Oil companies gouging us at the pump? The Democrats recently made a big spectacle of bringing the oil company CEO’s to Capital Hill for hearings on the price of gas at the pump. The reason why the Democrats want us to believe that this problem has been created by the oil companies is simple. If they yell, posture, and rant loud enough, we might not stop and consider just why we are in this mess. It has been Democratic Party policies and the liberal left that have created an environment that makes it difficult for domestic oil companies to drill, pump, refine, and deliver domestic oil to the market place. Instead we are now competing with a growing voracious world appetite for oil. China and India have become oil hungry. The Middle East is unstable and the risk is factored into the world oil price. Our dollar is weak thus it takes more dollars to buy an international barrel of oil.
Had the Democrats/Liberals let our domestic oil companies drill off Florida (as the Chinese are currently doing), off California, in ANWR, and on federal land our dollars would not have been pouring out of this country. Our trade deficit would be in much better shape, and the gas price at the pump would be somewhat lower. Democrats/Liberals created a maze of regulations designed to prevent the building of refineries in this country, thus we suffer spot capacity problems that plague the supply of gasoline, home heating fuel, and diesel driving up the price at the pump.
Before you vote in the fall, ask yourself; can I afford to go out and change my vehicle to a gas saving hybrid, can I afford to convert my home to solar, will my rent go up because it is costing the landlord more to provide heat, will I be uncomfortable next winter because my landlord has to send up less heat because he cannot afford the oil? Before you vote, ask yourself why in ANWR, Alaska, where drilling for oil will take up a minuscule footprint in a mammoth sized reserve, we will not tap that oil? Had we tapped that oil in 1995 when the Democrats – Bill Clinton – rejected drilling in ANWR, we would have reduced our oil imports by half. Checkout ANWR.ORG for more information. Had we drilled off Florida and California, we would actually be selling oil to other nations rather than sending our dollars out of this country.
Before you vote in the fall, consider why we are not using what could be abundant cheap nuclear electricity. We have created so many regulations about nuclear power plants intended to prevent their completion that we have not been able to build the number of nuclear power plants needed to relieve the need for oil to provide electric power. Environmentalists in their zeal to save the planet are actually destroying this nation. Environmental management of the planet is good; excessive over the top management without regard for our people, and the economy, is reckless.
The oil companies are not gouging us as your Congress would have you believe. The price at the pump today represents a smaller percentage of the price of a barrel of oil, despite all the taxes heaped upon you when you fill up, than the percentage was back in 1993. If the oil companies were gouging us, the price at the pump would represent a greater percentage ratio of gas to oil. Notice the relationship of the price at the pump versus the price of a barrel of oil has been dropping, not going up. Are those parties who refuse to drill, refuse to refine, and who refuse to rely on U.S. oil reserves telling you the truth? Are those parties sending your dollars to foreign nations? Domestic drilling will not dramatically lower gas prices, but it will help keep our dollars in the U.S., thereby strengthening our economy, and adding to the world oil supply, with the appropriate reduction of oil prices worldwide.
Source: Energy Information Administration: Official Energy Statistics from the United States Government
| Year | Average Price
Gallon of Gas |
Average Price
Barrel of Oil |
% Gallon of Gas
to Barrel of Oil |
||
1993 |
$1.07 |
|
$16.77 |
|
6.39% |
1994 |
$1.08 |
|
$12.37 |
|
8.71% |
1995 |
$1.16 |
|
$16.13 |
|
7.17% |
1996 |
$1.24 |
|
$18.41 |
|
6.76% |
1997 |
$1.25 |
|
$18.28 |
|
6.81% |
1998 |
$1.07 |
|
$12.16 |
|
8.82% |
1999 |
$1.18 |
|
$16.55 |
|
7.10% |
2000 |
$1.52 |
|
$26.13 |
|
5.83% |
2001 |
$1.47 |
|
$22.79 |
|
6.43% |
2002 |
$1.38 |
|
$23.18 |
|
5.96% |
2003 |
$1.60 |
|
$26.96 |
|
5.94% |
2004 |
$1.89 |
|
$34.30 |
|
5.51% |
2005 |
$2.31 |
|
$50.22 |
|
4.60% |
2006 |
$2.62 |
|
$61.11 |
|
4.28% |
2007 |
$2.85 |
|
$68.41 |
|
4.16% |
2008-Jan |
$3.24 |
|
$89.86 |
|
3.61% |
2008-Feb |
$3.08 |
|
$90.81 |
|
3.39% |
2008-Mar |
$3.29 |
|
$100.87 |
|
3.26% |
2008-Apr |
$3.51 |
|
$104.98 |
|
3.34% |
2008-May |
$3.59 |
|
$115.08 |
|
3.12% |
Ken, I stumbled across your web site helping my 15 year old son work on his scout Citizenship in the Nation Merit Badge for Boy Scouts. We had googled checks and balance for Judicial system and came across one of your articles. It had the ring of sound logic so I explored your site further. You express ideas well, I am wondering who you are and what you do for a living. I have recently made some short documentaries and thought some of your articles might be good subject matter for short documentaries. Ping back if you have 10 minutes free to chat on the phone and we will schedule it.
Vaughn Brock, Ausitn, TX
One reason is we have seen the price of oil more than double from $60 to $135 is just over two years without major supply disruptions. We have also been plagued by manipulation in other energy markets.
Enron and others manipulated the Western electricity markets in 2000 and 2001 and cost consumers over $40 billion. In light of that, Congress gave the Federal Energy Regulatory Commission new authority in the Energy Policy Act of 2005.
Specifically, Congress made it “unlawful for any person … to use or employ … any manipulative or deceptive device or contrivance,” in connection with the wholesale electricity and natural gas markets. We’re going to hear today from FERC’s Deputy Director of Investigation and Enforcement on how FERC has used its new authority to root out manipulation in physical electricity and natural gas markets.
To date, FERC has used its new authority to conduct 64 investigations resulting in 14 settlements totaling over $48 million in civil penalties. We have seen the very same energy traders move from Enron to Amaranth, and American families and business alike have the same concerns about potential manipulation in our oil markets.
Last December 2007, Congress granted the FTC anti-manipulation authority in the Energy Bill. Specifically, Congress made it “unlawful for any person … to use or employ … any manipulative or deceptive device or contrivance,” in connection with the purchase or sale of crude oil, gasoline, or petroleum distillates at wholesale.
During the hearing is was reported Michael Greenburger (the former speculation committe chairman) reported that gas could drop 25 to fifty percent. If spectulation could proprerly regulated would get prices back under control would drop the almost right away. These controls were removed in 2000.
One reason is we have seen the price of oil more than double from $60 to $135 is just over two years without major supply disruptions. We have also been plagued by manipulation in other energy markets.
Enron and others manipulated the Western electricity markets in 2000 and 2001 and cost consumers over $40 billion. In light of that, Congress gave the Federal Energy Regulatory Commission new authority in the Energy Policy Act of 2005.
Specifically, Congress made it “unlawful for any person … to use or employ … any manipulative or deceptive device or contrivance,” in connection with the wholesale electricity and natural gas markets. We’re going to hear today from FERC’s Deputy Director of Investigation and Enforcement on how FERC has used its new authority to root out manipulation in physical electricity and natural gas markets.
To date, FERC has used its new authority to conduct 64 investigations resulting in 14 settlements totaling over $48 million in civil penalties. We have seen the very same energy traders move from Enron to Amaranth, and American families and business alike have the same concerns about potential manipulation in our oil markets.
Last December 2007, Congress granted the FTC anti-manipulation authority in the Energy Bill. Specifically, Congress made it “unlawful for any person … to use or employ … any manipulative or deceptive device or contrivance,” in connection with the purchase or sale of crude oil, gasoline, or petroleum distillates at wholesale.
Americans may be surprised to learn that our oil futures markets were substantially deregulated by CFTC staff decisions that were made behind closed doors. This “London-Loophole” and now the “Dubai-Loophole” is keeping important U.S. energy trading in the dark. And without proper light manipulators have free reign.
Obviously the person who wrote the artilcle as to why gas and oil prices are so high is a conservative republican. Conservative republicans are totally oblivious to the actual true reason said prices are as high as they are. Prices are where the are because WE invaded Iraq PERIOD, END OF STORY. If you don’t beleive my claim one only needs to look at the timeline as to when prices started
their steady increase. When was it? Any body know? It was in 2002. Shortly after we went to war. Coincidence. I think not. We as Americans have to stop listening to the worthless, incompetant drival that spews out of consrvative republicans and oil industries spin doctors pie holes. When the heads of the top 5 oil companies went in front of Congress they made themselves look like TOTAL ASSES trying to explain their prophet margins. If their ARE any Americans that bought that big load of shit this country is in more trouble than I thought. Sorry for being so blunt people but it’s time as Americans, both Republicans and Democrats to wake the F___-up and smell the proverbial coffee and work together as our forefathers intended. The finger pointing just HAS to stop before this country continues its freefall into depths in which we will not be able to claw are way out of. Nice place we’ve put ouselves in for our future generations. We as Americans should be ashamed of the direction this country is headed.
Sean,
Obviously you’re a dyed-in-the-wool lib who doesn’t have a clue as to why oil prices are this high.
Let me give you one fact to refute your ignorance from above. The night of the 2006 November elections, where your Dimocratics took control of both houses, I paid $1.99 for gasoline. I made myself memorize that price so that I could use it as ammunition against ignorant comments soon to follow.
You will note that in November of 2006, the Iraq war was not going well and was 3+ years into the making.
Today, twenty months into the Dimocrat regime change, I paid $3.79.
And though I don’t really blame the Dimocratic Congress for high prices because I know better, I do blame them for being obstructionists in helping lower the price.
Your blaming the high barrel of crude oil on the war in Iraq is so wrong and so ludicrous, I won’t waste my time refuting it with anything but simple facts. Anything else would obviously be a waste of time…
This is for good ole Tex. Boy you Repube’s are dumber than I thought. Look at the price of a barrel of oil before the war started. What was it you dipshit? Duh. Talk about facts. You dont have any facts. Thats your problem. It was roughly 26$ a barrel. I’m the only one spouting any facts that a monkey could research. Yea I am a Dim. but I’m far from a liberal. I actually left out the oil companies. There not innocent in all this. They saw an oppurtunity due to soaring oil prices and proceeded to pork the American people, you and I mind you, right in the ASS. Write again when you have facts to support your claims, which you obviously do NOT have. Bonehead. God gave you a brain. Use it the way it was intended. That is to be an independent thinker as I. Not istening and believeing anyone in politics, Dim’s or Repube’s. I’m surrounded by idiots.
P.S. To my last entry. I just can’t believe that there are people out there as ignorant and naive as TEX. I’m assuming your a fellow American, so dont worry TEX I’m praying for ya’ll. I suppose you have some imaginary facts about religion next. Lord help save us from the TEX’s in this world. Amen.
Sean and Tex, with respect, and I mean without respect we cannot all work together for the betterment of the USA.
Sean, Iraq is not the cause of everything going wrong in the world. World energy consumption is skyrocketing. This is a world wide problem. Renewable energy is simply not ready.
The post above these comments does give some facts. Also try
http://brokengovernment.wordpress.com/2008/06/16/why-we-must-drill-now-and-drill-here/
and
http://brokengovernment.wordpress.com/2008/06/21/the-hidden-agenda-against-drilling-for-oil/
and
http://brokengovernment.wordpress.com/2008/06/12/china-drilling-off-the-coast-of-florida-why-cant-we/
To you Ken with due respect. I agree with you wholeheartedly as to all working together as humans and Americans. But you know as well as I do we’ll never see that in our lifetimes on either front. As to blaming Iraq for all our problems. I dont know exactly what you mean. I simply stated that the timing of the war and oil price increase was not a coincidence. You sound like an intelligent gentleman. You cannot in good conscience say to me that if we had never gone to war that we would be in the situation as to the degree of soaring oil prices that is unprescedented in human history, can you?
We started the current Iraq war March 20, 2003. Iraq has added about 1% to our military expenses as a percent of GDP. The early prosecution of this war was filled with incompetence and thus made the world more unstable adding risk for the oil speculators to feed on.
The precipitous rise in oil by the barrel prices did not start until 2005, escalating heavily in 2008.
Factors driving up the price of oil:
The precarious nature of Nigeria’s oil production due to war risk – U.S. not involved
China and India have begun a major expansion of industrial and vehicle capacity.
China is subsidizing all gasoline making it quite cheap to the Chinese motorist.
Iran is becoming more and more unstable and its oil production is declining due to management.
The world will be using 146% more energy in 2030 than today.
Our invading Iraq provided no bump in oil prices at that time and in this last year 2008 when prices have skyrocketed, Iraq has actually increased production above pre-war levels.
The Iraq war has helped devalue our dollar, but the economic impact of inflation, credit, no balanced budget from either the White House or Congress along with the trade deficit – we send now $500 Billion annually to the world to buy oil – have all served more to decrease the value of our currency and increase the price of oil.
Ken, first of all to you ,Tex and the rest of your followers apologize for being so abrasive. I am very passionate when I am right and can get a little gregarious. And for that I apologize. As to your last entry. That’s all jibberish to me. You stated that the sharp increase in price per barrel has only jumped dramatically in the last year to year and a half, which is true. But the fact remains (refer to your own posting) that the increase in both gasoline and price per barrel (oil) has steadily increased to no end like the human race has never seen shortly after the war began. I was wrong on the year the war started. But I was right as to when the relentless increase began. After the war started. I guess we’ll just have to agree to disagree my fellow American. I bid you adieu.
I concede that I am not well versed in the economics of energy consumption, but I’m wondering the following:
is this an issue of America trying to compete with developing nations who don’t value the well being of its people on a level even close to ours (e.g. China)? That is, are we forced to make profit concessions because we aren’t willing to sink as low as others when it comes to quality of life?
I’m not sure if this is applicable to oil, but it’s a question that surely comes into play when discussing emerging nations. Say what you will about the US and her policies, but there are governments in the world who are willing to do things at their own population’s expense – economic policies that we here wouldn’t dream of.
Hey Sean,
You might remind the monkeys who do your research that correlation alone does not constitute causation; Statistics 101! The ad hominem tone of your response indicates a lack of confidence in their (the monkeys) research, as well!
Interesting read, although I came to it a bit later – 3 days before this crucial election. I have to note that when I look at the author’s chart of gas prices vs. barrel, I see different things from the others above. Firstly, it would appear that during the Clinton era the price of oil remained rather stable – between $12 and 18 per barrel. This began to change immediately post Bush, when by 2004 that price had doubled (again, according to the above chart). This may or not have had to do with Iraq per se, but it would appear to have everything to do with the republic, if you will, under Bush. I found this article quite interesting:
http://www.blacksunjournal.com/energy-transition/1324_consumers-are-fully-responsible-for-high-oil-prices_2008.html
Mostly, I find talk about blame pointless. The facts are clear – bigger cars require more gasoline. More and more countries around the world are coming into “middle-classdom”, and thus will increase car ownership dramatically in the next 20 years (as the author has noted with 2030 projection above).
A good president now would capitalize and give Detroit a new missive – make 50 mpg a reality in less than 5 years, with cars than can run on cooking oil, propane, gasoline or electric. Give people the options and let them run with it. Yes to drilling where sensible, nuclear options, etc, but stop pretending that we can go on with the same ignorant cant about our privileged role in the world – it’s time we started earning our place again as the number one country for innovation, thrift and good old-fashioned decency. It’s not for the sake of the planet or any of that rubbish, but simply for the sake of ourselves – and our self-respect as a nation.