Gashostage.com

AIR passengers will be charged up to £40 extra for a return ticket within Europe to pay for the environmental impact of their journeys, under plans approved by the European Parliament yesterday.
MEPs voted in favour of the “immediate introduction” of a tax on jet fuel for flights within the 25 member states of the EU. The charge would double the cost of millions of budget airline flights.
 
They also accepted a recommendation for a special emissions trading scheme for the aviation industry, which would see airlines buying permits to cover their output of carbon dioxide.

Aviation is the fastest growing source of greenhouse gases, and flights within Europe are on course to double by 2020 and triple by 2030.

British Airways and other European airlines have been lobbying for a more lenient scheme that would compensate for only a small portion of their emissions and cost the average passenger less than £1.50 per flight.

But the parliament rejected BA’s argument that the impact of aviation on the environment was not sufficiently understood and, therefore, the scheme should be limited.

MEPs voted by 439 to 74 to adopt proposals drafted by Caroline Lucas, the Green Party MEP for southeast England. There were 102 abstentions.

The main proposal was for airlines to be forced to buy emissions permits within a separate trading scheme dedicated to aviation, with a specific cap on the amount of CO2.

BA had wanted to be allowed virtually unlimited growth by being able to buy cheap surplus permits from other industries.

The parliament also dismissed BA’s proposal for airlines to be allocated free permits to cover their existing level of emissions. BA wanted the scheme to focus on additional flights.

The MEPs said that the scheme should cover all flights arriving at or departing from EU airports rather than just intra-EU flights, as had been proposed by BA. But the scheme is likely to be limited to flights within Europe in the early years to avoid legal challenges from the United States and other countries. MEPs also accepted the proposal for a separate environmental tax to cover the impact of nitrogen oxides and condensation trails emitted by aircraft.

When emitted at altitude, these emissions trap heat in the Earth’s atmosphere. The parliament accepted that aviation’s total contribution to global warming was two to four times greater than the impact of CO2 alone, and that airlines should be forced to pay for this.

The GreenSkies Alliance, a coalition of environmental groups that opposes the growth of aviation, said passengers would have to pay up to £20 per flight, or £40 return, to cover the cost of purchasing just the CO2 permits for flights within Europe. A jet fuel tax and an environmental tax would push ticket prices up even further but the costs are harder to quantify.

Jeff Gazzard, of the alliance, said: “The huge European Parliament majority shows that MEPs overwhelmingly recognise that air transport’s greenhouse gas emissions are out of control and urgent action to control them is long overdue.”

The parliament’s vote will strongly influence legislation being drafted by the European Commission and due to be debated later this year. The emissions trading scheme is due to be introduced in 2008 but commission officials admit it could be delayed until 2010.

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Welcome to the new world…. the global economy is about to take a real hit.  Lets face it, until we discover a reliable new fuel source, the world is only getting bigger, not smaller. 

Crude oil futures soared to all-time record highs in New York as markets were roiled by news of missile launches by North Korea and tensions over Iran, dealers said.

New York’s main contract, light sweet crude for delivery in August, leapt 1.26 dollars to a record closing high of 75.19 dollars a barrel. Prices soared as high as 75.40 dollars a barrel, an all-time intraday record.

That topped the prior record close of 75.17 dollars and intraday record of 75.35 dollars a barrel, both set on April 21.

Trading of light, sweet crude was suspended on Monday and Tuesday because of the US Independence Day holiday.

Brent North Sea crude for August delivery jumped 1.46 dollars to 73.98 dollars per barrel in closing trades in London on Wednesday, approaching its all-time record of 74.97.

North Korea test-fired up to seven missiles on Wednesday including a long-range Taepodong-2 capable in theory of reaching US soil, triggering international outrage and crisis talks at the United Nations Security Council.

“Geopolitics continues to attract the attention of the oil community,” Barclays Capital analyst Kevin Norrish said.

“While not directly energy market-related news that North Korea has test-fired seven missiles … it has perhaps added to the awareness that global geopolitics are currently in a state of considerable potential flux.”

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The part that bothers me is the “While not directly energy market-related news that North Korea has test-fired seven missiles … it has perhaps added to the awareness that global geopolitics are currently in a state of considerable potential flux.” part.   The price fluxuations are just not realistic.  It would be like the cost of wheat going up so automakers increase the price of a car….. it isn’t related… and doesn’t affect the price… so why does a missle test affect the price of oil?

As gas prices start to worry the average consumer, the North American automakers are starting to feel the sales pinch.  GM, Ford and Chrysler who haven’t moved fast enough with respect to fuel efficient cars and trucks are now realizing large sales losses to companies like Toyota, Nissan and Honda.  GM’s automobile sales were down 26% over last year which analysts suggest is in large part due to the company’s philosophies with respect to fuel economy.  The North American consumer has started to see the higher gas prices that the European market has been in for years and the Big Three were not prepared.  Toyota for example, has sales increases in June of 15% and have increased their sales volume for this year by 12% overall by comparison.  Ford on the other hand lost 7% in sales and Chrysler plunged 13%.
GM, Ford and Chrysler have long lived on the credo that customer will buy the products they make, but recently consumers are looking for fuel efficient alternatives that the Japanese automakers provide.  Japanese make high quality 4 cylinder cars that are not only fuel efficient but have many of the luxuries consumers are looking for.  Traditionally, the North American automakers have considered the 4 cylinder car an entry level product which they do not include many luxury features and they are starting to pay the price.
GM has started this movement towards higher quality 4 cylinder cars, but one has to wonder if they were too late getting on board.

Have a look at the following Reuters article.

U.S. sales fell for all three big American automakers in June, led by a 26 percent drop at General Motors Corp. (GM), while Japan’s Toyota Motor Corp. surged.

Higher gas prices, slower sales of trucks and sport utility vehicles and a lack of deep incentives compared to last summer — when GM rolled out employee-level pricing — hurt the Detroit-based automakers in a weaker U.S. auto market.

The tough sales comparison comes at a time when GM’s board is under pressure to consider a three-way alliance with Renault SA and Nissan Motor Co.

Ford’s June sales dropped 7 percent and DaimlerChrysler’s plunged 13 percent, underscoring the pressure on Detroit automakers at the start of a summer season they are counting on to clear an unsold inventory of 2006 models.

By contrast, Toyota — now No. 3 in the U.S. market for cars and trucks — posted a 14 percent sales gain. Toyota sold more cars in June than Ford and Chrysler combined.

Toyota’s share of the total U.S. vehicle market rose to 15 percent in June, up from 12 percent a year earlier. The Detroit-based companies’ market share sagged to 56 percent, down from 62 percent.

“Toyota is unstoppable. They have the right product mix, the right price, the right image, and momentum of product,” said analyst Jesse Toprak of industry tracking service Edmunds.com.

Overall, U.S. light vehicle sales — cars, pickup trucks and SUVs — fell to 1.5 million units, down 11 percent, according to industry tracking firm Autodata Corp.

Toyota has taken a bigger share of a weakening U.S. market on the fuel efficiency of its line-up, which trails only Honda Motor Co. in average fuel economy among major manufacturers.

In the first half of 2006, Toyota sales rose 10 percent, boosted by the revamped Camry sedan and the new Yaris subcompact. “We expect that sales pace is going to continue in the rest of the year,” said Jim Lentz, executive vice president of Toyota Motor Sales.

He said Yaris sales were stronger than anticipated and Toyota was working to import them in higher volume from Japan.

Toyota has only a 9-day inventory of the Yaris, and an even tighter 4-day sales inventory of its Prius hybrid, essentially making both vehicles sellout hits.

Meanwhile, sales of Ford’s Explorer, a best-selling SUV, dropped by 36 percent in June while sales of the larger Expedition were down 46 percent. “There’s no question that higher gas prices have hurt demand for these products,” said Ford sales analyst George Pipas.

Auto executives said there were signs that consumers were also waiting for better deals in July, when both GM and Chrysler rolled out new discount offers.

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Oil: Facts behind the fiction 
Here are just some of the facts surrounding the issue of the world’s dependence on oil.

Every day the world currently burns more than 80m barrels of oil. By 2016 it is estimated that will rise to around 100m barrels per day.

All the world’s biggest known oil reserves are in the Middle East: Saudi Arabia, Iraq, the United Arab Emirates, Kuwait and Iran.

Each American burns 25 barrels of oil a year, each Briton burns 11, each Chinese burns 2.
Fewer and fewer major new oil fields are discovered each year:
16 in 2000
9 in 2001
1 in 2005

If the price of oil continued to rise, the prices of natural gas and electricity would also go up. The rise in energy costs would cause business to slow down, possibly triggering a recession.

The price of petrol in the UK has more than doubled in the past 20 years.

In the UK, we now pay around 98p for a litre of petrol. Of this:
30p reflects the crude oil and refining costs
61p goes in tax
3p goes to the petrol station
4p is the oil company’s profit.

Uses of oil include: DVDs, perfume, food preservatives, detergents, plastics, deodorants, medicines, explosives, carpets, contact lenses, paint, washing-up liquid. 

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Honestly, I can understand the worlds needs to move away from oil and gas.  It is very important for our world to learn how to use more natural sources of fuel that are not only cleaner to burn but more abundant.  In my crusade to stop gas prices from increasing dramatically, I have also suggested that we need to develop new fuels.  My position has always been that the oil and gas companies are gouging us now to make up for the loss of future business.  Lets face it, the big energy companies are blocking all new technologies that look like they might work so that we stay addicted to gas.  Oil is not running out yet…. but it will be soon and so the oil companies are fixing gas prices to maximize profits.

Oil rose near $74 a barrel on Monday as American drivers took to the road in large numbers, and as optimism over U.S. economic growth increased.
 
London Brent crude traded 36 cents higher at $73.87 a barrel by 1115 GMT, after touching a high of $73.99 a barrel earlier in the session.

The market in U.S. light crude was closed for a holiday. It gained 41 cents to $73.93 on Friday after an eight-day rally.

Drivers are expected to shrug off high pump prices and travel in unprecedented numbers during the U.S. Independence Day period, after the U.S. economy grew in the first quarter at the fastest rate in 2-1/2 years.

“Bullish data on the refined product side has supported the latest mini-bull run in the oil price,” said investment bank Citigroup in a research note.

Prices are less than two dollars away from Brent’s record peak of $74.97 reached in early May, and U.S. crude’s $75.35 in late April.

Analysts do not expect any big price movements until trading on the New York Mercantile Exchange (NYMEX) resumes on Wednesday.

“Prices won’t move much until the U.S. market opens after the holiday, when we will see an upward momentum,” said Keith Sano, manager for Sumitomo Corp.’s commodities business.

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As usual with the holidays comes a price increase.  Gas prices keep going up on the heels of major holidays.  Funny how gas prices always go up before holidays, no matter which country you are from…

The roads and airports will likely be pretty crowded this weekend. AAA over 40 million people will travel over the Independence Day weekend. That’s a record.

AAA spokesman Mantill Williams says more than 34 million of those holiday travelers will be going by car. He says high gas prices may mean people make some plan changes, but the cost won’t cancel trips.

Williams says the floods in the Northeast likely won’t have a big impact on travel.

An air travel expert predicts “one of the heaviest if not the heaviest” July 4th weekends ever. But Terry Trippler of Travel Passport says there shouldn’t be too much of a “crush of people” at airports. He says many people will take a longer vacation because the Fourth falls on a Tuesday.

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With holiday traffic at its peak, I hope that people who are traveling, do their part to conserve fuel.  We constantly complain about gas prices, but we rarely do the things we need to help save gas (thereby saving money).  Make sure your tires have the right tire pressure, do a tune up and add fuel and air filters if needed.  Do not leave the vehicle running while you load up camping gear and so forth…. do you have to take the big SUV? 

Enjoy your holiday!

Crude oil futures rose Friday on strong U.S. gasoline demand ahead of the Independence Day holiday in the U.S. Brokers said energy futures were also being supported by hints from the Federal Reserve on Thursday that it could be done raising interest rates.

Societe Generale’s director of commodity strategy, Michael Guido, said that by highlighting the role energy prices were playing in helping to slow economic growth to more sustainable levels “it was like giving high energy prices an honorable mention.”

The question is now, Guido said, “how much higher do (energy prices) go before it becomes a detriment?”

Light sweet crude for August delivery rose 28 cents to $73.80 a barrel on the New York Mercantile Exchange, where gasoline futures fell by more than 2 cents to $2.2725 a gallon after settling at a nine-month high on Thursday.

“Earlier in the week, the $73 mark has always been considered the resistance level,” said Victor Shum, energy analyst at Purvin & Gertz in Singapore. “Now, we’ve gone beyond that.”

Brent crude futures on the ICE Futures exchange climbed 16 cents to $73.04 a barrel.

Worries about a supply crunch ahead of the July Fourth holiday grew after the U.S. government released a report Wednesday showing gasoline stocks shrank last week for the first time in more than two months.

Gasoline demand in the U.S. continues to rise in spite of soaring pump prices. Over the past four weeks, daily gasoline demand was up 0.9 percent from a year ago at 9.4 million barrels a day, according to Energy Department data released Wednesday. The average retail price of regular gasoline nationwide is $2.87 per gallon.

About 40.7 million Americans will travel 50 miles or more from home during the July Fourth holiday, up 1.2 percent from 40.2 million last year, according to projections by the AAA, the largest motor club in the United States.

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All I can say is…. the US federal government investigated the oil companies and didn’t find any price gouging, price fixing or any other bad business practices….. ya right!