I love how there's so much angst over an issue that the Energy Information Administration said would have no effect on oil prices. You know, the non partisan agency within the Department of Energy who's entire purpose is to provide factual information. Or to quote Wikipedia:

EIA's mission is to provide policy-independent data, forecasts, and analyses to promote sound policy making, efficient markets, and public understanding regarding energy and its interaction with the economy and the environment.

Don't you think your politicians should listen to them instead of bickering and acting like they're the only hope the taxpayers have of paying less for oil? And shouldn't the taxpayers be upset that your economy is ruined and the price of oil has skyrocketed because the Bush administration launched an illegal war on one of the largest oil producing countries in the Middle East?


As for Pelosi's comment that she's "saving the world" (can someone post a link to that quoted in context?), here's an even stupider comment from Congresswoman Michele Bachmann (R-Minnesota)

You know haggie there is nothing but love for you when you show us how stupid we are here because we can't think for ourselves and you are the beacon of light that we are waiting for.

As for Pelosi's comment it was an interview she did.

Hey, if the completely retarded elected officials fit.....

dood you know that pretty weak when you start pointing out FN like its their fault. They reported on the story and gave the source link, you can check it out for yourself you know.

I did. Did you?



The source mentions Obama and his bipartisan plan to allow some drilling.

It's not Fox News's fault that this is going on. Not at all. But how can you not see and laugh at the ridiculous spin that is always put on what they report?



ETA: And Haggisjin is spot-on right about the EIA, and how stupid the Republicans are being about this drilling. I respect Obama's ability to compromise, but it really shouldn't have come to it.

futures ? anyone? the EIA isn't a market analyst org. the market sets the price, part of which is controlled by futures which see an immediate effect. or to quote cnn's market people.



so if we affect the futures it has an effect on prices. drilling would do that. and again, do we want to be wondering where oil prices will go if we don't become independent from foreign countries. we have the ability to end the dependence while working on alternatives.

Really?

Why can't we just, I dunno, learn to get along with the people who have lots of oil already? Is that really too complicated?

I think that ship has sailed.

Although, I'm surprised that our president hasn't proposed as an energy plan, "Let's give Canada the cash, and have them go in and buy the oil for us. Like how I used to buy beer for my underage cousins back in Texas."

Oh that would give us all sorts of street cred. then on top of paying more than what its worth. I'm sure you didn't make beer runs for your cousins just for the heck of it without a little extra sometin, sometin.

@ boobies

Why can't we just rely on ourselves, since we have the know-how, capability and materials?

@ Nomo

Thats just crazy talk, speculations/futures is only good for when there's only disaster then its okay to immediately raise cost on the spot, silly Nomo its not suppose to work in our favor.

a market analyst whose sole job is to make money on the market probably has a better line on what makes money than a govt dept.

kind of like bookies in vegas, I'm pretty sure they make more money than the fan who bets on their team. if market people say futures will have or has had an immediate effect, and can show it by the fact gas is .50 less a gallon already, I tend to think they are right.

Because it will cost a lot more to set up enough facilities to be "independent?" Which is something I'm really not understanding...what's wrong with a global economy? Is that an ok idea until it comes to stuff that's really expensive and we don't feel like negotiating for?

And that way when the rest of the world runs out of petroleum, the only people with any left will be us. That way we can extort everyone else.

It conflicts with our nation's overwhelming sense of xenophobia?

How sensitive is the futures market? Considering that Oil just jumped $4 a barrel based on an unexpected shortage in the US's currently available gasoline reserves, what's an action that will take a decade to have any impact going to do to it?

I understand what you're saying and I get that it is tongue in cheek too but yet it/that could lead to even bigger problems if it gets to that point.

I'd personally like to see a (unbiased) report on expenditure cost. I have a feeling we here at home would be satisfied that it (cost) would be helping ourselves out of foreign dependency and heck with any we could get back in the market (at a larger share) and sell some back, keeping us in that thing called the global economy.

it won't take a decade for the futures to come down. and your re-enforcing the idea that any action affects the cost. what difference it will make in 10 years? I guess we should just resign ourselves to being dependent on people that want to kill us.

global economy is fine, but covering your @ss is a good idea too. plus building refineries and oil rigs might make some jobs.

That's not what I'm saying - Look, it'll take, best estimate, about seven years to get any usable gasoline if we start drilling right now. Based on the way the market fluctuates, how big of an impact is more oil seven years from now going to have on the market? How long will it take for the futures to come down and by how much will they come down when they start?


For oil? Yeah. For energy? No.

But you've heard me call for Nuclear power before.

how big of an impact will it have if we do nothing?

Well, for starters, doing nothing means we won't waste millions (maybe billions) of dollars on useless acts.

But you didn't see me advocating doing nothing, did you? So it's a moot point.

Now answer my question.

There's no way to know this unless we do it.

Start drilling now, build real alternative energy production (like nook-you-lur), fix CAFE so that auto manufacturers can't just build ONE single car and then go "See, we're meeting standards." And all you people batching about gas prices...change your damn oil regularly, get a tune-up, make sure your tires are inflated properly and quit driving 85 mph on the interstate.

Some people are acting like there is.

what's your question?

If we start drilling today, how long will it take for the futures market to cause prices to come down and by how much will they come down when they start to come down based on the US having more oil in, like, seven years?

I think prices start coming down immediately, how much? can't say. Of couse I'm just speculating.

Immediately off of a seven-year-down-the-road promise? Is there any precedent at all for that kind of immediate impact from so far-off a goal?

I'd rather have higher fuel prices in the short-term, if it means that in 7 years we've used the resources that drilling would need for commercializing other technologies that would reduce our need for oil.

I think so, 7 yrs sounds like a long time but then I look at my 7 yr old son and I find it amazing 7 yrs came and went just like that. Apply that to anything work vs. goofing off, ect...

Seriously, what other market takes seven years down the road into effect? That'd be like selling the Armada figures based on the popularity of Bay's movie.

Biotech? Anything that needs EPA/FDA/USDA approval is announced fairly early on, often years before actual release to the general public. That has a pretty big impact on their stock prices...

Stock prices aren't the market prices for the product. Drilling is supposed to bring down the cost of gas for the consumer, but the price of beef hasn't gone down due to the FDA approval of cloned beef, even though it's sure to impact the supply of beef in the near future. But, right now, there's still a certain demand for beef at the market, and so much supply to fill it. The promise of more and better beef through cloning hasn't changed that.

It might make people investing in beef richer, but that's not the same thing as saving the consumer money, which is what the drilling is supposed to be about.

I think if we weren't producing beef but were extrememly dependent on it so much so that trading its future values had an impact on the price per pound that might be different.

market people say bring the futures down brings the price down now. 7 years would be the future. one of the reasons it went up was the futures if we can bring it down the same way by projecting oil on the futures market. so be it.

Futures, options, and other similar derivatives (the ones that trade on the market exchanges, that is) have a maturity time on the order of months up to about a year or two out tops. Their prices only depend on foreseeable events prior to that maturity. For instance, if Google's next quarterly results are in Oct, those results will have no real impact on the Aug options expiring next week. From all I know of commodity futures, they behave according to the same mechanism.

If the event were close enough, and somehow market participants are acting upon foreknowledge or in anticipation of the event, that may affect the market price during the term of futures contract. But in this scenario we're talking about something 7 years out, and that affect is very indirect when it does happen.


Beyond this issue, any benefit on the 7 year horizon doesn't stand alone. Drilling affects supply, but demand in that timeframe will continue to be affected by factors like China's and India's increasing consumption. Over 7 years, I think that has the potential to far outstrip any increased output here in the US (unless we somehow become the new Middle East in terms of oil reserves and cost of extraction -- highly unlikely).

Just looking solely at the price-of-oil component (ignoring the other factors that impact price at the pump), what's killing us in the US is the devaluing of the USD, and its no longer being the standard currency for global oil trade, and thus being shipped back to the US where we actually start to feel the pain of that inflation. We'd cut the per-barrel price almost in half if we could get rid of that.

I mean yeah, the price of oil isn't that great, but what's really going on is that our economy just sucks.


.... I think anyone who says that has only registered 2 basic factoids: 1) futures prices lead spot prices and 2) 7 years later is "in the future". Unfortunately, the prices of futures isn't something even the US government can just set as it pleases, especially with our current levels of spending + consumption and low levels of productive output.

all the more reason to start now.

Well the US's own production of oil at that late date will have such a low impact on the price of gas that the point is it would be far more effective and productive to address the dominating factors.

It's inflation. Inflation is primarily affected by government spending, our consumption rate, and our import/export ratio. While curbing government spending may seem a near unachievable dream, it is far far easier to accomplish that than it will ever be to produce enough oil to not only feed our own insatiable thirst, much less to output to the rest of the world in order to become a net producer (like Canada has).

I mean the US reversing its inflation by producing oil is like having the fattest 400lb obese man try to power a home by running on a treadmill.. while smoking and eating donuts at the same time. Some of us more libertarianish types love to fantasize about our economy being able to do something like that. But I think anyone in tune with reality knows a little better.

I do agree that any viable solution needs to be started earlier than later. But I think the consequences of doing the wrong thing far outweigh the consequences of doing nothing. I'd more than settle for simply halting the happy march to economic destruction.

Even though it will accomplish next to nothing? Brilliant. I thought you were against the government spending money on useless and ineffective shit.

would the govt pay for the oil companies to drill? if so that's stupid.
I am against govt waste, but alas the IRS still exists. how's that new city hall whatever thing going out there in frisco btw?

Well, they're certainly spending a lot of tax money on trying to decide whether the oil companies will be allowed to do something that - at best - might help the consumer but will absolutely help the oil companies profit.

I'm with you on government spending, BTW. I didn't mean that question as an attack on your position. I guess I just don't see how you don't file this whole debate into that mental drawer...

Exxon made 11 BILLION dollars in profit last year. The problem isn't that you're not allowing the oil companies to drill off shore.

*still can't believe there's actually a debate over this topic*

well I think they should vote get it over with and quit wasting money on it. then either we drill or not. and hey if exxon had that much profit maybe they could re-invest some of it into new rigs/refineries and exploration...oh wait. and I go back to the fact that the govt made more than exxon did off of that same oil. but thanks to infinite govt waste...we're still in debt and of course the value of the dollar isn't helping although it is getting a little better according to Clark Howard.

According to Exxon's annual financials, they had $40B in net income for the year 2007 and $18B in capital investments. So, like most businesses, it seems they are reinvesting. In what specifically, ye'll have to dig around deeper for in their statements.

Consumer prices surge, job market remains strained.

Hooray!