Sounds like an oilman who still has money in natural gas rights. If you heat your home with natural gas, you will have noticed that the cost has quintupled in the last 5 years. It is, like oil, a resource which we will also run out of. His plan to switch a bunch of cars over to natural gas as an interim measure would be expensive to the public as you would have to switch over to something else as the natural gas ran out. It would also run up the cost of heating our homes.

The generating of electricity using wind is potentially huge once you get by the NIMBY's. I think we will start seeing more windmills as we go around the countryside. Dupont and Danesco have a combined effort going to make Ethanol from switchgrass and biomass in an energy efficient system. Many more options are on the horizon but they all take time to develop and implement. That is why drilling is not the long term answer, but is a short term solution to keep us going as we make the slow transition to renewable sources.

This message has been edited. Last edited by: Poppy,

Wind is neat, but it has a problem - what do you do when it stops blowing? Currently there is no way to store large quantites of power (say a day's worth of electricity). Wind can help offest fossil fuels, but to replace them there needs to be some technological development - so it won't happen next month. Personally, I like nuclear fusion power, but it is still at least 30-50 years out before it could be useful.

quote:

Originally posted by Poppy:
And if we had this conversation in 2001 when the Democrats blocked drilling in ANWAR the same "logic" would have been given but we would have been talking about gas rising to unheard of prices like $3.00 a gallon.

What about Republican governors in Florida (Bush) and California (Arney S) and their state's ban on offshore drilling?
Now that this republican president has lifted the ban that his republican father put in place maybe we can look forward to savings of 30-50 cents per barrel - at peak production in 17 plus years, while sleeping soundly knowing we are burning our children's future resources.
Yippee!
Honestly, is the partisan finger pointing nonsense helping anything at all?

quote:

Originally posted by Suprtek:

quote:

Originally posted by cman:

quote:

Originally posted by Suprtek:
That is not entirely true...

Markets are basically driven by four factors - supply and demand are two, but also greed and fear. Remember the last time that the price of gas was above $4.00/gal? It was the afternoon of Sept. 11, 2001. Why? Supply or demand had not changed one iota - but the perception of the possibility of a change was enough to change the price point dramatically.

Open up drilling and watch the price fall...

While your premise is true in general, it fails specifically on oil markets. The oil market are not driven by consumers it is driven by professional oil traders (speculators!! gasp!). The Spetember 11 analogy is false... EVERYONE was spooked and unsure of the future. Would there be more attacks?

But, opening ANWR and/or the deep sea would do nothing in the short term for oil prices. These people can do math as well as I can and they are, as you say greedy. They'll see that starting exploitation there will do nothing for supply for eight years and therefore will give them little reason to hop off the gravy train.

And of course the fact that when those reserves come online they will be merely replacing lost production and not adding net oil production.

We'll have to agree to disagree.

If I'm looking at trading commodities and I know that there is a finite supply - my price point is X. If I know that the supply will change - albeit at some point in the future, my price point becomes X - (a variable relative to supply at the future date).

Real estate prices in Manhattan are very expensive. What do you think would happen to that price point if the New York government seriously started discussing opening Central Park for development?

On a side note, if fossil fuel production has already peaked - and we are now in a supply-side decline - why the concern about man-made global warming?

My point...
Bush Says Drill, Drill, Drill — and Oil Drops $9!

For those who don’t feel that vibrating vocal chords have any effect what so ever on inventory levels, read the following.

Oil's 2-day decline: $11 a barrel

Futures plummet after surprise growth in crude, gasoline stockpiles hints at impact of high prices on usage.

By Kenneth Musante, CNNMoney.com staff writer
Last Updated: July 16, 2008: 12:17 PM EDT

NEW YORK (CNNMoney.com) -- Oil prices plummeted Wednesday, bringing a two-day selloff to about $11 a barrel, after the government's weekly inventory report suggested record high gasoline prices may be reducing the nation's energy consumption.

At12:16 p.m. ET, light, sweet crude for August delivery was down $4.45 to $134.29 a barrel in electronic trading on the New York Mercantile Exchange.

Oil was down $1.17 before the report's release. Wednesday's drop followed a $6.44 plunge Tuesday that was the second largest decline ever on a dollar basis.

The government's weekly stockpile report showed that crude supplies rose by 3 million barrels in the week ended July 11. Analysts were looking for a drop of 3 million barrels according to a poll by energy research firm Platts.

Gasoline supplies rose by 2.4 million barrels, rather than the 1.1 million decline analysts expected.
Distillates, used to make diesel fuel, jet fuel and heating oil, rose by 3.2 million barrels. Analysts were looking for an increase of only 1.7 million barrels.

Bernanke: The two-day oil selloff also reflected the gloomy economic picture being painted by Federal Reserve Chairman Ben Bernanke in his Congressional testimony.

On Tuesday, Bernanke told the Senate Banking Committee that high energy prices and slower economic growth have limited ability of U.S. households to purchase fuel and other necessities. Bernanke appeared Wednesday before the House Financial Services Committee.

The price of gasoline and diesel fuel in the U.S. touched new records Wednesday, according to a daily survey from motorist group AAA. Gasoline is more than 35% more expensive than last year.

"The weaker economic outlook, the inventory build all contribute," said Amanda Kurzendoerfer, commodities analyst with Summit Energy. However she warned that long-term investors may see the price decline as a buying opportunity.

"The one thing we can be sure of is that we're looking at a lot of volatility going forward," she said.

OPEC, Brazil: The Organization of Petroleum Exporting Countries, which supplies about 40% of the world's oil, cut its demand forecast for 2009 Tuesday to an increase of 900,000 barrels a day, 100,000 barrels less than 2008.

There were also reports that production in Brazil had not been hurt as much as originally feared by a labor strike in the Campos Basin, which supplies about 80% of the country's oil, and tensions eased with Iran, the second largest producing member of OPEC.

State-owned oil company Petroleo Brasileiro SA said production had not been affected by the ongoing strike at 33 offshore platforms that began on Monday.

First Published: July 16, 2008: 9:31 AM EDT

I am sure that very soon we will see a corresponding decrease in the price of fuel. The oil companies are anxious to treat us all fairly.

I have lived in the same house for iover 30 years. Back in 1977 I paid Interstate Power $325.80 to heat my house for the year. I installed a new higher efficiency furnace in 1996 and added 600 square feet to my house. In 1997 my heating cost was $545.03 for 998 therms. In 2007 my heating cost was $710.41 for a totoal of 735 therms. In 1999 I used 730 therms for a cost of $352.81, but I was gone for three months over the winter.

George Bush removes the presidential ban on off shore drilling and the price of oil drops $10 in 2 days. Cause and effect or coincidence?

quote:

Originally posted by Poppy:
George Bush removes the presidential ban on off shore drilling and the price of oil drops $10 in 2 days. Cause and effect or coincidence?

Increased crude and gasoline supply estimates were the immediate cause of the decline.
Secondly, some of the sell-off was the result of cash-strapped banks selling energy contracts to raise money for other needs.
Lastly, computers programmed to sell once prices fall to certain thresholds added to the sell-off.

So you admit that the President has no influence on the price of oil going up or down.

quote:

Originally posted by Poppy:
So you admit that the President has no influence on the price of oil going up or down.

To the contrary, what I wrote was that a presidential ban lifted this week has nothing to do with inventory levels that were compiled the week previous.

This thread needs to be saved for posterity.

First, people claim the oil prices are the fault and responsibility of the President and Vice President in the Oil House. No, I am not saying you, Local Hero. You have not made that statement to my knowledge, but other people have.

Second, the President takes action to lift administrative restrictions on oil reserves, and the price immediately begins to tumble.

Third, along comes others to explain that it was actually nothing the President did that lowered the price, but rather the effects on reserves because of reduced consumption.

Is there anyone able to admit that blame placed at the Presidential level was misguided, politically-motivated spin? Not in an election year, there isn't.

I really believe that the president does not have the authority to directly cause oil prices to increase or decrease. I also believe that the president can influence market prices by negative or positive comments he makes regarding the oil market. Obviously, his recent action lifting the ban on offshore drlling did cause oil prices to drop some. Being from an "oil" family and having many friends in that business was an incentive for him to take no action prior to now. The high price of gas and diesel fuel has caused a lot of unrest among voters. Nothing makes a politician take notice like popularity polls and elections. George W. has to do whatever he can to help the Republicans next election.

quote:

Originally posted by Poppy:
So you admit that the President has no influence on the price of oil going up or down.

Here are two examples where presidential comments likely have had influence on the oil markets.
Exhibit A: The president reverses an 8 year policy and decide to sit down at the table and negotiate with Axis of Evil charter member Iran.
Exhibit B: The president reverses a 5 year policy and decides a time line for troop withdrawal from Iraq might be a good thing after all.
Exhibit A seems to have already had a softening effect supply concerns near the end the session today, and Exhibit B may well have the same as the news sinks in.
How much effect, or how long either will last, is something best left to the experts who deal exclusively in that sector.

that lifting of the ban was pure political posturing...most people in coastal areas who make a living off fishing,for ex, want nothing to do with having Exxon Valdez come into their backyard and ruin their ways of living.Witness Prince Albert sound,an ecological/financial disaster... We are talking millions of people making millions of dollars NOT in oil. So let`s try to force the greedy swine oil companies to drill on the millions of acres they already have that they have yet to set foot in.
Bush,powerful? Sure he has alotta power to do alotta things.Like make 85% of Americans wince whenever he opens his mouth.Utterly unbelievable, a walking lie machine. Dont swallow that hogwash about We Have To Drill Now! or else. Even if we drilled now, it`d be 10 years before we`d see any of it, and it`s impact would be all of a penny or two at the pump. Wow. What a trade, who`s this benefit? Let`s see. Big Oil? Cheney? Bush? Etc?