[johnmarkos]

The real price of gasoline (petrol) was between US$5.60 and US$15.14 in the U.S. in 1997, according to this report. Here's the executive summary:

http://www.icta.org/projects/trans/rlprexsm.htm

and here's the full report in PDF form:

http://www.icta.org/projects/trans/realpricegas.pdf

If gasoline does indeed cost US$15.14 a gallon with oil at <US$14/barrel (as it was in 1997), then the oil accounted for only 33 cents of that cost back then. Oil would have to go to >US$600 before it accounted for half of the real cost of a gallon of gasoline, if the high figure in this report is correct.

[pepper2000]

I'm not sure how you made the calculation of 33 cents. However, a gallon of gasoline doesn't require a full gallon of oil (at least not directly into the product) because gasoline includes various other ingredients. However, when you bring in refining energy costs and transportation costs, maybe it requires more than a gallon of oil to make a gallon of gasoline.

Environmental costs are also hard to quantify. I've even seen attempts to recalibrate the cost of oil by dividing the cost of the Iraq war by the number of barrels it has brought to the US.

[johnmarkos]

33 cents/gallon was a rough estimate. I merely divided the 1997-8 oil price of ~US$14/barrel by 42 gallons to get ~33 cents.

[johnmarkos]

My point was that the oil that was directly refined into gasoline accounted for a tiny fraction of what the report claimed was its real cost.

[larrydallas]

The war in Iraq has just driven us off of the cliff.

What was the cost per month? 5.8 billion or was that revised to 6 billion?

It might as well have been 60 billion a month because it is all being done with pretend money which is backed by nothing but an ever decreasing working base which is supporting a growing base of baby boomers which are retiring. All of the debt is based on speculation about the future and the US leading the world in technology and innovation.

The debt other nations buy from us (mainly China) is getting so out of hand that the currency will have to be devalued at some point. Time is a friend to the Iraqis and I'm pretty sure they would like the US to be there in the 6 billion a month or maybe more catagory for years.

The economic collapse might hit wayyyyyy before the peak oil effects do.