This is just another reason why we should have gotten out of burning oil long ago. This was all known decades ago. The monopolists though used a false-propaganda campaign on the people to convince them to become materialistic in a huge way. We ended up with the "Me Generation." We ended up with Yuppiedom. We ended up with Ronald Reagan and his disastrous and woefully ignorant, self-centered, deregulation/privatization, anti-environmentalism schemes.
June 8, 2008
By LOUIS UCHITELLE
Surging oil prices are beginning to cut into the profits of a wide range of American businesses, pushing many to raise prices and maneuver aggressively to offset the rising cost of merchandise made from petroleum.
Airlines, package shippers and car owners are no longer the only ones being squeezed by the ever-mounting price of oil, which shot up almost $11 a barrel on Friday alone, to $138.54, a record.
Companies that make hard goods using raw materials derived from oil, like tires, toiletries, plastic packaging and computer screens, are watching their costs skyrocket, and they find themselves forced into unpleasant choices: Should they raise prices, shift to less costly procedures, cut workers, or all three?
Even companies that have been performing well in the economic downturn are sounding notes of caution.
Natural oils have been substituted for ingredients made from petroleum; for example, palm oil now goes into a variety of laundry soaps. But like rubber, the cost of palm oil and other natural commodities is rising.
No business in America produces more of the oil-based ingredients that go into the nation's products than the Dow Chemical Company, based in Midland, Mich. From Dow's petrochemical operations come the basic ingredients of a wide variety of plastic bottles and packaging, including numerous containers once made of glass or tin.
Indeed, paint, computer and television screens, mobile phones, light bulbs, cushions, paper, mattresses, car seats, carpets, steering wheels and polyesters are all made with ingredients that Dow and other chemical companies refine from oil and natural gas.
Dow's sweeping price increases will probably have a domino effect, resulting in higher prices or, more likely, shrinking profits, analysts say. Constrained by the weak economy and fewer wage earners among their customers, the nation's retailers have so far not been able to pass on to consumers much of the rising cost of products that depend on oil. The Consumer Price Index, minus food and energy, is barely rising.