Cause and Effects on Today's Rising Gas Prices.

            

            

             Natural gas is not a renewable resource, since there is a fixed amount of it trapped in the Earth. However, many people carry the misconception that there is a very limited amount of natural gas, and that we may use all of it up. This isn"t true. The gas shortages of the 1970's were prompted by the government"s lack of faith in the industry"s ability to discover and develop new reserves, not by lack of gas supply. The unfortunate impression left by the shortages of gas in the 1970's is that there is little gas left to be discovered. On the contrary, the gas resource base is vast, and probably even larger than currently estimated. People are often confused by the difference in "proved reserves", those that could be economically produced with the current technology, and the total natural gas resource base.

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             Natural Gas Week (see note).

             I am presenting an informal study on the cause and effects of today's rising gas prices. There are two views as to the cause to these skyrocketing gas prices. The newspaper articles and The Associated Press are linking the problems to the "Organizational of Petroleum Exporting Countries (OPEC) cutting its crude oil production by roughly 8 percent last spring". This statement is true but there is a reason behind OPEC's decision to decrease production. This reason ties into the second view as to the cause of rising gas prices. As I had suspected all along, the reason for the increase is a slowing in production that is directly linked to the changing industry and technological standards. There's a new kind of business in town and its name is electronic commerce (e-commerce or e-business). One of the basic fundamental principles of e-commerce is the just-in-time practice. .

             Proctor & Gamble founded just-in-time practices. "As part of the Efficient Consumer Response (ECR) program, (developed by the grocery industry) consumer packaged goods giant Proctor & Gamble, with headquarters in Cincinnati, Ohio, developed a continuous replenishment program (CRP) that gained industry wide attention.