Published: September 06, 2008 01:05 pm      

Panel provides ideas for combating high gas prices

A panel of petroleum and business experts told a crowd gathered at Indiana University Southeast in New Albany on Friday that solving the nation’s energy crisis won’t be simple.

“We are consuming a lot more oil per capita than we did in past years,” said Dr. Jerry Conover, director of the Indiana University Business Research Center.

The Southern Indiana Economic Forum was hosted by U.S. Rep. Baron Hill, who is preparing to travel back to Washington, D.C., on Monday, to push a new measure that would tighten restrictions on the Future Commodities Trading Market.

“There is no silver bullet to solve our nation’s energy crisis,” Hill said.

Scot Imus, executive director of the Indiana Petroleum Marketers and Convenience Store Association and one of the panelists, said he supports Hill’s legislation.

Future commodities traders now consist of people in noncommercial fields, which is one cause for high gas prices, Imus said.

“(The market) used to be only people who wanted to buy the crude oil,” Imus said, adding companies that control a sizable percentage of the market can easily swing gas prices regardless of supply and demand.

Gas retailers, such as service stations, are actually making less per gallon of fuel in 2008 than last year, Imus said.

He said in 2007, retailers were clearing 7.5 cents a gallon, but now the mark is closer to 1.2 cents a gallon.

The high gas prices also are driving up the cost of other products, such as plastics, tires and pharmaceuticals, Conover said.

The cause of high prices may be as detailed as possible solutions. One of Hill’s challengers for the 9th District congressional seat, Libertarian Eric Schansberg, recently said speculation cannot account for the epic increases at the pump.

He said a weak dollar is one of the biggest reasons for the price jumps.

Imus agreed that a weak dollar has impacted the market, and a recent rebound with slightly lower gas prices proves it.

“Part of the decline in crude oil [prices] has been attributed to a stronger dollar,” he said.

As for solutions, a combination of drilling, conservation and alternative energy sources was suggested by the panel, which also included Bloomington City Councilman David Rollo and Charlie Laird, general manager of Inland Terminals.

While drilling is being pushed as an immediate solution by some, Rollo said it would take 10 years for it to impact prices.

“That does a disservice in terms of really forming a strategy,” he said in terms of drilling being the only solution.

Imus said until the Future Commodities Market has more restrictions, getting additional oil from within the country might not have much effect at all.

Republican Mike Sodrel, who is challenging Hill for the 9th District congressional seat, said recently that while drilling might not be the only solution, it has to be part of it.

“We’re going to have to increase the supply,” Sodrel said. “We can’t get out of this problem without drilling.”

Hill has suggested drilling on federal land, coupled with releasing oil from the Strategic Petroleum Reserve as a way to provide immediate relief at the pump.

His long-term solutions include increasing fuel economy standards, reducing energy intake, investing in renewable energy and additional drilling on the outer-continental shelf.

There is still no word on whether Hill and Sodrel will join Schansberg at an Oct. 21 debate at Vincennes University in Jasper. The Libertarian Party candidate would like to see as many debates as there were during the 2006 congressional race.

“It should be a no-brainer to have the debates we had in 2006 — in Bloomington, New Albany and Jasper. As the incumbent, Baron Hill has the most control in arranging the debates,” Schansberg said.