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What is the true cost of petroleum?

August 28, 2009

The question arises: What is the true cost of petroleum?

On the surface this question seems readily answerable, rather simplistic and naive.  However, a more in-depth look reveals many hidden costs not included in the daily commodity price quotes.

Excluded are the entire life cycle and financial costs of the commodity. Outside of carbon credits and the implications of the proposed cap-and-trade program, other underlying costs may include the short- and long-term impact on the environment and the contribution to the trade deficit. The financial ramifications of the national debt and the rapid decline in foreign investment in U.S. Treasury bills are most likely excluded from the commodity’s price.

Furthermore, there are the costs to protect our overseas oil supply lines by the Department of Defense and the tendency of “the power of oil” to adversely alter the economies and politics of the petroleum producing countries, some of them petro-oligarchs with regimes, which may conflict with U.S. interests. Once these factors are taken into consideration, the true cost of developing and commercializing many renewable energy technologies becomes highly favorable and economically justifiable.

In closing, with all these unaccounted costs included, it would be nice to know “what is real price we should pay for petroleum.”

If someone has the answer, please advise.

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One Comment leave one →
  1. July 4, 2010 11:02 PM

    “Energy efficiency” masks the underlying social and economic costs of operating upon unexamined assumptions about what can or cannot happen in the field of energy production. Clean energy technologies exist that may solve the world’s energy dependency, either within suppressed elements of the private sector, or within classified areas of the defense sector. The latter including for example the TR-3B, a high altitude, stealth, reconnaissance platform with an indefinite loiter time.

    By declassifying components that cause planes like the TR- series and the stealth bomber to levitate, we can turn “swords into plowshares,” to produce domestic inverse-g motors. In the private sector we can also reinvent certain once-targeted initiatives like Moray’s, Tesla’s or the Searl Effect Generator (SEG) that can superconduct down to 4 degrees Kelvin, whereupon it develops its own gravitational field generating millions of volts.

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