Want to understand the oil price spike?
Economists call it “supply and demand.”
If only Congressional Democrats understood the concept. If they only understood how much they are to blame for the current gas price crisis.
The Democrat ignorance of basic economics and major supply of class envy was on full display today as it staged the latest circus by dragging oil execs to D.C. for a hearing. So what was the evil oil executives’ “crime” ?
Oil companies are making too durn much money.
Meanwhile, these same Congressfools who have no idea how to produce any oil, who couldn’t run a lemonade stand if they had to, have the gall to question oil execs on how to run their businesses. This same Congress, however, wouldn’t dream of shelving oil taxes temporarily or opening the country to more oil drilling. It is this Congress that is responsible for much of the spike in oil prices, but it still has the audacity to stage a theater of finger-pointing.
Associated Press: Big Oil defends profits before irate senators By H. JOSEF HEBERT
On a day oil prices leaped to unheard-of highs, senators lined up Big Oil’s biggest executives and pummeled them with complaints that they’re pretending to be “hapless victims” while raking in record profits.
“Where is the corporate conscience?” Sen. Dick Durbin, D-Ill., asked the top executives of the five largest U.S. oil companies.
Where is the Congressional conscience, little Dick? Just as low as the 13% approval rating Congress enjoys?
Scott Miller at Conservative Post writes:
“Dick Durbin is the last guy to be talking about a conscience. This is the same damn clown that compared our troops [to] guards of the Soviet Gulags, Nazis, and Pol Pot.”
At the Stalinesque hearings, the head of Shell Oil, John Hofmeister, sought to remind Congress of their role in this mess. Powerline Blog posted the following :
The last theme that was sounded repeatedly was Congress’s responsibility for the fact that American companies have access to so little petroleum. Shell’s John Hofmeister explained, eloquently:
[I]n the United States, access to our own oil and gas resources has been limited for the last 30 years, prohibiting companies such as Shell from exploring and developing resources for the benefit of the American people.
Senator Sessions, I agree, it is not a free market.
According to the Department of the Interior, 62 percent of all on-shore federal lands are off limits to oil and gas developments, with restrictions applying to 92 percent of all federal lands. We have an outer continental shelf moratorium on the Atlantic Ocean, an outer continental shelf moratorium on the Pacific Ocean, an outer continental shelf moratorium on the eastern Gulf of Mexico, congressional bans on on-shore oil and gas activities in specific areas of the Rockies and Alaska, and even a congressional ban on doing an analysis of the resource potential for oil and gas in the Atlantic, Pacific and eastern Gulf of Mexico.
The Argonne National Laboratory did a report in 2004 that identified 40 specific federal policy areas that halt, limit, delay or restrict natural gas projects. I urge you to review it. It is a long list. If I may, I offer it today if you would like to include it in the record.
When many of these policies were implemented, oil was selling in the single digits, not the triple digits we see now. The cumulative effect of these policies has been to discourage U.S. investment and send U.S. companies outside the United States to produce new supplies.
As a result, U.S. production has declined so much that nearly 60 percent of daily consumption comes from foreign sources.
The problem of access can be solved in this country by the same government that has prohibited it. Congress could have chosen to lift some or all of the current restrictions on exportation and production of oil and gas. Congress could provide national policy to reverse the persistent decline of domestically secure natural resource development.
[emphasis mine]
Powerline posted the following exchange:
Later in the hearing, Senator Orrin Hatch walked Hofmeister through the Democrats’ latest efforts to block energy independence:
HATCH: [W]e’re talking about Utah, Colorado and Wyoming. It’s fair to say that they’re not considered part of America’s $22 billion of proven reserves.
HOFMEISTER: Not at all.HATCH: No, but experts agree that there’s between 800 billion to almost 2 trillion barrels of oil that could be recoverable there, and that’s good oil, isn’t it?
HOFMEISTER: That’s correct.
HATCH: It could be recovered at somewhere between $30 and $40 a barrel?
HOFMEISTER: I think those costs are probably a bit dated now, based upon what we’ve seen in the inflation…
HATCH: Well, somewhere in that area.
HOFMEISTER: I don’t know what the exact cost would be, but, you know, if there is more supply, I think inflation in the oil industry would be cracked. And we are facing severe inflation because of the limited amount of supply against the demand.
HATCH: I guess what I’m saying, though, is that if we started to develop the oil shale in those three states we could do it within this framework of over $100 a barrel and make a profit.
HOFMEISTER: I believe we could.
HATCH: And we could help our country alleviate its oil pressures.
HOFMEISTER: Yes.
HATCH: But they’re stopping us from doing that right here, as we sit here. We just had a hearing last week where Democrats had stopped the ability to do that, in at least Colorado.
HOFMEISTER: Well, as I said in my opening statement, I think the public policy constraints on the supply side in this country are a disservice to the American consumer.
[Emphasis mine]
Oil executives should be bringing Congressfools to THEIR offices so Senators and Reps can explain why they make oil business much harder and make life harder for the average American.
Filed under: Crazy liberals , oil executives, supply and demand, The Government Engineered Mortgage Crisis
