I’ve been thinking about contractions. Actually I’ve been thinking about the Summer 2008 driving season, recessions, the March 2008 trade numbers, our trade deficits, our energy deficits, and worldwide gas prices at the pump. Official numbers for our trade deficits, the cumulative trade deficit(s) for the calendar year thus far, our energy import sources, and the “at the pump pricing” for gasoline around the world for this past March were released last week. The results and implications for US/us were actually quite surprising—at least they were not what I had expected.
You see, the Summer of 2008 driving season usually kicks off on this coming Memorial Day weekend. Like everyone else I am already shelling out more per week to fuel up my vehicle(s) and am re-allocating expenditures on convenience (and junk) food, eating out, summer apparel, and anything else I don’t absolutely need to buy. I’ve never been a “power shopper” and only frequent the malls/retailers when I am pretty much buying gifts for others. From recent conversations, this is becoming common. The definition of recessions is based upon a contraction in spending and consumption. Recent stats for many large retailers showed contraction(s) in 2008’s first quarter.
Our eight largest trade deficits for the month of March 2008 (and 2008 Year to Date) are as follows: China $16.072 Billion ($54.745 Billion YTD), Japan $7.490 Billion ($20.959 Billion YTD), Canada $6.483 Billion, ($18.798 Billion YTD), Mexico $5.974 Billion ($16.613 Billion YTD), Germany $4.483 Billion ($10.802 Billion YTD), Nigeria $3.283 Billion ($9.580 Billion YTD), Venezuela $2.754 Billion ($8.773 Billion YTD), and Saudi Arabia $2.697 Billion ($9.584 Billion YTD), our hands-down overall biggest dollar denominated imports are for crude oil and petroleum distillates. While dollar values for energy suppliers rose, trade deficits with the others tended to decrease slightly. The March 2008 energy imports (in barrels) were mostly down from a year ago.
The top eight sources of Uncle $ugar’s crude oil imports for March 2008 were: Canada (1.727 Million barrels per DAY—MBPD) down 3%,Saudi Arabia (1.535 MBPD) up 26%, Mexico (1.232 MBPD) down 24%, Nigeria (1.138 MBPD) down 12%, Venezuela (0.858 MBPD) down 17%, Iraq (0.773 MBPD) up 48%, Angola (0.375 MBPD) down 46%, and Algeria (0.232 MBPD) down 54%. Uncle $ugar’s top eight sources of total petroleum imports for March 2008 were: Canada (2.303 MILLION barrels per DAY—MBPD) down .1%, Saudi Arabia (1.542 MBPD) up 24%,Mexico (1.351 MBPD) down 23%, Nigeria (1.158 MBPD) down 14%, Venezuela (1.015 MBPD) down 21% , Iraq (0.773 MBPD) up 48%, Algeria(0.427 MBPD) down 41%, and Russia (0.394 MBPD) down 13%. Crude imports averaged 9.385 MBPD at a March import average price per barrel of crude oil (@ $89.85) was a record. It is important to note that last Friday’s crude pricing reflected an all-time high of over $ 127 per barrel. While consumption may be contracting, the escalating per barrel price will negatively skew the trade deficit figures for April and May when they later become available.
“Pump” prices now hover nationwide at the $4.00 range. US/us are not used to this... and we collectively feel grossly ripped off—we shouldn’t! The worldwide March “at the pump” prices rank the USA (@ $3.45/gallon in March) in the 108th position globally. Gas prices (in dollars per gallon equivalents) then were $9.58 in Eritea, $8.73 in Norway, $8.38 in the UK, $ 8.37 in the Netherlands, $8.31 in Monaco, $8.28 in Iceland, $8.22 in Belgium, $8.07 in France, $7.86 in Germany, and $7.84 in Portugal. Working from the lowest worldwide pricing, the US ranks in the 44th position from the bottom. Venezuela was the cheapest at 12 cents per gallon, Iran followed at 40 cents, Saudi Arabia was at 45 cents, Libya was at 50 cents, and Swaziland was at 54 cents. Don’t you wish you could “fill up” in Caracas?
I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.
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This story was published on May 19, 2008.