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The Hundred-Dollar Gas Fill-Up And The Demise Of The Democrats In 2022 (1 Viewer)

Biden made a big mistake sending that letter.  He’s on the wrong side of this issue and the wrong side of economics 101, and they are handing his shriveled ### back to him on a platter.

I’d love to know how many people in his administration have a degree in Business.  They are so ignorant of basic economic principles it’s maddening.  They have no business being in power.

 
Biden made a big mistake sending that letter.  He’s on the wrong side of this issue and the wrong side of economics 101, and they are handing his shriveled ### back to him on a platter.

I’d love to know how many people in his administration have a degree in Business.  They are so ignorant of basic economic principles it’s maddening.  They have no business being in power.
A business degree isn't a box he was looking to check off. 

 
Completely, utterly insane.  She's in a closet with an elephant and has no idea it's right there.


Wow, she is so clueless...it's like a college professor who has never had a real job...a lot of buzz words but no idea what the real world is.

 
And when you follow through on those threats by executive fiat, you scare industry from investing.  Why invest billions in something when an old man who has no idea what he’s doing might become president and outlaw the thing you’re investing in.
You're not wrong, especially about the EO's as SB has brought up multiple times, but what you're getting at is why I am still struggling understanding why this is all the current administration's fault. It takes years to go from lease application to production, which is big oil's excuse for going slow now. So what we have been experiencing over the last year stems from decisions made one...two...three plus years ago, right?

We were at record production Feb 2020, everything abruptly grinded to a halt, the previous admin aided in also getting it cut overseas, production ran into problems getting back online domestically, then there was a war. Despite all of that our trailing 12 month oil production now is in line with production over the same time period over lapping 2018 and 2019, which was the highest that it had ever been.  At the same level of production our price per gallon of gas now is $5 whereas it was almost exactly half that 3 years ago. Obviously demand for oil is playing a big role as from a consumer perspective it isn't changing despite exploding prices because we were all shut-in for months. But after all that big oil net... $100b(!!!) in profits in Q1 2022 alone and dodges all public ire anyway.

Again, I don't pretend to be an expert in understanding this industry, but I've been poking around on this subject for a half hour or so a few times per week for a while to try and better understand it. It's becoming increasingly difficult for me to be convinced this is anything but big oil playing our divisive politics against us to enhance their profits. They know that by pointing the finger at gov't that the people will follow, so they can keep prices inflated and use them as fall guys while they take all of our money. This admin has poor energy policies and lacks fundamental economic sense with their decision making, but what has been happening at the pump goes well beyond them and only provides more reasons not to subsidize this commodity.

Where am I wrong? I have to be missing something, right?

 
It's becoming increasingly difficult for me to be convinced this is anything but big oil playing our divisive politics against us to enhance their profits. They know that by pointing the finger at gov't that the people will follow, so they can keep prices inflated and use them as fall guys while they take all of our money. 
Bingo.

 
They know that by pointing the finger at gov't that the people will follow, so they can keep prices inflated and use them as fall guys while they take all of our money.
Change this to a cake company.  Let's say this cake company, call them Exxocake, has invested double the money into their production capabilities than they've made in the last five years.  Now, when they are finally making some of that back the government wants their cake for cost.

That's where we're at right now.

 
Change this to a cake company.  Let's say this cake company, call them Exxocake, has invested double the money into their production capabilities than they've made in the last five years.  Now, when they are finally making some of that back the government wants their cake for cost.

That's where we're at right now.
But I don't need cake to function. If cake costs increase 200% then I'll just stop eating cake and eat cheaper, healthier foods. This is actually one of the adjustments we've made in this environment. 

 
Change this to a cake company.  Let's say this cake company, call them Exxocake, has invested double the money into their production capabilities than they've made in the last five years.  Now, when they are finally making some of that back the government wants their cake for cost.

That's where we're at right now.
That’s a tough comparison because in that world we could just use a different cake company thus they would need to ensure competitive pricing so we don’t. But when the cake company controls the worlds sugar it needs to be treated differently. 

 
Change this to a cake company.  Let's say this cake company, call them Exxocake, has invested double the money into their production capabilities than they've made in the last five years.  Now, when they are finally making some of that back the government wants their cake for cost.

That's where we're at right now.
We should stop subsidizing cake. 

 
But I don't need cake to function. If cake costs increase 200% then I'll just stop eating cake and eat cheaper, healthier foods. This is actually one of the adjustments we've made in this environment. 
You just bankrupted a great American small business.  I hope you can live with yourself.

 
You're not wrong, especially about the EO's as SB has brought up multiple times, but what you're getting at is why I am still struggling understanding why this is all the current administration's fault. It takes years to go from lease application to production, which is big oil's excuse for going slow now. So what we have been experiencing over the last year stems from decisions made one...two...three plus years ago, right?

We were at record production Feb 2020, everything abruptly grinded to a halt, the previous admin aided in also getting it cut overseas, production ran into problems getting back online domestically, then there was a war. Despite all of that our trailing 12 month oil production now is in line with production over the same time period over lapping 2018 and 2019, which was the highest that it had ever been.  At the same level of production our price per gallon of gas now is $5 whereas it was almost exactly half that 3 years ago. Obviously demand for oil is playing a big role as from a consumer perspective it isn't changing despite exploding prices because we were all shut-in for months. But after all that big oil net... $100b(!!!) in profits in Q1 2022 alone and dodges all public ire anyway.

Again, I don't pretend to be an expert in understanding this industry, but I've been poking around on this subject for a half hour or so a few times per week for a while to try and better understand it. It's becoming increasingly difficult for me to be convinced this is anything but big oil playing our divisive politics against us to enhance their profits. They know that by pointing the finger at gov't that the people will follow, so they can keep prices inflated and use them as fall guys while they take all of our money. This admin has poor energy policies and lacks fundamental economic sense with their decision making, but what has been happening at the pump goes well beyond them and only provides more reasons not to subsidize this commodity.

Where am I wrong? I have to be missing something, right?
Have you accounted for the drop off of Russian production in your analysis?  Given the nature of the market, while it’s very important to have domestic production so that the country as a net is benefitting, it’s also very much a commodity on the world market. What we do here is only a component of it.  We should step in to keep as many of those dollars at home as we can. However, nothing we do would totally negate the impact.  So my belief is the current administration has been at best asleep at the wheel in doing what it could, but even had it performed perfectly we would be seeing rising prices at the pump. 

 
Have you accounted for the drop off of Russian production in your analysis?  Given the nature of the market, while it’s very important to have domestic production so that the country as a net is benefitting, it’s also very much a commodity on the world market. What we do here is only a component of it.  We should step in to keep as many of those dollars at home as we can. However, nothing we do would totally negate the impact.  So my belief is the current administration has been at best asleep at the wheel in doing what it could, but even had it performed perfectly we would be seeing rising prices at the pump. 
Of course, but the common criticism relates to what was already happening before Ukraine...and that cutting off their oxygen was a good thing. But yet all I hear about this is...let's go Brandon? It makes no sense, but none of our politics makes sense so it makes perfect cents. 

 
Of course, but the common criticism relates to what was already happening before Ukraine...and that cutting off their oxygen was a good thing. But yet all I hear about this is...let's go Brandon? It makes no sense, but none of our politics makes sense so it makes perfect cents. 
Russia is doing pretty well selling to other countries, including France.

 
And the feds just delayed additional leases on Thursday.  On Friday talked about gas cards. Kerry just said we don't need more drilling.

All that after excoriating the oil and gas industry on Wednesday for not producing enough.

This administration is completely lost.

 
And the feds just delayed additional leases on Thursday.  On Friday talked about gas cards. Kerry just said we don't need more drilling.

All that after excoriating the oil and gas industry on Wednesday for not producing enough.

This administration is completely lost.


Gas cards sounds like a brilliant idea.  🙄

We have record high inflation.  Biden Admin...let's pay off student debt and send out gas cards to people.    

 
Sorry, Biden and the Dems don't know #### about the economy.  That's just a fact.  They are blaming everything on corporate greed.  Childish nonsense.  Get them out of power.

 
Sorry, Biden and the Dems don't know #### about the economy.  That's just a fact.  They are blaming everything on corporate greed.  Childish nonsense.  Get them out of power.
You're right about their economic policies and they're right about where (some of) the blame resides. Both can be true.

 
President Joe Biden said there may be no end in sight for high gas prices in the US until Russia's invasion of Ukraine is thwarted.

When asked how long American drivers should expect to deal with high fuel prices, Biden told reporters "as long as it takes, so Russia cannot in fact defeat Ukraine and move beyond Ukraine."

https://www.businessinsider.com/biden-high-gas-prices-will-continue-defeat-putin-russia-ukraine-2022-6


Look on the bright-side, 2024 is the light at the end of the tunnel.  

 
California is the absolute last state that should be giving out gas cards.  I thought it was about global warming.
Exactly - this is exactly what they wanted.  They want less oil consumption.  Here you go.  Why go out and encourage what you've been railing against for so long?

And, somehow, Newsom really likes the "buy votes" category of spending and is ignoring the 1200 year drought there.  Think of the desalination plants you could build with 30B.

 
I know nothing about this or CA, so won't try to discuss it. Just replying because I happened across this story below. This new desalination plant was apparently approved in 2014 so even if something gets approved now I guess it would take years to start working.

https://abc7.com/menifee-desalination-plant-water-conversation-groundwater-sun-city/12004715/


Yes, it can take years for major infrastructure projects to be completed.  Kind of makes it more important to get working on them before there's a crisis.  Oops, too late. 

 
This is sure to help:

My message to the companies running gas stations and setting prices at the pump is simple: this is a time of war and global peril.

Bring down the price you are charging at the pump to reflect the cost you’re paying for the product. And do it now.


https://twitter.com/POTUS/status/1543263229006254080?ref_src=twsrc^tfw|twcamp^tweetembed|twterm^1543263229006254080|twgr^|twcon^s1_&ref_url=https%3A%2F%2Fredstate.com%2Fnick-arama%2F2022%2F07%2F02%2Fbidens-numbers-hit-another-all-time-low-while-he-finds-a-new-target-to-blame-for-gas-prices-n587901

 
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Sounds like he would be shocked to know station owners set their own price but for the most part make a penny or two per gallon to try and get traffic into the convenience store part.
Yea, this is a pretty well known fact that gas stations only make a few pennies on gas, but make their profit on everything inside the store. Just amazing how out of touch and ignorant of the facts this administration. Who the hell put up that tweet?

 
So the Biden plan for leases from 2023-2028 has come out and they are shutting it all down.  

The Proposed Program includes no more than ten potential lease sales in the Gulf of Mexico (GOM) and an option for one potential lease sale in the northern portion of the Cook Inlet of Alaska. No lease sales are proposed for the other Alaska planning areas, nor for the Atlantic or Pacific planning areas during the five-year period. Click on the “Proposed Lease Schedule” tab above for the proposed schedule.

One lease sale in the whole of Alaska and zero, yes zero, in the Atlantic or Pacific.  I can confidently say that this does not help our situation at all and is quite likely to drive up oil futures as this is incredibly restrictive.

The moral of this story is if this administration actually gets up and talks about supporting the oil industry is an out and out lie.

What price liberal utopia?  We're finding out right now.

 
So the Biden plan for leases from 2023-2028 has come out and they are shutting it all down.  

The Proposed Program includes no more than ten potential lease sales in the Gulf of Mexico (GOM) and an option for one potential lease sale in the northern portion of the Cook Inlet of Alaska. No lease sales are proposed for the other Alaska planning areas, nor for the Atlantic or Pacific planning areas during the five-year period. Click on the “Proposed Lease Schedule” tab above for the proposed schedule.

One lease sale in the whole of Alaska and zero, yes zero, in the Atlantic or Pacific.  I can confidently say that this does not help our situation at all and is quite likely to drive up oil futures as this is incredibly restrictive.

The moral of this story is if this administration actually gets up and talks about supporting the oil industry is an out and out lie.

What price liberal utopia?  We're finding out right now.
Gee, I wonder why oil and gas companies wouldn't be in a hurry to commit to long term capital projects.  Then we have people who don't understand why that is impacting global pricing.  Again, if the argument is going to be that they wouldn't use the leases anyway, why wouldn't we still give them the leases and collect money into the federal coffers?  I mean, last I heard we were running a pretty substantial deficit and leases of this type always have healthy annual minimum payments.

 
Yea, this is a pretty well known fact that gas stations only make a few pennies on gas, but make their profit on everything inside the store. Just amazing how out of touch and ignorant of the facts this administration. Who the hell put up that tweet?


Probably Jennifer Dillon.

(If you played Go Fish with Dillon, she'd probably ask you to not to move your Bishop to take her Pawn)

The Obama regime has a cross section of Cool Guy President's former roadies. It's really not that uncommon pretty much everywhere. Of course the stakes here are that every day working class people won't be able to put food on the table for their kids.

The degree to which stupid people with connections get jobs they don't earn nor qualify for is staggering but a reality of working life.

No one who wants to actually get something done hires former Obama loyalists. It's why Psaki had to crawl over to MSNBC to get her payoff for shilling for the regime at the cost of the rest of her practical media career.

 
So the Biden plan for leases from 2023-2028 has come out and they are shutting it all down.  

The Proposed Program includes no more than ten potential lease sales in the Gulf of Mexico (GOM) and an option for one potential lease sale in the northern portion of the Cook Inlet of Alaska. No lease sales are proposed for the other Alaska planning areas, nor for the Atlantic or Pacific planning areas during the five-year period. Click on the “Proposed Lease Schedule” tab above for the proposed schedule.

One lease sale in the whole of Alaska and zero, yes zero, in the Atlantic or Pacific.  I can confidently say that this does not help our situation at all and is quite likely to drive up oil futures as this is incredibly restrictive.

The moral of this story is if this administration actually gets up and talks about supporting the oil industry is an out and out lie.

What price liberal utopia?  We're finding out right now.
2017-2022 plan

Page 17 of the pdf shows 10 sales in the Gulf of Mexico and 1 in Alaska. 

It looks like Biden is following in Trump’s footsteps. 

 
2017-2022 plan

Page 17 of the pdf shows 10 sales in the Gulf of Mexico and 1 in Alaska. 

It looks like Biden is following in Trump’s footsteps. 


What's with the comparisons to different time periods?  Someone in another thread tried to compare Biden's oil policy with Obama's.  The market dynamics are entirely different from now to then.  

 
What's with the comparisons to different time periods?  Someone in another thread tried to compare Biden's oil policy with Obama's.  The market dynamics are entirely different from now to then.  
That comparison of leases seems pretty relevant when claiming Biden is trying to kill them...by having similar numbers to Trump when it comes to leases.

 
What's with the comparisons to different time periods?  Someone in another thread tried to compare Biden's oil policy with Obama's.  The market dynamics are entirely different from now to then.  
You have a problem with comparing time periods?  How do you measure inflation?  How do you compare gas prices?  

 
You have a problem with comparing time periods?  How do you measure inflation?  How do you compare gas prices?  


I don't have a problem with comparing time periods if you're going to compare them.  Instead we get these silly comparisons, what was the price of a barrel of oil when Obama was in office.  Oh, that's how we compare the price of gas at the pump?  Don't worry about demand.  Don't worry about inflation.  Don't worry about cost of production.  Just worry about the price of a barrel of oil in 2012 compared to the price of a barrel in 2022?  That's all it takes.  LOL.  

Same thing here.  Trying to compare a small portion of leases without looking at the whole picture.  If you're going to compare, compare the entire market.  Compare all leases on federal land.  Compare all new drilling permits.  Compare producible leases.  Compare percentages of leases in litigation.  Compare EPA regulations.  Compare EOs affecting the industry.  Compare investments into the industry.  No, we're just going to look at this small portion of leases and announce them the same across different administrations from different time periods subject to different market factors. 

 
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I don't have a problem with comparing time periods if you're going to compare them.  Instead we get these silly comparisons, what was the price of a barrel of oil when Obama was in office.  Oh, that's how we compare the price of gas at the pump?  Don't worry about demand.  Don't worry about inflation.  Don't worry about cost of production.  Just worry about the price of a barrel of oil in 2012 compared to the price of a barrel in 2022?  That's all it takes.  LOL.  

Same thing here.  Trying to compare a small portion of leases without looking at the whole picture.  If you're going to compare, compare the entire market.  Compare all leases on federal land.  Compare all new drilling permits.  Compare producible leases.  Compare percentages of leases in litigation.  Compare EPA regulations.  Compare EOs affecting the industry.  Compare investments into the industry.  No, we're just going to look at this small portion of leases and announce them the same across different administrations from different time periods subject to different market factors. 
I compared the exact same report that Sand showed as cause for concern for the most recent time period. And it showed exactly the same leases in the exact same geographic locations. 10 gulf, 1 Alaska. If you think that is unfair, more power to you. 

 
I compared the exact same report that Sand showed as cause for concern for the most recent time period. And it showed exactly the same leases in the exact same geographic locations. 10 gulf, 1 Alaska. If you think that is unfair, more power to you. 


It is, because you aren't looking at the overall market picture.  What is the difference in demand from the two time periods that would make the current administration believe that a similar leasing program from a previous time period would be a viable answer to the current demand the United States currently has.  That is the first factor.  I listed numerous more above.  If you think we have the same market conditions we had 5 years ago, more power to you.    

 
So the Biden plan for leases from 2023-2028 has come out and they are shutting it all down.  

The Proposed Program includes no more than ten potential lease sales in the Gulf of Mexico (GOM) and an option for one potential lease sale in the northern portion of the Cook Inlet of Alaska. No lease sales are proposed for the other Alaska planning areas, nor for the Atlantic or Pacific planning areas during the five-year period. Click on the “Proposed Lease Schedule” tab above for the proposed schedule.

One lease sale in the whole of Alaska and zero, yes zero, in the Atlantic or Pacific.  I can confidently say that this does not help our situation at all and is quite likely to drive up oil futures as this is incredibly restrictive.

The moral of this story is if this administration actually gets up and talks about supporting the oil industry is an out and out lie.

What price liberal utopia?  We're finding out right now.


It is, because you aren't looking at the overall market picture.  What is the difference in demand from the two time periods that would make the current administration believe that a similar leasing program from a previous time period would be a viable answer to the current demand the United States currently has.  That is the first factor.  I listed numerous more above.  If you think we have the same market conditions we had 5 years ago, more power to you.    
You two can figure out if this is an issue or not. 

 
You two can figure out if this is an issue or not. 


You tell me.  Should we have the same plan from 2017-2022 when forecasts show this:  

https://www.reuters.com/markets/europe/global-oil-demand-set-rise-2-new-high-2023-says-iea-2022-06-15/

ETA: I could go on.  New drilling permits, 2020: 4,226; 2021: 4,859, 2022: 1,881 (on pace for 3,700).  Biden is following Obama's energy exploration trends.  Not a good idea to decrease drilling permit approvals when demand is expect to increase. 

 
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Gee, I wonder why oil and gas companies wouldn't be in a hurry to commit to long term capital projects.  Then we have people who don't understand why that is impacting global pricing.  Again, if the argument is going to be that they wouldn't use the leases anyway, why wouldn't we still give them the leases and collect money into the federal coffers?  I mean, last I heard we were running a pretty substantial deficit and leases of this type always have healthy annual minimum payments.
Every time I try to engage in this subject I can't follow the logic. 

You tell me.  Should we have the same plan from 2017-2022 when forecasts show this:  

https://www.reuters.com/markets/europe/global-oil-demand-set-rise-2-new-high-2023-says-iea-2022-06-15/

ETA: I could go on.  New drilling permits, 2020: 4,226; 2021: 4,859, 2022: 1,881 (on pace for 3,700).  Biden is following Obama's energy exploration trends.  Not a good idea to decrease drilling permit approvals when demand is expect to increase. 
Demand is expected to increase, so big oil won't commit to capital projects.

You two are smart guys - help me understand how they're not just using our partisanship to take our money.

 
Every time I try to engage in this subject I can't follow the logic. 

Demand is expected to increase, so big oil won't commit to capital projects.

You two are smart guys - help me understand how they're not just using our partisanship to take our money.


A poster used leasing plans from 2017-2022 to justify the same leasing plans from 2023-2028.  So when you take into account increasing demand, you can't say but Trump did this so it's ok for Biden when the market conditions are not the same.  That's the point I was trying to make. 

 
Every time I try to engage in this subject I can't follow the logic. 

Demand is expected to increase, so big oil won't commit to capital projects.

You two are smart guys - help me understand how they're not just using our partisanship to take our money.
Demand increases would lead to capital project spending in a normal environment.  We do not have that.  The oil and gas industry has had it made abundantly clear to them that for one party in our country at the very least, they want them out of business.  

Now we can debate whether or not that is good or plausible, but consider you own this kind of business in this environment.  You haven't had a great past decade or so, be it the Russian/Saudi price war, Covid causing lower demand, take your pick.  Oil is a worldwide commodity, you are at the whims of the market as to your price you can charge.  Because it's expensive to cap wells, even if you have to sell for a loss at times, you must produce.  We find ourselves today now where demand is high but supply is constrained due to the Russian invasion of Ukraine.  This is probably an intermediate term event.  You are making more at any point than you have in the past decade. Consider these two questions:

What are my realistic revenue projections for the next 10-20 years on any capital investment I make?

Can I rely on being able to operate any sites I open with this investment for that same period without government regulatory issues or suspension of leases?

Before you can invest capital dollars, you have to take your best guess and have some level of confidence to those two things.  I don't think the Russia/Ukraine war is going on in 2032, at least I hope not.  Pricing probably won't be what it is today past that intermediate term, so you'll need to discount your financial models for those price declines.  You simply can't count on today's pricing to stay going forward.  I say that, but understand that any one project isn't going to bring enough supply to the market to change the price of a world commodity.  This is a difficult scenario to model, but people are paid to do it and companies make these type of best guesses all the time.

Also, can you rely on that site being operational for 20 years or more?  How good would you feel as an oil and gas exec today given our political environment where one side is for little/no regulation and the other wants you out of business?  That's a pretty hard parameter to put on a project when projecting cash flows.  I did this type modeling for years, and there is no good answer to it.  To me, this is a huge barrier to spending capital reserves.  It's hard to commit to something that is going to take you 20 or 25 years to get your return on when you are under this type scrutiny or threat.

So when you take the above into consideration, what would you do?   As a business owner, I can't fault anyone who would look at that scenario and make the decision to take the profits for awhile and keep evaluating the situation.  That appears to me to be where we are. 

I don't think our partisanship has anything to do with it.  Yes these companies are making good profits today but I'm not sure why it's partisanship or them taking advantage of anything.  The market for crude and gas is what supply and demand dictate it to be.  Why would we expect them to take less than market price today when none of us complained with the cheaper prices during the Saudi/Russian pricing war?  This isn't the same as General Mills deciding to go up 3X on a box of cereal.

 

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