Category Archives: Energy

Drilling For Oil And The Price Of Oil

The price of gas continues to go up.  And I’m pretty sure it’ll continue to go up until just after Memorial Day.  For some reason I think I remember hearing that Memorial Day is traditionally considered the height of seasonal highs of gas prices; I dunno.  I guess I could look:

Typically, prices peak in the summer months, or around Memorial Day, as has been the case in 2010 and 2011

[ I love the internet ]

So we have about 2 more months to look forward to rising prices at the pump.  Other than this causing Obama extreme discomfort, this sucks.  It hurts people directly and indirectly; things that depend on the price of gas are going up as well.

So we all wanna know what we can do.  And the biggest call from the Right is for the administration to increase drilling.

But would it help?

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President Obama: High Gas Prices

Gas prices are rising.  And the President’s numbers on how he’s handling the crisis are falling.  America doesn’t think that Obama knows what to do, much less is willing to do anything about it.

And now that the President is looking at an election just 8 months from now, his views and policies on the subject are fluid.  Whereas before he was FOR rising prices:

The drop in oil prices, I do think, makes the conversation about energy more difficult, not less necessary. More than ever, I think, a wholesale investment in transforming our economy — from retrofitting buildings so that they’re energy-efficient to changing our transportation patterns and thinking about how to rebuild our electricity grid — those are all things that we’re going to need now more than ever. But with people not paying $4 a gallon for gas, it means it drops on their priority list. And that makes the politics of it tougher than it might have been six months ago.

Predictably the President feels he’s better situated to affect the transition from fossil fuels to renewable fuels from the White House.  So, he sees a short term lie pivot as justifiable to the larger picture.  In fact, you can see the same attitude from the administration’s energy secretary.  Before prices were going up, he was FOR those prices going up.  Now that it could jeopardize his job, he’s way in favor of those prices falling.

But is he?

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When They Say “The Do Nothing Congress” Remember They Are Talking About Democrats

The price of gas is goin’ nuts.  Jobs are only barely beginning to come back.  We need help in both arenas.  We need more and more stable sources of oil.  We need to reduce the amount of oil that we obtain from unstable sources and increase the amount of oil that we obtain from stable ones.

We need to rely on Canada, on Mexico.  We need to rely more on ourselves.

And when we can accomplish that with the added benefit of creating jobs, all the better.

But the DNC won’t allow it.

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The Price Of Gas: What Can We Do

Obama is faced with rising gasoline prices.  And as we head into an election year he is going to be asked what he’s gonna do about it.  His answer, I suspect, is that there is little a President can do to influence the price of gasoline.  The market dictates the price and that market is fed by the forces of supply and demand.

And, because it IS an election year, he’s going to demonize the “oil speculators” and claim that they are getting rich while the middle class is getting hammered.  Count on it.

But is that the real story?  Is it fair to let Obama skate on this issue so easily?

No.

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Bill O’Reilly: Wrong On Gas Prices

 

Bill O’Reilly has launched a pretty big offensive regarding the price of gasoline.  He’s been on air several times extolling the administration to get ahead of the situation and take a leadership role.  Personally, I’m not sure that Obama has  had much influence on the price of gasoline today.  Prices are high today not because of supply and demand, policies where Obama is clearly wrong, but because of the tension in the Middle East.  Specifically with Iran.

Given the nature of the world market there is no wonder that gasoline prices are going up.  And fast.

But O’Reilly loses me on his solutions.

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North Carolina Gas Tax Increasing

For those of us buying gasoline in North Carolina, the price of that gas is going to go up by about 1% beginning with the New Year:

RALEIGH, N.C. — The new year is already bringing changes to North Carolina drivers in the form of a record high tax on gasoline.

Revenue Secretary David Hoyle said last month the state motor fuels tax would grow by 3.9 cents per gallon to 38.9 cents starting Sunday. That’s the highest-ever state tax on gas. The tax rose by 2.5 cents per gallon in July.

State law directs the tax be recalculated automatically twice a year based on a formula linked to wholesale gas prices.

Right now, gas is about $3.22 before this new tax.  This will put gas at about $3.26 beginning January 1.

3.9 cents doesn’t sound like much, but 38.9 cents certainly does.  For each gallon of gas I pump I’m paying about $0.40 American.  My car has an 18 gallon tank meaning that every time I fill up I’m contributing $6.22 to the state.  Every time I fill up.

And this doesn’t count the federal taxes.

It would be interesting to see what both the state and federal governments do with that money.  How much of it goes to “infrastructure” projects?

 

What If Iran Obtains a Nuclear Bomb

Every indication points to the eventuality of Iran obtaining the technology to build a nuclear bomb.  It is my humble opinion that:

  1. A nation has the right to obtain such technology.
  2. We have no real ability to prevent this eventuality.

Rather than expend resources and political capital on attempting to prevent the inevitable, I think that we should prepare for the undeniable.  A nuclear Iran.  And as part of that planning, we need to address the following.

Can We Trust Iran To Be Rational

In other words, is Iran a nation ruled by people who respond to incentives in the way and manner that we would respond to those same incentives?

It turns out that Soviet Russia was.  They understood and reacted rationally to our nuclear stand-off.  Same goes with India and Pakistan.

Or do we think that Iran is led by a mindset that is mostly based in ideology, a religious ideology?  The most obvious example of which is the existence of Israel.

This question HAS to be answered.  And after it has been answered, all plans must account for the general agreement.

What Nations Put And Take With A Nuclear Iran

Who gains and loses when Iran obtains the technology and the ability to launch nuclear weapons?  The obvious losers are the United States and Israel.  But less obvious is who gains?  Understand not only who gains but why will allow us to negate many of the perceived “advantages” of those nations.

My guess is that the current modern world is mostly stable in terms of boundaries.  Certainly there will be small and rather negligent “map changes” but by and large the shape of our nations are mostly settled.  What isn’t settled is the economic influence of our nations as they stand.

How does China benefit, if they do, by a nuclear Iran?  Hell, how does Iran benefit from a nuclear Iran?

How Do We Negotiate With A Nuclear Iran

The Soviets had them and modern Russia does.  North Korea does, as does China.  Several other nations as well.  None of them have initiated a nuclear launch.

Why?

How will Iran be prevented from the same?  What will it take, what changes will have to be made, if any at all really, to prevent the launch of an Iranian weapon?  Is it the United States, in the end, that has to be the primary negotiator in these talks?  Is the United States the primary agitator in Iran’s mind?

In the end, these are the concepts that our leaders need to address.  There is little, if any, grounds to stand on that would allow us to prevent Iran from obtaining this technology.  Further, there is little, if any, hope that we’ll be able to prevent the

North Carolina Toll Roads

I’ve seen people drive all over creation to find a gas station that sells gas for $0.02 cheaper than they can get at their local fill-up.  In fact, they’ll spend 15 minutes to obtain cheaper petrol.  I see the same thing with folks wanting to buy a CD, or a book or a video game.

People react to price variance, often outrageously so.

Further, I acknowledge that we need to pay for roads.  Society needs to be burdened to cover the cost of building and maintaining this infrastructure.  Currently we use gas taxes to cover this.  However, with the advent of more fuel efficient cars, and all electric cars as well, that tax may no longer be appropriate.  It is continuing to fall short of requirements, though I suspect this is in large part due to the fact that gas taxes fund other things besides roads and bridges, and so another method is required.

I think that method is tolls.

We have long ago mastered the technology that allows us to gather and collect tolls without having to stop at toll booths thereby slowing traffic.  We can do this automatically and accurately.  Now the only thing preventing us is fear of change.

By tolling a rod we are able to directly collect funds from the vehicles using those roads.  AND we can tax some vehicles more than others.  For example, an 18-wheeler is going to impact our highways much more than a Prius.  We can tax the truck more.  And, from a capacity perspective, we are able to tax our roads in order to increase capacity.

As I mentioned above, people will go to great lengths to avoid even a small increase in price.  It is my expectation that as we increase the cost of driving on a road during peak times, fewer people will drive during those times.  This will spread traffic out  more evenly and allow for much more traffic on our roads than we currently experience.

And I’m glad North Carolina is going to experiment with this use:

Raleigh, N.C. — Growing congestion on Interstate 540 could require an expansion of the state’s first toll road, part of which is set to open to traffic next month, a regional transportation planner said Wednesday.

The Triangle Expressway is an 18-mile stretch of road that includes the western part of 540. Tolling is scheduled to begin in January on a 3.4-mile stretch that runs through Research Triangle Park

The rest of 540 is currently free, but planner Chris Lukasina said that could change in the future.

The long-term plan for the road, slated for completion around 2035, includes widening it from six lanes to eight, Lukasina said. Two of those lanes could become toll lanes, with varying costs throughout the day depending on traffic.

“At different times of day, or as congestion picks up or slows down, they can change the toll on that particular lane,” Lukasina said.

In other words, drivers will be able to pay their way into a faster lane.

I’ll be fascinated to see how this works.

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Domestic Oil Production: The Liberal Myth

During the 2008 campaign, we heard a lot of Sarah Palin extolling America to “Drill Baby Drill”.  And, from the Left, we heard the mockery of such a policy.  Chief among them the complaint that any oil production is more than 10-15 years away.  We’ll simply never see the oil is what they would say.

It’s starting to look like that’s not a true statementHat Tip to the incomparable Care Diem

A new record for monthly production: 13,768,395 barrels, a 34.6% increase from last August.  In just a little more than two years (since June 2009), oil production has doubled in North Dakota.

Like anything, expose it to the market and the benefits will astound you.

 

Stimulus And Jobs

More good news today out of California regarding Green Technology and the creation of jobs in that sector through Obama’s stimulus:

Solar company to file for bankruptcy

Knowing what we know about Obama’s business acumen the story here isn’t that he was wrong about a company and it’s ability to flourish.  While interesting, THAT aspect of the story has been told and retold.

No, the REAL story here is the fact that the company failed even though it received some money, a LOT of money:

A California-based solar company that received a $535 million loan guarantee from the Obama administration announced Wednesday that it will shut down.

The company, Solyndra Inc., said Wednesday it would suspend its manufacturing operations and lay off 1,100 employees effective immediately. The company said it intends to file a petition for Chapter 11 bankruptcy protection.

Another one bites the dust.

I’m interested though, what were the details surrounding the company’s decision to throw in the towel?

“Regulatory and policy uncertainties in recent months created significant near-term excess supply and price erosion,” Solyndra CEO Brian Harrison said in a statement. “Raising incremental capital in this environment was not possible. This was an unexpected outcome and is most unfortunate.”

Oh.  You mean that laws being passed make it difficult to predict the future?  And this inability to predict the future is creating a situation where banks don’t wanna lend you more money?

Weird.  Who woulda thought THAT?