Tuesday, January 08, 2008

 

Oil

I have been disappointed that the high price of gasoline hasn't been much of an issue in the presidential primaries. Even when the topic does come up, Investors Business Daily notes the message sent to producers:
As high as oil prices are, they must be thinking, the U.S. is obviously willing to pay them. How else to explain the unwillingness of its politicians and public to increase domestic production, one slam-dunk move that would bring prices down.

OPEC, and Saudi Arabia, which can produce oil very cheaply no matter what the world price, will lower prices if they can raise the comparative costs of offshore drilling to preserve its monopoly. But right now they have no reason to do it.

More drilling, and even the threat of more oil drilling, will lower the cost of oil faster than any "alternative" energy solution. But in the high U.S. presidential campaign season, it's much easier for politicians to instead blame private oil companies.
Among the Republican presidential candidates, Romney, Giuliani, and Thompson call for increasing domestic energy production and only Giuliani calls for increasing our refining capacity.

Democrats are a different story, as Doug Ross points out:
Democrats oppose drilling in deepwater, even though Hurricanes Katrina and Rita proved that modern offshore drilling platforms pose little or no pollution risk. Democrats oppose exploration in a tiny, postage-stamp sized region of Alaska. As for new refineries or nuclear energy, well, the Democrats oppose those, too. The net impact of Democratic behavior is that America will become increasingly dependent on foreign oil.
Ross created a map he called "The No Zone" and notes that China is drilling for oil 50 miles off of Florida's coast.



As for alternative energy, Steven Den Beste did the math a few years ago and concluded:
There is no technology for generation, transmission, conversion or storage of energy which we currently understand or could plausibly develop which would be efficient enough, and which could be deployed soon enough, cheaply enough, and at a scale large enough, to significantly aid us in winning this war. And if it can't do those things, I don't care about it.

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