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What's Driving Up Oil Prices Again? Wall Street, Of Course
WASHINGTON - Oil consumption has fallen, demand from U.S. motorists for gasoline is flat at best and refiners that turn crude into fuel are operating well below capacity. Yet oil prices keep marching toward $90 a barrel, pushing gasoline toward $3 a gallon in many markets, and prompting American drivers to ask, "What gives?"
Blame it on the same folks who brought you $140
oil and $4 gasoline in 2008: Wall Street speculators.
Experts attribute much of the recent rise in prices to flows of speculative money into oil markets. These bets are fueled by investor expectations that the U.S. and global economies are poised to return to growth and thus spark increased use of oil. Strong growth in China supports the narrative of rising oil consumption and tightening supplies.
"The thinking goes that rising stock (market) prices implies expanding business activity, implies growing energy demand, implies rising oil prices. I think you can make that case, but it's awfully weak," said Michael Fitzpatrick, vice president-energy for MF Global, a financial firm that brokers the sale of contracts for future delivery of oil.
While there are signs of U.S. economic recovery, such as a slight uptick in consumption and strong manufacturing data, there are plenty of ho-hum signs too, including dismal construction spending and continued high unemployment.
"I just don't think if you look across the entire spectrum of the macro-economy that it creates a picture of a growing body of incontrovertible evidence that there is a strong, sustainable recovery. I just don't see it," Fitzpatrick said. "I think it should be closer to the range we were seeing in late summer and early fall, $67 to $72" a barrel.
On the last day of July, oil traded at $67.50 a barrel and gasoline sold at a nationwide average of $2.52 a gallon for regular unleaded. On Thursday, oil prices settled at $84.87 on the New York Mercantile Exchange, and regular unleaded gasoline averaged $2.80 a gallon and more than $3 on the West Coast, according to the AAA.
"It's the story we've been talking about . . . . It's really about oil being an attractive investment for investors right now," said Troy Green, a AAA spokesman. "You've seen quite a bit of money flooding into the oil markets because of that."
What's different about today's price run-up from two or three years ago is that oil is now in ample supply.
"If you look at the fundamentals right now, there is certainly an abundance that is available (of oil) to the market for the next 12 months or so. It's not a near-term supply shortfall," said David Dismukes, the associate director of the Center for Energy Studies at Louisiana State University in Baton Rouge.
U.S. motorists and businesses consumed 18.69 million barrels per day (bpd) of petroleum product last year. That's projected to rise slightly this year to 18.89 million bpd. However, it remains far below peak consumption of 20.80 million bpd in 2005.
The latest data from the Energy Information Administration, the statistical arm of the Energy Department, shows that as of mid-March, U.S. refiners were operating at 81.1 percent capacity. They're making eight gallons of gasoline for every 10 they're capable of producing, a clear sign that demand is down.
Perhaps the only argument that would justify rising prices is that global consumption is expected to grow by 1.6 million bpd to 86.6 million bpd this year, according to the Paris-based International Energy Agency.
Even so, there's 6 million bpd of oil that's shut-in, a technical way of saying that recoverable oil is being left in the ground by the world's oil producers.
"When you look at inventories and shut-in capacity, (oil) prices today are above what those would indicate," said Daniel Yergin, the author of "The Prize: The Epic Quest for Oil, Money & Power," the recently updated Pulitzer Prize-winning book that chronicles the history of oil.
When oil traded above $140 a barrel nearly two years ago and pundits warned that the world was running out of oil, Yergin suggested that a glut of oil would come onto the market in 2010 and beyond. The 6 million bpd of oil now on the sidelines suggests that he was right.
Today's spare production capacity is three times what it was in 2004 and 2005, when supply actually was tight.
The Organization of Petroleum Exporting Countries signaled this week its concerns about rising prices by not calling for hard enforcement of production quotas by its members. That suggested the cartel will tolerate an open-spigot policy by its 12 members as needed to stabilize prices.
"While OPEC was silent on any threat to the recovery, speculation continues that the cartel is deliberately allowing members to exceed production quotas in order to limit upward price pressure," wrote analyst Matt Robinson, in a research report Thursday by forecaster Moody's Economy.com.
Rising oil and gasoline prices are deja vu all over again for Michael Masters. The hedge fund manager has crusaded for legislation that would prevent so much speculative money in the oil markets.
Wall Street is "gaming" the price of oil, he warns.
"If you're a bank, and you know there is going to be a large amount of investor inflows into the commodities market, you are going to position yourself ahead of them . . . You want to be a seller at a higher price," explained Masters, noting that large Wall Street banks invest for themselves in these markets even as they also broker the oil investments of others.
What's abundantly clear, he and others argue, is that an oil contract's price today has little to do with the supply of and demand for oil.
"It's a capital asset now. Once the majority of participants are capital-asset folks, common sense would tell you it's going to be traded like a capital asset . . . and consumers pay," Masters said. "It wasn't that way in the past."
What can be done?
The Commodity Futures Trading Commission is weighing a proposal to put global limits on how many oil contracts any one market player can buy or sell, and legislation to revamp financial regulation that's expected to pass Congress this year could force greater disclosure by oil traders to regulators.
Neither, however, promises imminent relief at the pump.
ON THE WEB
Oxford Institute study on oil prices 2002-2009
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66 Comments so far
Show AllI'd prefer stiff taxes being imposed on fuels, as they do in Europe, which can be offset with reduced income taxes for lower incomes. But, barring such a highly unlikely measure, I really cannot consider this speculator-driven high gasoline prices to be a bad thing at all, if it encourages conservation.
My non-discretionary gasoline use is probably no more than about 50 gallons a year. And it was zero until I lost my public transit-friendly job downtown.
You've got it bass-ackwards. If no matter how much we conserve gas, the prices still go up, why conserve? Sure it helps the environment, but what good is that if we're all broke.
I refer you to the law of supply and demand, and the theory of elasticity. Gasoline is relatively inelastic, so the very small reductions in demand haven't sent much of a market signal - especially to the speculators who are looking at future supply and demand. Get the price up to Euroepan levels and people will conserve.
Far above anything USAns can do, rediction in car use is vital to addressing futrue climate catastrophe. Reject the suburban livestyle, and move to walakble, sustanable communities. I hardly notice, or care about the price of gasoline where I live.
Although your basic premise could be considered a viable alternative in some select demographic I hate to break it to you but all of us USAns are not able to pick up and leave our suburbs and move to walkable, sustainable communities. As long as we live beneath a capitalist, greedy system nothing we do as individuals will make a difference in relation to gas prices.
The only hope we have is to live as frugally as we can in relation to our use of resources. We must all reduce our carbon footprints, grow our own food, recycle etc. Even those of us stuck in the suburbs can be as environmentally aware as anyone else. The answer is not relocating to help lower gas prices but rather reframe the question: What can we all do to save Mother Earth? Money really doesn't matter if the planet is dead.
You should have stopped with "As long as we live beneath a capitalist, greedy system nothing we do as individuals will make a difference in relation to gas prices."
Virtuous frugal simple living (which is how I live) will do little to address the major problems.
Instead a crash program of installation of decentralized solar along with all electric cars would do a lot and could have been initiated years ago.
The answer is a revolution against corporatism followed by sane energy policies This will eventually occur as life becomes increasingly difficult for ordinary Americans.
We cannot abandon the automobile until or unless we have widespread public transportation, like Europe.
"Reject the suburban livestyle, and move to walakble, sustanable communities. I hardly notice, or care about the price of gasoline where I live."
You fail to realize that many low income people have to drive further because they cannot AFFORD housing close to where they work, and cannot simply 'move' somewhere else at will.
If we are to raise gas prices, lets start making vehicles, such as the Tata (up to 59 mpg gas mileage: http://green.autoblog.com/2007/12/19/tatas-2-500-59-mpg-offering-described-as-eco-car-on-displa/), available for purchase here. Very few individuals really NEED an SUV.
"why conserve? Sure it helps the environment, but what good is that if we're all broke."
That about says it all.
Definitely pretzel logic pjd412
Increasing the tax on petro and using the money to create non-petro alternatives would contribute to the solution. Increasing the fortunes of banksters who use the profits from petro speculation to bribe politicians contributes to the problem.
You'd have to use the money to pay down the debt. Government can't create "green jobs" they tend to give money to the wrong people. Tax it, create the need and watch someone fill that need, whatever the solution is.
Lets just be honest about it
Who in the government is proposing that the government's debt be paid down?
The money is more likely to be used by Obama and Congress for pay back to corporations.
True, but in the real world, a European-level tax on gasoline in the US is about a likely as flying saucers coming to save us.
The imperitive for saving the planet is getting poeple to burn less gasoline. Any port in a storm.
"True, but in the real world, a European-level tax on gasoline in the US is about a likely as flying saucers coming to save us."
I never forgot that special election after Norman Sisisky's death in 2001 when Randy Forbes relentlessly attacked Louise Lucas on gas taxes. From that year onward, virtually every Republican and some Democrats would make it a habit of run scare tactics on gas taxes. Even in 2008, the blame on higher gas prices would be used to cover up for the company's own free will on gouging the gas prices themselves.
pjd412
NOT unless the majority of people involved agree. The tyranny of a minority is as bad as any other tyranny.
The majority has to agree to what? Saving the planet?
Actually, the bigger problem, and the saying you seem to be referring to is "the tyranny of the majority".
Wall Street again. Speculators again. Investors again. All we ever see anymore is the dark side of capitalism. Some people accept it and more and more are starting to not accept it as the status quo. It is going to be interesting in the near future to see where all this goes. I read yesterday that the Fed gave the banks over 4.5 trillion dollars as part of the bale out. Something is going to break here and one can hope sooner than later.
Every time you and I vote for an incumbant in the 2010 elections, we will contribute to this problem.
With (artifically) high priced oil we also get tar sands and offshore drilling.
you nailed it!!
The buzzards ALWAYS drive gas prices up as summer comes on.
"I'd prefer stiff taxes being imposed on fuels, as they do in Europe"
I'm with pjd412 here. Lets be honest and just put higher taxes if we want to discourage the use of oil and gas. But it can't be done surreptitiously, by fiat. If most don't agree, then you have the tyranny of the minority.
And lets also be honest that this will impact some parts of the country more than others, I have little admiration for people that are eager for something that will NOT affect them much.
Raising taxes on gas consumption doesn't always stop most drivers. What about alternative sources of fuel such as hemp and algae that can save both the environment and the pocketbook of the working class?
Move out of horribly suburbanized, car-dependent Virginia, and your gas consumption will decrese. Merely moving from northern VA (and later Lexington, KY) to Pittsburgh caused my personal driving mileage to drop from about 15-25,000 miles to about 4,500 miles.
I live in the Hampton Roads area. I have seen the Northern VA suburbs and the closest my area's suburbs can match theirs is VA Beach. Other than Hampton Roads and Northern VA, the rest of the state is big empty. I don't know if just moving the people alone will work. It is said that most of the employed in the Northwestern quadrant of Virginia travel all the way to Washington to work and the same goes for people living between Richmond and Fredericksburg. The main reason is lack of jobs. For people who drive, I believe that most of their driving comes from travelling to and from work and the longer the distance, the more that is the case. Moving to DC or Pittsburgh may reduce driving big time but then comes the question of jobs and costs of living. If there are more jobs inside the city itself, then I believe it is a splendid idea to live within the city itself. The next question though is what to do about people addicted to living in big houses as opposed to apartments.
Obviously, employers need to get out of these awful sprawling "business parks" or "industrial parks" and move to more more walk and transit friendly locations too.
Living in a city doesn't mean living in an apartment. It seems that I cannot say "city" without someone only imagining mid-town Manhattan.
"The city" can also look like this:
http://i109.photobucket.com/albums/n77/PJD123/ds_fea_soutside_slopes_0420_330.jpg
If you can please find a copy of the documentary "The end of Suburbia". I am always amazed at all the "delibeate inefficiencies" of suburban development - the circuitous driving routes needed to simply drive into a parking lot, the use of idiotic deliberately winding streets (even when the terrain is perfectly flat) and no interconnected streets - it HAS to be a deliberate plan to optimize business for car, and oil comapnies, and big-box retail. Suburbia completely crushes human-scale interactions that are the basis for solidarity and human-ness.
Actually, Virginia Beach - the area near the beachfront itself, is the sort walkable, transit-able community I am thinking of. Parts of Richmond - the fan district and around VCU is another good example, although a while back, I heard about how they deliberately re-routed bus routes onto a side street because the buses and bus stops contained "undesirable loiterers" or more bluntly, the yuppies didn't want to look at working class black poeple.
The Richmond area I can't find appealing for much hope of growth other than the state's capital which is the only blue area while everywhere else is generally flaming red. There is a lot of racism lingering in Chesterfield County despite population growth catching up to the suburbs in both Hampton Roads and Northern VA. Henrico County looked like it might be open to change but that's slipping back to red. So much for hoping that newly blue now going back red areas would be open to public transportation. When I would get to 295 betwen 64 and 95, it's all empty and I hear that traffic is not so much a problem in the Richmond area in general so I don't know if public transportation has any chance of catching up there.
Public transit will never be practical in the suburban areas you mention. The politics of the area has little to do with it - although the suburban environment itself breeds conservatism due to:
It's bland, chain-store and planned-development uniformity,
It's lack of any forms of cultural expression,
It's privatization and lack of public spaces,
it non walk-ability and transit-ability; and,
the sealed isolation of life in an automobile.
All this leads to a lack of interaction between people-as-citizens and a sense of collective stake in a community. Even just walking down a sidewalk, one must at least make eye contact with a passer-by. This is solidarity-enhancing in a way that is very different than when one seals oneself in a car for even the most incidental errands.
The old, Randy Newman tune "Cars" comes to mind.
But, going back to the purely practical, I find that traffic problems often go away closer into the city because of public transit and because compact development greatly reduces car-miles driven even when a car is used. For example, DC, Arlington and Alexandria have none of the traffic congestion problems that the far less dense suburbs outside the Beltway do.
There are very few places in Virginia (and much of the rest of the USA) with vibrant functioning central urban spaces, or even functioning smaller-city downtowns. So, maybe you have trouble understanding what I am writing about here.
pjd412
We can't all move there. Nor would most of us want to.
Especially us ole Texans. :)
I was not suggesting specifically Pittsburgh - but at least, for starters move somewhere with sidewalks and places you can walk to.
Higher oil prices, caused by Wall Street speculation are good for a number of reasons. 1) Higher oil prices reduce wasteful use of oil. 2) Higher fuel prices raise the price of food, and we might become a little less obese. 3) Higher fuel prices make our invasions and bombings of other nations more expensive and a little less likely. 4) Higher oil prices give more money to Iran, Venezuela, and Syria for their defenses, making it a little less likely we will start more wars. 5) All of this makes Americans think, maybe, and more rationally, maybe about their domestic politics. Cheap fuel, cheap food, cheap wars all make for cheap politics.
Are you a completely insensitive elitist?
Higher fuel and food prices mean suffering and death for thousands of impoverished people.
In the US, higher fuel prices will throw a wet rag on the recovery. Also, in a nation without extensive public transpotation, higher fuel prices mean hardship for the already hurting working class.
Higher fuel prices also translate into billions for wealthy elites, furthering the economic polarization of America.
Your argument is a kind of market based libertarian method of creating a rational energy policy. Unfortunately, it would do so almost solely on the backs of the poor and working classes.
Maybe you, Serious Citizen, ought to think a little more humanely about domestic politics.
Higher fuel prices will not stop the American war machine
"3) Higher fuel prices make our invasions and bombings of other nations more expensive and a little less likely."
Unless, of course, you happen to be an oil rich target like Iran, in which case you become an even more tempting target.
Tax all stock transactions.
And, raise the capital gains tax on profits from stocks sales.
On the other hand, there must certainly be betting on an Israeli/US attack on Iran which would instantly drive oil prices through the roof. Lots of money to be made on that bet by amoral Wall Street gamblers.
If we were to watch volume on oil futures call options trading we might even be able to predict with good accuracy the time of the coming attacks. The insiders will have the information way ahead of everyone else, and the call volume should show this.
Oil has a future value. If you buy 100 barrels of oil and there isn't enough oil in 10 years, its value might double until supply meets our huge demand.
I consider people who buy gold hoping it will double in value to be stooges. There are dozens of barely unprofitable gold reserves waiting to be mined if the price goes up. Oil is different. Our crazy economy is running around the globe, trying to extract the very last ounce of oil/coal from the earth and oxidize it into the atmosphere with old Hummers and mercury-spewing smokestacks.
Personally, I think we're going to turn large swaths of desert into electricity/biodiesel production farms. Furthermore, almost all of the world's governments will agree to slap a whopping big tax on all petroleum/coal/uranium reserves pulled out of the ground and shipped anywhere. With any luck this will suck half of the value out of the oil speculators' investments.
I don't know if these long-term oil speculations will turn out well or not, but they might. Oil prices in the end will gyrate on the politics of climate change and peak oil, and I can't forecast short-term politics that well. Oh, and the U.S. Dollar is headed for stagflation within 5 years.
"Personally, I think we're going to turn large swaths of desert into electricity/biodiesel production farms."
I hope you are correct. We have the technology now, and we could build solar and wind energy for a lot less per megawatt produced than the cost of new coal, oil and uranium fueled plants. I believe this is being roadblocked by oil, coal and nuclear interests.
"Oh, and the U.S. Dollar is headed for stagflation within 5 years."
I would call you an optimist. I think that will happen much sooner.
Kent Shaw
Oh, and the U.S. Dollar is headed for stagflation within 5 years."
"I would call you an optimist. I think that will happen much sooner."
I'm with you!
Gold tracks both the dollar and the price of oil quite accurately, it is much easier to store than oil and actually has value, unlike a "fist full of dollars". In the end game, those who want oil will be trading gold for it, just like they have been doing for what they need for 5000 years. In the last few years gold has already doubled in value, mostly due to the declining dollar. Will it double again? If the dollars continues to lose value, you betcha! Your notion that there are unprofitable gold reserves just waiting to be mined is uninformed at best. A better statement would be that there are ever increasingly diminishing gold resources which are becoming evermore difficult to find and exploit at today's current prices.
We probably won't be turing large swaths of the desert into electricity and biodiesel farms either; we don't have the water for the crops or the electrical infrastructure to support such developments. Biodiesel as well as ethanol are negative energy products; it takes more oil based resources to grow and refine them than they supply. Virtually all the infrastructure for alternative energy based systems is dependent on a supply of cheap fossil fuels. As oil prices continue to increase in the face of diminishing supplies, alternative energy solutions will become increasingly expensive. They look attractive now because oil is still relatively cheap. They won't look so good, or perhaps even be feasible, when oil is $200.
Here's an interesting take on it by Richard Heinberg. Personally, I think he's onto something.
"As early as 1998, Campbell, Laherrère, and others were discussing a Peak Oil impact scenario that went like this. Sometime around the year 2010, they theorized, stagnant or falling oil supplies would lead to soaring and more volatile petroleum prices, which would precipitate a global economic crash. This rapid economic contraction would in turn lead to sharply curtailed energy demand, so oil prices would then fall; but as soon as the economy regained strength, demand for oil would recover, prices would again soar, and the economy would relapse. This cycle would continue, with each recovery phase being shorter and weaker, and each crash deeper and harder, until the economy was in ruins. Meanwhile, volatile oil prices would frustrate investments in energy alternatives: one year, oil would be so expensive that almost any other energy source would look cheap by comparison; the next year, the price of oil would have fallen so far that energy users would be flocking back to it, with investments in other energy sources looking foolish. Investment capital would be in short supply in any case because the banks would be insolvent due to the crash, and governments would be broke due to declining tax revenues. Meanwhile, international competition for dwindling oil supplies might lead to wars between petroleum importing nations, between importers and exporters, and between rival factions within exporting nations."
http://heinberg.wordpress.com/2010/03/03/214-life-after-growth/
What if Peak Oil is for real instead of just Wall Street alone? Put those two together and include no alternatives such as hemp and algae for oil and none of this should be surprising.
I'm with you on this one, Max. And while hemp and algae are parts of the solution, they will not be enough to drive this behemoth that runs on oil.
As with the problems, the solutions must be many.
Good challenge to bring forth. What do you think about the idea of bringing more jobs closer to where more people actually lives? The reason I ask is that in my case and probably for most Americans, most of the driving mileage comes from having to drive to and from work? I have to admit that hemp and algae alone won't substitute oil in terms of demand unless the labor is intense and Americans are prepared to pay for it. In my suburb, businesses are clustered around one area more than spread out. It's hard for me to tell whether to keep it crowded in one location or spread out.
"What do you think about the idea of bringing more jobs closer to where more people actually lives?"
Well yeah, why wouldn't anyone see the value in doing that? I belong to a local Transition Towns group and that is one of the tenets of re-localizing our towns.
In my personal case, I work ten miles from where I live. Not perfect, but a damn sight better than the 37 miles (74 round trip) I used to commute. I would like to cut that down to walking distance some day, but we'll see. Jobs aren't growing on trees anymore.
Glad to see that you're on the multiple-solution bandwagon. There are many, many good ideas, but we can't implement them all, not any single one - they must all be pushed. So, what are you doing to push hemp and algae in your neck of the woods?
"So, what are you doing to push hemp and algae in your neck of the woods?"
Unlike public transportation, hemp is a special issue and the reason for this is that the plant has been unfairly outlawed by the DEA for decades. Any statewide or local effort to legalize the crop is useless unless the Fed first ends federal prohibition of growing and cultivating the plant. In this case, only the feds in Washington can remove the ban. Ron Paul has tried to introduce legislation such as the Hemp Farming Act to at least make industrial hemp legal to grow and manufacture. My state of VA basically allows it. Even North Dakota (from votehemp.com) is struggling to get the DEA to allow the state its own rights on regulating hemp.
http://www.legis.nd.gov/assembly/61-2009/bill-actions/ba3026.html
I saw the legislation on hemp in ME too from votehemp.com and I am impressed. What stands between us and hemp production is the DEA.
The price rises are the result of peak oil. The intermediary steps run through several layers of social and physical engineering, including the fantasy reality game known as the "market." Despite the meanderings of the clueless author of this story, the reality of peak oil is undeniable. Even the administration recently admitted the truth of this.
As long as we work at finding scapegoats instead of preparing for an energy challenged future, we will be dooming ever greater numbers of people to ever larger doses of future suffering.
As long as our priority is to keep the big energy fiesta going no matter the cost, we are lost. We are essentially dooming all of humanity and a goodly number of species we could care less about.
Physics is unrelenting. The numbers the cornucopians wish for are fantasy. We will not have the same driveby WalMart lives, no business as usual, no hopping into electric cars to buy cheap plastic crap from China at the mall, no fast food burgers, no salads from the central valley of California, and no cheap flights to Vegas. Won't happen.
In five years, you will see strife, increasing war, perhaps martial law, food shortages, fuel shortages, riots, and cornpone fascism from all the rubes who are too dumb to see that the powers that be, including the Repuglicans and Obama, have been using these beer belly fascists to urge on policies completely against the rubes' own best interest. You will see a real culture war ala Mao's Cultural Revolution or the Khmer Rouge in Cambodia. People with cultured accents will be rounded up. Wear glasses? You may be detained. Have a degree? You will be shot. Can't happen here? It's happening.
Peal oil is the base cause. We have a crappy education system that keeps people from understanding we are on a sphere in space which means oil is finite. You can't have fascism without ignorance. And, the best part are all these "pundits" who purport to know something about energy can't seem to grasp these fundamental facts: Sphere in space = finite. Finite = limited resources.
We are doomed. Hansen is right. Humans are too dumb to live. Too bad they have to screw it up for the rest of the species.
Unlimited growth is impossible.
"In five years, you will see strife, increasing war, perhaps martial law, food shortages, fuel shortages, riots, and cornpone fascism from all the rubes who are too dumb to see that the powers that be, including the Repuglicans and Obama, have been using these beer belly fascists to urge on policies completely against the rubes' own best interest."
Sadly, I think you are correct.
"You will see a real culture war ala Mao's Cultural Revolution or the Khmer Rouge in Cambodia. People with cultured accents will be rounded up. Wear glasses? You may be detained. Have a degree? You will be shot. Can't happen here? It's happening."
Hopefully it won't get as bad as that, but who knows what will happen once the widespread violence begins. Mobs have a mind of their own.
Oil will become an increasingly precious commodity. Most people knows this. China and India will both continue an upward trajectory of oil use. It won't take all that long for gasoline to hit $5. After that $10 in less than a decade. If the US would begin seriously taxing energy, we would be a step ahead of the problems that await us. Energy "shocks" should not happen. We should expect them.
"China and India will both continue an upward trajectory of oil use."
That is only true if the oil supplies are infinite. Having been to those two countries earlier this year, I can tell you that efforts are under way to stop the destructive forces of yuppie style capitalism which includes oil guzzling. Unlike the USA, honest attempts are being made to switch to green technologies to mitigate the effects of the oil crisis. Go visit those two nations and prepare to be ashamed of the mess the USA has created on them thanks to "free trade", outsourcing, spoiling and brainwashing people into destroying their beautiful cultures and traditions with their lust for yuppie style capitalism, etc...
China already has a mandated fuel economy standard of 41 mpg.
My electric motor scooter, which is used for most of my local transportation, is Chinese and is made from entirely Chinese-developed and manufactures components.
And, Chinese firms are the only ones willing to sell their components - motor controllers, motors and lithium cells, to the do-it-yourself, small-mfg. electric vehicle market.
But yes, working against these efforts is the the cultural imperialism of globo-capitalism.