Gas soars; voters whine; oil profits boom; politicians pander


From the Wall Street Journal (subsc. req.):

Booming crude-oil prices and improved refining profits are poised to put a firecracker under Big Oil’s first-quarter earnings and set the stage for a year that could come close to rivaling the industry’s record year in 2008.

First-quarter crude prices averaged about $100 a barrel, or about 20% higher than a year ago, pushed upward by oil-supply concerns due to political unrest in the Arab World and a recovering global economy. That spike is expected to lift earnings by about 50% at Exxon Mobil Corp., and about 33% each at Chevron Corp. and ConocoPhillips, compared with a year earlier….

“Major oil companies are firing on all cylinders,” says Fadel Gheit, an analyst with Oppenheimer & Co. “Their first-quarter earnings are going to be much, much better than a year ago.”

If oil prices continue to climb, they could at least rival 2008. That year, U.S. producers reported astronomic profits as crude hit $147 a barrel for a time. Exxon that year earned $45.2 billion, more than any other U.S. publicly traded company in history.

And of course, those numbers don’t become any easier to swallow when you consider the $4 billion in subsidies that the American taxpayer coughs up each year on behalf of Big Oil. Efforts in Congress to eliminate those subsidies have failed because Republicans have cast the reform as a tax hike. So even in the midst of a deficit panic, government is required to keep on subsidizing one of the most profitable industries on the planet, a practice defended by the party that proclaims itself the champion of the free market.

Intellectually, the current situation is not that complicated. People are demanding more oil than the market can supply — an economic recovery is boosting consumption at the same time that disruptions in the Arab world threaten oil output. So the price is jumping.

However, that market-driven fact of life is hard for people to accept. With the price of gasoline approaching $4 a gallon — close to the record average of $4.11 in 2008 — consumers don’t want an explanation, they want a solution. And politicians in turn are motivated to give them one, or at least the illusion of one.

Republicans, for example, want to cast government, and more specifically the Obama administration, as the villain. They propose that the federal government drop environmental restrictions and open additional areas to oil exploration and production, suggesting that such steps will lower the price at the pump. But among energy experts, there’s really no debate. Even if we removed all environmental restrictions on domestic oil production — and last summer’s Deepwater Horizon tragedy in the Gulf suggests such a step would come with a heavy price — the amount of additional oil that could be produced in the United States would be too small to move the global market, where the price of oil is set. We may not like to acknowledge that fact — it drives home our relative helplessness — but it remains fact nonetheless.

(And of course, every additional barrel of oil pumped from beneath American territory today makes us even more dependent on foreign oil tomorrow.)

For his part, President Obama is following the futile course set by his predecessor. Last week, he announced a federal investigation into the role of speculation in driving up oil prices, just as President George W. Bush did in 2005 and 2006. Those investigations turned up little or nothing, as will this one. But politically, it gives Obama an alternative villain to whom he can point, which in his situation is important.

The uncomfortable truth is that because the need for oil is so ingrained in our economy and lifestyles, oil prices have to move a lot in order to produce even a slight decrease in demand. They have to rise high enough to make it hurt before people will curtail consumption.

So … are you hurting yet?

– Jay Bookman

824 comments Add your comment

Southern Comfort (aka The Man)

April 25th, 2011
9:05 am

Wealth Envy!!!! Corporate profit envy!!!!! :)

We’re addicted to oil like a 60 year crack addict. There’s no way we can wean ourselves from it as it’s a daily way of life from gas to plastics and almost everything else we use. We should have learned from the 70’s, but an addict has to hit rock bottom and admit he has a problem before a solution can be found. I don’t think we’ve hit rock bottom yet, and I know there are many who refuse to admit we have a problem.

jm

April 25th, 2011
9:05 am

Coburn (R-OK) on Meet the Press indicated higher overall tax revenue was a needed and acceptable byproduct of tax reform.

Aren’t higher oil prices what Obama wanted? (yes) Now we just get them via the free market rather than government…

Um, natural gas (Pickens Plan) is the only practical way to go if you want an interim solution to our oil dependency problem.

jm

April 25th, 2011
9:07 am

“oil prices have to move a lot in order to produce even a slight decrease in demand”

Translation: Jay understands the elasticity of demand intuitively, if not intellectually. :)

Pennsylvanian

April 25th, 2011
9:07 am

“So … are you hurting yet?”

No. The price of gasoline is in the noise for me.

Mick

April 25th, 2011
9:08 am

**So … are you hurting yet?**

Yes – absolutely….

USMC

April 25th, 2011
9:08 am

On the bright side of things, maybe we can get some of these humongous SUV’s off of the road:-)

Scott

April 25th, 2011
9:08 am

When Bush was President, the media was all over him saying it was his fault gas prices were so high and that he was giving his cronies big breaks and more profits. With Obama president, the media says that he has no control over the gas prices. Do you think they would be saying the same thing if a Rep. was in the White House? The fact that he once again gets a free pass is such garbage. Enough said.

TnGelding

April 25th, 2011
9:09 am

Wrong! There is more than enough supply to meet the demand! Saudi Arabia just reduced prodution because of the glut and we’re running out of places to store it. It’s the speculators stupid! We simply have to change the way we get the oil to the refinery. Obama will eventually do something dramatic and controversial. His reelection depends on it.

What about converting the entire statewide school bus systems to natural gas? I’m sure the feds would finance it with more deficit spending.

godless heathen

April 25th, 2011
9:09 am

Based on the heavy traffic and the high rate of speed they were driving on I-75 this week-end, I’d say the peeps ain’t hurting yet.

jm

April 25th, 2011
9:09 am

“So … are you hurting yet?”

A Prius plus a good amount of oil futures plus exposure to less oil intensive investment alternatives has me effectively hedged….

TnGelding

April 25th, 2011
9:11 am

Every penny increase hurts the working poor, of which there are way too many in a country as wealthy as ours.

TnGelding

April 25th, 2011
9:12 am

Simply use less, somethng very easy for most of us to do. Park that gas-guzzler!

Aquagirl

April 25th, 2011
9:13 am

But Jay, drilling like a dentist on crack will make people feel better, and isn’t that what it’s all about? They absolutely refuse to accept our oil deposits aren’t as economically viable. They think a crowd of mythical enviro-wackos are keeping oil from magically jumping out of shale rock. Apparently the term “production cost” is beyond these free-market experts.

Pennsylvanian

April 25th, 2011
9:16 am

“Based on the heavy traffic and the high rate of speed they were driving on I-75 this week-end, I’d say the peeps ain’t hurting yet.”

How true! And look at the lines of people in cars idling in fast food drive through lanes, too lazy to park and walk inside.

jm

April 25th, 2011
9:16 am

Obama playing politics? That’s all he’s been doing for at least 2 months now. Shocker…

Obama watches Rome burn…..

“In our baseline macroeconomic scenario of near 3% annual real growth, we
expect the general government deficit to decline gradually but remain slightly
higher than 6% of GDP in 2013. As a result, net general government debt would
reach 84% of GDP by 2013. In our macroeconomic forecast’s optimistic scenario
(assuming near 4% annual real growth), the fiscal deficit would fall to 4.6%
of GDP by 2013, but the U.S.’s net general government debt would still rise to
almost 80% of GDP by 2013. In our pessimistic scenario (a mild, one-year
double-dip recession in 2012), the deficit would be 9.1%, while net debt would
surpass 90% by 2013.”

http://www.standardandpoors.com/ratings/articles/en/us/?assetID=1245302886884

Scott

April 25th, 2011
9:17 am

Aquagirl…..seriously get a clue. How many other countries are sitting off our shore in the Gulf of Mexico drilling away while we sit there and watch? How much oil sits in the ANWAR and we so nothing. Yes, we need to figure out a way to remove our oil dependence, however, we need to also figure out a way to sustain ourselves as the same time.

Keep Up the Good Fight!

April 25th, 2011
9:18 am

Call it like it is

April 25th, 2011
9:18 am

Its a silly game, that hurts no one but the common man. Obama will threaten to open up the gulf and Alaska, then the Saudi King will all of a sudden drop the price so Americans will be happy for now, and the cycle will begin again.

Road Scholar

April 25th, 2011
9:18 am

Even if the oil companies drilled when president obama took office, it would not be available for 5 more years. That is if there were existing platforms to be floated out to the discovered oil, that the oil had been discovered, and that the refinries were expanded, and , of course the new oil was only sold to the US. On the FREE MARKET the oil would still be priced at the going global rate, so, it would still be costly. Ah , the world ,arket! Deal with it!

Oh and do you really expect the oil companies to reduce the cost just for the US when they can make more on the world market? And India’s and China’s thirst will increase…

Stop the whining! Also drop the subsidies!

Gordon

April 25th, 2011
9:18 am

Jay,

How much of what is paid for a gallon of gas goes towards oil company profits?

jm

April 25th, 2011
9:18 am

If US debt gets downgraded, the world will get turned upside down.

ByteMe

April 25th, 2011
9:20 am

We have more rigs drilling in US territory than last year, but we also have well over 50% of all leases that are inactive. Why? It’s not the administration’s fault… they are approving plans to drill at the same pace as it has been throughout the 2000’s.

Could it be in the best interest of the oil companies to take leases off the market and not explore them so that supply remains tight? Hmmmm?

jm

April 25th, 2011
9:20 am

“politicians pander” Apparently that is their job. “Leader of the free world.” I think not right now.

TnGelding

April 25th, 2011
9:21 am

Drop the subsidies and watch the price go even higher!

getalife

April 25th, 2011
9:21 am

We wasted millions of lives, trillions of our money for Iraqi oil and the gop still want to hand out 53 billion to big oil.

The gop are to blame. Period.

Charlie

April 25th, 2011
9:22 am

Jay, both sides are going to have to give here.

I doubt your claim that expanded domestic production won’t put a dent in world markets. Regardless, domestic productio is falling, and we’re not even attempting to replace it. I listened to a former CEO of Shell Oil on CNBC last week. He’s hardly an oil industry apologist as one might expect from the title. But he also explained that the US is down over 30% in what we produce here in just over a 10 year period.

These windfall profits to oil companies will result in over $10BN to the US treasury. US Corp tax rates are already among the highest in the industrialized world. So the oil companies will pay thier part, but it won’t offset the loss to the economy after the effects of $4 gas.

Yet, look around those from your political ideology, and they don’t want coal (GA plant application rejected again last week) and they don’t want nuclear (scream Fukushima louder and I guess it’s supposed to end any discussion there), yet we’re all supposed to drive Tesla Roadsters powered by electricity that no environmentalist wants to let anyone actually produce.

The knee-jerks are winning this on both sides.

And America is losing.

ByteMe

April 25th, 2011
9:22 am

And Scott continues to mine that GOP meme that other countries are dilling in the Gulf of Mexico while we sit on our hands. NOT TRUE, Scott and you should learn to do your own research.

http://www.gpb.org/news/2011/04/01/tracking-oil-and-gas-rigs-in-the-u-s-yes-theres-an-app

Where are other countries drilling in the Gulf? Not in water we control. They are drilling off the coast of Cuba and Mexico and other Central American countries. We can’t drill there. Oh, and isn’t BP a British company? I seem to recall them drilling in our waters. How does that fit into your nonsense about other countries drilling while we sit on our hands?

Granny Godzilla

April 25th, 2011
9:23 am

Hurting yet?

Nope not us.

AGAIN – we reviewed and revised certain life choices when gas was about to hit 2 dollars a gallon and have reduced our use of fossil fuel nearly 60%.

There really and truly is only one way out of this mess – but most Americans are afraid of it.

Give up as much oil as you can. Now.

Fletch

April 25th, 2011
9:24 am

Before I get blasted by people who don’t know me, keepi9n mind that I am heavily invested in oil and natural gas exploration. Having said that, please get off the “if we only drilled here” platform. We could drill every last drop of oil on American soil, and it will still be sold by the oil company to whomever they choose.

Now, if you would like to offer suggestions as to how we stop oil companies from drilling and selling our oil for a profit on the world market I’ll be happy to listen. Otherwise, your arguments are empty and unrealistic.

jm

April 25th, 2011
9:25 am

Charlie 9:22 – US oil production increases would not affect world prices. It would, however, significantly improve our trade deficit / current account deficit. Because every $1 of US production is 1 less dollar of imported oil. This is an immensely important issue, since the US runs the highest current account deficit as a % of GDP in the whole developed world. There are good reasons to produce more oil in the US, but reducing prices is not one of them.

Granny Godzilla

April 25th, 2011
9:27 am

jm

“Because every $1 of US production is 1 less dollar of imported oil.”

And what guarantee is there that the oil produced in the US will be sold on the US market?

(ir)Rational

April 25th, 2011
9:27 am

Jay – these companies might be making “record profits” but what are their profit margins. If the supply of oil is interrupted, as it has been in the Gulf of Mexico, at least as far as procuring it for American’s is concerned, and in the Middle East wouldn’t the price of oil naturally increase under the laws of supply and demand? Do you honestly believe that not drilling in the US while at the same time looking for and developing new sources of energy will not help prices and later decrease or completely destroy our dependence on others for oil. This should be a clear goal for everyone who cares about our economic future. Especially considering the fact that most of the countries that supply a large portion of the oil for the world today consider us to be their enemy.

Left wing management

April 25th, 2011
9:27 am

Jay : “And of course, those numbers don’t become any easier to swallow when you consider the $4 billion in subsidies that the American taxpayer coughs up each year on behalf of Big Oil. Efforts in Congress to eliminate those subsidies have failed because Republicans have cast the reform as a tax hike. So even in the midst of a deficit panic, government is required to keep on subsidizing one of the most profitable industries on the planet, a practice defended by the party that proclaims itself the champion of the free market

You know, the more you look at things the more it’s enough to turn a good solid centrist into a wild-eyed Communist, ain’t it?

Top of the week to you, Jay! :)

Stephenson Billings

April 25th, 2011
9:28 am

Partly true (from Politifact http://www.politifact.com/truth-o-meter/statements/2011/mar/15/barack-obama/barack-obama-says-us-oil-production-last-year-was-/)

“So, 2010 is definitely the highest since 2003. But we’ll note a couple of caveats.

First, production levels actually have been quite stable over the eight-year period. Comparing 2009 and 2010 statistics, petroleum production only rose about 3 percent. And the level for 2010 is only 11 percent higher than for the lowest year in that eight-year period. So the increase the president is referring to is not particularly dramatic.

The second caveat is that the Energy Information Administration projects that production totals are poised to fall from their current levels over the next two years.

Domestic crude oil production, the agency says, is projected to decline by 110,000 barrels a day in 2011 and by an additional 130,000 barrels per day in 2012. The agency makes that projection based on expected production declines in Alaska due to maturing oil fields. Production in the Gulf of Mexico is also projected to decline. Both are partially offset by projected increases in the Lower 48 states, but on balance, EIA sees the numbers falling.

So Obama is right that American oil production is at its highest level since 2003, but we’re taking the statement down a notch on our rating scale because the amount is projected to fall during each of the next two years, making it somewhat problematic to use the number as evidence that domestic oil production is on a healthy trendline. On balance, we rate the statement Mostly True.”

Normal

April 25th, 2011
9:28 am

Good mornin’ all y’all and especially to Granny G. I too, have made life choices about gas usage…especially this week. I’m sleeping in…on vacation…and not leaving the house…catch up work to do.

When I have to leave, it’s on my motorcycle…
Today’s funnies…

http://icanhascheezburger.com/2011/04/23/funny-pictures-sumfin-wuz-in-that-brownee/

and, oh yes….

http://icanhascheezburger.com/2011/04/24/funny-pictures-happee-frickin-easter/

Fletch

April 25th, 2011
9:29 am

GG – “And what guarantee is there that the oil produced in the US will be sold on the US market?”

Perhaps JM is advocating the use of Government controls in an attempt to take over the oil industry.

Charlie

April 25th, 2011
9:29 am

JM, agreed.

The drill here/drill now folks need to understand it’s not about reducing prices. It’s a national security/trade balance/value of dollar issue.

Doggone/GA

April 25th, 2011
9:29 am

“Drop the subsidies and watch the price go even higher!”

Yes, that’s probably what will happen…but it will be a visible cost increase, not an INvisible one

Common Sense

April 25th, 2011
9:30 am

Obama deflates currency, Dollar Falls, Gas soars; voters whine; oil profits boom; politicians pander

jm

April 25th, 2011
9:30 am

Granny 9:27 – well, 1, it makes sense to sell oil in the US, drilled in the US, because transport costs are cheaper when you don’t have to ship it across an ocean.

However, I’m guessing that won’t convince you, and this probably won’t either. Because the reality is, it doesn’t matter. Even if it was sold elsewhere, the profits and revenue from that oil would inure to the benefit of the US government (through the fees and rights they get) and US companies (through the oil profits and revenue they get), thus reducing our balance of payments deficit. So in reality, it doesn’t matter whether its sold here or anywhere else, it would still help the BOP issue which is huge.

Normal

April 25th, 2011
9:30 am

“And what guarantee is there that the oil produced in the US will be sold on the US market?”

The way I understand it is that “our” oil goes into a global pool and could be sold anywhere…even back to us…for a price.

jm

April 25th, 2011
9:32 am

Charlie 9:29 – indeed.

Flet 9:29 I would never suggest any such thing….

Stephenson Billings

April 25th, 2011
9:32 am

And don’t forget the effect of the weakening US dollar (via CNBC http://www.cnbc.com/id/42703813)

“Weakness in the US dollar, which is causing everything to go up—including gas prices, food and stocks—is unlikely to go away soon as a selling frenzy hits the currency market.

The greenback is approaching pre-financial crisis lows and threatening to smash through its all-time low when measured against the world’s predominant national currencies.

A combination of factors accounts for the weakness, with the Federal Reserve’s easy-money policies, huge national debts and deficits and the consequential possibility of a debt downgrade because of the financial mess in Washington leading the way.”

Fletch

April 25th, 2011
9:33 am

Normal – “The way I understand it is that “our” oil goes into a global pool and could be sold anywhere…even back to us…for a price.”

Unless you advocate the acquirring of current oil production facilites from the current owners i.e. exxon, bp, etc… then there is no “our oil” The oil belongs to the owners of the leases, and the owners of the leases determine where it will be sold. If it is more profitible to sell it to China and India, that is where it will go.

stands for decibels

April 25th, 2011
9:34 am

Jay, since you asked, yes it hurts to routinely dump 50 bucks on a purchase that was running 35 bucks not that long ago.

But not enough to significantly curtail consumption which, in my case, would mean taking the financially rather painful step of trading my reasonably fuel efficient vehicle for a somewhat less thirsty one.

jm

April 25th, 2011
9:34 am

“If it is more profitible to sell it to China and India, that is where it will go.”

Um, that’s not really how this works…. (excluding countries with fuel price controls like Iran)

stands for decibels

April 25th, 2011
9:35 am

The drill here/drill now folks need to understand it’s not about reducing prices.

We could confiscate and re-sell any vehicle with a “Drill Here – Drill Now – Pay Less” sticker and use it to pay for re-education camps, I guess.

Left wing management

April 25th, 2011
9:36 am

Jay: Intellectually, the current situation is not that complicated. People are demanding more oil than the market can supply — an economic recovery is boosting consumption at the same time that disruptions in the Arab world threaten oil output. So the price is jumping.

However, that market-driven fact of life is hard for people to accept

To which, I have just one thing to say:

Stupefaction, when it persists, becomes stupidity — Ortega y Gasset

For his part, President Obama is following the futile course set by his predecessor. Last week, he announced a federal investigation into the role of speculation in driving up oil prices, just as President George W. Bush did in 2005 and 2006. Those investigations turned up little or nothing, as will this one. But politically, it gives Obama an alternative villain to whom he can point, which in his situation is important.

Again, stupefaction.

That’s some Hope and Pocket Change ain’t it?

buck@gon

April 25th, 2011
9:38 am

Voters are whining about gas prices, true. Go with that Jay. Condescend to your fellow Georgians. I actually like that; it’s a winning Democrat tradition, and you ought to buy a bigger bullhorn to shoot it out of your mouth.

That buzzing noise ya’ll have been hearing for the past fifty years is actually whining too. It is the incessant whine about some people having more money and things than other people. It’s such background-noise by now that it’s like MARTA trains at five points–you just go with it. But since Barack Obama was established “ruler” of us all, that whine has actually gotten louder, as more and more people are earning less and less.

This is the ingenious Democrat methodology of solving a problem, through the artful method of making it far worse all while casigating your fellow citizens as being ungrateful.

I like it, Jay. Go with that for 2012, especially when gas is $10 a gallon.

We can have all that high speed rail running door-to-door by then, right?

jm

April 25th, 2011
9:38 am

Fletch – if the US was a net exporter of oil, then there would be the issue of the most profitable place to ship the oil (though with world prices, excluding transport costs, everywhere is equally profitable, but theorizing for a moment that the US was a net exporter, the oil would go to places in North, South, and Central America first to countries that were importers). Since the US itself is a net importer, any new US production is HIGHLY LIKELY to enter the refinery and distribution system in the US, not elsewhere, simply due to shipping costs.

stands for decibels

April 25th, 2011
9:38 am

With Obama president, the media says that he has no control over the gas prices.

Fret not, Scott. I guarantee you that when per-gallon gasoline retail prices hit the 2008 previous-peak level, every so-called librul media outlet will commemorate the occasion by duly noting that Obama is president and that it’s happening on his watch and o-noes-how-will-he-ever-be-re-elected-now?

DW

April 25th, 2011
9:38 am

If you honestly believe more local drilling will solve the problem, ive got some great beachfront property in Arizona to sell you…

Fletch

April 25th, 2011
9:39 am

jm – “Um, that’s not really how this works”

Um, that’s actually how it works. If it didn’t, then everyone would drill in their own back yard to satisfy their needs. There are rigs in the gulf and off the coast of Southern California,and wells operating in the Bakken Fields. Perhaps you would like to explain how it is we import so much oil when we have so much on our doorstep?

Common Sense

April 25th, 2011
9:39 am

Profit margins of oil companies: 7.1%

So you could eliminate the profits entirely and only save yourself 28 cents a gallon. Of course there would be no reason to bring those gallons to the market and you’d be walking.

The federal gas tax is 18.4 cents per gallon, the Georgia State tax is 7.5 cents and then you add 15 cents for sales tax.

Wow, the government makes more in sales tax than the oil companies do in profit on a gallon of gas.

Now who actually earned it?

Del

April 25th, 2011
9:41 am

Nice diversion on Obama’s lack of leadership in this crises. The campaigner and chief narcissist can only point to the lack of alternative energy sources as the issue and offer up his peter pan plan of wind mills or solar panels as the solution. We need to deal with the world as it is today and unfortunately it’s all about oil. The president can’t hide behind the DOJ, he needs to announce that this country must exploit every potential energy source within our borders and tell the radical environmentalists to take a long vacation.

The Woz

April 25th, 2011
9:41 am

Bush was branded as Satan becasue gas prices were high bu now that Obama is president the progressives just blithely suggest that consumers are whiners becasue they are concerned about massive short term price increases in the price of gas. From 1.84 to nearly four bucks in just two years and the president and the progressives just blame the people.

ByteMe

April 25th, 2011
9:42 am

jm: most of the oil extracted from the North Slope oil fields is routed to Japan. It’s cheaper to do that than to transport it to the lower 48.

poison pen

April 25th, 2011
9:42 am

Granny Godzilla

April 25th, 2011
9:23 am
Hurting yet?

Nope not us.

AGAIN – we reviewed and revised certain life choices when gas was about to hit 2 dollars a gallon and have reduced our use of fossil fuel nearly 60%.

There really and truly is only one way out of this mess – but most Americans are afraid of it.

Give up as much oil as you can. Now.

Granny, I’m sure that your smug remarks will be appreciated by the people who make minimum wages and have to drive to work.

Jay, I am old enough to remember the long oil lines during the Nixon years and guess what? not one President has done a Damn think to fix the problem. To blame the Repubs is just plain stupid.
Would you care to guess what Obama will do, well my Crystal Ball tells me nothing, he will pay lip service and that’s it.

Granny, you may be right in that if we get oil from our country we don’t know if it will be sold here, but guess what, if Obama is any kind of President he can put an order out that it must be sold only in the USA. After all it’s our oil so lets see what kind of President he really is.

getalife

April 25th, 2011
9:42 am

We buy oil from Canada, Mexico and the Saudis.

There is no political will to change anything in the oil industry so quit whining.

It is like whining about our corrupt system.

The me generation will not change anything so plan on it.

jm

April 25th, 2011
9:42 am

Fletch 9:39 – see my 9:38 on the previous page. I’m sorry, factually, you’re wrong. We import 2/3 of the oil we consume.

Jack

April 25th, 2011
9:44 am

High gas prices are cutting into lotto and beer purchases. Not cigarettes, though. Just gotta have that smoke.

Common Sense

April 25th, 2011
9:44 am

Whatever area in the US opened to drilling for oil would certainly be enjoying job growth regardless of what you think it would have done for oil prices.

What happened to that laser focus on jobs, Mr. President?

Fletch

April 25th, 2011
9:44 am

poison pen – ” if Obama is any kind of President he can put an order out that it must be sold only in the USA. ”

So you are advocating government regulation and intervention in direct conflict with the principals of the free market?

ByteMe

April 25th, 2011
9:45 am

Woz: Bush was branded as Satan because he sowed war and corruption, which are most definitely in Satan’s bag of tricks. Gas prices? That was 3 hurricanes in a row in the Gulf taking out short-term production and refinery capabilities.

Consumers are whiners. Instead of using that as a wake-up call and permanently changing their behavior — they changed their behavior temporarily and SUV sales went to near 0 — they went back to the same stupid behavior expecting a different outcome.

larry

April 25th, 2011
9:46 am

Everybody is acting like oil is an infinite resource. It isnt. If we do not start adapting to that fact, we are going to be in a heep of trouble, no matter who is in the white house.

Meanwhile, a state price increase of 3.1 cents per gallon is coming May 1st unless the corrupt one suspends it.

poison pen

April 25th, 2011
9:47 am

DW

April 25th, 2011
9:38 am
If you honestly believe more local drilling will solve the problem, ive got some great beachfront property in Arizona to sell you…

DW, it will not solve the problem but guess what, it won’t hurt it either. Nobody really knows what we have until we try so hang onto your property.

Aquagirl

April 25th, 2011
9:48 am

Scott, I don’t think it’s possible to have an intelligent conversation with you if you think countries drill for oil.

Seems like a bunch of people are afflicted with Scott-itis, they’re convinced oil drilling is a finders-keepers arrangement, like if the well is drilled here it makes any difference. No more so than any other commodity produced affects our trade balance.

Fletch

April 25th, 2011
9:48 am

jm – “We import 2/3 of the oil we consume.”

And why do you think that is? I’ll help you, the companies that produce the oil, are not wholly owned and operated by the United States Government. They are corporations, and as such under free market principles, they are allowed to produce a product and in turn sell that product to willing buyers for a profit. There is no “our oil”, it belongs to the people who produce it, and they are free to sell it wherever they so choose.

Normal

April 25th, 2011
9:50 am

Poison,
you say, ” Obama is any kind of President he can put an order out that it must be sold only in the USA. After all it’s our oil so lets see what kind of President he really is.”

Show me where he gets that power. I believe something like that would have to go through Congress…President Obama is not a dictator.

buck@gon

April 25th, 2011
9:50 am

“We could confiscate and re-sell any vehicle with a “Drill Here – Drill Now – Pay Less” sticker and use it to pay for re-education camps, I guess.”

“Stupefaction, when it persists, becomes stupidity”

Stands and LWM,

Is this the “boot on the neck” that our great, intelligent, experienced and mature President talked about only a year ago?

You ladies aren’t stupid at least on your face, and I say this honestly because it’s difficult to tell actually when you are spouting such nonsense. I’m here simply to tell you that you are wrong. Price increases add to cost. Cost diminishes profit, decreases demand. It’s a law of economics. To deny it, is like denying gravity or denying the true age of the earth as you libs are always accusing fundamentalists of doing.

What you are is blind or insane. The jury is still out on that.

Like Jay, I urge you to ignore what I have to say henceforth, or you will have trouble sleeping at night. Because like Jay, I’m going to start asking you questions you can not or will not want to answer.

Consider this now your “re-education” camp, which, unlike your tyrannical liberal fantasies is completely and totally voluntary. Feel free to hang whatever uncivil label you want on me. I would gently urge you only that you be who you are, and that the more people get a glimpse of the true character of the modern liberal, the better it will be for the state and the nation as a whole.

jm

April 25th, 2011
9:50 am

ByteMe 9:42 – I buy that. And it depends on the type of oil and where its used based on emission regulations (light sweet crude)

Joe

April 25th, 2011
9:51 am

Wow u and Yucker trying desperatly to cover for Obama about these rising gas prices caused from his policys… LOL… Every far left pundit in the country is furiously in damage control because they see 20% approval coming….

sore loser

April 25th, 2011
9:51 am

There is currently an oversupply of oil, just a shortage of ‘paper barrels’. The Saudis would price oil at 80$ to maximize their sales, however the investors don’t care what price it is as long as it goes up. Its not fear in the middle east, its not. Why do we let people sit at computers and click buy and sell buttons all day long that send the price of oil, the lifeblood of the economy, skyhigh? I say only let people who actually take delivery of oil buy futures to set true demand, not speculative demand. If you want to restart the housing market, restart the economy, by getting investors who have no industrial interest in oil out of the market.

Mick

April 25th, 2011
9:51 am

I guess I can always get one of these-
http://www.brammo.com/empulse/

poison pen

April 25th, 2011
9:52 am

Fletch

April 25th, 2011
9:44 am
poison pen – ” if Obama is any kind of President he can put an order out that it must be sold only in the USA. ”

So you are advocating government regulation and intervention in direct conflict with the principals of the free market?

Fletch, when it comes to a Natural recource that is critical to our country, yes. Wouldn’t you want that? We cannot let outside influences destroy our country and right now we have an extremely fragile economy, in case you haven’t noticed.

10 Billion profit for Exxon in 8 weeks is out of line.

@@

April 25th, 2011
9:52 am

And as gasoline prices rise, so too, does government revenue.

http://www.eia.doe.gov/oog/info/twip/twip_feature.jpg

UGA1999

April 25th, 2011
9:53 am

Gas prices soon to be at $5…..what ya gonna do Mr. Obama? Tick Tock tick tock….

stands for decibels

April 25th, 2011
9:56 am

The solution is E-Z.

“What I think the president ought to do is get on the phone with the OPEC cartel and say we expect you to open your spigots. One reason why the price is so high is because the price of crude oil has been driven up. OPEC has gotten its supply act together and it’s driving the price, like it did in the past. And the president must jawbone OPEC members to lower the price. And if in fact there is collusion amongst big oil, he ought to intercede there as well.”

poison pen

April 25th, 2011
9:56 am

Normal

April 25th, 2011
9:50 am
Poison,
you say, ” Obama is any kind of President he can put an order out that it must be sold only in the USA. After all it’s our oil so lets see what kind of President he really is.”

Show me where he gets that power. I believe something like that would have to go through Congress…President Obama is not a dictator.

Then let him go thru Congress, whatever it takes, I don’t think the American people would be against it and the Repubs won’t be because they wouldn’t get elected to office if they tried to stop something that was good for the country.

ByteMe

April 25th, 2011
9:56 am

Gas prices soon to be at $5…..what ya gonna do Mr. Obama? Tick Tock tick tock….

Gas prices soon to be at $5…..what ya gonna do UGA1999? Tick Tock tick tock….

Or do you look to the government to solve all your problems?

UGA1999

April 25th, 2011
9:57 am

ByteMe….nope just the ones that have control over. hahah WAKE UP!

Granny Godzilla

April 25th, 2011
9:57 am

poison pen

smug remarks? nope. truth.

personal responsibility. ya’ got it on this or ya’ don’t.

you state ” if Obama is any kind of President he can put an order out that it must be sold only in the USA.”

Oh exactly how can this be achieved constitutionally?

are you suggesting nationalizing oil production in the US?

why you closet commie you……

Aquagirl

April 25th, 2011
9:57 am

Poison pen, why not just set higher MPG standards on cars we drive? Oh, sorry, that’s heavy handed government extremism. On the other hand, nationalizing the oil companies isn’t such a big deal.

I really think you need another cup of coffee.

@@

April 25th, 2011
9:57 am

That should’ve been “as oil company profits rise, so too, does government’s.”

godless heathen

April 25th, 2011
9:57 am

The most recent numbers I could find on the goog were from July 2010 when the average price of regular gas in the US was $2.75 a gallon. At that time the price in Saudi Arabia was $0.45 / gallon, Kuwait $0.85 / gallon, Iran $0.32 / gallon, Venezuala $0.06 per gallon.

No what’s all that about “It’s a world market and local production won’t affect the price.”?

Fletch

April 25th, 2011
9:58 am

poison pen – “10 Billion profit for Exxon in 8 weeks is out of line.”

I won’t disagree with you on that. But you know as well as I do that any such move on Obamas part to mandate where and how oil will be sold would be disasterous. NO president would make a move like that.

Also, the oil and natural gas being produced is NOT owned by the United States, nor is it being produced by the Federal Government. You can’t arbitrarlity tell an independent company when, where and how they can market their product. What you suggest would be like Deal telling Coca Cola that they can only sell their product in Georgia, because this is where it’s made. It simply won’t work.

godless heathen

April 25th, 2011
9:58 am

Yippee

April 25th, 2011
9:58 am

Pay attention to food prices and other areas of inflation. The hurting soon to come if the federal government doesn’t check spending will make gas prices the least of your worries. Be prepared.

jm

April 25th, 2011
9:59 am

Fletch 9:48 – and apparently the fee revenue the US government gets, the US exploration jobs, the US jobs that are implicitly part of the oil price production costs that are US jobs, and the revenue earned by US corporations mean nothing to you.

I grant you, if all the oil was explored and produced by foreign companies, a certain, though limited amount, would be lost to another country (assuming said company BP as an example didn’t have any US stockholders, which it does). But your thinking is just overly simple.

This probably won’t settle it for you guys, but here goes. The US exports 34,000 barrels per day in oil (http://www.eia.doe.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WCREXUS2&f=W). We produce approximately 9 million barrels per day (http://en.wikipedia.org/wiki/List_of_countries_by_oil_production).

So we export 0.38% of our crude oil production. You want to continue making your erroneous argument Fletch?

Jay

April 25th, 2011
9:59 am

Charlie doubts my claim — and the claim of most experts — that we lack the domestic capacity to lower world oil prices.

So let’s run some quick numbers:

In 2009, we produced 5.4 million barrels of oil in the United States. Let’s pretend we increased that output to 6.4 million barrels, an 18.5 percent increase. I’m doubtful that an increase that large would be sustainable — oil-rich Libya, for example, produces less than 2 million bpd, so that’s a big jump. Furthermore, the U.S. Energy Information Agency predicts an increase in U.S. production to 5.7 mbd — a 5.5 percent increase — by 2035, “from onshore enhanced oil recovery (EOR) projects, shale oil plays, and deepwater drilling in the Gulf of Mexico.”

A short-term increase of 1 mbd, in other words, would be really ambitious, more than 3 times the projected growth over the next 25 years. But for the sake of argument, let’s pretend we can do it.

In 2009, global oil production was 45.4 mbd. An additional 1 million barrels a day from U.S. sources would bump that to 46.4 mbd. I don’t really think that’s going to have much impact on global markets.

And if by some miracle it might, OPEC countries such as Saudi Arabia could offset it by merely cutting production, thus keeping prices nice and high, where they want them.

To cite another example, Iraqi oil production is up by more than 1 mbd since 2003. That additional oil on the world market hasn’t exactly brought prices down, from what I can tell at the gas pump.

ByteMe

April 25th, 2011
10:00 am

Then let him go thru Congress, whatever it takes, I don’t think the American people would be against it and the Repubs won’t be because they wouldn’t get elected to office if they tried to stop something that was good for the country.

Except that that’s not the in the long-term leases the oil companies have on the land they drill. So it would violate the Constitution and the Supremes wouldn’t allow that. So are you saying the government should violate established private property and contract law and ignore the courts just so you could fill up for a few pennies less? How would Ayn Rand feel about it? Let’s ask her.

@@

April 25th, 2011
10:00 am

LIHU‘E — The Tax Foundation reports Hawai‘i is one of nine U.S. states that siphons off more tax revenue when gas prices rise.

For every gallon of gas purchased, Hawai‘i drivers are taxed a total of five times: federal fuel tax of 18 cents per gallon; state fuel tax of 17 cents per gallon; Environmental Response, Energy & Food Security tax of $1.05 per barrel; county taxes ranging between 8.8 and 16.5 cents per gallon; and a state gross income tax for distributors of 4.17 percent that is then passed on to consumers as general excise tax.

Other states that double tax on gas include: California, Connecticut, Georgia, Illinois, Indiana, Michigan, New York and Virginia. The Tax Foundation said Illinois leads the pack with a 9.25 percent sales tax, with proceeds split between state and local governments.

http://thegardenisland.com/news/local/govt-and-politics/article_e594782e-5c37-11e0-8c16-001cc4c03286.html

UGA1999

April 25th, 2011
10:01 am

Seems like Obama is getting his wish…..remember what he said during his campaign.

Get work prez!

jm

April 25th, 2011
10:01 am

Flet 9:58 “But you know as well as I do that any such move on Obamas part to mandate where and how oil will be sold would be disasterous. NO president would make a move like that.”

You are series of non-factual statements sir. Apparently you forgot the Nixon years, where price controls were defacto moves that affected where oil was allocated.

larry

April 25th, 2011
10:01 am

At that time the price in Saudi Arabia was $0.45 / gallon, Kuwait $0.85 / gallon, Iran $0.32 / gallon, Venezuala $0.06 per gallon.

Those countries have nationalized their oil industries .

poison pen

April 25th, 2011
10:03 am

Granny Godzilla

April 25th, 2011
9:57 am
poison pen

smug remarks? nope. truth.

personal responsibility. ya’ got it on this or ya’ don’t.

you state ” if Obama is any kind of President he can put an order out that it must be sold only in the USA.”

Oh exactly how can this be achieved constitutionally?

are you suggesting nationalizing oil production in the US?

why you closet commie you……

Granny, show me where in the Constitution it states that we have to have Obamacare?
Not everyone has the oportunity to control all aspects of their lives, especially poor people, for someone so liberal as yourself I would have thought you would have shown more compassion for these people, I guess you are just a big liar.

Common Sense

April 25th, 2011
10:03 am

@Byteme
No we do not expect government to solve all our problems. Only the ones that they are complicit in creating.

Like the lack of drilling here in the US.

itpdude

April 25th, 2011
10:03 am

We should all thank the older generation for heeding Jimmy Carter’s warning that the US needed to shoot for energy independence back in the 70’s. Can you imagine if the older generation had not heeded that warning? It would have put the US in a bad spot!

jm

April 25th, 2011
10:04 am

Jay 9:59 CIA world factbook disagrees with your US oil production estimates.

https://www.cia.gov/library/publications/the-world-factbook/geos/us.html

See also my previous post.

ByteMe

April 25th, 2011
10:04 am

Apparently you forgot the Nixon years, where price controls were defacto moves that affected where oil was allocated.

I seem to recall that his moves to freeze prices and reallocate resources didn’t turn out well for the country and was abandoned.