High gas prices force some to find other transportation
October 3, 2005
In the wake of Hurricane Katrina, 95 percent of oil production and about 85 percent of gas production in the Gulf of Mexico was halted. Damages from Hurricane Rita are still being assessed as well.
High prices have left consumers looking for other ways to get around.
Economics professor Stephen Karlson said he has seen a change in the DeKalb community.
“Drivers have already been making substitutions. I’ve seen a lot more bikes on campus this fall, and a lot of parents are asking their kids to use the school buses rather than haul them around in minivans,” Karlson said.
Karlson gave testimony Wednesday to the House Republican Task Force on Motor Fuel Prices. He stated the reasons for higher prices and what substitutions can be made.
He said the recent hurricanes are only a temporary problem. The damage will be repaired, workers will return and companies will compete once more for customers.
An Exxon Mobile press release reflected that Tuesday.
“Within two weeks, all major import facilities and product pipelines were operating at full or only slightly reduced rates. All but about 5 percent of U.S. refining capacity had returned, and all but 15 percent of U.S. oil, and 6 percent of gas production, had been restored,” said Rex Tillerson, president of Exxon Mobile Corporation.
Karlson’s main concerns centered around India’s and China’s growing need for more oil. As the countries demand more, prices rise.
“The real permanent reason is the economic growth elsewhere, with India and China, in particular, increasing their fuel use of all kinds, as well as replacing coal and wood with petroleum products,” Karlson said.
Although the price at the pumps returned to pre-storm levels, consumers worry about larger, more permanent effects.
“The hurricane was just icing on the cake,” junior economics major Terrance White said.
Due to rapid demands in China and India our supply has diminished. Prices have increased, except for the recent drop in price after the U.S. government released part of the nation’s oil reserves. The prices should stay stable for the time being, but the nation needs to find alternative energy sources, and people need to change their driving habits and learn how to conserve fuel, White said.
Asia’s demand is likely to increase, which leaves the U.S. the opportunity to discover fuel substitutes.
Illinois has been researching the use of ethanol from corn. However, this incurs other costs such as fertilizer, pesticides, and machinery. Foreign researchers such as those at the Weizmann Institute in Rehovot, Israel have also found energy through the extraction of hydrogen from zinc compounds.
“Alternatives to fossil fuels might have their value, but taxpayers ought not be swayed by special pleading, whether from the ethanol coalition or petroleum interests,” Karlson said. The technology is still not viable for widespread use.