Here's a post that should warm the heart of Arles, Dutch, Cam, etc....

It seems to me that every few weeks the media break their usual coverage of high gas prices to posit the theory of releasing the strategic oil reserves to bring down prices. Typical media (I believe this should warm Dutch's heart), in that it's a concept which sounds good in a 20-second segment, but which is actually a bad idea.

Anyway, the media aren't responsible for the latest round of this in today's news in the Chicago area. No, this time it's Governor Blagojevich (Democrat), who's saying we should do this:

It's perfectly appropriate to look to Washington to help us solve our problems, just as municipalities and others look to us to try to help solve issues at the local level.

Blagojevich is basically saying that to provide "relief" from gas prices, it's more appropriate for the President to release some of the strategic oil reserves than it is for him, the governor, to do something like suspend the state tax on gas, which would take money away from schools, medical care, etc.... It's a heck of a spin.

Anyway, I happen to agree with Bush & his admin on this, who basically say the strategic oil reserves exist for times of dire emergency. High prices aren't a dire emergency (within reason, of course, oil at $200/barrel would be a serious problem for our economy, if it his that price overnight).

It should be pointed out that even the most prominent member of Blagojevich's party in Illinois (my opinion), Sen. Barack Obama, disagrees with him:

There's a reason why it's called strategic oil reserves, we should make sure that it is a crisis -- an emergency, a terrorist attack, serious disruptions in supplies in the Middle East -- before we tap in those reserves. That's why they're there.

(NOTE: I got my quotes from here (http://www.rrstar.com/apps/pbcs.dll/article?AID=/20050818/NEWS0109/508180317/1004/NEWS), but any cursory google search would give you more info.)


Of course, in case any of you think I've swung too far to the center, I should point out that I in fact favor higher gas prices as a way to encourage demand for more conservation-conscious vehicles (i.e. Hybrids and other passenger cars that get "good" mpg).

Interestingly, OPEC has had to tiptoe through the tulips throughout history with this. If they slow production enough and costs skyrocket, the public will look to alternative sources and corporations will be there to reap the profits of these new technologies. For once, it seems as if this is out of OPECs hands as it's China and India (as well the typical war-induced speculation) that are currently driving the high prices.

I also endorse Bush's non-use of the reserve - it's a quick fix that will only be a blip on the radar anyway.

When we talk about our reserves, are we talking about Alaska and off-shore California? Just how much oil do we have there?

When we talk about our reserves, are we talking about Alaska and off-shore California? Just how much oil do we have there?

We have quite a bit of oil in those places, the problem is, much of it is protected. :rolleyes:

In a truly free market, all the oil companies would be prospecting the US and getting more rigs in place where we know we have oil. They would then turn around and sell it at $50 a barrel and make a killing.

From what I understand, there is quite a bit of oil in shale in the Rockies, but I am not sure if the methods for extracting it are up to snuff yet. I know there is a HUGE operation in Canada where they are extracting oil from what are basically tar sands.

It's Blagojevich. I've gotten the impression he isn't the sharpest knife in the political drawer. He's been more serendipitously lucky in his career than anything. If I recall right, the House district he represented a few years back used to be run by Dan Rostenkowski, who was all-powerful until corruption, combined with the Republican revolution, removed him in 1994. The district was clearly a non-Republican district that tilted on the fluke result. As a result, Blagojevich ran for it in 1996 and took it back. He got to be in the right place at the right time again as George Ryan's governorship and the Republican party in general imploded spectacularly before the last gubernatorial election, leaving the deck cleared for whoever won the Democratic primary, namely him.

We have quite a bit of oil in those places, the problem is, much of it is protected. :rolleyes:

In a truly free market, all the oil companies would be prospecting the US and getting more rigs in place where we know we have oil. They would then turn around and sell it at $50 a barrel and make a killing.

From what I understand, there is quite a bit of oil in shale in the Rockies, but I am not sure if the methods for extracting it are up to snuff yet. I know there is a HUGE operation in Canada where they are extracting oil from what are basically tar sands.

So does that oil count as part of our reserves or not? I fully expect that some day those areas won't be protected and I'm curious what that gives us.

Yes and no. Part of our oil reserves yes, part of our strategic reserves no. The strategic reserves are some big oil tanks in Louisiana that house a few million barrels of oil IIRC. I am fuzzy on the exact size of the reserves, but they are a blip in the big scheme of things.

When we talk about our reserves, are we talking about Alaska and off-shore California? Just how much oil do we have there?

I'm under the impression that the "Strategic Oil Reserve" are actual barrels upon barrels of oil stored in caverns somewhere. I don't think we are talking about our potential capacity, in this case...

I'm under the impression that the "Strategic Oil Reserve" are actual barrels upon barrels of oil stored in caverns somewhere. I don't think we are talking about our potential capacity, in this case...

Gotcha. Thanks for the clarification. For this, I would have to agree that we shouldn't touch our strategic reserves. I do still think we should go into Alaska though. We could have better control of our prices and we wouldn't have to meddle as much in the Middle East.

Gotcha. Thanks for the clarification. For this, I would have to agree that we shouldn't touch our strategic reserves. I do still think we should go into Alaska though. We could have better control of our prices and we wouldn't have to meddle as much in the Middle East.

Unfortunately we still have to meddle in the Middle East no matter what. The aforementioned energy needs of India, and even moreso China, mean that the world economy is heavily dependent on there being enough stability in the Gulf that those countries can be supplied the oil they need to continue growing. China is going to have to get its energy somehow, we have to keep the Mid East stable (even if only as a source of oil, despite social unrest :( ) so that those needs can be met. Otherwise global stability, both economically and otherwise, becomes much more uncertain.

Basically the doomsday scenario in modern geopolitics is China not having access to the energy it needs to continue its economic growth. Without that access China has to find a way to acquire the energy it needs, possibly by shifting resources toward military capability. And then going after any of its resource-rich neighbors, possibly Siberia, and triggering another massive and possibly nuclear war. The Middle East is basically Cold War Germany these days, a place we have bases and a large standing force, and we unfortunately need to start thinking of it that way.

In my humble opinion of course :D

Of course, in case any of you think I've swung too far to the center, I should point out that I in fact favor higher gas prices as a way to encourage demand for more conservation-conscious vehicles (i.e. Hybrids and other passenger cars that get "good" mpg).

I encourage the exact opposite for the same reason. Buy those gas guzzling trucks and SUV's and drive all day long in stop and go traffic. The sooner we use up all this damned oil, the sooner we can move on to alternate fuel sources.

:)

Basically the doomsday scenario in modern geopolitics is China not having access to the energy it needs to continue its economic growth. Without that access China has to find a way to acquire the energy it needs, possibly by shifting resources toward military capability. And then going after any of its resource-rich neighbors, possibly Siberia, and triggering another massive and possibly nuclear war. The Middle East is basically Cold War Germany these days, a place we have bases and a large standing force, and we unfortunately need to start thinking of it that way.

In my humble opinion of course :D

That is a very good point.

I have always been a firm supporter of the Iraq War because of this. If we can have a viable democracy in the region, I think much of the instability will go away. I think more of the countries will become democracies, if one can become established.

I have always been a firm supporter of the Iraq War because of this. If we can have a viable democracy in the region, I think much of the instability will go away. I think more of the countries will become democracies, if one can become established.

Well, we'll know in 25 years, but I'm firmly of the belief that the Bush Admin's ME policies (including the Iraq War) have hindered, rather than helped, our long-term strategic standing there.

There's no history of democracy in the ME, and the Iraqi Constitution isn't shaping up to be a real democracy (more of a loosely federated state). Assuming that democracy isn't going to spring up in the ME in, say, the next 50-100 years (and I understand a lot of you disagree with this assumption), you need to look at what the likely governments are going to be. They're either going to be secularist dictatorships (Egypt, Syria, arguably Saudi Arabia, Jordan and all the small "Emirate" states) or Islamic states (Iran, probably Iraq).

Which type of state suits our interests better?

Given that fundamentalist Islam views the U.S. as Enemy #1 (or #2 after Israel, arguably), I'd say it's the secularist states. Ironically that was the view shared by every Administration before Bush. Unfortunately, our invasion of Iraq has only served to stiffen the resolve of Islamic Fundamentalists, which certainly hasn't helped the secularists.

We have quite a bit of oil in those places, the problem is, much of it is protected.

I was under the impression that the amount of oil available in ANWR is actually very small and only a short-term solution. Is this incorrect?

Unfortunately, our invasion of Iraq has only served to stiffen the resolve of Islamic Fundamentalists, which certainly hasn't helped the secularists.

I'm sure they haven't strengthened their resolve because we are failing. ;)

Perhaps "stiffen the resolve" is the wrong phrase.

The U.S. invasion of Iraq gives Islamic Fundamentalists the hope that a secular dictatorship can be replaced by an Islamic Republic.

I was under the impression that the amount of oil available in ANWR is actually very small and only a short-term solution. Is this incorrect?

There is some debate to how much oil is actually there, but I have heard that the if the US could somehow incent car manufacturers to try to engineer cars that would shave off 1 or 2 mpgs on fuel efficiency, that would net the US more oil than if they drilled in ANWR...

so China has only been growing in the last 2-3 years? Funny how gas was less than $1/gallon a couple of years ago and now it's getting close to $3/gallon.

It's simple economics, the oil companies are simply finally willing to raise prices over the magic $2/gallon and now see all the profits that are out there since we really haven't curbed consumption.

I think it may be reaching a point, however. One of my co-workers related to me anecdotally the other that there apparently is beginning to be a decent upswing in the number of SUVs in used car lots. $2 may not have deterred the consumption levels that much, but $3+ will get lots of people antsy. We've been considering getting a better used car than what we have now, but the rise in gas prices is effectively killing any notion of making a jump to SUVs. Aside from my father-in-law's Explorer, which he's willing to sell us without resorting to nasty things like credit checks and the like (not that my credit is nasty, BTW), we've pretty much decided on either a wagon like the Legacy/Outback or perhaps a light SUV like the CR-V.

so China has only been growing in the last 2-3 years? Funny how gas was less than $1/gallon a couple of years ago and now it's getting close to $3/gallon.

It's simple economics, the oil companies are simply finally willing to raise prices over the magic $2/gallon and now see all the profits that are out there since we really haven't curbed consumption.
But isn't the $60+ a barrel what the oil companies pay for the oil?

It's simple economics, the oil companies are simply finally willing to raise prices over the magic $2/gallon and now see all the profits that are out there since we really haven't curbed consumption.

The simple economics is that their costs have gone up, OPEC has been raising prices, and is able to do so because of increased global demand as well as instability factors. You seem to believe that oil companies are colluding here in the states and raising prices together so they can be evil and make billions (mwahaha). But the reality is that the marketplace is too competitive on that end and only about a quarter of the price of gas has anything to do with the oil companies. (Article (http://www.cnn.com/2005/EDUCATION/08/15/extra.gas.prices/index.html))

so China has only been growing in the last 2-3 years? Funny how gas was less than $1/gallon a couple of years ago and now it's getting close to $3/gallon.

Where in the hell were you finding gas for under $1 per gallon 2-3 years ago?

It's simple economics, the oil companies are simply finally willing to raise prices over the magic $2/gallon and now see all the profits that are out there since we really haven't curbed consumption.

It is simple economics, but not quite in the way you present it. The cost per barrel of crude oil is dependent on a variety of factors, of which the stability of the middle east is a significant one and the Iraq invasion has helped drive up the cost. What the oil companies pay per barrel, plus what it costs to refine the fuel helps determine the overall cost. Refineries are and have been running at capacity for a long time due to restrictions on new refinery construction and EPA requirements.

That's not to say that oil companies and moreso individual gas stations don't have some flexibility in what they choose to charge and aren't averse to artificially driving up prices (and with gas demand not diminishing this summer despite record pump prices, who can blame them), but there are many more factors than simple "how high can we get away with charging the public".

I'm no fan of the oil companies by any stretch, but I think it's important to look at the issue fairly.

I would like him even more if he pushed heavily for alternative energy sources to get us away from the M.E!

Too much of the recent increase in oil prices is due to "irrational exuberance" than actual supply and demand. It's fear that and emotion driving the prices up for the most part. OPEC and the Americas haven't lowered oil output substantially and China's demand isn't any higher than it was a year ago. The supply and demand is not dramatically different. What is different is that people are talking oil prices up.

The Administration hasn't helped. Buy repeatedly saying the situation is only going to get worse, they are inviting it to get worse. The biggest role a president can play in an economy is cheerleader; the Administration should be saying there is no reason for oil prices to be high, we expect them to drop and we're ready to take whatever measures are necessary to lower prices. That message alone would probably drop prices $5 a barrel.

Same with the strategic oil reserves. You don't have to actually use the reserves to get the effect. Threaten to use the reserves and you can calm the market and spark OPEC to increase production. Tapping the reserves is the "nuclear option." George HW Bush tapped the reserves during the first Gulf War, so I'm not sure why it's a bad idea now.

Two other things about the reserve: first, it's there in the event of a war. Last I checked, were were in a war. Secondly, the reserves are so small that even in the event of a major market event, the reserves would make almost no difference. They are merely a very useful emotional crutch. It's not something to fall back on. People who think the strategic oil reserves could sustain us for more than about three days in the event of a major reduction in oil supply would be sadly disappointed.

I agree that tapping into the oil reserves is a bad idea, but what disappoints me greatly is that this administration seemingly has never heard of the word "conservation." The cheaper gas prices a few years ago allowed for the MPG goals establised almost 30 years ago to be ignored. As a result, instead of CAFE standards being about 40 MPG today a good number of Americans are paying almost $3 a gallon to fill vehicles that get about 13 MPG. I wonder why the oil companies are experiencing record profits...

We need to at least lessen our dependency on oil. I would say foreign oil, but no matter where we drill we will still be OPEC's bitch as long as we have an economy that requires an enormous usage of the world's oil supply.

So...start it at home, BigJohn. The government isn't making the American consumer buy these giant SUVs and cars with low gas mileage.

This whole thing is ridiculous as history repeats itself. Same thing happened in the 70's - everyone got rid of their gas guzzlers and got small Japanese cars and Volkswagen Rabbits. The cost of gas goes down and the American consumer again shows it has no long-term memory and immediately falls in love with these new-fangled SUVs.

Blame the government, foreign countries, OPEC - but then take a good hard look at oneself in the mirror.

So...start it at home, BigJohn. The government isn't making the American consumer buy these giant SUVs and cars with low gas mileage.
But they are indirectly influencing people because the SUVs are taxed as light trucks rather than passenger cars. I live in NJ, where last year half of all new car purchases were SUVs. I saw fewer SUVs (but more pickups) in Texas and Nebraska this summer than I see in NJ.

So...start it at home, BigJohn. The government isn't making the American consumer buy these giant SUVs and cars with low gas mileage.

This whole thing is ridiculous as history repeats itself. Same thing happened in the 70's - everyone got rid of their gas guzzlers and got small Japanese cars and Volkswagen Rabbits. The cost of gas goes down and the American consumer again shows it has no long-term memory and immediately falls in love with these new-fangled SUVs.

Blame the government, foreign countries, OPEC - but then take a good hard look at oneself in the mirror.

I was going to post much the same thing.

Last night one of my buddies and I were discussing much the same thing. People are buying these cars that get 13-18 MPG on the highway, then complain about gas prices! If you are that worried about gas prices, do what I did, buy a car that gets 25-30 MPG on the highway!

My buddy said, "The government needs to step in and force the car companies to make cars that are more fuel efficient."

They do! But, I do not think that hybrids are selling like hot cakes because everyone wants a high performance car or SUV. Let the market dictate what it wants, and suppliers will naturally move in that direction. That is half the problem we have today, we cannot drill for oil in many places because of environmental controls. It is difficult to build new or expand existing refineries for the same reason.

The other thing is that we have a push-pull effect going on in the media. We have gloom and doom prognosticators that constantly make the most dire predictions. We are running out of water, food, gas, breathable air, the world is cooling off, the world is heating up, the big earthquake is coming, SoCal is going into the ocean, etc. Has any of this come to pass?

Let's look at ANWAR. The oil companies believe that there is close to the amount of oil down there as there was on the North Slope, based upon the geological structure of the rock, etc. Others say there is not nearly that amount of oil down there. What the oil companies want to do, is drill some test holes, and see if the oil is there, and if it is exploit it. Environmentalists are against this because of potential ecological damage.

My take on all of this: Let's get over ourselves. Oil is a naturally occurring resource. In some parts of the globe, it actually bubbles up to the surface naturally (not many, but it does occur). Is an oil spill a terrible occurance? Yes. However, we should not hold ourselves hostage to some caribou in a corner of the world I am never going to be going to. Not only that, with our drilling techniques today, we are much less intrusive than we were 20, 30, 40, 50 years ago. Finally, the economic boost from exploiting the resources would have a significant impact on our economy.

Let's not forget either that demand for oil is only from the energy sector, we need oil in our plastics and lubrication industries as well. Even were we to stop burning oil in our cars and our energy plants, it would still be required in massive quantities for our petrochemical sector.

The tree-huggers have also kept us from making additional nuclear power plants for 30-40 years. This has increased our dependence upon fossil fuels. Coal, oil, and natural gas all pollute more than a nuclear power plant does when it is properly used and maintained. It is only when plants go critical that they pollute more than the other plants do. For example, a coal plant releases more radioactive material into the environment than a nuke plant does. Some people will point out that 3 Mile Island was a disaster. No, it wasn't all the safeguards worked as they should and prevented a disaster, that is what the safeguards are there for!

We need to develop a national energy strategy to move to these more efficient forms of power and away from fossil fuels. However, in the short term, we are going to need to exploit the resources we have available.

The other thing is that we have a push-pull effect going on in the media. We have gloom and doom prognosticators that constantly make the most dire predictions. We are running out of water, food, gas, breathable air, the world is cooling off, the world is heating up, the big earthquake is coming, SoCal is going into the ocean, etc. Has any of this come to pass?

Yes, much of it has as a matter of fact:

The world is getting warmer, that's a fact. What is less certain is how much of this effect is natural earth cycles and how much is due to human effect. There is quite a bit of strong evidence pointing to the human effect, but I'm sure one can find opposing viewpoints that minimize this.

We are depeleting the earth's oil reserves. Yes, there are many untapped areas where oil can be drilled, but at increasing expense due to geological issues or at a cost of negative impact to the surrounding environment. The rate at which we are using oil vastly exceeds the natural processes that create oil.

There is a growing problem of access to fresh water around the world. Like the cycles in creating oil, there is a natural water cycle. It's a more subtle and complicated cycle than that of oil creation, but there are increasing issues that affect people's ability to access usable fresh water.

Air quality is an issue in an industrialized world. We've taken many steps in this country to address the issue, but situations like the one last week in Malaysia point out that air quality is a continuing problem as more nations become more industrialized and pollution increases.

Food is a more complicated issue; as we continue to improve our ability to generate productive crops and livestock we can make more with less land. However there are concerns about the technologies used in increasing our harvest - are all of them safe, or do they carry certain risks, and are these risks outweighed by the benefits they provide?

Big earthquakes happen, or have you forgotten the 9.0 earthquake off of Sumatra last year? The geologic record is littered with evidence of massive quakes. We can't know with great precision when they'll strike, but we know they will.

I presume you're smart enough to know that the idea of SoCal dropping into the ocean is a myth.

My take on all of this: Let's get over ourselves. Oil is a naturally occurring resource. In some parts of the globe, it actually bubbles up to the surface naturally (not many, but it does occur). Is an oil spill a terrible occurance? Yes. However, we should not hold ourselves hostage to some caribou in a corner of the world I am never going to be going to. Not only that, with our drilling techniques today, we are much less intrusive than we were 20, 30, 40, 50 years ago. Finally, the economic boost from exploiting the resources would have a significant impact on our economy.

So the litmus test on environmental impacts is it only matters if it's a place you'll visit? You may not care about what environmental impact drilling would have on the flora and fauna of the region, but don't be so naive as to think it doesn't have an impact on you. The Earth is one huge life cycle - things that happen in remote places will affect you at some point - it may take a long time, the effect may be subtle, but it's real. I haven't made up my mind about drilling in ANWAR because I haven't read enough about the suggested impact on the area, but I'm not automatically going to dismiss the idea that the impact could be negative enough to outweigh the benefits of accessing the oil there.

The tree-huggers have also kept us from making additional nuclear power plants for 30-40 years. This has increased our dependence upon fossil fuels. Coal, oil, and natural gas all pollute more than a nuclear power plant does when it is properly used and maintained. It is only when plants go critical that they pollute more than the other plants do. For example, a coal plant releases more radioactive material into the environment than a nuke plant does. Some people will point out that 3 Mile Island was a disaster. No, it wasn't all the safeguards worked as they should and prevented a disaster, that is what the safeguards are there for!

You seem to conveniently ignore the fact that nuclear power produces waste that is extremely radioactive and very deadly, and as yet we haven't found a good long-term method of dealing with that waste other than to shove it in the ground somewhere and hope for the best - never mind earthquakes, never mind leakage into groundwater, etc. Come up with a good solution for the waste and I'd be all for building more nuclear power plants.

We need to develop a national energy strategy to move to these more efficient forms of power and away from fossil fuels. However, in the short term, we are going to need to exploit the resources we have available.

I agree. But the convenience of the technology that's already there (oil usage) means we have to really make an effort to pursue and develop the alternative energy sources, because it's real easy to just say "fuck it, we can just use gas and damn the future". That's where government incentives to encourage people to buy hybrid vehicles, government regulation upping the MPG requirements of the auto fleet and a look at whether it makes sense to continue subsidizing the oil companies come into play.

So...start it at home, BigJohn. ...but then take a good hard look at oneself in the mirror.
I do not own anything that has an internal combustion engine. It helps a great deal that I live in NYC, but if I lived in my native Detroit (where driving is the only real option) I would be purchasing a Ford Escape Hybrid (the only American hybrid vehicle.)

Even if I did have a vehicle, I would still continue to walk or bike to places that were within a reasonable distance. I have seen too many times people who need to drive half a block to the store. I am also the type who pulls into a parking lot and parks in the first spot I see, even if it means WALKING a few extra yards. I find it extremely annoying when people drive thru a parking lot for 20 minutes looking for the closest possible space.

Sadly, I feel very much alone.

I think you missed the entire point of my post...

Yes, much of it has as a matter of fact:

The world is getting warmer, that's a fact. What is less certain is how much of this effect is natural earth cycles and how much is due to human effect. There is quite a bit of strong evidence pointing to the human effect, but I'm sure one can find opposing viewpoints that minimize this.

Just like prior to 1970 the Earth was getting colder and people were predicting another Ice Age.

We are depeleting the earth's oil reserves. Yes, there are many untapped areas where oil can be drilled, but at increasing expense due to geological issues or at a cost of negative impact to the surrounding environment. The rate at which we are using oil vastly exceeds the natural processes that create oil.

No argument, but we have also discovered new ways of getting oil out of the ground. We have also discovered that old fields are becoming viable fields again, etc. Everytime we have a prediction that we will run out of oil by year X, we find out that estimate wasn't really right.

There is a growing problem of access to fresh water around the world. Like the cycles in creating oil, there is a natural water cycle. It's a more subtle and complicated cycle than that of oil creation, but there are increasing issues that affect people's ability to access usable fresh water.

Again, no argument here. But the doomsday people were saying we'd have wars fought over water rights by 2010, I don't think that's going to happen. Plus, with the improved technology in desal water plants, it is not as big a problem as we think. Sure, we'll have to throw money at it, but this can be fixed.

Air quality is an issue in an industrialized world. We've taken many steps in this country to address the issue, but situations like the one last week in Malaysia point out that air quality is a continuing problem as more nations become more industrialized and pollution increases.

Recent polling data showed that the majority of school children thought that our air was hazardous to breathe. That is ridiculous. Yes, we must take care of the air we have, but the air is certainly not toxic, by and large.

Food is a more complicated issue; as we continue to improve our ability to generate productive crops and livestock we can make more with less land. However there are concerns about the technologies used in increasing our harvest - are all of them safe, or do they carry certain risks, and are these risks outweighed by the benefits they provide?

Right, a few centuries ago, there was worry that the world could only support something on the order of 1-2 billion people. We're at approx. 7-8 billion last time I checked. There is a risk/reward in everything we do. I see no reason why we should be petrified over items such as genetic engineering of plants. We are merely speeding up the process of natural selection. Heck, we've been genetically engineering corn for at least 3 millenia.

Big earthquakes happen, or have you forgotten the 9.0 earthquake off of Sumatra last year? The geologic record is littered with evidence of massive quakes. We can't know with great precision when they'll strike, but we know they will.

I presume you're smart enough to know that the idea of SoCal dropping into the ocean is a myth.

Actually I am. I grew up in LA and know quite well that whole myth, thank you very much. Again, that is my point. We have all these people throwing out information, half of which is false. We cannot live our lives in fear of things we have no control over. In hindsight I shouldn't have listed this because it is out of our control, whereas most of the rest of it is stuff we do control.

So the litmus test on environmental impacts is it only matters if it's a place you'll visit? You may not care about what environmental impact drilling would have on the flora and fauna of the region, but don't be so naive as to think it doesn't have an impact on you. The Earth is one huge life cycle - things that happen in remote places will affect you at some point - it may take a long time, the effect may be subtle, but it's real. I haven't made up my mind about drilling in ANWAR because I haven't read enough about the suggested impact on the area, but I'm not automatically going to dismiss the idea that the impact could be negative enough to outweigh the benefits of accessing the oil there.

Yes, I do worry about the environmental impact drilling would have. However, I know enough about the industry to know what they are capable of doing today. The majority of the ecological impact will not be at the site (barring a major oil spill, which I think goes without question), but rather at the refining site. However, a major oil spill there will have much less impact globally than a spill off the coast of California.

However, if the oil companies cannot make a buck in ANWAR, they aren't going to begin large scale operations there. Let them test drill, see if they find any, and if they do exploit it.

You seem to conveniently ignore the fact that nuclear power produces waste that is extremely radioactive and very deadly, and as yet we haven't found a good long-term method of dealing with that waste other than to shove it in the ground somewhere and hope for the best - never mind earthquakes, never mind leakage into groundwater, etc. Come up with a good solution for the waste and I'd be all for building more nuclear power plants.

I didn't cover that fact, but you are correct. That is why the storage area should be in an area with sparse human population, that is geologically quiet. There are plenty of areas to do this. Or better yet, talk to the French. Over 80% of their electricity was provided by Nuclear Plants back in the 1990s. We have too many people with a NIMBY attitude here in the states, and that prevents us from making any real progress. How many people die from mining coal each year? What about the air pollution from all the coal and oil fired power plants in the nation? (No, I am not being hypocritical saying our air is good and then saying the pollution from the power plants is bad. By and large, we have good air quality, but in localized areas, such as downwind of power plants, it can be significantly improved. I recognize that.)

I agree. But the convenience of the technology that's already there (oil usage) means we have to really make an effort to pursue and develop the alternative energy sources, because it's real easy to just say "fuck it, we can just use gas and damn the future". That's where government incentives to encourage people to buy hybrid vehicles, government regulation upping the MPG requirements of the auto fleet and a look at whether it makes sense to continue subsidizing the oil companies come into play.

Again, why should the government get involved? Is it my fault that most consumers are crying because they bought their precious SUV and are now crying because gas prices are so high? Now the Feds need to step in and make the big bad car companies build cars that the Feds decide are the cars we should be driving? No thanks, I think I can choose what car is the best for me and my family. For the record, I drive a Nissan Maxima and my wife drives a Nissan Sentra, both get over 25 MPG. With gas prices so high, what other incentive do people really need to buy a hybrid, if gas is that critical of an item right now? If gas prices stay high, I might consider a hybrid.

Read my post carefully, I am not saying damn the future lets burn the oil up now! I said, let's use oil for the short term, but let's get a national energy plan so that 5-10 years down the road we are less dependent upon foreign oil. What I didn't say or imply, is that the legs to that stool are increased domestic exploration of oil, reduce the amount of red tape to get Nuclear Power Plants built, and reduce the environmental controls surrounding drilling of natural gas and oil domestically. Oil is too valuable a resource to be burned as fuel, but in the short term, it is our best option.

Even if I did have a vehicle, I would still continue to walk or bike to places that were within a reasonable distance. I have seen too many times people who need to drive half a block to the store. I am also the type who pulls into a parking lot and parks in the first spot I see, even if it means WALKING a few extra yards. I find it extremely annoying when people drive thru a parking lot for 20 minutes looking for the closest possible space.

Sadly, I feel very much alone.

I am not close enough to walk to the store, but I nearly always park at the first available spot. Of course, my wife hates it when I do that.

I think you missed the entire point of my post...

If your point was that lots of people cry "doomsday" early and often, I agree. But the way you listed your examples of such made it seem like you were arguing none of these things was a problem, hence my reply.

Science is not a static thing - as we gain more data and more information we are able to adjust and refine our conclusions. You will always have fringe people on both sides - those shouting "the sky is falling" at the slightest problem and those saying "there is no problem" when there clearly is. I'm not denying that there has been much doomsday talk that has been clearly overblown or exaggerated. Such talk diminishes the effectiveness of warnings - sea levels aren't rising nearly as quickly as the doomsdayers proclaimed, but they are rising (as just one example).

No argument, but we have also discovered new ways of getting oil out of the ground. We have also discovered that old fields are becoming viable fields again, etc. Everytime we have a prediction that we will run out of oil by year X, we find out that estimate wasn't really right.

How would you respond to the "Hubbard Peak" theories? At first blush this theory seems to be proving right so far.

Again, no argument here. But the doomsday people were saying we'd have wars fought over water rights by 2010, I don't think that's going to happen. Plus, with the improved technology in desal water plants, it is not as big a problem as we think. Sure, we'll have to throw money at it, but this can be fixed.

Hopefully you're right. The important thing is that the problem has been recognized and that steps are being taken to try and mitigate it. While there is harm in overly exaggerated doomsday scenarios, to the extent that such talk spurs action to prevent the predicted catastrophe, there is some good being done.

Recent polling data showed that the majority of school children thought that our air was hazardous to breathe. That is ridiculous. Yes, we must take care of the air we have, but the air is certainly not toxic, by and large.

Maybe I wasn't clear, but I acknowledge that air quality is not nearly so big a problem in this country. There are still times and places where it's a problem (such as particularly bad days in the L.A. valley), but by and large our EPA regulations have done a good job of reducing the problem in this country.

However it remains a major issue in other, less-developed countries that are willing to sacrifice the health of their citizens for economic gain. I'm trying not to be judgemental about these actions, because there are real economic consequences for these emerging economies if we were to expect them to abide by the level of pollution standards we have in this country. But the economic realities don't diminish the fact that air quality is a real issue in many parts of the world.

Right, a few centuries ago, there was worry that the world could only support something on the order of 1-2 billion people. We're at approx. 7-8 billion last time I checked. There is a risk/reward in everything we do. I see no reason why we should be petrified over items such as genetic engineering of plants. We are merely speeding up the process of natural selection. Heck, we've been genetically engineering corn for at least 3 millenia.

Well, a few centuries ago we believed lots of things about which we now know better. And there's a difference between selective breeding which is what humans have done for millenia and the chemical and hormonal additives and treatments we've begun using in the last few decades. Just because we don't yet know if these things we are adding are harmful doesn't mean we won't find out down the road - for a long time we added lead to things like paint and gas without knowing the real consequences of doing so.

Actually I am. I grew up in LA and know quite well that whole myth, thank you very much. Again, that is my point. We have all these people throwing out information, half of which is false. We cannot live our lives in fear of things we have no control over. In hindsight I shouldn't have listed this because it is out of our control, whereas most of the rest of it is stuff we do control.

Earthquakes are out of our control, but what is in our control is the ability to predict when and where they happen, and more importantly the standards to which we hold building construction in earthquake prone areas to withstand these events and reduce the potential for lives lost and property damage.

Yes, I do worry about the environmental impact drilling would have. However, I know enough about the industry to know what they are capable of doing today. The majority of the ecological impact will not be at the site (barring a major oil spill, which I think goes without question), but rather at the refining site. However, a major oil spill there will have much less impact globally than a spill off the coast of California.

I'm not sure I completely agree with that last sentence. I guess I'm taking a bigger-picture view and while it's easy to have an "out-of-sight, out-of-mind" approach to this issue, a major oil spill in that area will have serious repurcussions on that area's ecosystem, effects that will eventually trickle outward to affect us in various ways down the road.

I didn't cover that fact, but you are correct. That is why the storage area should be in an area with sparse human population, that is geologically quiet. There are plenty of areas to do this.

If there were plenty of areas to do this, then why haven't we been able to find an area that meets this criteria? The problem lies in the requirement of "geologic quiet" - over the half life of spent fuel rods, there really isn't any place on earth that is geologically quiet. There are areas that are less active, but by burying this waste with toxic radiation lasting thousands of years we're essentially burying ticking time bombs that we hope won't go off in the future.

Or better yet, talk to the French. Over 80% of their electricity was provided by Nuclear Plants back in the 1990s. We have too many people with a NIMBY attitude here in the states, and that prevents us from making any real progress. How many people die from mining coal each year? What about the air pollution from all the coal and oil fired power plants in the nation? (No, I am not being hypocritical saying our air is good and then saying the pollution from the power plants is bad. By and large, we have good air quality, but in localized areas, such as downwind of power plants, it can be significantly improved. I recognize that.)

The problem is the lethality of the radiation - pollution from oil and coal fired plants may kill us slowly, but a radiation problem would be far more dramatic. The reason why we don't just stuff our nuclear waste in a rocket and fire it at the sun is that the risk if such a rocket malfunctioned and the waste crashed back on the Earth is far too catastrophic to take.

Again, why should the government get involved? Is it my fault that most consumers are crying because they bought their precious SUV and are now crying because gas prices are so high? Now the Feds need to step in and make the big bad car companies build cars that the Feds decide are the cars we should be driving? No thanks, I think I can choose what car is the best for me and my family. For the record, I drive a Nissan Maxima and my wife drives a Nissan Sentra, both get over 25 MPG. With gas prices so high, what other incentive do people really need to buy a hybrid, if gas is that critical of an item right now? If gas prices stay high, I might consider a hybrid.

Why does the government get involved in any such areas? You might favor a more libertarian approach that lets the market decide all issues, but the problem I have with that is that many issues don't resolve themselves in time to prevent major problems that affect all of us. Would companies quit polluting the environment as quickly and as thoroughly if the government weren't applying regulations on them to do so? I don't think so - I highly doubt market motivation from aware consumers would act as quickly to enact such changes. I think it's partly a question of inertia - without a push, many people are reluctant to make changes in their habits. Government regulation provides that push.

Read my post carefully, I am not saying damn the future lets burn the oil up now!

I didn't mean to imply that you did - I was simply pointing out that without a push in the direction of alternative energy sources (such as incentives for hybrid cars) it's easy for people to keep to the same routines and live for today while ignoring the future.

I am not close enough to walk to the store, but I nearly always park at the first available spot. Of course, my wife hates it when I do that.
The next time she starts into you for it just tell her that the exercize will do her some good. Tell her that just walking a little more can help her to lose that stomach and firm up her bottom to look more like the cute young receptionist at your office. I guarantee she will stop bitching about walking an extra 20 feet.

Where in the hell were you finding gas for under $1 per gallon 2-3 years ago?



It is simple economics, but not quite in the way you present it. The cost per barrel of crude oil is dependent on a variety of factors, of which the stability of the middle east is a significant one and the Iraq invasion has helped drive up the cost. What the oil companies pay per barrel, plus what it costs to refine the fuel helps determine the overall cost. Refineries are and have been running at capacity for a long time due to restrictions on new refinery construction and EPA requirements.

That's not to say that oil companies and moreso individual gas stations don't have some flexibility in what they choose to charge and aren't averse to artificially driving up prices (and with gas demand not diminishing this summer despite record pump prices, who can blame them), but there are many more factors than simple "how high can we get away with charging the public".

I'm no fan of the oil companies by any stretch, but I think it's important to look at the issue fairly.
Gas was a buck a gallon in Syracuse a couple of years ago.

The oil companies are turning record profits, gas stations are not. gas stations make jack squat on the gas, they DO make money on the food/drink in the mini-mart (which is why stuff is so pricey there). Obviously, the rise in barrel prices isn't affecting Exxon, etc now is it?

The reasons behind the rise in cost per barrell aren't tangible, more and more the cost of "the possibilty of a major pipeline disruption" keeps rising. Is there greater instability in Iraq today than there was a year ago?

Now, we've had it made in the shade for decades so I take it as a "we're catching up to what everyone else pays for gas" but it's still a little insane so see such dramatic rise in costs where there's been no disruption in supply

Gas was a buck a gallon in Syracuse a couple of years ago.

The oil companies are turning record profits, gas stations are not. gas stations make jack squat on the gas, they DO make money on the food/drink in the mini-mart (which is why stuff is so pricey there). Obviously, the rise in barrel prices isn't affecting Exxon, etc now is it?

The reasons behind the rise in cost per barrell aren't tangible, more and more the cost of "the possibilty of a major pipeline disruption" keeps rising. Is there greater instability in Iraq today than there was a year ago?

Now, we've had it made in the shade for decades so I take it as a "we're catching up to what everyone else pays for gas" but it's still a little insane so see such dramatic rise in costs where there's been no disruption in supply

Do you dispute that the price of crude oil has gone up in the last couple of years? That cost is out of the control of the oil companies. As I said, I'm not suggesting that oil companies and gas stations don't jigger the prices of gas some based on what they think they can get away with, but a much bigger factor is the cost the oil companies are paying in buying the crude and their ability to get production from the refineries.

Maybe it's just Washington state and all our gas taxes, but I don't think we've been under $1.50 per gallon in several years. If you were paying $1 per gallon just 2 years ago you had it made.

hxxp://www.energybulletin.net/3544.html

interesting "look" at the SOR

Our refineries are all pretty much operating at capacity as it is right now. And quite a bit of that oil is coming out of our own ground right now. I got to tour a refinery earlier this summer and pick the manager's brains on this. Opening up the reserves will do nothing because national refineries are already putting out as much processed petroleum as they can. Tapping the reserves only changes where the crude is coming from, not how much can be processed. It's just political BS to talk about it.

Our refineries are all pretty much operating at capacity as it is right now. And quite a bit of that oil is coming out of our own ground right now. I got to tour a refinery earlier this summer and pick the manager's brains on this. Opening up the reserves will do nothing because national refineries are already putting out as much processed petroleum as they can. Tapping the reserves only changes where the crude is coming from, not how much can be processed. It's just political BS to talk about it.

Oil refineries are operating above 90% capacity and have been for years. Most plants run best when operating at 80-85% capacity so maintenance can be performed on the other parts of the plant.

Right...I've never understood this. All it would take is one hurricane or terrorist attack on a refinery and we're toast. I wonder what the finger pointing will look like then! In the meantime, "everything's cool...."

Right...I've never understood this. All it would take is one hurricane or terrorist attack on a refinery and we're toast. I wonder what the finger pointing will look like then! In the meantime, "everything's cool...."
Interesting you bring this up because probably the most significant thing I noticed at the refinery was a total lack of security. I know they have closed circuit cameras everywhere, but I never saw so much as one security guard on the premises and we were able to drive our bus right through the refinery totally unimpeded. And this refinery had it's own exit on I-20. Tanker trucks were running in and out of there with no checks or inspections at all. If I wanted to kill that refinery I would have driven a tanker full of gas or fertilizer right into the middle and blown it sky high and absolutely nothing would have stopped me.

If I wanted to kill that refinery I would have driven a tanker full of gas or fertilizer right into the middle and blown it sky high and absolutely nothing would have stopped me.

But... but... but... at least we've made the planes safe!

Or not. (http://www.washingtonpost.com/wp-dyn/content/article/2005/08/16/AR2005081601467.html)


The nation's largest flight attendants union yesterday questioned a federal government proposal to end the ban on knives, ice picks and razor blades on board commercial airplanes.

"As the front-line personnel with little or no effective security training or means of self defense, such weapons could prove fatal to our members," Patricia A. Friend, international president of the Association of Flight Attendants, said in a letter to Edmund S. "Kip" Hawley, the new leader of the Transportation Security Administration. "They may not assist in breaking through a flightdeck door, but they could definitely lead to the deaths of flight attendants and passengers."


The TSA is reviewing security procedures at the nation's airports to determine whether they protect against current terrorist threats. An internal TSA document last week detailed proposals that focus on protecting the nation from an inflight suicide bombing attack and suggested that certain categories of passengers, such as high-ranking government officials and airline crews, could be exempt from security screening. The proposals also included a possible end to the ban on certain items allowed in carry-on luggage.

A TSA spokeswoman said the proposals would not reduce the level of security at airports, adding that no final decisions have been made. "The approach is about focusing the limited resources TSA has where the threat is the greatest," spokeswoman Yolanda Clark said. "The challenge here is to look at security through the lens of threat vulnerability and consequence. The suggestions that are being considered are part of a larger effort to challenge the measures we have in place to help us improve security."

The flight attendants, whose union represents 46,000 members, said that easing the ban on some prohibited items could pose a safety risk on board the aircraft and lead to incidents that terrorize passengers even if they do not involve a hijacking.

"Even a plane that is attacked and results in only a few deaths would seriously jeopardize the progress we have all made in restoring confidence of the flying public," Friend said in her letter. "We urge you to reconsider allowing such dangerous items -- which have no place in the cabin of an aircraft in the first place -- to be introduced into our workplace."

The TSA's proposals come at a time when Congress is cutting the number of federal airport screeners and as security experts increasingly believe that U.S. airliners are adequately protected from another Sept. 11-style hijacking because of reinforced cockpit doors, air marshals and more vigilant passengers.

Yesterday, the pilots union said it agreed with many of the TSA's new proposals and welcomed the review. "We applaud the fact the TSA is taking the time to review their procedures and their screening process," said Bob Hesselbein, who serves as head of security at the Air Line Pilots Association, the union representing 64,000 U.S. airline pilots.

Hesselbein suggested that security screeners could be more effective if they were trained to do more than search for scissors and Swiss Army knives of innocent travelers.

The next time she starts into you for it just tell her that the exercize will do her some good. Tell her that just walking a little more can help her to lose that stomach and firm up her bottom to look more like the cute young receptionist at your office. I guarantee she will stop bitching about walking an extra 20 feet.
This made me snicker ;)

SI

Do you dispute that the price of crude oil has gone up in the last couple of years? That cost is out of the control of the oil companies. As I said, I'm not suggesting that oil companies and gas stations don't jigger the prices of gas some based on what they think they can get away with, but a much bigger factor is the cost the oil companies are paying in buying the crude and their ability to get production from the refineries.

Maybe it's just Washington state and all our gas taxes, but I don't think we've been under $1.50 per gallon in several years. If you were paying $1 per gallon just 2 years ago you had it made.
I suppose this would be a decent time to point out that Exxon-Mobil made a record $9B (in PROFIT) last quarter. Or that they have made $29.6B in the past year and "competitors" BP, Royal Dutch/Shell, and Chevron have made $20.0B, $18.2B, and $12.7B in the past year. Not exactly competing and breaking the bank there. Most industries at least have a loser or some companies that are not profitable but if you're in oil, you're rolling in money and I'm guessing that's not because of having to pay those high oil prices and razor thin margins.

Oil refineries are operating above 90% capacity and have been for years. Most plants run best when operating at 80-85% capacity so maintenance can be performed on the other parts of the plant.
This is one thing I don't get. I haven't been able to find a straight answer as to why there have been no refineries built in 30 years. There's lot of government red tape but why?

SI

I suppose this would be a decent time to point out that Exxon-Mobil made a record $9B (in PROFIT) last quarter. Or that they have made $29.6B in the past year and "competitors" BP, Royal Dutch/Shell, and Chevron have made $20.0B, $18.2B, and $12.7B in the past year. Not exactly competing and breaking the bank there. Most industries at least have a loser or some companies that are not profitable but if you're in oil, you're rolling in money and I'm guessing that's not because of having to pay those high oil prices and razor thin margins.


This is one thing I don't get. I haven't been able to find a straight answer as to why there have been no refineries built in 30 years. There's lot of government red tape but why?

SI

You're right. I saw news report on this the other day, showing the profit reports. Oil companies (that process the oil) are making huge profits, much more than the oil producers. All of their profits have increased 43-45% in the last year, after a large increase the year before.

BTW, it is the actual gas stations that are losing money. They have razor thin margins (and they are already being cut by the increase use of credit cards), and the increased gas prices are cutting into where they make money (junk food and sodas).

Let's think about this... It is all about supply and demand. If the producers are selling oil at $60+ per barrel, and their costs are the same.

We are not having an oil shortage, we are having an increase in demand, which is driving the prices up. If we had supply sitting on the docks, than it would be a refinery problem (although that would help). The oil companies are charging what people are willing to buy at. The other thing that people miss is the $15 surcharge for "terrorism risk." What oil supply has been disrupted by terrorism, and why are we paying an extra $15 for this?

The reason we have not built any new refineries are the way the laws are set up for new chemical plants. The only new chemical plants built in the last 20 years that I can think of are the ethanol plants in the Midwest, and those were done with heavy government backing, so some of the environmental controls were loosened I believe.

I suppose this would be a decent time to point out that Exxon-Mobil made a record $9B (in PROFIT) last quarter. Or that they have made $29.6B in the past year and "competitors" BP, Royal Dutch/Shell, and Chevron have made $20.0B, $18.2B, and $12.7B in the past year. Not exactly competing and breaking the bank there. Most industries at least have a loser or some companies that are not profitable but if you're in oil, you're rolling in money and I'm guessing that's not because of having to pay those high oil prices and razor thin margins.

SI

Hey, as I said I'm no great defender of the oil industry - I know about their record profits and given that, any subsidies they get from our government should be revoked. I'm not blind to the fact that demand for gas in our country and the willingness of motorists to continue to pay the current prices without demand dropping plays into the costs. I wouldn't have any problem with a deeper look at finances of the oil companies to see exactly why they are producing record profits at a time of rising costs for them. Given the importance of fuel costs to our national economy, I wouldn't object to greater government oversight of the industry - should the oil companies be generating record profits when higher fuel prices are a drag on nearly every other segment of the economy?

But, I still stand by the contention that prices for crude oil have risen in the last few years, and that is at least part of the reason for the increase in prices along with a limited amount of production that the available refineries can provide to meet the demand.

I'm prepared to think of the oil companies as evil greedheads. But I don't think that's the sole reason for the increase in gas prices.

Hey, as I said I'm no great defender of the oil industry - I know about their record profits and given that, any subsidies they get from our government should be revoked. I'm not blind to the fact that demand for gas in our country and the willingness of motorists to continue to pay the current prices without demand dropping plays into the costs. I wouldn't have any problem with a deeper look at finances of the oil companies to see exactly why they are producing record profits at a time of rising costs for them. Given the importance of fuel costs to our national economy, I wouldn't object to greater government oversight of the industry - should the oil companies be generating record profits when higher fuel prices are a drag on nearly every other segment of the economy?

But, I still stand by the contention that prices for crude oil have risen in the last few years, and that is at least part of the reason for the increase in prices along with a limited amount of production that the available refineries can provide to meet the demand.

I'm prepared to think of the oil companies as evil greedheads. But I don't think that's the sole reason for the increase in gas prices.


Sole? No. Large part (or even vast majority of the reason)? Yes.

[QUOTE=dawgfan]Where in the hell were you finding gas for under $1 per gallon 2-3 years ago?

Not quite under $1, but a little less than 3 years ago it was down to at least 1.17 on average in SC, which means some was probably near 1-1.05. Now its $2.45.

Hey, as I said I'm no great defender of the oil industry - I know about their record profits and given that, any subsidies they get from our government should be revoked. I'm not blind to the fact that demand for gas in our country and the willingness of motorists to continue to pay the current prices without demand dropping plays into the costs. I wouldn't have any problem with a deeper look at finances of the oil companies to see exactly why they are producing record profits at a time of rising costs for them. Given the importance of fuel costs to our national economy, I wouldn't object to greater government oversight of the industry - should the oil companies be generating record profits when higher fuel prices are a drag on nearly every other segment of the economy?

I know a little about the oil industry and I think there's some mis-perceptions here. One common mis-perception is that oil companies (Exxon, BP, Shell, Chevron, etc.) make most of their profits on gasoline. This is completely untrue.

Major integrated oil companies, like Exxon, BP, Shell, Chevron, etc. make most of their profits by drilling and producing oil. This is called "Upstream" part of their business. The "Downstream" part of their business includes refineries, gas stations, chemical plants, etc.

I have a link to Chevron's 2nd Quarter Financial Statement here.

http://library.corporate-ir.net/library/13/130/130102/items/160877/2005_2QRelease.pdf

Here's Exxon's

http://library.corporate-ir.net/library/11/115/115024/items/160686/xom_072805.pdf

As you can see, Chevron's and Exxon's "Downstream" business only accounts for 25% or less of their profits. This makes sense - with record price for oil ($60/barrel), oil companies make more money by selling oil they produce.

So then why is gasoline price so high? There are many factors that drive this and I'm sure I don't know all of it. Some that I can think of :

1. With high oil prices, it drives gasoline (and other fuels, like jet, diesel, heating oil, etc.) price higher.
2. Gasoline supply and demand - even with high prices, gasoline demand is high. As some mentioned, US refining capacity at or near it max.

Why is oil price so high? Simple - there is higher demand for oil than the supply. A few years ago, OPEC successfully controlled oil prices ($25-35/bbl) by adjusting each OPEC country's quota. Recently, OPEC has basically allowed every country to produce as much as they could. Still, with higher demand in China, India and other developing countries, along with annual increases in the major consumers, like the US, demand for oil has exceeded the supply.

To drive oil prices lower, we need to :

1. Conserve.
2. Develop alternative sources - with higher oil prices, other sources become more competitive.
3. Find and produce more oil.

Hope this helped!!!! ;)

BTW, dawgfan, I don't know of any government (US) subsidies that oil companies receive. Also, I'm not a supporter of any government intervention on issues like this - governments have notoriously poor record at managing free market systems.

BTW, dawgfan, I don't know of any government (US) subsidies that oil companies receive. Also, I'm not a supporter of any government intervention on issues like this - governments have notoriously poor record at managing free market systems.

I'm not certain of this, but I was under the impression that oil companies get subsidies from the federal government in the form of tax breaks or other means for the purpose of R&D - drilling, developing alternate energy sources.

If they indeed receive any form of government subsidy or tax break, I can't see how, with the record profit margin they have, they should continue to do so.

I'm relatively neutral on the concept of government oversight in terms of pricing, but given the huge role the oil companies play in our economy by virtue of gas prices I could be persuaded it's a good idea in this instance.

Bush has changed his tune and is now talking about tapping strategic oil reserves: http://money.cnn.com/2005/09/26/news/economy/bush/index.htm?cnn=yes

Thoughts?

He's also encouraging people to conserve, especially with regard to gasoline. Personally, I think this marks a change in administration policy. Thoughts?

In other news, I heard on the radio this morning that Jeb Bush made a public show of trading in his SUV for a hybrid (don't know which one).