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Sol Sanders Archive
Monday, July 4, 2011     INTELLIGENCE BRIEFING

Obama's energy disaster:
One part black magic,
two parts propaganda

Again, and again, we must return to energy, the mother’s milk of the economy where the Obama administration’s ham-fisted tactics are strangling the baby of recovery in the crib.


China Vice-President Xi Jinping shakes hands with Cuba's President Raul Castro after arriving in Havana, June 5. Xi toured a joint oil exploration project while in Cuba     AP
In his June 29 press conference, the president again singled out rebates to push U.S. fossil fuel production in his demand for tax increases for an economy already threatened by double-dip recession.

The proposal compounds regulatory mischief: blocking oil and gas in the Gulf of Mexico while Chinese and other foreign companies drill off Cuba almost within sight of Florida beaches, forfeiting 250,000 jobs. “Regs” threaten West Texas fields contributing 20 percent of U.S. new production because of an obscure lizard. The White House dallies over a pipeline to bring Canadian oil sands crude to Texas refineries. While Moscow pushes Arctic prospecting, Juneau can’t get Washington to open up 14.7 million acres of state land with the critical Alaskan pipeline faltering from declining throughput.

Also In This Edition

Mr. Obama’s token strategic oil release — into the international crude pool rather than reducing U.S. pump prices — was one more feint in his ideological war on fossil fuels. [Never mind ignoring the reserve’s national defense character; it was never meant as a price instrument — nor political toy.]

All this is done under the rubric of protecting the environment. “Junk science”, as many highly qualified skeptics believe, may underpin claims fossil fuels consumption decisively impacts climate change. It will take decades to know, given our shallow data for changing climate through the ages.

But “junk economics” is all too evident in the administration’s energy strategies. Granted, impediments to cheap energy were inherited from previous governments and imperfect markets. But Mr. Obama’s drive for “renewable sources” mimics earlier Carter administration’s abandoned “alternative energy” skeletons still littering the landscape.

Mr. Obama’s wind power subsides are indeed producing jobs — for China and Spain — with transferred American companies’ technology. Chinese windmills and solar panels are exported to the U.S., often replacing American manufacture.

The vignette of former Gov. Arnold Schwarzenegger entertaining the possibility of Chinese “high-speed rail” proposals with federal stimulus funds — just before California all but bankrupted — is quintessential of a mind set.

High salaried propagandists for tax free non-governmental organizations [NGOs] promote “the environment” through advocacy of “mass transit”, citing China’s example. They fail to note deficit-ridden Chinese government railways — whose two top executives recently were arrested for stealing tens of millions — blackmailed European and U.S. companies for technology transfers in exchange for a phantom Chinese market. Now Beijing attempts exports while their own projects operate with anemic passenger loads — at lower speeds because of faulty engineering. The misrepresentation is all too typical of limitless, mindless propaganda pumped out on a daily basis, for example on that other Washington subsidized enterprise, National Public Radio, by the Obama cheering section.

In fact, a whole new era in fossil fuels is beginning. So-called “peak oil”, the crisis posited when diminishing reserves supposedly would meet rising consumption, has vanished. New vistas have developed worldwide with expanding deep-water drilling technology — a Norwegian billion-dollar floating platform in deep water off Rio de Janeiro, a good example. New fields await discovery in our own Gulf of Mexico — the less than cataclysmic British Petroleum oil spill notwithstanding. Recovering Iraq with the world’s second largest reserves, many yet untapped, is returning with 10 million barrels a day.

Even more spectacular, a new era for natural gas suddenly has emerged with new technology exploiting vast shale reserves lying deep below rock formations in a dozen countries, not the least the U.S. [An ironic comment on priorities: Beijing is investing government billions into American companies to get at that technology.] Of course, there already has been a half-baked university “study” by enviromentalistas arguing “fracking” — the process of getting at that gas — would poison ground drinking water. The study produces not a single instance nor does it explain the risk with most such deposits lying well below aquifers.

“Politically correct” spokesmen and the mainstream media promise black magic energy solutions, for example, electric cars, ignoring almost three quarters of our electricity for recharging batteries is met with coal and gas — much less the enormous costs and problems of grid expansion required for a massive changeover.

This conjuror’s trick has gone wrong; Mr. Obama is actually cutting the beautiful young lady in half as he cripples the energy sector.

Sol W. Sanders, (, writes the 'Follow the Money' column for The Washington Times . He is also a contributing editor for and An Asian specialist, Mr. Sanders is a former correspondent for Business Week, U.S. News & World Report and United Press International.


U.S has no influence over oil prices.
- Today U.S. and Canada are only producing 12% of the world's oil. OPEC and Russia are producing 46 % of the world’s oil and they don’t want to bring the price of oil down.
- In late 2008, OPEC decided a total reduction in supply to 4.2 million bpd. That’s 5 times the Arctic National Wildlife Refuge oil production expected in 2025.
- One of the largest discoveries in the Gulf of Mexico in the last decade is only 35 days of consumption in the USA.
- In 2018, Mexico could become a net oil importer. In 2025, Norway and Russia could stop exporting oil.
- Drought threatens drilling in South Texas. Fracking a single Eagle Ford well requires as much as 13 million gallons of water.
- Unstablility in the muslim world is already threating a production of 25,6 million barrels per day of oil. With Iraq returning with 10 million barrels a day, OPEC will soon be far stronger than in 1973 when the oil crisis ended the post-World War II economic boom.

luc      5:06 p.m. / Monday, July 4, 2011

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