Controlling the price of gasoline at the pump is a matter of national security.
On Friday, oil spiked $10.75 a barrel, a record single-day increase, which followed on the heels of a $5.49 a barrel jump the day before.…
"A sinister cabal of superior writers."
Article comments
276 - pleasexcuetheinterruption
It wasn't a response to you. You have been proven untrustworthy by deliberately misquoting statements to further your agenda. Until you recognize, acknowledge, and desist from such actions communication with you is useless.
LMAO I provided the direct quote upon request. And it did contain the contradiction I said it did. And my use of quotations marks denoted an accurate paraphrasal of that direct quote. Until you admit you contradicted yourself, communication with you is useless.
277 - pleasexcuetheinterruption
Oh and as Clavos pointed out 2 of the top 4 are OPEC and 3 of the top 5. Not 1 of 4 like you said. Got that wrong too then.
The most important fact is that 50% of our oil has OPEC as its source.
And it doesn't even matter if it's OPEC or not. I don't want Russia, Canada, or Mexico making huge profits off of our oil purchases either.
278 - Mooja
Clavos, do you you recognize any beneficial effects to the U.S. economy by having access to a cheap energy source?
279 - pleasexcuetheinterruption
Clavos, do you you recognize any beneficial effects to the U.S. economy by having access to a cheap energy source?
I would rather use relatively expensive domestic alternatives than relatively cheap foreign oil which causes the transfer of literally TRILLIONS of dollars out of the U.S. economy.
280 - pleasexcuetheinterruption
Which is why research, subsidies and incentives to use alternatives would have the same effect as this plan. Except it wouldn't encourage people to actually drive less. Which is one thing this plan does do. So what is really needed is a combination of the two.
281 - Clavos
Shit, I lost a response to #278.
Mooja, do you not see the pickle all those years of cheap oil has us in?
Virtually our entire economy is dependent on it in one form or another.
And most of it is in other countries.
Now, the piper is starting to demand payment, and the citizens are out to lunch.
282 - pleasexcuetheinterruption
It's not "expensive" I'm worried about; I'd like to see it go to $10 a gallon next month as long as it stayed here. At $10 (or maybe it'll take $14 or 15), there will finally be, as you said, incentive to actually try to get off the crude addiction; but if all that money keeps leaving the country, the foreign producers will own you AND the alternatives, when they come.
Exactly.
It's going to 10 whether we want it to or not. The question is, do we make it go to 10, pocket the difference, and find alternatives NOW, or do we wait for OPEC to make it go to 10, have them pocket TRILLIONS of our economy in the meantime, and only then get serious about reducing consumption and finding alternatives when we can hardly afford it any more.
283 - pleasexcuetheinterruption
Mooja, do you not see the pickle all those years of cheap oil has us in?
Virtually our entire economy is dependent on it in one form or another.
I am fond of saying we should have been increasing the gas tax 5c a year since 1970.
The key phrase is dependence. The market is not going to solve our dependence in the most beneficial way for us. The market will solve it in the most benefial way for the entire globe, theoretically, at our expense. When oil production starts declining seriously, and the price skyrockets, there won't be time or money to make the changes. The transition needs to be made gradually and the clock is ticking.
284 - Clavos
"When oil production starts declining seriously, and the price skyrockets, there won't be time or money to make the changes."
Quoted for Truth.
That's the whole point...
285 - troll
...why don't we just come up with some new toy that oil producers need to defend themselves and sell it to them for big bucks along with a multi-year maintenance package
286 - Mooja
"Mooja, do you not see the pickle all those years of cheap oil has us in?"
No I don't. <--- This is how you answer a direct question by the way. Something many here could learn from.
I believe that cheap energy has been a benefit to this country (and mankind) in so many ways. Food production, medical and technical advances; the list goes on and on. All of these efforts would have been retarded had energy costs risen tenfold many years before it had to.
While all this cheap energy has been available we have even been able to (cheaply) advance technology that may eventually lead us off dependence on oil. There are, and have been for some years, many very smart people working on these technologies. In my opinion it would be a smarter strategy to do whatever you could to support those folks instead of proposing tax shell games.
287 - Clavos
Mooja, the pickle is that, because of artificially cheap oil, we now can't live without it, not just as fuel, but everything upon which our society is built is inextricably linked to oil; it pervades everwhere: transportation (obvious), power (ditto), medicine, manufacturing (power AND raw material, especially plastic), pharmaceuticals - virtually everything in our culture, and we are dependent on foreigners, many if not most of them hostile to us, for two thirds of our oil.
In my book, that's the very definition of a bad position in which to be, especially now that China and India are becoming such prolific consumers of petroleum themselves. Not only does their presence in the market significantly increase the demand and hasten the end of all oil, it also allows (or will, shortly) the producers (Chavez, the Russians and Iran come immediately to mind for their hostility to the US) to cut us off without hurting themselves.
"There are, and have been for some years, many very smart people working on these technologies. In my opinion it would be a smarter strategy to do whatever you could to support those folks instead of proposing tax shell games."
Those "very smart people," haven't come up with anything so far except ever more ways to use oil. Why? Because the oil was cheap! So, now we are totally dependent on it, and we have to get it from people who would like to take us down.
Are you so myopic you cannot see that the "tax shell game," as you call it, would help those people enormously, by keeping trillions of dollars from flowing away?
288 - pleasexcuetheinterruption
Stop calling it a shell game if you can't respond to the simple explanations for why it is not a shell game. And this plan does help those very smart people by making their alternatives less expensive relative to oil, and by decreasing oil consumption.
289 - Mooja
Clavos, "Those "very smart people," haven't come up with anything so far except ever more ways to use oil. Why? Because the oil was cheap! So, now we are totally dependent on it, and we have to get it from people who would like to take us down."
I disagree that they haven't come up with anything. Solar, wind, and fuel cell technology has advanced in leaps and bounds over the last 30 years. The fact that these advances have not been unable to undercost oil based energy is a testament to how difficult the problem is. Getting off oil is not something you can throw money at and fix. It reqires smart peole spending long hours focused on advancing other technologies. It also speaks to the fact that oil has been and is so very cheap compared to the alternatives.
Tax shell games help no one. Cheap energy helps everyone.
290 - pleasexcuetheinterruption
Tax shell games help no one.
Stop calling it a shell game if you can't respond to the proofs it clearly isn't.
And importing most of our energy needs (as opposed to providing for them ourselves), no matter how cheap, doesn't help anyone in the U.S.
291 - Christopher Rose
Hey Clavos, I wonder if Foreign Policy scoped your article before publishing 5 Reasons to Love $4 Gas?
From the same source, you might also enjoy reading The New World Energy Order...
292 - Clavos
Chris,
Interesting articles, both. I bookmarked them for future reference as well.
However, now I'm very worried; where the hell did they get that picture of my belly? :>)
293 - Christopher Rose
Big brother (or big oil) is obviously watching you.
294 - bliffle
You'll be glad to hear that gas is $7.99/gallon at Rancho Shopping Center in upscale Los Altos Hills. That's for 100 Octane, fill your Ferrari yourself.
295 - Dr Dreadful
I'm glad you clarified that, Bliffle. I was thinking it must be spiked with beluga caviar for them to be charging that much...
296 - Clavos
In an interesting reversal, Florida governor Charlie Crist has reversed himself and announced he now supports drilling in the Gulf of Mexico.
Crist's decision is driven by rumors which have circulated for several years that Cuba has granted leases to China to drill in its substantial known reserve fields, parts of which lie between the island and the US, in places actually touching US territorial waters.
Crist's reversal is crucial to enabling the drilling to begin, though by no means definitive, as both houses must approve before that can happen. However, according to recent reports, sentiment in congress does seem to be shifting.
Ironically, one of the reasons that the question of Gulf drilling is open to discussion again is Katrina. A number of platforms off the northern Gulf coast were severely battered by the storm, some were shut down for weeks afterwards (remember the spike in gas prices?), yet not one drop of oil was spilled.
Proven reserves in the Gulf are substantial, and there is much exploration yet to be done.
297 - bliffle
Oh great. Now Clavos proposes that we compete with Cuba for bottom-of-the barrel raw materials business.
You can just see how selling raw materials cheap to foreigners has worked for Cuba.
How stupid.
298 - Clavos
"You can just see how selling raw materials cheap to foreigners has worked for Cuba.
How stupid."
One big difference:
We're skilled capitalists, expert at squeezing the last dollar out of the rubes.
The Cubans can't do anything right.
You're very good at cynically shooting down other people's ideas, but have never, in all the time you've been on these boards, presented so much as one good idea of your own; nothing but negativity.
You obviously are a singularly unhappy individual.
299 - Clavos
Here's an analysis, by columnist Robert Samuelson, of yet another report, this time from economist Jeffrey Rubin, discussing what the rising oil prices portend for US in the near and distant future, and what we should be doing about it.
Samuelson notes:
"By Rubin's reckoning, we've barely passed the halfway point on a steady march upward that will take gasoline to $7 a gallon and oil to $225 by 2012. Despite fluctuations, the underlying rise, he says, will have pervasive and surprising side effects."
Rubin predicts:
"-- Two distressed industries -- homebuilding and autos -- suffer further. "In two years, there will be fewer Americans driving," [Rubin] says. Higher gasoline prices push people to mass transit and carpools. Home prices take another hit, especially in distant suburbs with long commutes. "People won't be able to afford what they used to afford," he says."
More ominously:
"There's been a huge transfer of power to oil producers. Even at $100 a barrel, Saudi Arabia, Kuwait and the United Arab Emirates will earn almost $8 trillion in oil revenues between now and 2020, estimates the McKinsey Global Institute. More troubling are the political implications. "This has really strengthened the Iranians, Russians and Venezuelans to be more provocative in the world," says Larry Goldstein of the Energy Policy Research Foundation..."
"...How can we retrieve some of our lost power? The first thing is to get out of denial. Stop blaming oil companies and "speculators." Next, we need to expand domestic oil and natural-gas drilling, including Alaska. Although we can't "drill our way" out of this problem, we can augment oil supplies and lessen price strains. It might take 10 years or more, because new projects are huge undertakings. But delay will only aggravate our future problems."
Only time will tell how much damage the runup in oil prices will do to our economy, but the longer we wait to take action - any action - the greater the damage will be.
300 - bliffle
"The Cubans can't do anything right."
So, then, you're a racist?
301 - Clavos
Cuban isn't a race, bliff, but you knew that.
...On second thought, you probably didn't.
302 - bliffle
How does one determine what a 'race' is?
As near as I can tell, it's just some group one wants to disparage.
303 - Clavos
Like Americans (aka gringos)?
304 - bliffle
The big gas price increases are caused by speculation and market manipulation.
All your favorite characters are involved, from Clinton to Bush and McCain.
Here are some interesting citations regarding Commodities Future Trading Commission (CFTC)and the Commodities Futures Modernization Act (CPMA)
News Busters
Balto Chron
Public Citizen
Draw your own conclusions.
There are a lot of references, just Google around for "Commodities Future Trading Commission" and the "Commodities Futures Modernization Act", and even "ENRON loophole".
305 - Clavos
"The big gas price increases are caused by speculation and market manipulation."
Especially market manipulation by OPEC and the other producers, who ride their coattails.
306 - Clavos
Interesting.
The Chinese government, out of concern about current oil prices, has just raised retail pump prices by 18% in an effort to curtail consumption, according to a report on tonight's ABC World News broadcast.
The Chinese are once again outsmarting the Americans.
They will be the world's next economic leader, and probably within the next twenty years.
307 - bliffle
Chinese economists and ministers are openly scolding US officials for their poor stewardship of the US economy.
308 - Clavos
Like not raising the price of fuel at the pump, as they are?
One reason I have begun buying Chinese stocks.
309 - Dave Nalle
Um. The Chinese have the power to just raise the price at the pump because they're a totalitarian regime with a command and control economy. It's not so easily done here in the US. It would probably be done most practically with a tax, and that would require the passage of legislation through Congress. How likely is that to happen with the price already as high as it is.
Realistically, we ought to be thanking the oil companies for NOT cutting their profits and keeping the price relatively high.
I do wonder if there might be a way to increase the price more without going through the legislative bottleneck. Maybe an emergency executive order or some sort of interference in the importation or production process. If a price increase were in the form of a fee for a specific purpose rather than a tax, it might be possible to pull it off under the aegis of the EPA or FEMA or even DHS.
Dave
310 - bliffle
Here come the famous "Free Market" zealots ready to tinker in the economy and exert various aberrant controls, and they have...
...no...
...idea...
...of...
...the...
...consequences.
311 - pleasexcuetheinterruption
Oh great. Now Clavos proposes that we compete with Cuba for bottom-of-the barrel raw materials business.
You can just see how selling raw materials cheap to foreigners has worked for Cuba.
How stupid.
Not what he said at all. 1) it's the Chinese drilling it 2) selling 'raw materials' has worked out rather well for otherwise barren deserts such as Saudi Arabia, Iraq, Iran, Kuwait, UAE etc who have otherwise no foundation for a competitive economy
"The Cubans can't do anything right."
So, then, you're a racist?
Cuban is not a race.
How does one determine what a 'race' is?
As near as I can tell, it's just some group one wants to disparage.
Are you kidding me? Get yourself a dictionary..
The big gas price increases are caused by speculation and market manipulation.
All your favorite characters are involved, from Clinton to Bush and McCain.
Here are some interesting citations regarding Commodities Future Trading Commission (CFTC)and the Commodities Futures Modernization Act (CPMA)
News Busters
Balto Chron
Public Citizen
Draw your own conclusions.
There are a lot of references, just Google around for "Commodities Future Trading Commission" and the "Commodities Futures Modernization Act", and even "ENRON loophole".
1) The report referenced in the first article explaining why commodities trading is to blame for the high prices, not supply relative to demand, was written by Michigan Senator Carl Levin. He is a politician not an economist.
2) The first article claims that supply and demand doesn't explain the high prices because U.S. oil inventories are higher than ever. So what? Inventory has nothing to do with supply. That was probably because the price of oil was expected to rise in the future, so businesses inventoried. Furthermore, current inventories are low to average as of June 2008, so would the author now say the high prices are now justified? Obviously inventories are not not a measure of price or supply.
Link
3) The author of the first article explains that energy futures are causing the high price because it allows investors to buy up oil today and sell it in 6 months at a higher price. So doing that today does make the price go up today by decreasing supply. But what does selling it in 6 months do? It reduces the price in 6 months by increasing the supply in 6 months. Delaying the sale by 6 months in no way changes the amount of oil physically coming to the market. All that the price speculation does is smooth over bumps in supply and demand, and turn a relatively small profit for the investor. The only way speculation would increase the price unfairly and unnecessarily in the near term is if someone was stockpiling large quantities of oil for sale in 100 years (as opposed to 6 months).
Here come the famous "Free Market" zealots ready to tinker in the economy and exert various aberrant controls, and they have...
...no...
...idea...
...of...
...the...
...consequences.
You're the one proposing the market regulation. All Clavos proposed is an increase in an already existing tax. Ooohh scary...
312 - Jet in Columbus
Bliffle-you're wrong... they know the consequences and they don't care.
313 - Jet in Columbus
The prices will stay high because no matter how much we import or pump from our shores, we'll never have the refinery capacity to refine it, so it makes sense to the greedy bastards to sell it to China and India.
Low refinery capacity spells higher gas prices at the pump and higher profits going into Houston's pockets from the far east...