Italy’s Minister of Industry Claudio Scajola and Brazil’s Energy Minister Edison Lobao were among consumer-nation officials attending the Jeddah summit that said more supply was needed to ease prices. “We expect Saudi Arabia to open the taps,” Austrian Economy Minister Martin Bartenstein said in an interview two days ago. “One third of inflation in the euro zone comes from energy and inflation is now of importance.”

Speaking in Jeddah today, the Austrian minister said: “We would like to see more oil on the market. That is the only action I can think of that can discourage the speculators.”

Adam Sieminski, chief energy economist at Deutsche Bank AG, and other analysts maintain that consumers will need to curtail demand before prices head lower. The biggest drop in prices in 11 weeks came on June 18, after the world’s second-biggest oil consumer, China, raised gasoline, diesel and power prices to rein in energy use.

Saudi Arabia will increase production capacity to 12.5 million barrels a day of oil by the end of next year and could add a further 2.5 million barrels a day if needed, from some new giant fields, Naimi said.

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It was almost inevitable that a combination of $4-a-gallon gas, public anxiety and politicians eager to win votes or repair legacies would produce political pandering on an epic scale. So it has, the latest instance being President Bush’s decision to ask Congress to end the federal ban on offshore oil and gas drilling along much of America’s continental shelf.

This is worse than a dumb idea. It is cruelly misleading. It will make only a modest difference, at best, to prices at the pump, and even then the benefits will be years away. It greatly exaggerates America’s leverage over world oil prices. It is based on dubious statistics. It diverts the public from the tough decisions that need to be made about conservation.

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One was an oilman from Texas, the other a high-paid energy executive. Despite that, or perhaps because of it, for seven years George W. Bush and Dick Cheney have been unable to persuade Congress and the public that domestic oil drilling is an answer to America’s energy needs.

With the clock running down on his presidency, Mr. Bush made one last push Wednesday by calling on Congress to end the 27-year moratorium on most offshore drilling. With oil at more than $130 a barrel, gasoline over $4 a gallon and the broader economy threatened, the White House is betting it can finally break a decades-old Washington deadlock between those who favor domestic oil exploration and those who say conservation is the key.

The question is whether Americans are feeling enough pain at the pump to force their elected leaders to go along, and whether it will make any real difference if they do.

“If Congressional leaders leave for the Fourth of July recess without taking action, they will need to explain why $4-a-gallon gasoline is not enough incentive for them to act,” Mr. Bush said Wednesday in the White House Rose Garden. “And Americans will rightly ask how high oil ”” how high gas prices have to rise before the Democratic-controlled Congress will do something about it.”

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Abandoning grueling freeway commutes and the ennui of San Fernando Valley suburbs, Mike Boseman recently found residential refuge in this Southern California city. His apartment building straddles a light-rail line, which the 25-year-old insurance broker rides to and from work in Los Angeles.

Richard Wells is more than a generation older but was similarly attracted to the Pasadena apartment building. The British-born scientist retains what he calls a European preference for public transportation despite his nearly 30 years in California. Plus, he said, the building’s location means, “I can walk to a hundred restaurants, the Pasadena symphony and movie theaters.”

Messrs. Boseman and Wells embody trends that are dovetailing to potentially reshape a half-century-long pattern of how and where Americans live: The driveable suburb — that bedrock of post-World War II society — is for many a mile too far.

In recent years, a generation of young people, called the millennials, born between the late 1970s and mid-1990s, has combined with baby boomers to rekindle demand for urban living. Today, the subprime-mortgage crisis and $4-a-gallon gasoline are delivering further gut punches by blighting remote subdivisions nationwide and rendering long commutes untenable for middle-class Americans.

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Here, in some of the best soil in the world, the stunted stalks of Dave Timmerman’s newly planted corn are wilting in what sometimes look more like rice paddies than the plains, the sunshine glinting off of pools of collected water. Although time is running out, he has yet to plant all of his soybean crop because the waterlogged soil cannot support his footsteps, much less heavy machinery.

Timmerman’s small farm has been flooded four times in the past month by the Wildcat Creek, a tributary of the Cedar River which overflowed its banks at a record 31 feet last week, causing catastrophic damage in nearby Cedar Rapids and other eastern Iowa towns and farmsteads.

“In the lean years, we had beautiful crops but they weren’t worth much,” Timmerman said, surveying his farm, which his family has tended since his great-great-grandfather. “Now, with commodity prices sky high, mother nature is throwing us all these curve balls. I’m 42 years old and these are by far the poorest crops I’ve ever seen.”

And he added, “It’s going downhill by the day.”

As the floodwaters receded in some areas, they rose in others.

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Are we living in the last century of our civilization? Is it possible that all of our technology, knowledge and wealth cannot save us from ourselves? Could our society actually be heading towards collapse?

A dramatic preview of an unprecedented ABC News event called “Earth 2100.”According to many of the world’s top scientists, the answer is yes, unless we take action now.

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Don’t expect relief from stratospheric gasoline prices any time soon, the Energy Department said Wednesday.

Gas prices will likely hover around $4 a gallon through next year, as oil prices continue above $100 a barrel before moderating in 2010, Guy Caruso, administrator of the Energy Information Administration (EIA), told a House hearing.

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This year’s rapid run-up in crude oil prices might have prompted silly legislation at any time — but the fact that it has happened in an election year has fostered a sort of wrongheadedness renaissance. Lawmakers from both parties are scrambling to dust off failed strategies from years past and tout them as new and improved ways of halting oil’s meteoric rise. None of them will work, of course, nor are they intended to; they serve only to mislead the public into thinking that Washington is looking out for consumers.

Exhibit A in the case against congressional Democrats as wise stewards of the energy economy is which failed to advance Tuesday after it got too few votes to head off a filibuster. It would have imposed a windfall-profits tax on oil companies and allowed the U.S. attorney general to sue OPEC on antitrust grounds, among other things.

Trying to find an economist who thinks a windfall-profits tax is a good idea is like searching for a climatologist who thinks global warming is caused by trees.

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It isn’t even summer yet, and people in New England are already fretting about how they’ll pay to heat their homes next winter. The region relies heavily on home heating oil, and prices are well above $4 a gallon. Some families barely made it through last winter’s expensive heating season.

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As expected, the IEA [International Energy Agency] cut slightly its forecast for annual oil demand growth, but surprised the market with a deep reduction in its forecast for supply growth from non-Opec nations, leaving the world more dependent on the producers’ cartel.

It cut its demand growth forecast further by 80,000 b/d to an annual increase of 800,000 b/d because of record high prices, the slowing US economy and the partial removal of fuel subsidies in some Asian countries.

However, the agency warned that so far, there were “very few signs of slowing demand in non-OECD countries where economic growth is far more significant than price in determining demand”.

The cut in the IEA’s forecast for oil demand growth was overshadowed by a larger cut in forecast supplies. The agency cut its forecast for non-Opec supply growth to just 455,000 b/d, or 225,000 b/d below last month’s forecast. It expected most of the non-Opec fresh output to be in the form of biofuels, which would account for 72 per cent of the supply increase.

The non-Opec supply growth forecast for 2008 is now below the growth achieved by the group both in 2007 and 2006, in spite of significantly higher oil prices.

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Gasoline prices reached a national average of $4 a gallon for the first time over the weekend, adding more strain to motorists across the country.

But the pain is not being felt uniformly. Across broad swaths of the South, Southwest and the upper Great Plains, the combination of low incomes, high gas prices and heavy dependence on pickup trucks and vans is putting an even tighter squeeze on family budgets.

Here in the Mississippi Delta, some farm workers are borrowing money from their bosses so they can fill their tanks and get to work. Some are switching jobs for shorter commutes.

People are giving up meat so they can buy fuel. Gasoline theft is rising. And drivers are running out of gas more often, leaving their cars by the side of the road until they can scrape together gas money.

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The president of the European Central Bank, Jean-Claude Trichet, on Monday called on oil producers and consumers to learn from past mistakes if Western economies were to avoid a repeat of the high inflation and unemployment that followed the first global oil shock in 1973.

That year is widely acknowledged as an economic watershed, a time when an OPEC oil embargo led to a spiral of higher prices, recession in Western economies and a wrenching contraction in the early 1980s that finally put an end to a decade of sharp inflation.

No one, whether Western consumers or oil suppliers, should want to repeat that history, Trichet said. “There is a joint interest in behaving as properly as possible,” he said.

Trichet spoke at the Forum for New Diplomacy, a series of periodic discussions organized by the International Herald Tribune and the Paris-based Académie Diplomatique Internationale, on the occasion of the 10th anniversary of the ECB.

He did not specify what suppliers might do, but some countries, including the United States, have urged oil exporters to pump more crude to bring down prices.

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With gas prices relentlessly soaring, Americans are being forced to rethink their driving habits. Many are combining trips, driving less or shifting to mass transit.

Then there are the “hypermilers,” drivers who strive to boost their gas mileage by changing their behavior behind the wheel.

They include Kent Johnson, who was found recently at a parking lot outside Laurel, Md., leaning against his red Chevy Aveo hatchback, holding his right shoe.

He had driven there with one shoe off, the one for the accelerator foot, “so you can feel the pedal pressure a little bit easier,” he explains. “You know, when you’re trying to eke that extra little bit, then, just small things can add up.”

Most of Johnson’s techniques are simple: Slow down, ease up on the accelerator, coast in neutral down hills.

“I drive with my shoe off ”” that’s extreme,” he says.

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The average price of gasoline in the U.S. hit $4 a gallon for the first time Sunday, the latest milestone in a run-up in fuel prices that is sapping consumer confidence and threatening to nudge the nation into recession.

The record nationwide average for regular-gasoline prices, announced by auto club AAA, follows Friday’s near-$11 surge in oil prices to a record $138.54 a barrel. Both are part of what, by some measures, is the worst energy-price shock Americans have faced for a generation, in terms of its toll on their pocketbooks.

In recent days, soaring fuel prices and disappointing employment data have reignited fears that the nation’s economy — which has taken a pounding over the past year from a housing downturn, credit crunch and weakening job market — will slip into recession, or pull back further if a recession is already under way. Rising fuel prices are straining household budgets, damping the spending that drives more than two-thirds of the nation’s economic activity.

“What we’re seeing here is a lot of additional pressure on a consumer sector that was soft to begin with,” said Alliance Bernstein economist Joseph Carson. “Is it a tipping point by itself? It’s close.”

Read it all from the front page of this morning’s Wall Street Journal.

Unfortunately, instead of hiking the price ourselves by means of a gasoline tax that could be instantly refunded to the American people in the form of lower payroll taxes, we let the Saudis, Venezuelans, Russians and Iranians do the taxing for us ”” and pocket the money that the tax would have recycled back to the American worker.

This is insanity. For 25 years and with utter futility (starting with “The Oil-Bust Panic,” The New Republic, February 1983), I have been advocating the cure: a U.S. energy tax as a way to curtail consumption and keep the money at home. In this space in May 2004 (and again in November 2005), I called for “the government ”” through a tax ”” to establish a new floor for gasoline,” by fully taxing any drop in price below a certain benchmark. The point was to suppress demand and to keep the savings (from any subsequent world price drop) at home in the U.S. Treasury rather than going abroad. At the time, oil was $41 a barrel. It is now $123.

But instead of doing the obvious ”” tax the damn thing ”” we go through spasms of destructive alternatives, such as efficiency standards, ethanol mandates, and now a crazy carbon cap-and-trade system the Senate debated last week. These are infinitely complex mandates for inefficiency and invitations to corruption. But they have a singular virtue: They hide the cost to the American consumer.

Want to wean us off oil? Be open and honest. The British are paying $8 a gallon for petrol. Goldman Sachs is predicting we will be paying $6 by next year. Why have the extra $2 (above the current $4) go abroad? Have it go to the U.S. Treasury as a gasoline tax and be recycled back into lower payroll taxes.

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Energy ministers of advanced nations expressed “serious concerns” about soaring oil prices and urged producers to lift production through greater investment and provide more transparency on oil supply data.

A joint communiqué by the Group of Eight ministers, also signed by China, India and South Korea, stopped short of the tough language demanded by Kevin Rudd, Australia’s prime minister. He urged G8 leaders to “apply the blowtorch to Opec”, which he blamed for the rise in crude oil prices to a record $138.54, after a $10.75 jump on the New York Mercantile Exchange on Friday.

Ministers meeting in Aomori, northern Japan, said: “Current high oil prices are unprecedented and against the interest of either consuming or producing nations.”

The producers among the G8 said they would seek to raise production and called on “other producing countries to increase investment to keep markets well supplied”.

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Toss a barrel of $139 oil into the economy and the ripples will swamp some of the boats trying to stay afloat in the current sea of economic troubles. And planes. Airlines are grounding their least fuel-efficient planes in an attempt to cut costs. So fewer budget-priced seats will be available to holidaymakers. Businessmen, too, are beginning to respond to the rising cost of company meetings by discovering the virtues of teleconferencing. Of course, home-bound consumers and desk-bound businessmen could drive, but petrol prices being what they are, that, too, is expensive.

All of which adds to the pressure on politicians to do something. Not for them Ronald Reagan’s famous plea to his officials: “Don’t just do something, stand there.” Some sensible new policies are badly needed but that is not on the cards, since the inclination of politicians is to do the opposite of what needs doing.

In their never-ending hunt for the quick fix, politicians in America and Britain want to ease the pain at the pumps by lowering petrol taxes. Never mind that prices would soon rise so that the net effect would be to lower the tax receipts of the US and UK Treasuries and increase those of the House of Saud, Hugo Chavez, Vladimir Putin and others not kindly disposed to western democracies. Even if prices did fall, the result would be to encourage greater use of petrol, and to discourage the development of alternatives to the use of oil-based products.

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The likelihood that the U.S. is in a recession appeared to increase Friday, following weeks of hopes that the country might be skirting one.

Unemployment rose sharply and payrolls shrank for the fifth consecutive month. The economy news came on a day that oil surged to record prices, the dollar weakened and the Dow Jones Industrial Average plunged nearly 400 points. The deteriorating job numbers led markets to scale back the odds that the Federal Reserve will boost short-term interest rates this fall to ward off inflation.

The jobless rate posted its largest one-month gain in two decades, rising to 5.5% in May from 5.0% in April, the Labor Department reported Friday. Payrolls, measured by a separate survey, fell by 49,000 jobs last month, bringing the tally of job losses so far this year to 324,000.

The rise in unemployment has been accompanied by higher food and energy prices, pushing up the “misery index” — the sum of the unemployment and inflation rates — to around 9.4, the highest level since the recession of the early 1990s apart from a one-month blip in 2005.

Read it all from the front page of this morning’s Wall Street Journal.

Oil prices… [hit new record highs] Friday on an analyst prediction that prices could hit $150 by July 4 and also continued upward pressure from comments made by the president of the European Central Bank regarding an interest-rate hike.

Ole Slorer of Morgan Stanley said he expected a “short-term spike in oil prices,” on the back of rising demand in Asia, Dow Jones Newswires reported.

Read it all. Ugh.

The world needs to invest $45 trillion in energy in coming decades, build some 1,400 nuclear power plants and vastly expand wind power in order to halve greenhouse gas emissions by 2050, according to an energy study released Friday.

The report by the Paris-based International Energy Agency envisions a “energy revolution” that would greatly reduce the world’s dependence on fossil fuels while maintaining steady economic growth.

“Meeting this target of 50 percent cut in emissions represents a formidable challenge, and we would require immediate policy action and technological transition on an unprecedented scale,” IEA Executive Director Nobuo Tanaka said.

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The biofuel debate is electrifying the UN food price crisis summit in Rome, pitting nations against each other and risking transforming bioenergy – once hailed as the ultimate green fuel – into the villain of the piece, the root cause behind global food price spikes.

Biofuel uses the energy contained in organic matter – crops like sugarcane and corn – to produce ethanol, an alternative to fossil-based fuels like petrol.

But campaigners claim the heavily subsidised biofuel industry is fundamentally immoral, diverting land which should be producing food to fill human stomachs to produce fuel for car engines.

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People who fail to act over global warming are “as guilty” as Josef Fritzl – denying our children a future, a senior Anglican bishop has warned.

The Bishop of Stafford, the Rt Rev Gordon Mursell, said a refusal to face the truth about climate change was akin to locking up future generations and “throwing away the key”.

He insisted he was not accusing those who ignored the environment of being child abusers, but added that such shocking parallels were needed to make people aware of their responsibility.

Fritzl, 73, held his daughter Elisabeth captive for 24 years in a dungeon beneath the family home in Austria, repeatedly raping her and fathering seven children, one of whom died days after birth.

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Gas prices rose another cent on Saturday to $3.96 a gallon nationwide. The high prices are already prompting thousands of SUV owners to try and dump their gas guzzlers. Andrew Leonard, who writes the “How the World Works” blog for Salon.com, talks with Guy Raz about all the things that affect prices at the pump.

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The bandit pulled his truck to the back of a Burger King in Northern California one afternoon last month armed with a hose and a tank. After rummaging around assorted restaurant rubbish, he dunked a tube into a smelly storage bin and, the police said, vacuumed out about 300 gallons of grease.

The man was caught before he could slip away. In his truck, the police found 2,500 gallons of used fryer grease, indicating that the Burger King had not been his first fast-food craving of the day.

Outside Seattle, cooking oil rustling has become such a problem that the owners of the Olympia Pizza and Pasta Restaurant in Arlington, Wash., are considering using a surveillance camera to keep watch on its 50-gallon grease barrel. Nick Damianidis, an owner, said the barrel had been hit seven or eight times since last summer by siphoners who strike in the night.

“Fryer grease has become gold,” Mr. Damianidis said. “And just over a year ago, I had to pay someone to take it away.”

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If the speculators are not to blame, what about the oil companies, which have failed to increase output in spite of record profits? Profiteering, say some. However, that accusation doesn’t stand up to much scrutiny either. The oil price is set in a market. For Shell, Exxon et al to hoard oil underground would be to leave billions of dollars of investment languishing unused. Others fear that oil is pricey because it is running out. But there is little evidence to support the doctrine of “peak oil” in its extreme form. The Middle East still seems to contain a sea of the stuff. Even if new finds elsewhere have been rarer and less accessible than in the past, vast quantities of oil could now be profitably stripped from tar sands and shale.

The truth is more prosaic. Finding and developing new oil fields is an expensive and time-consuming business. The giant new fields in the deep water off Brazil are unlikely to produce oil for a decade or more. Furthermore, oil is perverse. When prices are low, oil-rich countries welcome the low-cost, high-tech and well-capitalised oil firms. When prices are high, countries like Russia and Venezuela kick them out again. Likewise the engineers, survey ships and seismic rigs that oil firms need to find and produce new deposits are expensive right now. The costs of finding oil have, temporarily, doubled precisely because everybody wants to give them work.

So the oil shock will take time to abate. Some greens may welcome that, seeing three-figure oil as a way of limiting greenhouse emissions. Conservation will indeed increase. But everything high prices achieve could be done better by sensible carbon taxes. As well as curbing oil use, high prices have put tar sands in business which create far more carbon dioxide than conventional oil. Profits are going to ugly oil-fed regimes, not Western exchequers. And the wild unpredictability of prices will blunt the effect of dear oil on people’s behaviour.

From this perspective, governments should speed up the adjustment””or at least stop delaying it.

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When Ohio’s Kent State University offered custodial staff the option of working four days a week instead of five to cut commuting costs, most jumped at the chance, part of a U.S. trend aimed at combating soaring gasoline prices.

“We offered it to 94 employees and 78 have taken us up on it,” said university spokesman Scott Rainone.

The reason is simple: rising gas prices and a desire to retain good workers. And while so far only the university’s custodians are eligible, Rainone hopes the option will be offered to all departments — including his own.

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This week, a battalion of angry addicts brought London to a standstill. They snarled up the traffic, then marched on 10 Downing Street to demand their fix at prices they can afford. Across the world, in countries as different as the US and Iran, fellow junkies are rising up in rage. Their addiction is to a gloopy black drug called petrol ”“ and we are all about to go cold turkey.

In the past seven years, the price of oil has soared from $30 (£15) a barrel to $140. By the end of next year it could be at $200. No matter how much we plead or howl at our governments, it will never go back: the final act of the Age of Oil has begun.

The era that is ending began at 10.30am on 10 January 1901, on a high hill called Spindletop in south-eastern Texas. A pair of pioneer brothers managed to drill down into the biggest oilfield ever found. Until then, the dribbles of oil that had been discovered were used only for kerosene lamps ”“ but within a decade, this vast gushing supply was driving the entire global economy. It made the 20th century ”“ its glories, and its gutters ”“ possible. Humans were suddenly able to use in one frenetic burst an energy supply that had taken 150 million years to build up. A species that died before the age of 40 after a life of boring, back-breaking labour spurted forward so far and so fast that today billions live into their eighties after a life of leisure and plenty.

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Imagine for a minute, just a minute, that someone running for president was able to actually tell the truth, the real truth, to the American people about what would be the best ”” I mean really the best ”” energy policy for the long-term economic health and security of our country. I realize this is a fantasy, but play along with me for a minute. What would this mythical, totally imaginary, truth-telling candidate say?

For starters, he or she would explain that there is no short-term fix for gasoline prices. Prices are what they are as a result of rising global oil demand from India, China and a rapidly growing Middle East on top of our own increasing consumption, a shortage of “sweet” crude that is used for the diesel fuel that Europe is highly dependent upon and our own neglect of effective energy policy for 30 years.

Cynical ideas, like the McCain-Clinton summertime gas-tax holiday, would only make the problem worse, and reckless initiatives like the Chrysler-Dodge-Jeep offer to subsidize gasoline for three years for people who buy its gas guzzlers are the moral equivalent of tobacco companies offering discounted cigarettes to teenagers.

I can’t say it better than my friend Tim Shriver, the chairman of Special Olympics, did in a Memorial Day essay in The Washington Post: “So Dodge wants to sell you a car you don’t really want to buy, that is not fuel-efficient, will further damage our environment, and will further subsidize oil states, some of which are on the other side of the wars we’re currently fighting. … The planet be damned, the troops be forgotten, the economy be ignored: buy a Dodge.”

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Exxon-and OPEC-bashing in Congress, and a host of populist musings in the media and blogosphere, have it wrong. Washington’s politicians and policy-makers are to blame for much of the rise in oil prices because they have been woefully ignorant of economic developments around the world.

Prices are soaring, in part, because oil is denominated in U.S. dollars and the dollar has declined, thanks to Washington’s overspending on wars, trade, subsidies and government budgets. Investors have also abandoned credit markets since the (thanks to U.S. deregulation) subprime meltdown and put their money into real assets instead.

But the biggest reason prices have been soaring is the future supply and demand outlook.

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