Further disprooving his claim is somthing i found. I believe in his most recent state of the union adress he said that America used 20% of the worlds oil, and had only 1% of the total supply. By that locid (liberal logic) we would last 1/20 of a year............right? WRONG, its not a 1:1 ratio of use vs reserve. If that logic stood true then we would run out of oil in one year because of 100% use. Liberals have NO idea what theyre talking about, we need to drill in canada so were not funding terrorists and paying their jacked up prices.Remember, Obama said this:
"Even if we drilled every square inch of this country right now, we'd still have to rely disproportionately on other countries for their oil," Obama said
That is obviously not true. We have 6% more oil in our nation than we use. So he is not even close to being correct. We do not have to know where it is when Obama makes such statements...
I guess I don't see why Obama's statement is ignoring price. If we could recover enough oil to satisfy domestic consumption, but the price of doing so was greater than the world oil price, we would still rely on foreign oil. Oil that's recoverable at a higher price than the market supports is basically the same as not having the oil at all...at least until the market price for oil goes up. Nobody would buy oil that's more expensive than the market price, and oil companies won't sell oil at a loss.Yep, unfortunately for Obamites, Obama said "drilled every square inch". That is very specific and says he is ignoring things such as price and damages caused by drilling.
I find the Obamite mindset fascinating in that they can completely ignore what he actually says and pretend it never happened...even while it is repeatedly shown to them.
So then the USGS is lying, according to you. Do you have anything to back up this powerful claim?
Remember they said we have 26% of the world's oil in the US, and the US only needs 20%, meaning we have 6% MORE than we need...which shows Obama to be completely and utterly wrong.
So please show this information you have which says the USGS is lying.
Yet you claim that the existence of oil somewhere - anywhere - in the U.S., regardless of the price of extraction and regardless of how long it might take to find it and extract if from wherever it it, is the same as "having" it. That's complete BS. And you pretend that when Obama explicitly says "proven reserves" that's the same thing as "undiscovered oil.""This study does not take into account any other factors such as whether or not a company might find it financially prudent to explore or develop," he [Interior Deputy Secretary David Hayes] said of the USGS analysis.
Try here.What is your evidence that we are not currently approving permits at a reasonable pace?
Those numbers don't seem to be presented with enough detail to demonstrate that the Obama administration is being particularly unreasonable when it comes to approving permits. The Fox News article demonstrates that there are fewer permits being approved, but does not support the (implied) argument that there should be more approvals.Try here.
(BTW: Yes, it was the old Forbes article. First that popped up the other day when I checked. :$ )
I was curious, so I did the math on my own situation, and it turns out I spend about 3% of my (after tax) paycheck on gas. Now obviously other people might make less, or drive more, or drive a less fuel efficient car, but that's a pretty big difference.
Yet every attempt to raise CAFE standards is met with howls and gnashing of teeth, rants about Freedumb! & Big Brother infringing on the "right" to drive giant gas guzzlers willy-nilly across the landscape.I was curious, so I did the math on my own situation, and it turns out I spend about 3% of my (after tax) paycheck on gas. Now obviously other people might make less, or drive more, or drive a less fuel efficient car, but that's a pretty big difference.
The average amount of yearly driving a person does is about 15,000 miles per year, or ~288 miles per week. The average vehicle gets 17 MPG and gas costs about $4 per gallon. That means the average American spends about $68 dollars per week on gas. Not exactly peanuts, but not exactly a crippling cost either.
The point about Bush's announcement and the economy's prospects back serve as a vivid example of oil's price sensitivity to actual and/or expected changes in supply/demand, even rather small ones.You keep making that false attribution wrt Bush announcing more permits & the crash of oil prices in 2008. Obama announced more permits, too, but the price went up. Correlation is not causation, no matter how badly you want it to be.
I already linked the pertinent graph & analysis, but you just go back to what you want to believe, because it's what you want to believe, because it helps maintain your belief system.
And this, as well-
Oil futures aren't about what might be happening years from today, but about what might be happening much more short term, and the time from permit to drilling to actual production is a matter of years.
An expectation of a possible major shortage caused by war with Iran, closing the Strait of Hormuz, etc. causing speculators to buy up oil futures. Not the sample thing as relatively small fluctuations in actual domestic oil production. The trouble with speculators is that they manipulate the market based on perception and fear and it is out of proportion to real supply and demand. It distorts conventional market mechanisms.The point about Bush's announcement and the economy's prospects back serve as a vivid example of oil's price sensitivity to actual and/or expected changes in supply/demand, even rather small ones.
The two articles you link above support my point, one particularly so as it cites the Iranian concerns as reason for oil price increases. This is clearly an expectation of reduced (future) supply resulting in a price increase.
Oil speculators cause some increase. I think it difficult to determine exactly how much. In fact, I'm not persuaded yet that they know how much is pure speculation and how much a proper and necessary hedging tool used by various business, like retail gas distributors, airlines and trucking/shipping for example, to protect themselves from price swings.
In any case, I believe the speculators see increased demand/reduced supply too and thus enter the market. If thye thought we would see reduced demand/increased supply they should be selling short. I.e., their activity is nothing but demand/supply driven, particularly expected demand/supply.
If you think the price increase from speculators is attributable to something other than supply/demand, please explain. If you're claiming something else I can only guess it may be price fixing or price manipulation, both of which are difficult to imagine.
You aren't disputing anything I've said: Th oil market is highly sensitive to demand/supply and expected demand/supply. That is all.An expectation of a possible major shortage caused by war with Iran, closing the Strait of Hormuz, etc. causing speculators to buy up oil futures. Not the sample thing as relatively small fluctuations in actual domestic oil production. The trouble with speculators is that they manipulate the market based on perception and fear and it is out of proportion to real supply and demand. It distorts conventional market mechanisms.
And for all those words you haven't described how speculation can drive up prices. You offer an explanation without an explanation.Actually we have a third alternative, which is what has already been implemented and will go into effect in the next few years. Speculation in markets is really important as it provides liquidity, but in the past the amount of the market that was open to speculation (as opposed to open to the people who... you know... actually used the commodity) was much lower. As it exists now, most commodity market activity is speculation, not consumption, and that can create some pretty serious price instability that has no relationship with actual supply and demand.
The US has recently imposed some new rules and the EU is looking to similarly limit commodities speculation. If the market returns to being dominated by people who actually want a product as opposed to those who are gambling with it, I believe we will see a much better return to price stability and a massive deflation in commodities prices.
Wait, what? How speculation drives up prices is economics 101, but yes commodities bubbles can and do burst, which is also a huge problem. The amount of money that has been invested into speculation has increased enormously in the last 10 years. When you have a larger amount of money competing for a (relatively) fixed supply of a product, prices increase. You do realize now that the major majority (like 70%) of the money invested in commodities is no longer used to actually buy the product, right? It exists purely to speculate on its price. You have more than doubled the amount of money vying for a product, but don't expect that to contribute to price increases?And for all those words you haven't described how speculation can drive up prices. You offer an explanation without an explanation.
We've seen speculation homes etc, the demand it created drove up home prices. But what happens when the expected (increased) demand doesn't appear? The bubble bursts.
Simple fact is that speculators are bullish on oil, why? They believe demand exceeds supply, or will. What if it doesn't? They'll lose their azzes. All you're suggesting is an artificial bubble due to expected demand/supply factors. Those are unsustainable, even in the short term, if they are not well founded.
You do not understand speculation other than on a superficial level.Wait, what? How speculation drives up prices is economics 101, but yes commodities bubbles can and do burst, which is also a huge problem. The amount of money that has been invested into speculation has increased enormously in the last 10 years. When you have a larger amount of money competing for a (relatively) fixed supply of a product, prices increase. You do realize now that the major majority (like 70%) of the money invested in commodities is no longer used to actually buy the product, right? It exists purely to speculate on its price. You have more than doubled the amount of money vying for a product, but don't expect that to contribute to price increases?
This appears to be classic speculative bubble behavior, and we've already seen enormous volatility in a number of prices, sometimes varying by more than 50% in a single year. This is simply another example of foolhardy financial deregulation that's coming back to bite us in the ass. More government is needed.
Your post just showed that you don't understand speculation, even on a superficial level. It simply amazes me that after the recent bursting of the largest speculative bubble in history that you are appealing to the rationality of the market as if it would prevent another such one from occurring.You do not understand speculation other than on a superficial level.
You're describing demand, yet you do not know what drives it other than a profit motive or the word 'speculation' which you seeming believe is somehow magical. You see, a profit motive alone is insufficient. Why do they, speculators, believe the profit opportunity exists? Just because of their 'speculation'?
If their expectations of demand/supply are unfounded, the only thing that could possibly keep the bubble going is an ever increasing amount of (unfounded) speculation. Where does this parade of highly capitalized individuals who are willing to 'carry the torch' and pump higher amounts of money into the oil futures market come from? Is there an endless supply?
At the first decline you would wipe the speculators out, much like those entering the R/E market late. They would be long on positions that they can't take delivery on and would be forced to sell at a loss.
There are only two scenarios I see: (1) Their demand/supply expectations are wrong in which case the bubble will burst. It will be sooner rather than later given the enormous of capital required to keep it inflated. Or (2) They are correct, and, if so, at worst they are somewhat accelerating the inevitable price increase.
Accelerated permitting will defeat either of the above. The bubble will burst sooner, or if they are presently correct their calculations will necessarily change.
Otherwise, the obvious regulatory step is to increase the margin amount on oil futures. I assume I needn't explain why this would be effective without creating much downside for all involved, including legitimate players. Conservatives/business people have been suggesting this for some time now.
Jeebus, there were droughts in countries producing such crops. I.e., supply problems.-snip-
Is someone blocking the Wheat Straights of Hormuz? Is the same thing happening with corn, soybeans, oats, etc, etc? Of course not. You are trying to treat the symptom instead of the disease because the real answer is something that doesn't fit with your ideology.