“Living With High-Priced Oil”The New York Times
December 5, 2007
Direct consequences of the recent huge jump in oil prices include rising transportation costs and higher heating bills, but the impact is also being felt in less obvious ways. Here, a look at life in a time of high-priced oil across the globe, the country, the neighborhood and the home.
Norway Benefits
• The world's 10th-largest oil producer is spending some of its earnings on its citizens -- it hopes to offer every child a subsidized kindergarten spot by the end of 2008.
China Runs Short
• Price controls in China prevented refiners from passing on higher costs to consumers, creating shortages in some areas earlier this year.
Japan Conserves
• With virtually no oil resources of its own, Japan has relied on conservation efforts to dampen higher oil prices.
Russia Reaps
• As a top producer, Russia has raised living standards for many. But with oil wealth, democracy has taken a back seat while President Vladimir Putin's power has been strengthened.
Airlines Hurt
• Fares are rising but they won't cover a total fuel bill that could exceed $50 billion in 2008, up from $12.7 billion in 2000.
Farmers Move To Customers
• Instead of trucking produce across the U.S., big California growers are thinking of shifting some production to places like Maine (broccoli) and Michigan (celery).
Cows Change Diets
• Farmers are looking for cheaper alternatives to corn feed for livestock, as the demand for corn in ethanol production has increased costs.
Rails Streamline
• The freight railroad CSX has invested more than $1 billion to upgrade the fleet's fuel efficiency since 2000. But it still passes costs to customers -- rail surcharges have doubled since April.
Companies Shift
• DuPont used to put petrochemicals in nearly all its products, but now 17 percent of revenue comes from products derived from renewable materials. Higher oil prices have pushed ingredient costs up 3 percent this year.
Carriers Pass Costs
• At UPS, fuel costs are less than 5 percent of revenue. Like FedEx, it will raise shipping rates by an average of 4.9 percent in 2008.
Truckers Out Of Work
• Trucking companies pass high fuel costs on to customers. YRC Worldwide says business has dropped over the last five quarters, putting 5,000 of its 66,000 employees out of work.
School Buses Go Overbudget
• Counties with large school bus fleets are facing deficits. In Montgomery County, Md., thousands of dollars may be taken from other programs to cover the rise in prices.
Roads Go Unpaved
• Asphalt costs have increased, halting roadwork in parts of the U.S. In Lawrence County, Ala., efforts have shifted from repaving to repairing.
Police Conserve
• Rising gas prices are stressing some police department budgets. Every penny increase in gas costs the Pennsylvania State Police $40,000 a year; troopers have been asked to save fuel by driving at the speed limit.
A Few Homes Go Solar
• Residential solar installations have increased to 7,358 systems in 2006 from 2,795 in 2002, and are estimated to rise to 11,000 this year.
Heating Bills Rise
• The 7.9 million households using heating oil in the U.S. will pay an average of $375 more for it this winter.
Gas Prices Jump
• About 205 million drivers will pay $100 to $120 more, on average, this year. If gas prices remain high, drivers will spend $30 to $40 more each month.
Small Cars Gain
• Thousands of families have traded in big trucks and sport utility vehicles for smaller, more fuel-efficient cars. Sales of large and midsize S.U.V.'s have fallen 24 percent in the last two years.
Mail Goes Over Budget
• The United States Postal Service estimates that every penny increase in gasoline prices costs it $8 million. In 2006, fuel costs were about $260 million over budget.
Shoppers Shift Meals
• When gas prices go up by 10 percent, eating out falls by more than 5 percent and the proportion of cereal bought on sale increases by 2 percent, studies have shown.
