Reuters reported today that General Motors said it was closing four truck plants and could sell its Hummer brand to cut slow-selling trucks and SUVs from its lineup in response to higher gasoline prices.
America, whether you like it or not, things are about to change. And change radically.
For those not familiar with the term, peak oil is the point in time when the maximum rate of global petroleum production is reached, after which the rate of production enters its terminal decline. (Definition from Wikipedia.)
The oil that is left in the ground is harder to reach and harder to refine. That oil is going to cost the oil companies more to get out of the ground and cost more to turn into a final product. And now more customers in the marketplace are driving up costs. Global customers like India and China have a rising middle class hungry for oil. These two countries have lots of people. Billions.
If you don’t like $4 a gallon, how about $5 or $6 or $8 a gallon? If you convert liters to gallons and pounds to dollars, our cousins in the United Kingdom pay $7 a gallon for diesel fuel… today.
Goodbye Hummer. Goodbye diesel dually GMC. Goodbye Cadillac Escaslade.
We aren’t going to wake up one day and find the automakers have a magic solution. In time cars and trucks are going to get better gas mileage, but not overnight. Gas prices are going nowhere but up. We are going to have to learn to drive smaller, drive shorter and share our ride.
So much of the food we eat and goods we buy come from overseas and shipped across the country. Semi trucks get horrible gas mileage compared to cars. Producers of foods and goods will have no choice but to pass the rising transportation costs up to us, the consumers.
In the not too distant future, we might see a rise in regional manufacturing and regional food production. Making goods in China and growing fruit in Brazil may no longer be cheaper if companies can’t afford to get the products to us.
Get ready, America. The fun has just begun.
Local food sourcing is going to become more common. Wal-mart is starting to do it to keep prices down.
I think we’ll see local sourcing of everything combined with increased rail traffic, especially if our rail infrastructure ever gets electrified.
It serves the U.S right for being so dependant on oil.Americans have to realise that they simply cannot keep influencing the Saudis and bring down the price of oil.The world is changing and it is about time that the Americans start using renewable sources of energy.The U.S has been the only country that has been able to adapt to new technology most effectively.It should lead the way in bringing about a revolution in this field too especially when we are facing such an uphill task.