But Mr. Obama has decided most of the people can be fooled most of the time.
Instead of “pivoting” on his disastrous energy policies, the president called an Ides of March press conference to boast of booming domestic crude production. In fact, from 10 million barrels a day it’s at seven going toward six.
With worldwide consumption rising despite still bleeding wounds of the 2007-08 financial crisis, supply has maxed out. Our friends, the Saudis, promise more production. But nobody has seen it yet. [Payback for Mr. Obama ignoring their advice on Mubarak and Bahrain?] Anyway there would be quality and delivery complications.
Truth be told, most experts privately admit the convoluted energy muddle defies immediate solution.
True, we are nowhere near “petroleum peak” — that long prophesied moment when unstoppable infinite energy demand meets immovable finite fossil fuel supply. Recent deepwater drilling has turned up humongous new fuel. A good example is Brazil’s South Atlantic finds we are helping to finance as Mr. Obama proudly acknowledged during his recent visit. Then there’s vast North American shale. The Israelis have learned to crack it underground avoiding environmental constraints much like our “no hands” eastern Kentucky pilot underground coal gasification.
But regulations — which Mr. Obama intensified after the Gulf spill — have throttled U.S. production. [Curiously, soon there will be Chinese pumping off Castro’s Cuba near Florida beaches!] The Obamaites also did inherit local environmentalistas’ restrictions. [Note: there’s more seepage in California’s Santa Barbara channel than from drilling!]
Reality stubbornly intrudes. Cheap energy has been a hallmark of America’s incredible jobs creation for over a century. But Mr. Obama’s self-righteous ideologues want this reversed. It’s never easy to get into others’ minds, certainly not the elite dominating this Administration. But their “green” religion envisages an early end to fossil fuels, vast government subsidies to speed their demise, and higher prices [including more taxes] to help push us toward unproved, expensive alternatives.
High priest of this man-made global warming gospel is John Podesta, President Clinton’s chief of staff. His Center for American Progress provides a hallelujah chorus for their ally, Sec. of Energy Steven Chu. Nobel physicist Chu has a messianic solution: growing and trading tropical glucose as a petroleum substitute, the very stuff of science — science fiction, that is. Nor do these fanatics tell us where costly funding for preserving the environment is to come if not increasing energy market efficiencies. Nowhere in this crew is anyone who ever produced a single BTU except gassing before captive audiences. Furthermore, as in the Gulf disaster, they are as deaf to pragmatic arguments as the muezzin calling to prayer over the cacophony of Cairo traffic.
Honest oil industry people admit not much can be done immediately given growing Mideast instability with its 40 percent of world production. Even the cutoff of Libya’s 2 percent, while appearing small, hits European refiners supplying New England and Middle Atlantic pumps. Suspending ethanol mandates now, catastrophically exacerbating a world food crisis at taxpayer’s expense, would only make things worse by reducing volume.
But vast amounts of Fed Chairman Ben Bernanke’s “quantitative easing” flows into soaring commodities including oil. Investors have shied away from long-term investment, again because of administration generated uncertainties about financial regulation, taxes — and energy.
Were the president to take one of his increasing flipflops — messy and inconclusive as they are — and pull out all stops for domestic fossil fuel and electricity production [a hundred plant proposals sitting on the shelf!], prices would not collapse. But jawboning could erode crude prices, so often loaded with surprises in the past. And it would create jobs!
But alas! President Obama has chosen class warfare, so beloved of his leftwing base, over reconciliation with industry. With the help of innocent populists — such as Bill O’Reilly — he will blame it all on the oil companies and their huge profits. That, his gurus plot, is a winner for November 2012 — if not at the gaspump.
Sol W. Sanders, (email@example.com), writes the 'Follow the Money' column for The Washington Times . He is also a contributing editor for WorldTribune.com and EAST-ASIA-INTEL.com. An Asian specialist, Mr. Sanders is a former correspondent for Business Week, U.S. News & World Report and United Press International. He can be reached at firstname.lastname@example.org.
In 2007, Brazil made the World's Biggest Oil Discovery in 30 Years. But this is only less than a 14 month supply of oil for the world.
And in Brazil the more expensive deepwater projects need oil prices of $75 to $85 a barrel to be economically viable. So, worldwilde, oil prices will have to remain above $70 forever.
5:24 a.m. / Wednesday, March 30, 2011