The famous words from a Sunday School song come to mind with an alternative meaning for me these days. With oil prices surging, the impacts to my daily life are high on my list of things to ponder, and it’s not just about gas for my car.
Our lifestyles revolve around oil and there are a lot more consumer items to be considered beyond fuel for our automobiles. The Ranken Energy Corporation website states, “Americans consume petroleum products at a rate of three-and-a-half gallons of oil and more than 250 cubic feet of natural gas per day each!” But, as many of us know, petroleum is not just used for fuel.” Ranken’s website says that “Petroleum and petroleum by-products are a vital part of our transportation system and our daily lives. Even those who might argue we use bicycles for our personal transportation fail to recognize that parts of the modern bicycle are made from petroleum by-products and fossil fuel energy was likely used to create the frame, wheels, and chain. Click to see a few products made from hydrocarbons. Our modern lives cannot be lived without using products that have been manufactured with fossil fuels (even a toothbrush) and/or were created with energy provided by fossil fuels.”
Ranken Energy Corporation’s list includes things like: aspirin shampoo, wax, toothpaste, crayons, shaving cream, soft contact lenses, fertilizers, anything polyester and nylon, and so much more. Another good list is offered by PBS via a pdf file showing a plethora of products one doesn’t normally think of when contemplating our oil consumption.
So, not only are we seeing prices in corn, cotton, sugar, soy beans, and other food products going up (see many of my earlier posts for details on that), but now many of our other household products.
A February 24th, 2011 New York post article by Paul Tharp titled Crude Crisis Sparks Rapid-fire Price Hikes states, “Consumers should brace for other hikes as they purchase the more than 6,000 daily products derived from petroleum, ranging from gym gear and iPhone cases to fertilizers and lipsticks.” He goes on to say that “Atlas Corp. has raised the price of roofing and exterior building products by 10 percent until June, when they will raise them another 12 percent. Building products are also squeezed by slow sales due to the housing recession.” So that adds up to a total 22% in rate hikes by summer for those building products!
“Analysts believe gas pumps here are in store for at least a 25-cent-a-gallon jump by the weekend. That's due to the sharp 30-cent-a-gallon spike in the past three weeks in wholesale gasoline, which settled here yesterday at $2.7167 a gallon, the first flat day in more than a week.”
An MSNBC article by John Schoen points out that the turmoil in the East will wreak havoc in our wallet. He writes, “Every extra dollar consumers and businesses have to spend on oil takes another little bite out of economic growth.” The article goes on to say, “Oil price hikes also depress economic growth by raising the cost of raw materials made from petroleum — everything from asphalt to plastics. Higher jet fuel prices put pressure on airlines to raise ticket prices. Higher diesel fuel prices drive up the cost of shipping and construction.”
He quotes the Agriculture Department warning: “… that U.S. consumers should brace for rising food costs this year as higher commodity and energy prices make their way to store shelves. Food prices are forecast to rise a sharp 3.5 percent this year — nearly double the overall inflation rate — with most of those increases coming in the second half of the year.”
Well, I’ve seen prices going up already.
And, think about this. The MSNBC article says “That puts the Fed in a difficult position if the U.S. economic recovery begins to stumble under the weight of higher food and energy prices.”