurred for at least a couple million years.

  18. 18 Bert
    September 10, 2008 at 20:35

    I meant BILLION years, not million.

    In terms of the likely success of humans turning around the current warming trend, I’d suggest these articles:


    which shows weighted human contribution to greehouses gases to be 3.3 percent of the total.


    which makes the point that water vapor is far more powerful of a greenhouse gas than the others combined. And that if water vapor is added to the mix, human contribution now falls to 0.28 percent of the total.


    which seems to agree closely with the above two.

    But I do believe that if people need to mouth the “global change” mantra in order to act like responsible beings, then by all means let’s chant it together. The end result is still good, even if the reasons are way off base.

  19. 19 Jens
    September 10, 2008 at 21:06


    let us debunk your webpages.

    1) geocraft is a project sponsored by PhilipsConeco, hardly a company that is neutral when it comes to CO2 out put, since they fleec us for billions of dollars, so that we carry non poluting the world

    2) this web-page also clearly shows that we have a dramatic increase of CO2 from 280 to 377 ppm. furrthermore, i would like to draw your attention the colums that lists plenty of other grenhouse gasses a ZERO prior to 1750 and have some values for nowadays. lastly where did you get the water vapor data from. it is not listed in the table?

    3) this article is humbuck and just masquardes as science. it has not been peer-review and is purely a propaganda article. i personally could write something diametricaly oposed and make it look like a real science article, withouyt having the slightes bases to do so. DO NOT BE FOOLED BY THIS ARTICLE. it states 30000 plus scientist have signed the petion. i wonder how many of them are qualified to make a statment about this topic. all you need is to have a bachlor to do so, and even that does not get checked. any idea how many millions of americans have a bachlor????? thought so, 30000 is an infinite small number of the total…..

  20. 20 Bert
    September 10, 2008 at 22:05

    I agree totally on the OTHER greenhouse gases point, by the way. However, the point about the increase in CO2 after 1850 is that CO2 was not constant before 1850.

    CO2 happens to be the fourth most abundant gas in the atmosphere, with or without humans, so it seems odd that Al Gore got so hung up on it alone. Although CO2 is still a small fraction, compared with N2 and O2 for instance.

    And also, while I remain very skeptical that we will cause a climate CHANGE by reducing CO2 emissions, even if we abolished CO2 entirely from human sources, the goals are nonetheless very good, IMO. Anything that gets the ridiculously wasteful SUVs and pickup trucks off the road is fantastic, as far as I’m concerned. Anything that stems the deforestation tide is equally good, of course.

    Also, SUVs and pickups will remain wasteful no matter how miserly the engine is, simply because they have a huge frontal area, creating lots of drag. That’s part of their SUPPOSED appeal. Car and Driver used to publish a very useful figure: horsepower required to go at a given steady speed, and I believe that was 50 mph. That figure tells it all. I wish they still published that number.

    Me, I get road rage whenever I see those behemoths on the road.

  21. 21 Lauren
    September 10, 2008 at 22:33

    @ bert

    An increase in CO2 emissions have contributed to a surface temp. increase which results in an increase in water vapor. Water vapor is a greenhouse gas but one that in a short period of time condenses into clouds which can also prevent solar radiation from reaching the Earth’s surface. You want to blame clouds for global warming?

    Yes, there are naturally occurring greenhouse gases- they’ve been in existence since the world began, but that’s the point. They’re natural. The planet’s been dealing with them for billions of years. CO2 emissions from human activities have are not natural so people have pretty much been dumping a heap of crap into the air that normally wouldn’t be there (or at least not in such large amounts).

    Oh, and that garbage at the end of that petition about how the earth is flourishing and greener than ever clearly haven’t heard about the droughts that have been occurring in the rainforests for Pete’s sake

  22. 22 Bert
    September 10, 2008 at 22:57

    Lauren, all you say I can agree with, but it misses the point.

    If humans create a certain amount of emissions, it is important to see if that’s large compared to other, natural sources, or whether it’s small.

    So there are in fact gases OTHER THAN CO2 that humans create in large qunatity, compared with natural sources. Why aren’t we paying attention to them, more so than to CO2, of which we create a small fraction?

    Also, these debates always make me want to ask, do you take public transportation for your daily commute? If not, why not?

    I’ve been doing so for decades, and yet the very, very vast majority of my neighbors and my co-workers do not. I know they have the same option I have, so it just makes me wonder, if you know what I mean. They always have convenient excuses. In sum, the excuses are that they won’t use public transportation unless it causes absolutely zero incovenience for them. But no one said cleaning the environment would come for free, right? If it doubles your commute time, suck it up. Read a book.

  23. 23 Jack Hughes
    September 11, 2008 at 01:17

    If Marie Antoinette was alive today she would drive a Toyota Prius and eat organic cake.

    She would tell the peasants that rising fuel costs, skyrocketing food prices, and bubbling unemployment was good for them. For some reason.

  24. 24 Bert
    September 11, 2008 at 01:45

    Somehow, the Marie Antoinette analogy doesn’t work all that well. Until gasoline reached close to the $4.00/gal level, more or less, all the peasants you mention were out there buying very inefficient, huge coaches, which needed a team of horses to drag them along. They weren’t riding to work on a single horse, nor were they (heaven forbid!) walking. These peasants were just spoiled brats. Not the downtrodden we associate with Marie Antoinette’s time at all.

    More than half of vehicles sold to private individuals were trucks, SUVs, and vans, if you can wrap your head around that factoid. That was not going to stop, no matter how much hand-wringing from those who do the talking. Even Al Gore among them, by the way, until he got shamed into practicing what he was preaching.

    It took high gasoline prices to knock some sense into people. And having had sense knocked into them, consuption suddenly plummeted. Says to me, people were being amazingly wasteful just a few short months ago, eh?

    And I am totally convinced that if prices go back to the $3.00/gal level, everyone’s going to rush to the obese SUV market again.

  25. 25 Jack Hughes
    September 11, 2008 at 10:17

    Hi Bert,

    Can you please tell us what the correct lifestyle looks like ?

    Does it include any cars at all ? Hot water ? Imported food ? What about watching TV – is that kosher – or is it dangerous to the environment ? Holidays ? What kind of clothes are allowed ? Birthday presents – are they OK ? Or too frivolous.

    I am curious to know because I once lived next door to an eco-man and it looked very bleak. His wife left him after 2 years of austerity. I admired him for living his dream – but it was unfair on his children. My wife used to give them secret chocolate treats when he wasn’t looking.

  26. 26 rick
    September 11, 2008 at 10:27

    @ Steve
    Saving the planet is going to cost too much? Good logic!
    We will make some adjustments and survive and move on in a cleaner healthier world.
    We might have to give up the odd flight to Canada or Europe but it will be worth it.
    @ Jack
    You got kids?

  27. 27 rick
    September 11, 2008 at 10:33

    @ Jack
    Did you know that almost all chocolate sold in the world comes out of West Africa and that most of it has a child slave labour component in it? None of the major chocolate producers can claim their prduct to be slave free.

  28. 28 rick
    September 11, 2008 at 10:49

    @ Jack re: lifestyle
    I think what is required is that we concider the consequences of our consumption and buy wiser. buying local, maybe putting in a solar hot water heater instead of a pool, eating less meat, having smaller cars and actualy organizing our trips to avoid waste, recycling where possible.
    We don’t have to act like pigs at the trough just because we can. Unfortunatly most of us will only respond to price incentives.

  29. 29 Jack Hughes
    September 11, 2008 at 11:11


    Can you be specific, please.

    Saying “smaller cars” might make you feel good – but is having a car at all OK ? And if so please tell me what model to pick.

    How much meat am I allowed per week ?

    What about holidays – are they OK ?

  30. 30 Jack Hughes
    September 11, 2008 at 11:29

    It’s like a game of riddles:

    I ask how far I am allowed to drive and the greenies say “fewer miles”.

    I ask what size car – they say “smaller”.

    I ask how much choccie – they say “less”.

    And yes I have got children and I want a nice future for them and all other children. No I am not in the pay of Big Oil. Sorry about my wife sneaking the chocolate treats.

    I am just asking some simple questions that nobody seems able to answer.

  31. 31 Bob in Queensland
    September 11, 2008 at 11:37

    @ Jack Hughes

    It’s not complicated. The answer is simply that every small reduction helps.

    Yeah, in the ideal world nobody would burn any carbon fuel but only the most hardcore “greenies” (your word) are advocating anything that drastic. However, if everybody burned 10% less petrol/gasoline and everybody used low energy light bulbs and everybody turned their heating down a degree or their A/C up a degree all these little changes would make a big difference.

    In my house it’s me who sneaks the chocolate but I go for the bitter, dark variety.

  32. 32 Jack Hughes
    September 11, 2008 at 12:05


    You still haven’t said what we need to do. You just say we need to do more.

  33. 33 Lauren
    September 11, 2008 at 14:51

    @ bert

    I’m sure there are other greenhouse gases that humans produce that are harmful, but I’m not sure what they are, which is my fault. That point aside, COS emissions are produced by things people use/do on a daily basis and could be reduced by lifestyle changes and a more emphasis on developing alternatives.

    As for me, I’ve been taking public transportation for over 10yrs and sometimes it has doubled my commute time, but that’s what music’s for (I get car- or bus- sick easily so reading is out of the question 😉 )! At this point I still don’t have a driver’s license and I consider 5 miles each way to be within walking distance.
    My only problem with public transportation (@ least in MN) is that they have increased rider ship but they keep increasing the fare but not increasing the routes.

  34. 34 Bert
    September 11, 2008 at 21:10

    The “correct lifestyle” is simply one that isn’t extreme. Even the ancient Romans knew this: “In medio stat virtus.”

    It is very hard to feel sorry for the downtrodden peasants of our day, who feel the need to drive themselves to work in 6000 lb SUVs alone. Or who move out to the exurbs just so they can afford to live in a 3500 sq ft home, with associated heating and cooling, and commuting, energy costs.

    We can learn to live with $4.00/gal gasoline very well indeed. Or do you believe that Europeans, who pay close to twice that, are living like monks?

    The very simple truth is that people will not take any measure to conserve, no matter how much doomsday talk comes from the habitual talkers like Al Gore. People do like to put on a nice facade, of course, blathering on about how important the environment is to them. It’s therapeutic. Mkes us feel like “we care.” Unless we are hit in the wallet, most of us prefer to believ that “the govt” can fix the problem, with absolutely no effort on our part, and no impact to our lives.

  35. 35 Bert
    September 11, 2008 at 21:22

    About carbon based fuels, other than H2, all of them are hydrocarbons, aren’t they? Even ethanol is a hydrocarbon. Fossil fuels are no different from other fuels in that regard.

    If there’s any difference among them, it’s that some create more CO2 per energy unit generated than others do. However, CO2 is the natural byproduct of PERFECT combustion, not some pollutant. It is the byproduct of all breathing life forms, including plants when there’s no sunlight.

  36. September 28, 2009 at 07:56

    thanks for the article… its, very interesting indeed….

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