Nations React to Rising Oil Costs: Spain Lowers Speed Limit, US Whines
Once again, oil prices are rising around the world. Yes, the turmoil in Libya and the Middle East is jacking up global prices, but it's becoming more and more apparent that the trend is certain to continue. After all, even Saudi Arabia's own experts -- who sit on the world's largest oil stores -- admit that they drastically overestimated their supplies. Russia, whose huge economy depends on oil, is forging into dangerous arctic waters to drill. It's getting clearer: good ol' peak oil is nigh. And some nations, like Spain, are already moving to react to a new, oil strapped world -- for one thing, the country is lowering its speed limit. Other nations -- guess who? -- aren't doing anything.Granted, it's only shaving around 6-7 mph or so off the national limit -- it's dropping from 120 km/h to 110 km/h (about 74 mph to 68 mph). Spain's government is also raising the percentage required in its biofuel blends to 7%, and, perhaps most importantly, lowering the price of rail tickets by 5%.
Sure, these are all relatively small measures. But its nonetheless marks a forward-thinking, long-term approach that's reflective of a changing world.
Spain, aiming to reduce its dependence on oil as crude prices surge, will raise biofuel blending and lower both speed limits and rail fares, Deputy Prime Minister Alfredo Perez Rubalcaba said on Friday.The changes will go into effect on March 7th.
"A 10 euros increase in oil prices as has been seen in recent days increases our country's energy costs by 6 billion euros per year, or 500 million per month," Rubalcaba said at a weekly news conference after a cabinet meeting.
Meanwhile, here in the United States, a number of Governors are braying about the rising price of oil, warning that it could ruin their states' economic recoveries. Their solution? Get Obama to tap into our reserve stores. Call up the Saudis. Anything but address head-on the fact that our nation can't be tethered to oil forever.