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President opens up offshore drilling?
- Thread starter LotoSteve
- Start date
It's little more than a token gesture. He opens up some Atlantic sites off Virginia - locations which deserve no merit for their limited potential - but maintains the strict restrictions in Alaska and in the Gulf. It's meaningless. But you're right Steve, in that this is only to distract from the pending Climate bill which is coming up very shortly. The new House bill is sponsored by Kerry, Lieberman and a couple others and yes, you guessed it, it includes a new petroleum tax which will be passed onto consumers!
http://www.ft.com/cms/s/0/a28df5a6-3b71-11df-b622-00144feabdc0.html
http://www.ft.com/cms/s/0/a28df5a6-3b71-11df-b622-00144feabdc0.html
LotoSteve
New member
I figured it would be something sneaky.
On the flip side, I hope the oil speculators get their azz handed to them.
It's definitely a magic trick. He gets to say he's opened up all these new offshre sites without having to pay any price from his environmental supporters. The site has no impact if no one wants to drill there.
To play Devil's advocate for a moment...
Gas around me is at about $2.70 a gallon. It's that much for one reason and one reason only- that's what consumers are willing to pay for it. If the suppliers could get $8, they'd price it there. But when they inch it up, demand drops and the supply pipeline begins to back up. The price drops to remove the constraint. So will a new tax really affect prices at the pumps? A 15 cent increase in tax may get passed along to the consumer. But the consumer isn't tax sensitive. They're fuel price sensitive. So demand will drop, supplies will back up and prices will drop. The net effect being the oil company is now paying the tax.
To look at it more simply, if there was 15 cents to be had, the oil suppliers would be seeing it now.
Am I missing something?
To play Devil's advocate for a moment...
Gas around me is at about $2.70 a gallon. It's that much for one reason and one reason only- that's what consumers are willing to pay for it. If the suppliers could get $8, they'd price it there. But when they inch it up, demand drops and the supply pipeline begins to back up. The price drops to remove the constraint. So will a new tax really affect prices at the pumps? A 15 cent increase in tax may get passed along to the consumer. But the consumer isn't tax sensitive. They're fuel price sensitive. So demand will drop, supplies will back up and prices will drop. The net effect being the oil company is now paying the tax.
To look at it more simply, if there was 15 cents to be had, the oil suppliers would be seeing it now.
Am I missing something?
I completely understand why he doesn't want to open up the West Coast. All that coastline is covered in homes of wealthy people and wealthy people make campaign donations. But Alaska? Alaskans want it. The rest of us want it. The inpact is about nil. I'm missing what the barrier is.
And it's foolish on his part $1.50 unleaded would insure him a second term.
And it's foolish on his part $1.50 unleaded would insure him a second term.
catastrophe
Registered
This thread would be interesting reading if anyone on here knew what they were talking about.
It reminds me of the Fountain thread where everyone was guessing what was going to happen and the Mercury thread also.
It reminds me of the Fountain thread where everyone was guessing what was going to happen and the Mercury thread also.
fund razor
Founding Member
I found the thread to be interesting. I also enjoyed reading the article from Financial Times that Nick linked.
I felt that Nick and Chris each knew what they were talking about.
Is it ok for me to post that?
I felt that Nick and Chris each knew what they were talking about.
Is it ok for me to post that?
mustang
New member
Agreed completely and I think some good points are being brought up and debated. Did you know that all residents of Alaska receive a yearly subsidy from the oil companies? A friend of mine lives in Juneau, has nothing to do with the oil industry and receives a check every year....basically just for being a resident of Alaska. Whether the oil companies are buying their support or not...they do have the support of the Alaskans.
clayinaustin
Charter Member
drill baby, drill! 
Actually, demand rose steadily all the way up to $4.50/gallon back in '06 & '07.
Wrinkleface
Founding Member
drill baby, drill!
Dude, this isn't the porn section!!!!:biggrinjester:
GENERAL LEE
Founding Member - E Dock
The hitch in that analysis is refinery utilization. Refiners are already getting killed and the majors are cutting back on refining. There's recent stories of big layoffs at the plants because the oil cos are looking at long-term reduction in refined gas demand. We've been running around 80% for a while due to a lot of maintenance. The question will be how many refiners will start back up if price of crude continues to rise? Refiners will stay offline until price of gas/refined products goes up. The taxes WILL be paid by the consumer.
And let's not forget the near complete disconnect between demand for the physical commodity versus demand for the financial commodity. If the Billionaire Boys Club wants it, we could see the price of oil move 50% in either direction within a matter of weeks.
catastrophe
Registered
I found the thread to be interesting. I also enjoyed reading the article from Financial Times that Nick linked.
I felt that Nick and Chris each knew what they were talking about.
Is it ok for me to post that?
You are way way too obvious.
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