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Original Rant

A new war brewing?

There is a new war brewing on the horizon. It is a war between green and red, white and blue. It is a war between the common man and the environmentalist.
Concern for the environment and the animals have been put ahead of concern for the well being of the common man. Environmental regulations enacted by government under pressure from the environmental lobby have finally made a significant impact on the economy and the common man is feeling it. He is beginning to ask why concerns about polar bears and caribou are more important than his ability to provide for his family. He understands that cheap oil is the lifeblood of this economy and that it won't change overnight. He understands that we used to produce much of our own oil and it was cheap. He understands that we now import 70 percent of it, and it's expensive. He knows that we have plenty right here, but we can't get to it because of environmental regulation. He knows that the fears of environmental destruction are bogus and that the protection of the polar bear and caribou and a chunk of Alaska that looks like the surface of the moon have been deemed more important than his ability to provide for his family. And that's a problem because the common man doesn't like to have his family's needs put second to a polar bear.
If the trend of rising fuel and energy prices continues, I believe the common man will finally take action and call and write his elected officials and remind them that he pays their check and that last time he checked, he didn't see a polar bear or caribou pulling a lever at the voting booth.

My response

Regarding the new war brewing.

Now I have heard everything.  It is the enviros against the “common man.”  Who does the writer think environmentalists are?  High-flying elitists?  We share the same demographic as his “common man.”  We have day jobs or are retired on fixed incomes.  We share the same pain at the pumps and in the grocery stores as other common men.  We just think it is high time we preserve some part of the earth so that we can have clean air to breathe and clean water to drink and for recreation, and have some place to go for recreation other than the shopping mall. 

But you don’t have to be an environmentalist to see the folly of offshore drilling as a cure for our economic ills.  First of all, the price of gas at the pumps is the result of the Fed’s fiscal policy, which kept interest rates low to stimulate the housing boom, which busted, and then the bailouts of Bear-Stearns and continuing to keep interest rates low despite inflation.  This caused the US dollar to drop against foreign currencies.  Since oil and other commodities are sold in dollars, weaker dollars mean higher prices.  Then the speculators got into the act and the rest is history.

But even if we opened the continental shelf for drilling, there are no rigs built which could be deployed to start drilling there in the near future.  Rigs are like ships. They take years to build and tether precisely to the ocean floor.

Even if there were more rigs, refiners tell us that there is no spare refining capacity.  It takes years and billions of dollars to build a refinery and they won’t build any new ones unless they are sure of an increasing demand.

Even if there were more refineries, oil companies sell oil to the refiners at the spot rate, even our own domestic oil.  We don’t even keep all of the oil we drill in the US.  Some of Alaska’s oil, for example, goes to Asia.

Alaska has oil wells and three refineries but Alaskans pay $.30 to $.40 more than we do for gas at the pump.

The oil companies have millions of acres of leases that they are not drilling on.  Opening more land and water to them will just inflate their corporate profits with little or no advantage to the “common man”.

Oil company profits are ridiculously high because the cost of production has not gone up with the price for which they sell it.  The made a profit at $35 a barrel and so their profits at $140 a barrel are lots higher.

The price of oil goes up every time a hurricane threatens production in the Gulf of Mexico.  Hurricanes Rita and Katrina caused huge damage to oil and gas production and caused large oil spills in their aftermath.  Read the report at the US Department of the Interior’s Minerals Management Service at http://www.gomr.mms.gov/homepg/whatsnew/newsreal/2006/060501.pdf
And now we propose to put a string of wells along the Atlantic coast of the US, right in Hurricane Alley?  YGBSM!

Now the government is putting new rules in effect to discourage speculators and even indicted one company.  Prices went down.  Americans drove 10 billion miles fewer than this time last year and prices went down.  What else can we do o get the price down?

We think of oil and gas but not of the other things oil is used for.  Look around you and see all the plastic shopping bags and plastic wraps the supermarkets use to package food.  Fertilizers, herbicides and pesticides are all made from oil.  Decreasing our dependence on these will also decrease the demand on oil.  Increasing subsidies for alternative energy sources instead of oil companies will spur the economy and bring lots of research, production and installation jobs to the US.

My friend, the only difference between you and me is that we think differently.  We are both “common men/women.”

Ken's Response


RE: A New War Brewing

I don’t know what the author of the original article is smoking but it must be good.

To say we have plenty of oil right here is about as far out in left field as you can get and still not be locked up.  Even with reserves from shale oil, which look like they might be economical to produce in quantity at upwards of $200 per barrel, the deep and currently closed offshore waters plus ANWR this country has nowhere near the reserves necessary to feed our oil appetite.  Also this all-knowing soul was obviously looking at a different section of ANWR than I have looked at when he thinks it looks like the surface of the moon.  (That smoking stuff again?)

The reason that we used to produce much of our own oil and now import 70% of it is due to two reasons.

1.    We use one heck of a lot more oil than we did in the fifties when we were almost self-sufficient.
2.    Oil is not like grass, it does not grow back, it is a fixed volume in any given reservoir.  As you produce it the amount left decreases (think of drinking from a glass of water).  Oil companies have developed many ingenious ways to produce higher and higher percentages of the original oil in place – and have served our economy well in the process - but the original amount present remains the same and finite.


Adding reserves by drilling sounds wonderful, I’m sure, to the layman because the numbers probably seem huge.  The problem is that all the potential new reserves will not come on stream at anywhere near the same time, the amount actually produced will not be close to the 100% oil in place values quoted in newspapers and spouted by oil executives trying to get the public off their back and the potential additional production will only postpone the problem for a few short years not eliminate it.

We must reduce demand and find alternatives, caribou and polar bears or not.