ralfy wrote:Objects don't care where oil comes from for obvious reasons, but those who pay do. That's because the deeper or dirtier the oil, the more processing needed, and that means higher costs. If costs are too high, then some goods and services are sacrificed for those that are needed more, and that affects economies that require increasing sales of goods and services.
Sure. However, looking at oil prices since the early 70's, global oil supply and demand differentials clearly have a MUCH higher impact on the price of oil than relative costs of extraction.
When it's relatively scarce, for whatever reason, the masses pay much higher prices to obtain it -- perhaps whining a lot, but still paying it. In economics terms, that's called highly inelastic demand.
And now that access to truly high mileage, efficient vehicles is becoming more common, I guess we'll get to see how much the relative cost/efficiency really matters.
Clearly in the US, where giant trucks and SUV's continue to be in very high demand and efficient HEV's and PHEV's and tiny high mileage ICE's not so much (Ford stopping production of almost all sedans as a recent example), despite all the claims around here to the contrary, gasoline prices aren't at the forefront of peoples' minds, or we'd be seeing a strong push in the other direction.
People do better re efficiency in Europe. Of course, they have meaningful fuel taxes, and we can't do THAT in the US, as someone might not get elected.
And in the third world where lots of truly poor people live, there is a lot more biking, walking, using scooters, using buses, etc. already. The people buying cars are generally within the middle class (or above) sphere of wealth.