I am not impressed by cries to open new areas to drilling for oil. I would prefer my shores and wilderness areas to be unsullied by oil rigs, but I feel it is inevitable that all sources of oil will eventually be tapped. Don’t tell me this will lower the price of oil, though. If there is one thing we can count on, it is that the price of oil will rise. That is what happens to all finite, non-renewable resources.

This is our second wake-up call. We ignored the first one in the ’70′s. I can only hope that this time we will quit desperately trying to possess every last drop of oil and start putting our efforts into developing clean, renewable energies.

If you crunch through a yield of 30 gallons of gas per barrel of crude, national average MPG of 25 (although those cutting back most are likely those with more ravenous and expensive tanks to fill), we’re talking about reducing the country’s demand by about 400-500,000 barrels per day. In other words, within a few months of record-high prices, we’ve got people conserving more than twice as much as offshore drilling will produce in a few years.

And note that is driving reductions. Americans drive about 8 billion miles per day. Thus, an improvement of about 2.5 miles per gallon in the national fleet is worth 10% of that, or about 800 million miles per day. That translates into about one million barrels of crude oil, or about four times as much swing in the demand-supply gap that offshore drilling provides.

Now, note that it has taken about 500,000 barrels a day of effective demand destruction with a lot of uncertainty about how much more is possible to knock oil down even $25 / barrel. If we were to instead increase supply by a puny 200,000 (with knowledge that this production capability could be held back if the Oil Cos. didn’t like the prices they were getting), I doubt we’d see all that much change at the pump.

So, perhaps in exchange for ineffective drilling, let me see … I know that my pathetic “colleagues” across the aisle are waiting for an epic ass-kicking across the country and are humping the legs of anyone that will give them the cash to stave off defeat. I know that those having their legs humped are hoping to survive a few more quarters before the business changes profoundly and permanently.

Ergo, I suggest that windfall profits tax and some serious lease money for alternatives and helping people downgrade their dependence to oil. As a bonus, funnel some of the cash to incentives for more efficient cars and give Detroit a serious boost in the process (and hint to them *very* strongly to use their good fortune for product enhancement to take on the Euros and Asians).

Of course, this is pretending we don’t have places like California that will be 20 percent alternative powered in just two years.

In cultural and social affairs, the initial stance of conservatism (namely skepticism, which is acknowledgment of ignorance by a different name) may have some merit. When you’re talking technology or some other feature of life where you can actually do calculations and make predictions, conservatives usually just end up looking dumb.

There’s a reason that the current Bush administration does all it can to harass and censor scientists. In the scientific world, reality does have a rather liberal bias.

A requirement for a special license certification for “light trucks” over 5000 pounds.

The approach must be multifaceted yet the biggest gain in the short term would be on the savings side.

Better MPG

Solar

Wind

Nuclear

Public transportation……

As far as R&D we must use SBA style loan guarantees instead of grants and tax breaks. If we had loan guarantees instead you not see BIO-FUELS scam via it would have to be a viable concept.

The tax breaks and grants should only be used as off-sets to real cost. For example if you take highway money and put it toward public transportation and it off sets cost of road construction than that is a good investment for tax payers.

How about auctioning off the exploration/drilling rights and earmarking ALL of those proceeds to alternative energy development?

Or, how about requiring the oil company to donate a barrel (of the same quality, of course) to the US Strategic Reserves for every barrel sold on the market?

As for what the Dems in Congress want, I think they’re trying to strike a deal similar to what you put above. That is: Dems allow drilling (which will not solve the problem), in exchange for Republicans allowing money to be spent on research (which might solve the problem).

Dems avoid the possible backlash while actually moving the country forward. Oil companies continue to make large profits, and the only thing that gets hurt is the planet. The GOP should be proud.

Without bashing the Bush Administration for years and years of lost opportunity, I’ll simply say that right now we are where we are. We’ll have to pay high prices for a number of extra years while at the same time investing money in new technology.

That will cost taxpayers money when they don’t really have it to spend. More incumbents (in both parties) will lose, and my share of the national debt will increase.

It’s not a good political solution, but R&D is where we need to be placing our time and money. It also keeps me from having to look at oil rigs when I go to Tybee.

Call it cheap politics if you want, what do you have to lose if you and your fellow dems allow it then?

Why not look at this as an opportunity to get something in return? Tax incentives for hybrids/diesels/hydrogen powered cars, wind power, solar power, etc?

The dems refusal to continue to put anything on the table shows their solutions are just as hollow as the Bush energy plan has been for the first 6 years of his term.

I re-ask the question, what do you guys want in exchange for the drilling that, though you all claim won’t help the problem, is wanted by over 70% of Americans?

The most optimistic projections for oil found in the OCS would be 3% of the current world demand for oil. (Also note that it will take about 5 years to reach that capacity.)

Now, it seems to me that if demand for oil in the world market is growing faster than 3% per annum, then we are at best keeping oil prices from rising as quickly as they would if we did not drill. That’s far different that lowering prices. And a far cry from America being “self sufficient” as you argue.

Also, the idea that some have put forward that we could force companies to “only sell this oil in America” is so impossible in so many ways that it makes my head hurt.

Drilling is a cheap political ploy (which may be bought by the voters – we’ll see), but it is not a solution to the problem.

BTW – you should read more of Konop’s posts before you try to pigeon hole him with a label of your choice. You may, however, refer to me as a Democrat all you like.

if supply increases which it would if america used its vast resources without so much enviro bs and liberal do gooders getting in the way, the market would react. in fact, it already did just on the exec order issued by president bush a month ago.

the free market works konop in spite of overzealous regulators like your friends running the dem party. what’s the worst that could happen if oil companies are allowed to drill at anwr, offshore, etc.? why are you against america being self sufficient?

What part of your post said Exxon CEO Rex Tillerson would lower prices on gas if he drills more?

Tillerson (Exxon CEO Rex Tillerson) also explained that Exxon’s more than $5-billion annual investment in exploration would be bigger if the company has more access to exploration opportunities. “We have very, very robust exploration programs that span the globe. We would do more if we could gain access to more areas to apply our technology, let our geoscientists go to work,” he said. “Certainly we have the financial capacity to do more. Much of what’s driving the pace of what we’re doing is access to those opportunities.”

You calling me a liberal is laughable when I was the one warning about the falling dollar and the economy years ago while you were campaigning for the largest expansion in government in America ever! Face it, mindless hacks like you are why the GOP is in trouble!

You Claim;

….with oil at $130 per barrel, they would drill on those lands if it made sense to do so……

If Exxon is making a higher gross contribution margin why would they increase supply if it would lower their contribution margin?

Exxon would lower prices if they felt competition from competing sources that leaves them with to much supply. The reason gas prices dropped were people are using less gas. A company will lowers prices to gain back market share. A smart company would not lower prices and increase supply to destroy their contribution margin.

pelosi and your fellow dems are facing unhappy voters in their home districts. the gop can only hope they continue to avoid the subject right through november.

Unlike you I care more about my country than being a mindless talking point groupie for any party. Once again instead of dealing with the issue at hand you fall back on attacks.

The Wall Street Journal brought up the same issue I have talk about on the site. Drilling for oil does not mean the oil company will sell the supply to lower prices. In fact the history has shown the opposite behavior from oil companies via the 65million acres that are capped.

As I told the Job of a CEO is to make the highest ROI for shareholders. The question is simple if we grant more leases should we force oil companies to use the old and new supply? The other question is are you capable of answering a question thoughtfully or do you just fall back on mindless talking points?

now for the other side, here is a blog post from former congressman ernest istook:

Former Congressman Ernest Istook took time out his busy schedule to reply to a blogger’s misgivings concerning the new Democrat mantra against “Big Oil,” in particular, their criticism that the oil companies are not exploiting the vast majority of already granted oil drilling leases. Below is Mr. Istook’s reply:

Col. Ward —

First, thank you for your service to our country. We can never express that often enough. Your general description of the oil and gas business is on-target. And the congressional comment you cite sounds to me like it came straight out of the playbook of environmentalists who want to mislead Americans. Rep. Tim Ryan (D-OH) is not alone in the claims he makes. (And here’s a weblink to his comments)

Evidently, talking points are being circulated encouraging a lot of Congressmen to make claims like this. Here’s another example from a floor speech by Rep. David Wu (D-OR): “WHY SHOULD WE OPEN LAND FOR DRILLING WHEN BIG OIL ISN’T EVEN DRILLING WHERE THEY HAVE LEASES?” (Mr. WU asked and was given permission to address the House for 1 minute and to revise and extend his remarks.) Mr. Wu goes on: “Madam Speaker, it is no wonder that the only Republican solution to our record high gas prices is more drilling. Who would expect anything less when two former oil executives occupy the White House? The problem is that this has been the Republican energy plan for the last 7 years. It was created in secret by Vice President CHENEY and oil executives. And it is responsible for the record high oil prices that we all face at the pump today. Republicans claim that we could lower the price at the pump if we would only approve more and more drilling leases. That is their rhetoric. Here are the facts. Oil companies do not need new areas to drill. They need to focus on areas that are already opened to them. Of the 42 million acres of Federal land currently leased by oil and gas companies, only about 12 million acres are actually being drilled to produce oil and natural gas. Madam Speaker, if the Republican claims about more drilling are correct, why aren’t they demanding Big Oil explore drilling on the 30 million acres of Federal land that are already open to them but that they refuse to explore?”

Believe me, with oil at $130 per barrel, they would drill on those lands if it made sense to do so! No, not all oil and gas leases are “being used”, because not all of them have production-worthy quantities of oil or gas. Lots of people have property that is not being used, but government doesn’t use it as an excuse to take it away, or to forbid the owners from buying other property.

First, a company may lease property, but never have the funds to properly explore it or drill an exploratory well. Second, after paying for further tests (such as seismic), they often decide the lease isn’t worth the high, high costs of drilling after all. Or they may hold onto the lease for years until either higher oil prices or new technology makes it feasible to drill. Third, a company may lease property but drill on another tract (which drains a “pool” that covers multiple leased tracts), so perhaps they’re counting it as “not used” if no well is sunk on that particular piece of property. Fourth, they may try to drill and be blocked by government bureaucrats, environmental lawsuits, etc.

Finally, not all acres are alike. Some have lots of oil. Others have virtually known. Saying they’re not drilling for oil everywhere is like faulting them for not digging a gold mine on every acre.

I’ll also check around to see if there’s a more specific comeback to that.

Thanks for writing. –Ernest Istook

And have been roundly vilified by the usual right wing outlets including this site.