The price of a barrel of oil has more than doubled in the past year and a half, from $60 in early 2007 to a high of $142 earlier this summer. This has led to a search for someone to blame for this price increase and for government policies to reduce oil prices.

The actions of energy traders, more pejoratively known as speculators, are being targeted by Ralph Nader, the chief executives of the major domestic airlines and many members of Congress as a major cause of this price increase. However, data from world oil market demonstrates that it is unlikely that speculators have had a noticeable impact on world oil prices.

To maximize environmental benefits from the rollout of its cap-and-trade program for greenhouse gas emissions, California should focus on achieving a positive demonstration effect from the program by doing as little as possible to harm the state's economy, as transparently as possible and as fast as possible.

Unconventional natural gas and the technologies developed to extract it in the U.S. point to a possible lower carbon energy future for China that can be facilitated through international cooperation between them, improving China's reliance on domestically produced coal, and creating economic and environmental benefits for both countries as well as the rest of the world.

With the continued successful operation of its greenhouse gas emissions market, California can become a global leader in the design and implementation of regional carbon polices. Moreover, if more regions use the California market as their starting point, then linking these programs together will be more straightforward and the ultimate goal of an effective global climate policy the more likely end result.

Last week, Stanford's Board of Trustees announced that the university would not directly invest funds from its endowment in coal mining companies.  Even the strongest advocates of this action acknowledge that it is a symbolic gesture with little direct effect on the coal industry or global greenhouse gas emissions.  But if a university administration wants to take symbolic (or real) action on climate change, is coal investment a wise choice?

From 1996 to 2006, China’s oil consumption growth far exceeded that of all major consuming countries. China’s average growth in oil consumption over the time period 2000 to 2006 was estimated to be approximately 8 percent per year, up from 6 percent per year from 1996 to 2000. One factor alleged to have caused this rapid increase in the growth of oil consumption in China is the under-pricing of oil to domestic consumers--selling oil-derived products such as gasoline and diesel fuel domestically at prices that are less than the world oil price plus the cost of producing that product. We explore validity of this claim, quantify the extent to which oil domestic oil consumption is subsidized by the Chinese government, and assess the impact of these subsidies on China’s demand for oil. We find economically significant evidence of under-pricing of gasoline and diesel fuel by China relative to the US over our sample period of January 2005 to July 2008 for all of the approaches to computing the comparable price of these products for the two countries. We estimate that underpricing of oil in the form of gasoline and diesel fuel in China resulted in a total subsidy to Chinese consumers of between 5 and 15 billion dollars in 2007. We also analyze the likely change in the consumption of gasoline and diesel in 2007 that would result from the elimination of this underpricing and find that it had little impact on gasoline and diesel fuel consumption for short-run own-price elasticities in the range of recent estimates of these magnitudes from cross country studies.