Oil Tetris

April 12, 2006 | By | 4 Replies More

The U.S. consumes 400 million gallons of gasoline every day.   That amounts to almost 5,000 gallons every second.  More than half of that oil is imported.

Everything we do is affected by oil.  In addition to keeping us warm and transporting us, we eat oil.  Not literally, but the average American meal travels an about 1500 miles to get from farm to plate.

If there were an interruption in the oil supply, we would look to the U.S. Strategic Petroleum Reserve.  That much-cited U.S. reserve, however, holds only a 60-day supply of oil. It is official U.S. policy, then, that We the People shall always remain only small one incident from a major oil crisis.

A rational society operates with headroom.  It makes certain that when there is any sort of foreseeable incident (such incidents are inevitable), sufficient resources exist to stave off crises.  A rational society operates like a Tetris game in the opening stages, where the player has time and resources available to make the necessary adjustments:

Tetris - safe.jpg

A rational society provides this headroom by outlawing wasteful vehicles such as SUV’s and large non-commercial pickup trucks.  A rational society heavily regulates the energy efficiency of factories and residences.  A rational president takes the bully pulpit and to clearly tells everyone that we are in post-peak-oil.  He advises the people that a massive restructuring of our economy is necessary to make our economy less vulnerable to restricted oil supplies and price gouging.  The rational president tells the people that the clock is ticking and gives details about what must be done in 1 year, 5 years and 10 years.

An irrational society continuously strains oil resources and operates only under best-case presumptions.  An irrational society fails to provide for headroom.  Small incidents (including expected incidents) throw irrational societies into frenzy and disarray.  An irrational society operates like a Tetris game in its last desperate moments.  There is no margin for error and any little thing could end the game.  We have to be perfect, repeatedly and forever, or else:

tetris - unsafe.jpg

U.S. oil policy is irrational.  In the U.S., we’re nonchalently playing those last few moments of oil-Tetris every day.  Such a plan functions only a under the best-case scenario where 5,000 gallons of oil somehow keep gushing every second.

We’ve already seen what happens to the market when a hurricane damages the refineries near a single city:  New Orleans.  This same market disruption would no doubt happen if a terrorist organization blew up a major pipeline, refinery or oil tanker.  It would also happen if oil producers again banded together (as they did in 1974) and it would once again bring oil consumers to their knees.  The stakes are immense.  An oil crisis endangers ordinary citizens by depriving them of heat, transportation, food and jobs.

Dispite these dangers, official U.S. policy is that our oil supply will always remain fragile and that the citizens and economy will remain vulnerable to foreseeable irregularities affecting the oil supply.  Let’s see: fragil oil supply, no substitute energy source, massive oil waste and no meaningful national dialogue.

We undoubtedly have the best government that corporate money can buy.

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Category: Economy, Entertainment, Politics

About the Author ()

Erich Vieth is an attorney focusing on consumer law litigation and appellate practice. He is also a working musician and a writer, having founded Dangerous Intersection in 2006. Erich lives in the Shaw Neighborhood of St. Louis, Missouri, where he lives half-time with his two extraordinary daughters.

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  1. Doug says:

    One can better understand the problem that SUVs cause for the American oil economy by relating it to the economic concepts of fixed and variable costs. In a household (for example), costs can be categorized into either fixed costs (those that are INDEPENDENT of activity level) or variable costs (those that are DEPENDENT upon activity level). Thus, a cost such as a monthly mortgage payment will be considered fixed, because it is essentially constant regardless of how much activity happens inside the building. By contrast, a cost such as electricity will be considered variable, because it changes depending upon how much energy is consumed from one month to the next.

    What is most significant about fixed and variable costs is the very different burdens they place on the person who pays the bills. The more fixed costs a person has — a mortgage, a car payment, a cable bill, a credit card bill, etc. — the greater danger the person is in from fluctuations to his or her income. Conversely, the fewer fixed costs a person has, the more the person can adjust his or her financial obligations in response to fluctuations in his or her income. In particular, the person can reduce his financial obligations in response to reductions in his or her income, thereby remaining financially stable.

    Now, consider the SUV. An SUV is like a high fixed cost on the US demand for oil, because it creates a demand for oil that cannot be (easily) reduced in response to fluctuations in supply. People who must drive a certain number of miles per day must consume a certain (large) number of gallons of gasoline to do it. By contrast, if everyone who drives an SUV today would switch to a vehicle that uses less gas, it would reduce the fixed cost, creating more stability in both the supply and the price of gasoline. In other words, worldwide demand for gas would not be so perilously close to its maximum supply level, and there would be more latitude to absorb a sudden reduction in supply.

    Unfortunately for all Americans, such stability will not appear anytime soon. Not until either more gasoline supply comes on line, or until aggregate gasoline demand is reduced.

  2. Erich Vieth says:

    Just consider: when it becomes "news" that the cost of a gallon of gas increases by five cents, it can only be because this country is horribly overdependent on oil as a source of energy.  And it's not something we might need to address someday. Rather, we've already entered the period James Kunstler has deservingly titled "'The Long Emergency." See his book: The Long Emergency: Surviving the End of Oil, Climate Change, and Other Converging Catastrophes of the Twenty-First Century (2006).

    It is truly amazing that our so-called leaders fail to react when tiny changes in the price of oil send media into convlsions and set new rounds of intense discussion at office water coolers.  We need to immediately implement draconian conservation measures.  The window of opportunity is small, if it still exists at all.

  3. Daniel Lord says:

    And now that oil is, temporarily down in the $40 range until OPEC can cut back production enough that hedge funds start speculating in it again. President-elect Obama has a chance to act. But the dropping price of oil has, as it has in the past, removed any significant sense of urgency in the public for energy policy reforms and action. Let's hope President-elect Obama steels his resolve and tackles it anyway. The problem didn't go away–it is merely in remission for a while.

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