Editorial: Are we ready for gasoline at $3 and up?

Thursday, May 20, 2004 | 8:36 a.m.

During previous periods of high gas prices, in the early 1970s and for several years in the 1980s, the foreseeable future always brightened the outlook of consumers. They could take comfort in the fact that prices would again, surely, stabilize at affordable levels. Perhaps many American consumers are still believing the current national average price of $2-plus a gallon is only a temporary hardship. The AAA, for example, is predicting that a record number of Americans will be traveling this Memorial Day weekend and that travel will be strong all summer. Our sense, however, is that the days of gas for less than $2 are over.

While many factors play into rising gasoline prices, there is a major one now that was largely absent in past spikes -- world demand. Previously "backward" nations, with their growing populations, are now industrializing at rapid rates, meaning their demand for oil has greatly surged. China alone is responsible for much of the surging demand, which is barely being met even though world oil production is nearing capacity. With demand high and getting higher, and with supply reaching its production limits, it's hard to foresee the price of gas going anywhere but up. Other factors causing high prices are the unending turmoil in the Middle East, fear of terrorist attacks on oil fields and production plants, barely sufficient numbers of refineries, finite distribution capacity, and, in the United States and many other countries, energy policies that encourage c onsumption over conservation.

We support President Bush's call for using hydrogen to power America in the distant future. But his policies affecting today and the coming decades have contributed to the high demand for oil and the resultant high prices. In particular, he has protected automobile manufacturers from laws requiring greater fuel efficiency. An emergency response proposed by Democrats -- tapping into the nation's oil reserves (we have enough to power the country for two months at our current rate of consumption) -- would increase supply for a few weeks, but only stabilize gas prices for about the same period of time. Gas prices would soon be back where they were.

What's really needed is something that moderates in Congress have supported for a long time, a national strategy to produce fuel-efficient cars and trucks, more mass transportation and more car pooling and bicycle lanes. Even the conserve(?)atives who ridicule conservation, we bet, would be glad for such a strategy the day gas tops $3.