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Obama: Anyone who says we can lower gas prices by more drilling (2 Viewers)

http://m.spokesman.com/stories/2012/feb/22/gas-prices-defy-bounds-of-supply-demand/

</h1>

<h1>Gas prices defy bounds of supply, demand

Kevin G. Hall McClatchy

February 22, 2012 - Updated: 11:42 a.m.

WASHINGTON – U.S. demand for oil and refined products – including gasoline – is down sharply from last year, so much that the United States has actually become a net exporter of gasoline, unable to consume all that it makes.

Yet oil and gasoline prices are surging.

On Tuesday, oil rose past $105 a barrel and gasoline averaged $3.57 a gallon – thanks again in no small part to rampant financial speculation on top of fears of supply disruptions.

The ostensible reason for the climb of crude prices on the New York Mercantile Exchange, where contracts for future delivery of oil are traded, is growing fear of a military confrontation with Iran in the Persian Gulf’s Strait of Hormuz, through which 20 percent of the world’s oil passes.

Other factors driving up prices include last month’s bankruptcy of Petroplus, a big European refiner, and a recent BP refinery fire in Washington state that has temporarily crimped gasoline supply along the West Coast; gas now costs an average of $4.04 a gallon in California.

While tension over Iran has ratcheted up in the past few months, the price of oil and gasoline has leapt far beyond conventional supply-and-demand variables. Financial speculators are piling into the market, torquing the Iranian fear factor into ever-higher prices.

“Speculation is now part of the DNA of oil prices. You cannot separate the two anymore. There is no demarcation,” said Fadel Gheit, a 30-year veteran of energy markets and an analyst at Oppenheimer & Co. “I still remain convinced oil prices are inflated.”

Consider that light, sweet crude trading on the NYMEX changed hands at $79.20 a barrel just four months ago but soared past $105 a barrel Tuesday, partly on news that Iran would halt shipment of oil to Britain and France. But those countries already had stopped buying Iranian oil. And Didier Houssin, the International Energy Agency’s director for energy markets and security, said “there are alternative supplies that can make up for any loss of Iranian exports,” the Wall Street Journal reported.

Still, oil’s price shot up because it trades in financial markets, where Wall Street firms and other big financial players dominate oil trading, even though they have no intention of ever taking possession of the oil whose contracts they are trading.

Since oil prices are the biggest component in the price of gasoline, pump prices are soaring. AAA said Tuesday that the nationwide average price for a gallon of gasoline stood at $3.57, compared with $3.38 a month ago and $3.17 a year ago. It takes about $6 more to fill up the tank than it did this time last year – and last year’s gasoline-price surge helped take the steam out of the economic recovery.

Historically, financial speculators accounted for about 30 percent of oil trading in commodity markets, while producers and end users made up about 70 percent. Today it’s almost the reverse.

A McClatchy Newspapers review of the latest Commitment of Traders report from the Commodity Futures Trading Commission, which regulates oil trading, shows producers and merchants made up just 36 percent of all contracts traded in the week ending Feb. 14.

Not surprisingly, big Wall Street traders on Tuesday projected oil will rise above $112 a barrel; some such as Swiss giant Vitol even suggested $150-a-barrel oil is coming soon. When they dominate the market, speculators’ bids can make their prophecies self-fulfilling.

“These people are not there to be heroes. They are there to make money. It’s our fault because we are allowing them to do that,” Gheit said. “Obviously these people are very strong, and the financial lobby is the strongest of any single lobby.”

What’s indisputable is that oil and gasoline are not in short supply, and that demand remains weak. That was clear in the latest weekly energy market update by the U.S. Energy Information Administration – published last week for the week ending Feb. 10.

“Total products supplied over the last four-week period have averaged 18.3 million barrels per day, down by 4.6 percent compared to the similar period last year. Over the last four weeks, motor gasoline product supplied has averaged nearly 8.1 million barrels per day, down by 6.4 percent from the same period last year,” said the EIA, the Energy Department’s statistical arm.

Inventories of stored oil are also unusually high, the EIA said.

Hence, no shortage to explain soaring prices.

In fact, U.S. demand and consumption patterns are so abnormal compared to recent decades that oil and gasoline are both now being exported to Europe, Asia and Latin America.

Exports of U.S.-refined product averaged 2.93 million barrels per day over the four weeks ending on Feb. 10, compared to 2.19 million barrels per day for the four weeks ending Feb. 11, 2011, the EIA said.

Similarly, the United States did not export any oil in the four weeks ending Feb. 11, 2011, but in the four-week period ending this Feb. 10, the nation exported 37,000 barrels.

The export picture suggests that when domestic demand rises, American motorists might be competing with drivers elsewhere for U.S.-made gasoline, which fetches a higher price as an export.

“To the extent that there is this export market that wasn’t there before, it is certainly … keeping prices higher than they otherwise would be,” said John Kilduff, a veteran energy analyst at AgainCapital in New York.



 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
 
The last time a sittong President threatened to drill, the price dropped immediately.

The ME nations aould be reluctant to cut production and the prospect scares the speculators

 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
but if we're drilling it, then we're getting paid for it and the money goes into our ecomomy and not the econimies of undemocratic nations.
 
The problem isn't oil production, it is the world wide ability to afford oil. The cheaper oil gets, the more people world wide who can afford it. 5% more production doesn't lead to a 5% reduction in prices as way more people can afford oil at $3 per gallon rather than $4 per gallon.

The US is better off hoarding our oil, and treating it as an investment. Lets pay more for oil made overseas today, and keep our oil for when the situation gets much worse.

 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
but if we're drilling it, then we're getting paid for it and the money goes into our ecomomy and not the econimies of undemocratic nations.
But WE don't drill. Exon and Mobile does. The US government only sees income from oil in the forms of corporate taxes and income taxes, and the bids on the oil lands. Most other countries control their oil resources more, and get a much higher fraction of the profits.
 
Last edited by a moderator:
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
but if we're drilling it, then we're getting paid for it and the money goes into our ecomomy and not the econimies of undemocratic nations.
Who exactly is we? International oil companies traded on the world market? Are you Sarah Palin?
 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
but if we're drilling it, then we're getting paid for it and the money goes into our ecomomy and not the econimies of undemocratic nations.
But WE don't drill. Exon and Mobile does. The US government only sees income from oil in the forms of corporate taxes and income taxes, and the bids on the oil lands. Most other countries control their oil resources more, and get a much higher fraction of the profits.
and all of the employees required to drill it who will pay taxes and purchase goods and not collect unemployment and welfare.
 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
Right. That's why I've never bought the "we need to drill here in order to reduce our dependency on foreign oil" arguments. If we increase domestic production by 10% and the entire additional 10% is sold by the oil companies to China, how does meaningfully impact our dependence on foreign oil?
 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
but if we're drilling it, then we're getting paid for it and the money goes into our ecomomy and not the econimies of undemocratic nations.
We?
 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
but if we're drilling it, then we're getting paid for it and the money goes into our ecomomy and not the econimies of undemocratic nations.
We?
yes we...people like MTskibum in North Dakota for example
 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
but if we're drilling it, then we're getting paid for it and the money goes into our ecomomy and not the econimies of undemocratic nations.
But WE don't drill. Exon and Mobile does. The US government Howevonly sees income from oil in the forms of corporate taxes and income taxes, and the bids on the oil lands. Most other countries control their oil resources more, and get a much higher fraction of the profits.
And let's not forget that profits made offshore are taxed at a steeply discounted rate if at all. So thru the magic of accounting oil drilled here could make us nothing at all. However any cleanup from a spill can get dropped in our Lap. And people wonder why the young are occupying parks around the country. Because the rules are waaaay out of whack.
 
It would be tough to lower gas prices with more drilling. All of the cheap oil has already been drilled and is being produced.I am working as a petroleum engineer up in north dakota, one of the hottest places for new oil production. These wells have millions of dollars worth of costs associated with them that oil wells in years past did not have. They drill down to the reservoir, then they drill horizontally through the reservoir for 2-3 miles. This horizontal drilling is not cheap as it effectively doubles the drilling time. Even after a wells exposing 2 miles of reservoir the well will not produce very much oil, it has to be fracked, and fracking greatly increases the cost of the well. To greatly ramp up oil production means we will be drilling in more remote areas, that require even more expensive technology.America can produce alot of oil at 100 dollars a barrrel, but we are running out of the cheap stuff.
Great post. That's what a lot of people don't understand. Peak oil is not a theory that states that we are almost out of oil. It's the fact that the cheap stuff is gone and the light, sweet crude is going too.Yes there is plenty but oil left, but high oil prices are here to stay regardless of who the president is.
 
It would be tough to lower gas prices with more drilling. All of the cheap oil has already been drilled and is being produced.I am working as a petroleum engineer up in north dakota, one of the hottest places for new oil production. These wells have millions of dollars worth of costs associated with them that oil wells in years past did not have. They drill down to the reservoir, then they drill horizontally through the reservoir for 2-3 miles. This horizontal drilling is not cheap as it effectively doubles the drilling time. Even after a wells exposing 2 miles of reservoir the well will not produce very much oil, it has to be fracked, and fracking greatly increases the cost of the well. To greatly ramp up oil production means we will be drilling in more remote areas, that require even more expensive technology.America can produce alot of oil at 100 dollars a barrrel, but we are running out of the cheap stuff.
Great post. That's what a lot of people don't understand. Peak oil is not a theory that states that we are almost out of oil. It's the fact that the cheap stuff is gone and the light, sweet crude is going too.Yes there is plenty but oil left, but high oil prices are here to stay regardless of who the president is.
Charleton Heston told the American public this very same thing in 1975 in a series of nationally televised ads. I believed him. Hey, it was Charleton Heston!!37 years later I'm not so sure I can believe it, particularly since a major find tomorrow could completely change the landscape. We should keep an open mind. People in the oil business sure do.
 
It would be tough to lower gas prices with more drilling. All of the cheap oil has already been drilled and is being produced.I am working as a petroleum engineer up in north dakota, one of the hottest places for new oil production. These wells have millions of dollars worth of costs associated with them that oil wells in years past did not have. They drill down to the reservoir, then they drill horizontally through the reservoir for 2-3 miles. This horizontal drilling is not cheap as it effectively doubles the drilling time. Even after a wells exposing 2 miles of reservoir the well will not produce very much oil, it has to be fracked, and fracking greatly increases the cost of the well. To greatly ramp up oil production means we will be drilling in more remote areas, that require even more expensive technology.America can produce alot of oil at 100 dollars a barrrel, but we are running out of the cheap stuff.
Great post. That's what a lot of people don't understand. Peak oil is not a theory that states that we are almost out of oil. It's the fact that the cheap stuff is gone and the light, sweet crude is going too.Yes there is plenty but oil left, but high oil prices are here to stay regardless of who the president is.
Charleton Heston told the American public this very same thing in 1975 in a series of nationally televised ads. I believed him. Hey, it was Charleton Heston!!37 years later I'm not so sure I can believe it, particularly since a major find tomorrow could completely change the landscape. We should keep an open mind. People in the oil business sure do.
But Obama's word is the truth and can never be questioned. Shame on you. ;)
 
It would be tough to lower gas prices with more drilling. All of the cheap oil has already been drilled and is being produced.I am working as a petroleum engineer up in north dakota, one of the hottest places for new oil production. These wells have millions of dollars worth of costs associated with them that oil wells in years past did not have. They drill down to the reservoir, then they drill horizontally through the reservoir for 2-3 miles. This horizontal drilling is not cheap as it effectively doubles the drilling time. Even after a wells exposing 2 miles of reservoir the well will not produce very much oil, it has to be fracked, and fracking greatly increases the cost of the well. To greatly ramp up oil production means we will be drilling in more remote areas, that require even more expensive technology.America can produce alot of oil at 100 dollars a barrrel, but we are running out of the cheap stuff.
Great post. That's what a lot of people don't understand. Peak oil is not a theory that states that we are almost out of oil. It's the fact that the cheap stuff is gone and the light, sweet crude is going too.Yes there is plenty but oil left, but high oil prices are here to stay regardless of who the president is.
Actually, the oil found in these shale formations like the Bakken are cheaper to bring to market than other oil found in other formations. The oil coming from the Bakken formation is some of the easiest to refine we've ever seen. You could almost use it to run your vehicle directly from the ground. Also, there hasn't been a dry hole drilled in North Dakota in over 3 years, where previous drilling technology averaged about 1 dry hole in every 4 drilled. So, while it does cost significantly more to drill for the oil, it doesn't cost significantly more to produce it when you consider all of the factors. Does that mean more drilling will result in lower gas prices? No. But that isn't due to the cost of bringing the gas to market. The Bakken formation oil would still see continued production even if oil fell to $35 a barrel.
 
It would be tough to lower gas prices with more drilling. All of the cheap oil has already been drilled and is being produced.I am working as a petroleum engineer up in north dakota, one of the hottest places for new oil production. These wells have millions of dollars worth of costs associated with them that oil wells in years past did not have. They drill down to the reservoir, then they drill horizontally through the reservoir for 2-3 miles. This horizontal drilling is not cheap as it effectively doubles the drilling time. Even after a wells exposing 2 miles of reservoir the well will not produce very much oil, it has to be fracked, and fracking greatly increases the cost of the well. To greatly ramp up oil production means we will be drilling in more remote areas, that require even more expensive technology.America can produce alot of oil at 100 dollars a barrrel, but we are running out of the cheap stuff.
Great post. That's what a lot of people don't understand. Peak oil is not a theory that states that we are almost out of oil. It's the fact that the cheap stuff is gone and the light, sweet crude is going too.Yes there is plenty but oil left, but high oil prices are here to stay regardless of who the president is.
Actually, the oil found in these shale formations like the Bakken are cheaper to bring to market than other oil found in other formations. The oil coming from the Bakken formation is some of the easiest to refine we've ever seen. You could almost use it to run your vehicle directly from the ground. Also, there hasn't been a dry hole drilled in North Dakota in over 3 years, where previous drilling technology averaged about 1 dry hole in every 4 drilled. So, while it does cost significantly more to drill for the oil, it doesn't cost significantly more to produce it when you consider all of the factors. Does that mean more drilling will result in lower gas prices? No. But that isn't due to the cost of bringing the gas to market. The Bakken formation oil would still see continued production even if oil fell to $35 a barrel.
The cost of bringing oil to market would naturally influence the price, as would supply and demand. But we continue to see fluctuations in price that have little to do with these conditions, almost every indicator points to speculation and manipulation. Until the informed members of our society start to address the real issues behind oil pricing we are just spinning our wheels. We are truly intellectually lazy when it comes to the pricing of energy,and our media ought to be ashamed of themselves for not doing something (anything?) to educate the public.
 
It would be tough to lower gas prices with more drilling. All of the cheap oil has already been drilled and is being produced.I am working as a petroleum engineer up in north dakota, one of the hottest places for new oil production. These wells have millions of dollars worth of costs associated with them that oil wells in years past did not have. They drill down to the reservoir, then they drill horizontally through the reservoir for 2-3 miles. This horizontal drilling is not cheap as it effectively doubles the drilling time. Even after a wells exposing 2 miles of reservoir the well will not produce very much oil, it has to be fracked, and fracking greatly increases the cost of the well. To greatly ramp up oil production means we will be drilling in more remote areas, that require even more expensive technology.America can produce alot of oil at 100 dollars a barrrel, but we are running out of the cheap stuff.
Great post. That's what a lot of people don't understand. Peak oil is not a theory that states that we are almost out of oil. It's the fact that the cheap stuff is gone and the light, sweet crude is going too.Yes there is plenty but oil left, but high oil prices are here to stay regardless of who the president is.
Actually, the oil found in these shale formations like the Bakken are cheaper to bring to market than other oil found in other formations. The oil coming from the Bakken formation is some of the easiest to refine we've ever seen. You could almost use it to run your vehicle directly from the ground. Also, there hasn't been a dry hole drilled in North Dakota in over 3 years, where previous drilling technology averaged about 1 dry hole in every 4 drilled. So, while it does cost significantly more to drill for the oil, it doesn't cost significantly more to produce it when you consider all of the factors. Does that mean more drilling will result in lower gas prices? No. But that isn't due to the cost of bringing the gas to market. The Bakken formation oil would still see continued production even if oil fell to $35 a barrel.
The cost of bringing oil to market would naturally influence the price, as would supply and demand. But we continue to see fluctuations in price that have little to do with these conditions, almost every indicator points to speculation and manipulation. Until the informed members of our society start to address the real issues behind oil pricing we are just spinning our wheels. We are truly intellectually lazy when it comes to the pricing of energy,and our media ought to be ashamed of themselves for not doing something (anything?) to educate the public.
Oh I completely agree with you on speculation being the #1 factor in the rise in prices. We have more gas than we use right now, yet price is rising. In fact, I was arguing along the same lines in that the cost of production really hasn't changed too dramatically. That being the case and supply being abundant right now, it follows that speculation is once again running rampant.
 
Has Obama ever been well versed in economic theory? Not sure he knows the definition of supply & demand
Is this a joke? Obama was a professor at one of the preeminent Law and Economic schools in the world.
:lmao:He taught Constitutional Law, so naturally he's an Econ Wizard.
was thinking the same thing. His undergrad was in Political Science and he got his law degree. What kinda of extensive Economic education would he have had. It's like saying the Drama teacher at the high school can teach Calculus because somebody in the building does...
 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.

The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.

My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
but if we're drilling it, then we're getting paid for it and the money goes into our ecomomy and not the econimies of undemocratic nations.
But WE don't drill. Exon and Mobile does. The US government only sees income from oil in the forms of corporate taxes and income taxes, and the bids on the oil lands. Most other countries control their oil resources more, and get a much higher fraction of the profits.
Do they give away those permits for free then?
 
Does anyone know what percentage of our domestic drilling is exported overseas?
If it's too much, it's Holder's fault.
Funny hack. The thing to remember is it's all a global market. Once you pump it out of the ground it belongs to you. The big fallacy in American thinking is that somehow what is produced here belongs to us. It doesn't. It goes right on the global market. That's why the informed laughed at drill baby drill.Great political sideshow that was only a means to get elected.

The price is what's important no matter where it comes from. And pressure or lack thereof is more important by far than all this talk of " oh no. Iran wants to get their way". The Saudis just initial a work order for more to calm markets but Morgan Stanley and Goldman want to get well after the meltdown so we gotta pay.

My guess is oil goes way down for the election season next fall with many a balance sheet getting well this summer.
but if we're drilling it, then we're getting paid for it and the money goes into our ecomomy and not the econimies of undemocratic nations.
But WE don't drill. Exon and Mobile does. The US government only sees income from oil in the forms of corporate taxes and income taxes, and the bids on the oil lands. Most other countries control their oil resources more, and get a much higher fraction of the profits.
Do they give away those permits for free then?
No one in the oil business is complaining about the final cost of the permits. So it's safe to say that they are not a big factor.

 
Did one of the oil companies spend like 6 billion dollars studying how to crack the Arctic Ocean for oil only to be denied permits in the planning stage? What does that do for the cost of gasoline? Isn't there 27 billion barrels of oil there?

 
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Has Obama ever been well versed in economic theory? Not sure he knows the definition of supply & demand
Is this a joke? Obama was a professor at one of the preeminent Law and Economic schools in the world.
:lmao:He taught Constitutional Law, so naturally he's an Econ Wizard.
I'm fairly certain every law professor at the University of Chicago SOL knows the definition of supply and demand.
 
Did one of the oil companies spend like 6 billion dollars studying how to crack the Arctic Ocean for oil only to be denied permits in the planning stage? What does that do for the cost of gasoline? Isn't there 27 billion barrels of oil there?
Spend 6 billion without assurance that the permits are pre-approved? Ouch. Career killer.
 
Just to be clear, $6,000,000,000. That's a hell of a lot of zeros without permits in hand.

Financial suicide is more like it.

 
It would be tough to lower gas prices with more drilling. All of the cheap oil has already been drilled and is being produced.I am working as a petroleum engineer up in north dakota, one of the hottest places for new oil production. These wells have millions of dollars worth of costs associated with them that oil wells in years past did not have. They drill down to the reservoir, then they drill horizontally through the reservoir for 2-3 miles. This horizontal drilling is not cheap as it effectively doubles the drilling time. Even after a wells exposing 2 miles of reservoir the well will not produce very much oil, it has to be fracked, and fracking greatly increases the cost of the well. To greatly ramp up oil production means we will be drilling in more remote areas, that require even more expensive technology.America can produce alot of oil at 100 dollars a barrrel, but we are running out of the cheap stuff.
Great post. That's what a lot of people don't understand. Peak oil is not a theory that states that we are almost out of oil. It's the fact that the cheap stuff is gone and the light, sweet crude is going too.Yes there is plenty but oil left, but high oil prices are here to stay regardless of who the president is.
It's all relative. At $100/barrel oil is still an incredibly cheap energy source. And as we move to different types of oil extraction, technology and higher production will drive down the current costs.I believe diversifying our energy usage is important, but as far as cost goes oil will continue to be one of our best sources of energy for a long time.
 
Has Obama ever been well versed in economic theory? Not sure he knows the definition of supply & demand
I'm not sure I understand it either when it comes to oil. Oil seems to be impervious to basic economic supply and demand rules.
Every Principles of Microeconomics textbook I've ever reviewed says that an increase in the expected future price of a good will tend to decrease supply and increase demand, both of which lead to a higher equilibrium price today.Oil speculators are worried about political developments in Iran that might cause the price of oil to rise in the future. And the price of oil is therefore rising today. This is 100% normal and completely predictable from supply-demand analysis.
 
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Obama did more today to raise the price of oil than to combat it. Even the appearance that the Administration is going to open up drilling will stir the speculators and prices would fall; instead the President speech pandering to all sides causes doubt that will fuel speculation. His message that the other side applauds bad news is comical, when just after he made this statement, he goes on to say that anyone thinking we're going to drill our way out of this mess is clueless, which was followed by applause from the crowd. :lmao:
If the President can make a simple comment and cause the price of oil to go up you know that industry is corrupt and effed up as just about anything.
 
I can buy gas for .18 a gallon. Two pre 1964 dimes are worth $5.20.

The price of oil going from $10 to $110 has as much to do with the US Dollar as it does supply and demand. And with $15t of debt and QE and other forms of money printing this is going to get much worse as time goes on. I'm not saying inflation is the only reason, but it has a major role.

We could have $2 a gallon gas by July 4th if the Fed would raise rates to 4%. Of course it would take the DOW down by a considerable amount and send unemployment up.

 
He's sort of right. Drilling might not solve the problem... but SAYING that you're going to drill always brings the cost down. It's all driven by speculation.

 
Has Obama ever been well versed in economic theory? Not sure he knows the definition of supply & demand
Is this a joke? Obama was a professor at one of the preeminent Law and Economic schools in the world.
:lmao:He taught Constitutional Law, so naturally he's an Econ Wizard.
I'm fairly certain every law professor at the University of Chicago SOL knows the definition of supply and demand.
It isn't like the Chicago school is known for conducting economic analysis of laws and regulations. It is just another liberal ivory tower.
 
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In 2008 Barack Obama told us he liked gasoline prices at $4 per gallon. Obama thought that along with destroying the coal industry, high oil prices would push us to use less energy and to drive electric cars and travel more by bicycle. In December 2008, when Obama was putting together his White House team, Dr. Steven Chu was selected to become Secretary of Energy. Prior to the General Election, Chu was even more enthusiastic about raising gasoline prices than was Obama, "Somehow we have to figure out how to boost the price of gasoline to the levels in Europe," Mr. Chu, who directs the Lawrence Berkeley National Laboratory in California, said in an interview with The Wall Street Journal in September.

http://m.lubbockonli...%E2%80%99s-plan
:lmao: Quouting a lubbock conservative article. Is doubly-biased a word?
 
Has Obama ever been well versed in economic theory? Not sure he knows the definition of supply & demand
I'm not sure I understand it either when it comes to oil. Oil seems to be impervious to basic economic supply and demand rules.
Every Principles of Microeconomics textbook I've ever reviewed says that an increase in the expected future price of a good will tend to decrease supply and increase demand, both of which lead to a higher equilibrium price today.Oil speculators are worried about political developments in Iran that might cause the price of oil to rise in the future. And the price of oil is therefore rising today. This is 100% normal and completely predictable from supply-demand analysis.
Do you believe that simply increasing our domestic supply would have a meaningful impact on gas prices? Would drilling here give us any control over the overall supply/demand dynamics versus OPEC? I am not clear on the size of our potential, but what little I have heard on the subject doesn't lend much confidence to effect global markets. :shrug:
 
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In 2008 Barack Obama told us he liked gasoline prices at $4 per gallon. Obama thought that along with destroying the coal industry, high oil prices would push us to use less energy and to drive electric cars and travel more by bicycle. In December 2008, when Obama was putting together his White House team, Dr. Steven Chu was selected to become Secretary of Energy. Prior to the General Election, Chu was even more enthusiastic about raising gasoline prices than was Obama, "Somehow we have to figure out how to boost the price of gasoline to the levels in Europe," Mr. Chu, who directs the Lawrence Berkeley National Laboratory in California, said in an interview with The Wall Street Journal in September.

http://m.lubbockonli...%E2%80%99s-plan
:lmao: Quouting a lubbock conservative article. Is doubly-biased a word?
You can :lmao: till your head twists off. What was said was said.

 
Obama took to the stump today to lash out at his critics and claimed that they are celebrating the rising gas prices. He pointed out that oil production since he became President has nearly quadrupled under his watch, and it lowered under Bush. He went on to say that we can't lower prices by increased drilling, and anyone who says otherwise is not telling the truth. "There is no silver bullet," he says. Is he right?
Yes. Market dictates price, not supply. There is no shortage of available gasoline or oil to produce it. Refineries are not running at capacity. The one argument you could make would be for either a much softer policy on Iran, which might ease fears of them closing the strait of hormuz which is currently driving speculation on oil commodities, which is driving up the price.
 
In 2008 Barack Obama told us he liked gasoline prices at $4 per gallon. Obama thought that along with destroying the coal industry, high oil prices would push us to use less energy and to drive electric cars and travel more by bicycle. In December 2008, when Obama was putting together his White House team, Dr. Steven Chu was selected to become Secretary of Energy. Prior to the General Election, Chu was even more enthusiastic about raising gasoline prices than was Obama, "Somehow we have to figure out how to boost the price of gasoline to the levels in Europe," Mr. Chu, who directs the Lawrence Berkeley National Laboratory in California, said in an interview with The Wall Street Journal in September.

http://m.lubbockonli...%E2%80%99s-plan
:lmao: Quouting a lubbock conservative article. Is doubly-biased a word?
You can :lmao: till your head twists off. What was said was said.
:lmao:
 
...he says that we can't lower prices by increased drilling, and anyone who says otherwise is not telling the truth...
I think he's right--because the program Sucks. The oil companies sell our oil to China and then we buy it for inflated prices from somewhere else.The oil companies are no longer American--why the hell do we want to give them more of our oil?? :hot:
Who is we in "we buy it for inflated prices from somewhere else"? The oil companies are private companies, correct? It is there oil and they can sell it to who ever gives them more money for it, correct? So why should a private company sell their goods to a local merchant who won't pay as much as selling to a foreign merchant? Overall, more money will be coming to the US economy (from China).
 
'MTskibum said:
It would be tough to lower gas prices with more drilling. All of the cheap oil has already been drilled and is being produced.I am working as a petroleum engineer up in north dakota, one of the hottest places for new oil production. These wells have millions of dollars worth of costs associated with them that oil wells in years past did not have. They drill down to the reservoir, then they drill horizontally through the reservoir for 2-3 miles. This horizontal drilling is not cheap as it effectively doubles the drilling time. Even after a wells exposing 2 miles of reservoir the well will not produce very much oil, it has to be fracked, and fracking greatly increases the cost of the well. To greatly ramp up oil production means we will be drilling in more remote areas, that require even more expensive technology.America can produce alot of oil at 100 dollars a barrrel, but we are running out of the cheap stuff.
Thanks for actual insight./thread
 
'loose circuits said:
Has Obama ever been well versed in economic theory? Not sure he knows the definition of supply & demand
Obama's version of supply and demand: "I demand the government control the supply."ETA: Yes, I know this isn't about the speculation occurring around oil prices.
 
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