The effects of cheaper oil

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This past year has seen a fairly steady decline in gas prices across the country.

One year ago today, the Detroit Metro area was fueling their cars with an average price of gas at about $3.62. Today, Michiganders find themselves with the average price of gas more than a dollar cheaper at $2.43, according to The Daily Fuel Gauge Report.

This past year has seen a fairly steady decline in gas prices across the country. For car owners, including Oakland’s commuter-dominated campus, this has come as a relief after suffering the high prices of 2011-2013.

Across the globe, however, many experts are breathing the same sigh of relief, including professor Michael L. Ross.

Ross is a professor of Political Science at the University of California Los Angeles. His 2012 book, “The Oil Curse: How Petroleum Oil Shapes the Development of Nations,” was named an Outstanding Academic Title by Choice Magazine.

The Oakland Political Science department hosted Professor Ross this past Thursday for a lecture on international affairs. Ross spoke on the geopolitics of oil and the global effect of cheaper oil prices.

Professor Matthew Fails, associate professor in the political science department, said the department chose Ross because of his expertise on a unique topic.

“Oil has profound political consequences,” Fails said. “We are currently in the midst of historic declines in the price of oil, which presents the possibility that these effects might become magnified.”

Ross mentioned that the topic of gas prices in the United States has become a very sensitive issuesuch a sensitive issue that the federal tax on gasoline hasn’t been raised since 1993.

Ross, along with many politicians and economists, feels that with gas prices currently so low, now is the time to raise the federal gas tax without causing too much damage to the economy.

“We need to get off fossil fuels. There are no two ways around it,” Ross said. Having high oil prices lowers the amount of fossil fuels emitted, and “governments aren’t doing what they should be doing and taking into account climate change.”

On top of the issue of climate change, Ross sees another main global effect of cheaper oil prices. There can be no discussion on the global effect of oil prices that doesn’t address the Middle East.

Before oil was found, most of those countries were so poor they were barely even countries. Their government’s control comes from their immense wealth of oil, so when prices fall it means more chaos in the Middle East.

However, it may not be all bad. Ross stated in his lecture that lately we have seen most countries attempting to be internationally cooperative, except the key oil exporting countries. The countries dependent on oil imports are very likely to cooperate, but the oil exporting countries are the ones with control.

A drop in oil prices may force an increase in cooperation from oil exporting countries.

There is no telling where the price of oil will go next. The price of oil is so sensitive to changes in supply and demand it is almost impossible to forecast. Ross explained that if there’s one thing history has told us, it’s that oil prices are not likely to stay steady.

“Prices may look low now but what they are, are volatile,” Ross said.