Offshore Drilling Is Bogus

on Jul 31, 2008

Sorry also forgot to mention that on top of his little windmill he's looking into getting some solar panels on his roof. They're gonna cost him a couple grand after the installation is done, but it's going to cut his electricity bill by almost 70%. If he expands his battery plant, he'll only need to run off commercial power 1 or 2 days a week

17

greywar

on Jul 31, 2008

Yes, it seems the Saudis are up to their old tricks to lull us, but they won't sustain the ploy as they have far too many other markets now.

Steven - Stuff like this just makes you sound like the folks on the Ron Paul conspiracy sites.

The mere mention of new oil sources has always dropped prices.

Yes current high prices make more oil exploration more attractive, welcome to the basics of economic theory. You say this as though it was somehow unusual. It isn't.

Oil companies made money pumping oil at $30 a barrel. the current break even price is now up to somewhere between $55-70/barrel depending on the life cycle of the source and mechanism.

Which is better : No drilling and oil @ $125+/barrel or drilling and oil @ $90/barrel?

The "Don't ever drilll anymore because it won't solve every problem instantly!" mentality is pretty infantile.

18

Daiwa

on Jul 31, 2008

I think wind-generated power technology has tremendous potential to reduce fossil-fuel consumption, but only when that technology becomes scaled down, highly efficient & affordable enough to be like the satellite dish on your roof. Big 'wind farms' are highly inefficient, adding piddling amounts of power to the grid, and currently only exist thanks to subsidies. Powering individual homes with a combination of solar & wind (with backup from the 'grid') is another thing altogether & very much worth pursuing.

19

EL-DUDERINO

on Jul 31, 2008

I think wind-generated power technology has tremendous potential to reduce fossil-fuel consumption, but only when that technology becomes scaled down, highly efficient & affordable enough to be like the satellite dish on your roof. Big 'wind farms' are highly inefficient, adding piddling amounts of power to the grid, and currently only exist thanks to subsidies. Powering individual homes with a combination of solar & wind (with backup from the 'grid') is another thing altogether & very much worth pursuing.

Yes it is. If you are interested cruise on over to myspace and look up a guy by the username "Over Unity". He has done just that, he built a new home in PA somewhere and has installed three solar panels and a small wind turbine. The combined power output will allow him to live off the power grid completely. You may have to go back a month or two but he has a couple of blogs detailing the process.

If I ever get the cash together I will be looking into building an e-nertia house (www.enertia.com). These houses are built in such a way that they need little to no heating or air conditioning year round. You can also get the home outfitted with solar panels and a well so that you can live completely off the grid.

20

CharlesCS

on Jul 31, 2008

Thats my dream house right there. Solar panels on the roof and water from the ground and rain. A windmill may not be too bad either.

21

Eagle Seven

on Jul 31, 2008

All the hoopla over ANWR, Arctic Ocean rights and offshore drilling is nothing but a ruse to delude the public into believing so-called energy independence will bring down the cost of gasoline and energy in general. Undisclosed is the oil industry’s motive that with the price of oil at an all-time high, profits will continue to grow like never before. There is no intention to ultimately reduce the price because there would be no incentive for the oil titans to explore for oil if they thought it would drop below $100 a barrel other than perhaps more easily accessible gas for domestic use.
Even as a ploy to threaten OPEC to increase supply therefore driving down the price of oil will not work as it did in the ’70s when Nixon and Carter called for energy conservation, brownouts and smaller cars inasmuch as China and India will more than offset US move to tap our continental shelf.
This noisy cry for offshore drilling is but a deterrent for getting back to basics of developing alternative energy.

Copyright © 2008 Richard R. Kennedy All rights reserved. Revised: July 31, 2008.
http://stevendedalus.joeuser.com
http://www.lulu.com/rrkfinn

Let me get this straight...oil companies want higher oil prices so they can have their higher profits, and so the evil oil companies want to drill for more oil so they can reduce the price?

Am I the only one who notices this fallacy in logic? Either the oil companies want higher prices, or lower prices. Frankly, the reason oil companies want more domestic drilling is so they don't have to pay Canada or Venezuela for their oil, and thus reducing costs, and hence increasing profit margins. It is a boon for us that the increase in drilling will decrease prices overall, as well.

If oil companies start drilling, both oil companies and US consumers win, while Canada, Venezuela, and OPEC loses. The choice seems obvious to me...

22

theruler99

on Jul 31, 2008

Let me get this straight...oil companies want higher oil prices so they can have their higher profits, and so the evil oil companies want to drill for more oil so they can reduce the price?

Am I the only one who notices this fallacy in logic? Either the oil companies want higher prices, or lower prices. Frankly, the reason oil companies want more domestic drilling is so they don't have to pay Canada or Venezuela for their oil, and thus reducing costs, and hence increasing profit margins. It is a boon for us that the increase in drilling will decrease prices overall, as well.

If oil companies start drilling, both oil companies and US consumers win, while Canada, Venezuela, and OPEC loses. The choice seems obvious to me...

Do you really think this offshore drilling will have an effect on oil prices? No.

The US consumes about 23,000,000 barrels per day (domestic 9200000 b/d 40% and imports 13800000 b/d 60%). Now, let’s say, within the next 15 to 20 years, the US double its production of oil. Would this reduce the price of oil? No, because according to the Energy Information Agency of the U.S. government, world demand for oil is expected to increase by 54 percent in the first 25 years of the 21st century.

23

Paladin77

on Jul 31, 2008

Gonna have to disagree here. Currently most major windfarms are only going up in spots that are pretty much guaranteed to be almost constantly wind-swept. And the "backup diesel" generators that you speak of are largely a boogeyman myth. Hydro-Quebec is in the process of building windfarms that will generate over 2,000 MegaWatts of power to come online between 2011 and 2015.

You are correct they won’t need to use diesel generators because they will be using hydro-electric generators as the main source of power and the power generated by the wind turbines will be put on the grid. There are only a few places on the planet where the wind blows at a constant rate 24/7 none of them are near Quebec. You can’t turn on and off power generation like a light bulb you have to have time to get it up and running. If the wind dies down power stops and the hour and a half it takes to get a diesel up and running will mean that people will be without power for that time. Using the hydro-electric power as your source and supplement it with wind power just means they get to sell the power on the grid. Don’t get me wrong wind power is okay in my book it is just not the cure or even a band-aid to the real problem.

If oil companies start drilling, both oil companies and US consumers win, while Canada, Venezuela, and OPEC loses. The choice seems obvious to me...

That is because you are not smoking green stuff. If you smoke the green stuff and drink the cool aid you would see things a lot differently.

24

Moderateman

on Jul 31, 2008

Steven, Steven, Steven, More and more you are starting to sound like a walking breathing Democratic talking point parrot. For once I am ashamed of you.

25

Eagle Seven

on Jul 31, 2008

Do you really think this offshore drilling will have an effect on oil prices? No.The US consumes about 23,000,000 barrels per day (domestic 9200000 b/d 40% and imports 13800000 b/d 60%). Now, let’s say, within the next 15 to 20 years, the US double its production of oil. Would this reduce the price of oil? No, because according to the Energy Information Agency of the U.S. government, world demand for oil is expected to increase by 54 percent in the first 25 years of the 21st century.

It will have a marginal effect, in that it will slow the increase in price as we get closer and closer to peak oil production, yes. Your argument is like saying "You know, we're all going to die anyways, so why bother going to the doctor? He's just delaying the inevitable."

While we're leading the world's movement to non-fossil-fuel energy sources, does it make sense to make the transition as painless as possible to the US citizen? It's the poorest of the country that hurt the most from high fuel prices, after all.

26

Nitro Cruiser

on Aug 01, 2008

Obama's energy solution - inflate your tires.

27

theruler99

on Aug 01, 2008

While we're leading the world's movement to non-fossil-fuel energy sources, does it make sense to make the transition as painless as possible to the US citizen? It's the poorest of the country that hurt the most from high fuel prices, after all.

Do you really think the oil companies want to sell their product for less money (less profit)?

28

EL-DUDERINO

on Aug 01, 2008

Do you really think the oil companies want to sell their product for less money (less profit)?

If they can sell in higher volume at a lower price it can end up being more profitable. Look at Wal-mart, relatively cheap prices but they sell in high volume so they make huge profits. It's the same for oil companies, these are random numbers but if the oil companies are able to sell 70 million barrels of oil a day at $140/barrel vs. 100 million barrels at $100/barrel which is more profitable? The 100 million at $100/barrel.

29

stevendedalus

on Aug 01, 2008

But to Steven's premise, while it is fashionable now, it is also wrong (probably right for some as they are like goldfish). The reason that the oil companies do not want oil at $140/barrell (but Opec is like goldfish and does) is that it makes alternatives cost effective.

You argue well, but the oil companies--though for forty years exploited Mideast oil to the hilt and kept prices way down--are in it for profits and the 18-26 cent a gallon was made up by the huge volume of gas-guzzlers and households conversion from coal to oil. The result, however, of cheap Arab oil was at the expense of the US wildcatters. The '70s crisis revitalized to some extent the incentive to drill domestically--hence, offshore and Alaska. OPEC, nevertheless, toyed with us and crushed domestic incentives as drilling again became unprofitable. Now that OPEC has other markets--India and China--the price per barrel will remain high and domestic oil will again become profitable and consequently in the oil industry's interest to keep prices high, not reduce them.

30

stevendedalus

on Aug 01, 2008

If they can sell in higher volume at a lower price it can end up being more profitable. Look at Wal-mart, relatively cheap prices but they sell in high volume so they make huge profits. It's the same for oil companies, these are random numbers but if the oil companies are able to sell 70 million barrels of oil a day at $140/barrel vs. 100 million barrels at $100/barrel which is more profitable? The 100 million at $100/barrel.

This is the argument I used above for the good old days, except the volume will no longer be there unless you wish to continue filling the highways with Humvees, trucks and SUVs. Moreover, the oil industry would prefer to pump less at a higher price as the cost of productivity is essential.