Oxford SWF Project, a university think tank on sovereign wealth funds, is looking at reports that the latest entry in the field could be Scotland. The project has a new post about the Scottish government floating the idea of an oil stabilisation fund to use oil and gas revenues.  It cites Scottish cabinet secretary for finance John Swinney looking abroad gleefully:

“We want to harness the benefit of oil revenues now for future years. An oil fund can provide greater stability, protect our economy and support the transition to a low carbon economy. Norway’s oil fund is worth over £200 billion – despite the first instalment being made as recently as the mid 1990s – and Alaska’s oil fund even gives money back to its citizens every year.”

The SWF project reckons the idea is a good one, but wonders if something other than meets the eye is at play. It had two questions.

First, it wonders whether the plan might just be a political rebuke for the UK government from the ruling (and separatist) Scottish National Party over a perceived lack of savings over the years.  Second, it notes that the UK government floated the idea of a strategic investments fund back in April and questions whether "the Scottish SWF reflects a ‘whatever they have, we should have’ mentality".

Here's a third question. Is it not a bit late for an oil fund? UK oil and gas output, most of which is in Scottish waters, has more than halved since 1999.

The Organisation of the Petroleum Exporting Countries agreed on Wednesday to make its deepest output cut ever to counter slumping demand and falling oil prices.  The output cut has been received with cautious optimism by analysts.

Some say that the price of oil will fall further, while others say $40 a barrel was the lowest it will go. “If you look at the market, prices are going up immediately,” said Frank Schallenberger, head of commodity research at Landesbank. “I really think this is the end of a bear market. $40 was the bottom.”

However, the White House called to the historic cut “short-sighted” and said the oil cartel has an obligation to keep the market well-supplied. “It’s not clear that OPEC’s actions will be effective given the shift in global demand and the ability of OPEC members to meet the cartel’s targets,” White House spokesman Tony Fratto said.

Will the price of oil continue to drop or will it recover? And how will the oil supply cut trickle down to the consumer in terms of cost?

With oil plunging to record lows, and the average retail price for gas sinking to less than $2, will Americans rekindle their love affair with trucks and SUVs?

Falling gasoline prices are putting extra money in the pockets of consumers, but there is also some concern that drivers may return to their gas-guzzling vehicles.

Are you taking advantage of cheaper gas prices? Could this be the second coming of gas-guzzling vehicles, or is this simply a brief reprieve? Share you cheap gas strategies.

It’s become a truism that Americans are driving less due to high fuel prices. Here are five signs that signal a decline in demand:

1. Drop in volume: The fall in U.S. oil demand in the first half of 2008 was the biggest in 26 years, according to the EIA.

2. Less time on the road: Americans are spending less time behind the wheel, according to the Dept. of Transportation

3. Taking the train : A record number of riders are turning to mass transit to get around

4. Fewer buying gas : Retail gas sales have dropped below year-ago levels

5. Safer roads : Fewer drivers mean fewer road accidents, according to Warren Buffett. Berkshire Hathaway is the parent company of Geico, one of the largest U.S. auto insurers.

Is the writing on the wall? Share your signs of dropping oil demand.

For full coverage of the oil market, click here.

President Bush is urging Congress to end a decades-old ban on offshore oil drilling in response to consumer anxiety over record-high gas prices.

“Every American who drives to work, purchases food or ships a product has felt the effect. And families across our country are looking to Washington for a response,” Bush said.

The push by Bush and Republican presidential candidate John McCain to lift the ban could find plenty of support. About 60 percent of Americans surveyed in a Reuters/Zogby poll said they would favor government efforts to boost domestic drilling and refinery construction.

Roughly the same amount said they would back efforts to reduce domestic demand through tougher fuel-efficiency standards.

Do you favor more U.S. oil drilling?

For more on the rising cost of oil, click here.

Americans in dire need of a break are canceling their vacation plans — from air travel to road trips — because of soaring fuel prices.

In a Reuters/Zogby poll, nearly 39 percent of Americans surveyed said they were reconsidering their vacation plans due to record-high oil prices.

In another survey, 82 percent of Americans said they were opting to stay home this July 4th weekend due to economic concerns.

Have oil prices affected your vacation plans?

For more results from the Reuters/Zogby poll, click here .

A surge in gasoline prices is forcing many to rethink their daily commute to work.

Some private employers as well as local governments are offering a four-day week as a perk that eliminates two commutes a week. In the automaking heartland, the shorter workweek offers employers a way of rewarding employees when the budget does not allow a salary increase.

According to staffing service company Robert Half, some 44 percent of respondents have changed the way they commute — from sharing a ride to driving a more fuel-efficient car. Others are working from home or looking for a closer job in order to reduce costs.

What measures are you taking to reduce your commuting times?

For full coverage of rising oil prices, click here .

More Americans are leaving their cars at home and jumping on buses, trains and trolleys as retail gasoline prices approach $4 per gallon, the American Public Transportation Association said in a report.

“There’s no doubt that the high gas prices are motivating people to change their travel behavior,” APTA president William W. Millar said. (For the full story, click here.)

Record high gas prices are forcing many drivers to spend less time behind the wheel. Data from the Department of Transportation on May 23 shows Americans drove 11 billion miles less in March than a year earlier — the sharpest year-on-year drop in the history of the agency’s reporting.

The government agency also reported that highway miles driven in March fell 4.3 percent from a year earlier — the first March decline since the last major oil shock in 1979.

Have you started taking mass transit more often in light of high gas prices?

Related blog: Who wants a 4-day work week?

For full coverage on the rising cost of oil, click here.

(Editor’s note: This blog was originally posted on May 23 and updated on June 2, 2008)