I believe the price of oil will slowly and steadily increase again this year. I also anticipate a shift of freight away from the ports of Long Beach and Los Angeles.
Although the outlandish price of oil within the 12 months preceding our national elections brought to the forefront the need for a real, long-term, coordinated U.S. energy policy, my belief is that prices were artificially depressed in the months preceding the election by those both outside and inside the country who were concerned with the impact that oil prices would have on our national elections and the current “power” structure within our government. With the elections over, prices will start climbing again, albeit slowly, so that President-elect Obama will not have to address oil prices immediately. Oil prices will trend upward once those ultimately controlling oil prices realize that they need to “make hay while the sun shines,” with probably only a five-to-seven-year window or so to maximize their supply advantage.
My second thought is that companies will be looking for longer-term alternatives to replace the Southern California ports. The impact of the clean-trucks rules on pricing at these ports, coupled with increased costs associated with newer equipment, will make imports and exports through the Southern California ports less attractive, and hurt the ports’ business.
The world economy and our world economic powers are confronting issues they have never faced before. Other nations are looking for positive leadership from the U.S., rather than the negativity and lack of a positive coordinated direction they’ve experienced during the past two presidential terms in our government.
Winston Churchill once said, “Democracy is the worst form of government, except for all the others.” It is time for our government to step up and show what we as a country can do to stabilize the world economic crisis, and make this world a safer place in the future for all children.