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With Gas Prices Soaring, Obama Looks to Ramp Up U.S. Oil Production

After spending some more time looking at the data, i can see that the most developed economies are far more "price sensitive" to petro than the developing world.

Case in point: In 2000, daily oil consumption averaged 4,795.715 barrels per day. In 2010, daily oil consumption averaged 8,371 barrels per day, an increase of 74.58%! If we are to assume that by 2020 they will consume 50% more than today (a conservative assumption given the undervalued yuan), they will take an additional 4185.5 barrels per day from global supply.

What does this mean? Close to half of all growth in global demand for petro will come from China. Our current consumption is not sustainable without serious price increases as global supply will be incapable of keeping up with emerging market demand. Therefore, convergence is almost a guarantee!
 
Goldenboy219 said:
After spending some more time looking at the data, i can see that the most developed economies are far more "price sensitive" to petro than the developing world.

Case in point: In 2000, daily oil consumption averaged 4,795.715 barrels per day. In 2010, daily oil consumption averaged 8,371 barrels per day, an increase of 74.58%! If we are to assume that by 2020 they will consume 50% more than today (a conservative assumption given the undervalued yuan), they will take an additional 4185.5 barrels per day from global supply.

What does this mean? Close to half of all growth in global demand for petro will come from China. Our current consumption is not sustainable without serious price increases as global supply will be incapable of keeping up with emerging market demand. Therefore, convergence is almost a guarantee!
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Isn't this why China is scrambling all over to make alliances with countries to drill for more oil? I mean China can drill in the Gulf off Cuba, less than 100 miles from our waters with Obama's blessing, and we can't? Brazil/Soros get's 2 billion to devolop more oil then he says we want to be their best customer? That is just BS!

j-mac
 
j-mac said:
Isn't this why China is scrambling all over to make alliances with countries to drill for more oil? I mean China can drill in the Gulf off Cuba, less than 100 miles from our waters with Obama's blessing, and we can't? Brazil/Soros get's 2 billion to devolop more oil then he says we want to be their best customer? That is just BS!

j-mac
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Given current projections, Chinese oil production will not converge with internal consumption until some time after 2025. This is a non-issue in regards to fuel prices because (once again!) the petro market is almost entirely demand driven.

Take the 2009 financial crisis into consideration: demand fell by a little more than 1% while the price for petroleum fell from $147/barrel to around $40 per barrel.

Your supply side solutions are really a waste of time.
 
Perhaps we need a very large number of new nuclear facilities built in the US. We can use nuclear power to create vast amounts of electricity to power all the things that stay "fixed." and use the petroleum products to power things that move. Everybody wins.
 
Goldenboy219 said:
Given current projections, Chinese oil production will not converge with internal consumption until some time after 2025. This is a non-issue in regards to fuel prices because (once again!) the petro market is almost entirely demand driven.

Take the 2009 financial crisis into consideration: demand fell by a little more than 1% while the price for petroleum fell from $147/barrel to around $40 per barrel.

Your supply side solutions are really a waste of time.
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More arrogance. Sad.

The price per barrel of crude oil – which was at an all-time high the day Bush signed the moratorium that ended the ban on offshore drilling after going up and up and up to that point – continued to drop and drop. By September, it was below $109 a barrel. By October it had dropped even more. And it kept dropping.

But now in the age of Obama, it’s going up and up and up again. We have had a 55% increase in the price of our gasoline during a terrible recession. Obama’s energy policies have hurt this nation badly at an incredibly vulnerable period, without so much as a peep from most of the media.

Barack Obama threatened to bankrupt the coal industry – which produces 49% of our nation’s electricity – and said that:

“Under my plan of a cap and trade system, electricity rates would necessarily skyrocket.”

He told just enough lies and half-truths to get coal-state Democrats such as West Virginia Senator Jay Rockefeller to get them to believe he wouldn’t destroy their economies. But now that he’s elected he’s free to break those promises and pursue ruinous policies. Rockefeller is now saying of Obama that:

“he’s beginning to not be believable to me.”

But it’s like, “Sorry Sucker.” When you vote like a fool, you receive a fool’s fate.

Anyway, maybe you thought, “Well, I’m not in a coal producing state,” or “I’m not in a coal-fired electric grid,” so you thought Obama’s shockingly bad energy policies didn’t matter.

But you’re still going to have to put gas in your car, and Obama’s going to see to it that it costs you a pretty penny to do it.

Gas Prices Have Risen 55% On Obama’s Watch And Continue To Soar « Start Thinking Right
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j-mac
 
j-mac said:
I don't dispute your numbers, but I do dispute your feeling that we can not produce more, while we transition to whatever source we end up moving toward.

j-mac
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We really don't know enough about the details to push for changes. Our refineries probably have long range contracts with OPEC, other sources, and don't have the resources to take on new contracts.

ricksfolly
 
ricksfolly said:
We really don't know enough about the details to push for changes. Our refineries probably have long range contracts with OPEC, other sources, and don't have the resources to take on new contracts.

ricksfolly
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Since Obama took office, contract law means little. This is a national security issue, and it is quite possible that we have a President putting policy, and people in place that specifically are harming the American people by artifically restricting the exploration, and devolopment of domestic sources of energy. That should be a crime, and if ever proven may well be.

j-mac
 
j-mac said:
More arrogance. Sad.




j-mac
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Nothing you have stated in any way refutes my point that the price of fuel is demand driven.
 
Goldenboy219 said:
Nothing you have stated in any way refutes my point that the price of fuel is demand driven.
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Well, to a point sure. But there is also the speculation market right? I mean if gas prices were totally demand driven like you say, then according to you with drops in demand price would go down here.

j-mac
 
j-mac said:
Well, to a point sure. But there is also the speculation market right? I mean if gas prices were totally demand driven like you say, then according to you with drops in demand price would go down here.

j-mac
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You are correct, when demand drops so does the price. Considerably!
 
I keep seeing these 'drill baby drill' threads all over the net and fail to understand the lack of logic behind such thinking. To even imagine increased US drilling/production will affect global oil pricing, much less US pump pricing, is about as irrational as it gets. There seems to be little understanding by some posters of how commodity market speculation using beat-up USD actually functions, much less how oil is traded, demand points or production costs. Plenty of whining but aside from some posters attempting to pound simple facts into whiner heads, little reality. Must be a failing nationalist syndrome.
 
Goldenboy219 said:
You are correct, when demand drops so does the price. Considerably!
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I understand, but in that case why are we allowing other countries, some of which don't care for us too much, dictate price, when we have as much oil as they do?


j-mac
 
j-mac said:
I understand, but in that case why are we allowing other countries, some of which don't care for us too much, dictate price, when we have as much oil as they do?

j-mac
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What we do not have is the productive capacity to change the price of oil. Please do not be talked into believing into anything of the sort.
 
croniccynic said:
I keep seeing these 'drill baby drill' threads all over the net and fail to understand the lack of logic behind such thinking.
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Perhaps you need some help.
croniccynic said:
To even imagine increased US drilling/production will affect global oil pricing, much less US pump pricing, is about as irrational as it gets.
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Yep. There is that darned supply/demand issue. Complicated.
croniccynic said:
There seems to be little understanding by some posters of how commodity market speculation using beat-up USD actually functions, much less how oil is traded, demand points or production costs.
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I hate smugness. Especially when it is unaccompanied by very little of value in the post.
croniccynic said:
Plenty of whining but aside from some posters attempting to pound simple facts into whiner heads, little reality. Must be a failing nationalist syndrome.
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Gosh. You are awesome. Can I have your autograph, Mr. Egghead?
 
Goldenboy219 said:
How does this address our current production gap?
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Oh I get it, if it doesn't lower gas prices by 20 cents tomorrow morning, the idea should be abandoned.
 
Goldenboy219 said:
What we do not have is the productive capacity to change the price of oil. Please do not be talked into believing into anything of the sort.
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Production capacity is a matter of doing, and not impossible. In fact the mere show that we are willing to ramp up would have a down ward pressure on the market would it not?


j-mac
 
American said:
Oh I get it, if it doesn't lower gas prices by 20 cents tomorrow morning, the idea should be abandoned.
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No you don't!

The price of petro is almost entirely demand sensitive. In the midst of the financial crisis (early 2009), we witnessed the result of a 7% drop in demand from OECD nations led to a 72% decrease in petro prices. Not that we should just stop consuming oil over night, but if we can average 2%-3% reduction per year (which is a challenge), we can reduce the reliance on fossil fuels while simultaneously putting downward pressure on the spot price.

When we consume twice what we produce, drilling our way out of it is a political talking point.
 
j-mac said:
Production capacity is a matter of doing, and not impossible. In fact the mere show that we are willing to ramp up would have a down ward pressure on the market would it not?


j-mac
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OPEC holds all supply cards, and can easily increase production without having to drill a mile deep. We simply cannot. Our friends in Saudi Arabia have the ability to reduce the price if they so desired, but yet lack the motivation to do so (why would they want to increase production by 20% and sell their oil @ a 5% difference?).

The key is curbing demand.
 
Goldenboy219 said:
OPEC holds all supply cards, and can easily increase production without having to drill a mile deep. We simply cannot.
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I don't think this is absolute in all areas of US known reserve untapped oil. Although it is true for drilling offshore, that may be due only to the fact of where oil leases are approved to be extracted.

Clearly a re examination of those leases, and a move toward going after oil in this country that makes more sense to get rather than letting some environmental group, or person place them off limits to save the speckled snail darter is where we are approaching quickly.

We simply cannot. Our friends in Saudi Arabia have the ability to reduce the price if they so desired, but yet lack the motivation to do so (why would they want to increase production by 20% and sell their oil @ a 5% difference?).
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Our friends? The same country that manipulates the price daily? The same country that recently cut production because they said there was too much oil on the market? The same country that produced 19 out of the 20 9/11 hijackers? Those friends?

Yeah, between them, and the enviro-weenies here that have been placed in charge of regulatory agencies in order to "nudge" us in the "right" direction, I, and the American people as a whole are growing increasingly tired of the excuses.

The key is curbing demand.
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have you ever known a successful rehab to have occurred where the junkie was forced into rehab?

j-mac
 
Misterveritis said:
Perhaps you need some help.

Yep. There is that darned supply/demand issue. Complicated.

I hate smugness. Especially when it is unaccompanied by very little of value in the post.

Gosh. You are awesome. Can I have your autograph, Mr. Egghead?
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Here's your value:

Offering countering information that's readily available through a number of unbiased sources to posters who firmly believe increased US drilling will lower their fuel costs seems similar to arguing with flat earth people. People on this and other forums have attempted to enlighten the more US oil drilling equals cheaper pump prices crowd about the futility of such a stance, all to no avail. If you feel the US can produce enough oil to move global oil prices and consequently oil byproduct pricing, simply employ a search engine with the phrase 'why increased US oil drilling won't lower pump prices'.

Sorry, you picked a no autographs day.
 
j-mac said:
I don't think this is absolute in all areas of US known reserve untapped oil. Although it is true for drilling offshore, that may be due only to the fact of where oil leases are approved to be extracted.
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You still do not get it; this is not a sustainable solution. U.S. production cannot account for the increased demand from emerging markets.

Clearly a re examination of those leases, and a move toward going after oil in this country that makes more sense to get rather than letting some environmental group, or person place them off limits to save the speckled snail darter is where we are approaching quickly.
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Or those environmental wakos trying to save the gulf shrimp?

Our friends? The same country that manipulates the price daily? The same country that recently cut production because they said there was too much oil on the market? The same country that produced 19 out of the 20 9/11 hijackers? Those friends?
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I was being sarcastic.

Yeah, between them, and the enviro-weenies here that have been placed in charge of regulatory agencies in order to "nudge" us in the "right" direction, I, and the American people as a whole are growing increasingly tired of the excuses.
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Good! Frustration leads to substitutes; all of which receive little if any government support.

have you ever known a successful rehab to have occurred where the junkie was forced into rehab?
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I do not agree with your analogy. Various corporate interests have little desire for the American people to become energy independent, and lobby the hell out of our congress men and women to ease support for any viable substitute.

Remember the GM EV1?
 
lpast said:
When gas prices are high they tell us theres not enough supply, when theres plenty of supply they tell us theres not enough refining capacity or they have to shut them down for maintenance. The oil companies will never accept less than the huge profits they always have no matter how much drilling is allowed...There will always be an excuse when gas prices go skyhigh. I do however still support domestic drilling, at least that keeps some of our money out of arab hands
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exactly!!! and who has been pulling the "presidential" puppet strings for decades now?
 
Goldenboy219 said:
No you don't!

The price of petro is almost entirely demand sensitive. In the midst of the financial crisis (early 2009), we witnessed the result of a 7% drop in demand from OECD nations led to a 72% decrease in petro prices. Not that we should just stop consuming oil over night, but if we can average 2%-3% reduction per year (which is a challenge), we can reduce the reliance on fossil fuels while simultaneously putting downward pressure on the spot price.

When we consume twice what we produce, drilling our way out of it is a political talking point.
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Nothing more, nothing less than a political talking point. US oil companies have a surplus of government approved drilling permits sitting in filing cabinets. As global oil prices rise, and they will primarily due to increased demand by developing countries, so will the incentive to invest in drilling and producing on those permits.
 
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