PAA: Kristian Stipe

How Does oil price effect my day to day life, outside of driving a car?

Everything, and I mean EVERYTHING is affected by the price of oil. The food you get at the grocery story was grown or raised using farm equipment that runs on oil, then it is processed using oil based machinery, after that it is packaged, usually in plastic which is petroleum based, after that is it shipped in large trucks or trains that run on oil. From there it is placed into plastic bags (even paper bags are affected by oil) then taken home where it is usually cooked, which is powered by electricity which is usually, but not always, produced from oil based products. Food is not the only thing that goes through this cycle. Lumber for your house, the cloths on your back, the roads you walk on, and everything in between is all affected directly by the price of gasoline.

Since everything is affected by oil, I was curious if I could figure out the process of a single banana, from seed to the counter. Let's start with the workers there. They all have rubber soled shoes, polyester clothing, and rubber gloves, all of which are directly related to the price of oil. From there we move on the the banana itself. Once the fruit starts to appear on the plant they wrap it in a plastic bag coated with pesticides. Not only is the plastic bag a direct product of oil, pesticides are as well. After the bags are put on the entire field is sprayed with more pesticides, from a helicopter, running on gasoline. Right before harvesting, the works insert foam cushions between the bunches to avoid bruising; Foam is also a product from oil. After that the bananas are harvested and transported to the processing plant, where the bunches get cut up, washed, then washed again. Any bananas that didn't meet code are shipped to become baby food, or animal feed. The ones that do make it get a plastic sticker of the brand put on them, and from there they are packaged in plastic and cardboard. Once packaged they are shipped by boat to their location. Once they arrive they are shipped by truck to the grocery store. They are then placed into cooling cellars and await the shelves. Once on the shelves they are bought and driven home. Once home they can finally be eaten.

The more we consume the more gas prices affect you. With record high gas prices we are starting to feel the tightening grip of the oil companies around our way of living. When gas prices drive the price of everything we come into contact with daily, who is to blame for the rising gas prices? Is it our fault for being so dependent on fossil fuels for so long? Or does the fault lye with the oil companies for bringing in record profits, even in a very low economy. Or should we blame the government for giving the oil companies subsidies, even though they rake in more and more money every single quarter. I don't believe that the fault lies with any one aspect. They are all to blame. In America we complain about high gas prices and yet, when looking at Europe, whose gas prices have been $4-$8 a gallon for a very long time now, we don't see a trend that will soon apply to us. What will Americans do when the price of gas reaches 8 dollars a gallon?

When gas prices are $4 or more, when on average only 48 cents is tax. That leaves more than $3.50 that goes back to the oil companies. It's no wonder that the huge oil companies are making record profits.“The big five oil companies' profits for 2011 are: Exxon, $41.1 billion; Shell, $31.2 billion; BP, $26.1 billion; Chevron, $26.9 billion; Conoco Phillips, $12.4 billion. CEO bonuses are in the millions.” (Lichkay, 2012) In attempts to better their bottom line, oil companies have now started to export more and more oil to other countries because they can make more money elsewhere. When Europeans pay $8 a gallon vs our $4 a gallon, it makes sense why they would do that. On the other hand, when they export more oil than the US imports it drives our gas prices up.

Some things that affect gas prices are unavoidable. Things like Iranian President Ahmadinejad threatening to stop its flow of oil by blockading the Strait of Hormuz, Europe’s debt crisis, or the tension in the middle east all affect the price of gas, and no one group or person is to blame for those things.

Some people blame the President and his administration for the rising gas prices. Some say it is because he has refused additional drilling and pipelines to be put in place, but the fact is this has not effected out current production. “A projected drop in total domestic oil production this year should amount to six-tenths of 1 percent of all U.S. consumption of liquid fuels.” (Kiely , 2011) The only fault of this administration is leaving the oil subsidies intact. The oil companies get money from the government, just for being an oil company.

I would not put the blame on any one group, but all of them. The oil companies for charging an astronomical amount for the oil, the government for giving them tax breaks just because, and the consumer, for being so dependent on the commodity.

Now my question is, how can we make the change? How can we become less dependent on oil? One major thing that needs to change is Americas idea of recycling. Plastic bags take up 1.6 billion gallons of oil, every year, go to producing plastic grocery bags. What people don't realize is that they are 100% recyclable. We consume 380 billion plastic bags annually and only 1% of all plastic bags are recycled. That means 342 billion plastic bags are thrown away every year. “In 2001, Ireland consumed 1.2 billion plastic bags, or 316 per person. A plastic bag consumption tax, 37 cents per bag, introduced in 2002 reduced consumption by 90%. Approximately 18,000,000 liters of oil have been saved due to this reduced production.” Recycling would greatly start to help us become less dependent on oil, but it is only a small step.

If we want real change we have to do something huge. We need to be able to change our whole way of life. Hydro power, Wind power, Solar power, all of these things are very plausible possibilities, but the problem with those is, as of today they are not efficient enough to provide the amount of power that oil does. In order to be headed in the right direction we need to start developing better and better ways to collect green energy. Natural Gas is great but we will run into the same problem as we are facing now with oil. It will run out eventually and then we are right back to where we started. Instead of just giving away the subsidies to the oil companies, I think they should only be able to get them if they put a certain amount of money toward research of newer, greener energies. On a personal level, do things like driving a hybrid or taking public transportation, buying reusable grocery bags, making your home more energy efficient, growing some of your own food, if you can, and switching to electronic billing instead of paper bills. Ever little thing helps.

Bibliography

Steve, M. (2012, January). American petroleum institute. Retrieved from http://www.api.org/Oil- and-Natural-Gas-Overview/Industry-Economics/Fuel-Taxes.aspx

SCHLUETER, S. (2012, March 17). Answer man: Is obama, or somebody else, to blame for high gas prices? read more here. Retrieved from http://www.bnd.com/2012/03/17/2103693/who-is-to-blame-for-high-gas-prices.html

Kiely , E. (2011, March 24). Home • articles • is obama to blame for $4 gasoline? is obama to blame for $4 gasoline? democrats, republicans spin oil data in dispute over high gas prices.. Retrieved from http://www.factcheck.org/2011/03/is-obama-to-blame-for-4- gasoline/

Food democracy. (2008, July 16). Retrieved from http://fooddemocracy.wordpress.com/2008/07/16/plastic-bags-and-oil-consumption/

The journey of bananas: From land to your hand [Web series episode]. (2010). Youtube. Retrieved from http://www.youtube.com/watch? v=TV7tsXyq7ow&feature=endscreen&NR=1

Armah, P., Archer, A., & Phillips, G. (2009). Drivers leading to higher food prices: biofuels are not the main factor . Manuscript submitted for publication, College of Agriculture & Technology, Arkansas State University, Retrieved from http://www.springerlink.com/content/wh063731746866x4//fulltext.html

Lichkay, J. (2012, April 12). Know who's to blame for high gas prices?. Retrieved from http://articles.southbendtribune.com/2012-04-12/news/31333665_1_high-gas-prices-oil- prices-ideas-and-feedback