We know that oil production in existing fields is declining. But what we are learning is that there are VAST deposits of oil in areas which we are now only discovering. And we are finding new ways to recover oil economically (and ecologically safe) from oil shales that we previously could not have recovered.

There is enough oil from known deposits in the United States to provide all our petroleum needs with imports limited only to Canada. Those sources could fuel us easily for the next 20 years as we transition to petroleum alternatives using the taxes and royalties from our own domestic prouction to pay for the transition.

But if we follow the course libs have laid out, we won’t be able to afford to transition to an economic alternative and massive increases in energy cost will further constrict the economy preventing the growth which would make that transition possible.

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OK DW, maybe I missed it. I’ll put all of it right here together so you can sort it out.

You said:

The sweet, sweet irony is that I have people here ridiculing my lack of understanding of supply and demand, then turning around and saying, “Yeah, baby! There’s no doubt that the increasing demand for this diminishing supply of oil will, like, totally lower the price! Adam Smith himself told me so!”

I replied:

Ummm…. you’re gonna have to show your work on that one.

To which you gave me:

Okay. Here were a couple of my main points in this thread:

1. Oil is a limited resource, even if we do open new areas up for drilling.

2. Demand is increasing for oil, not leveling off or dropping.

So, where did anyone tell you that:

increasing demand for this diminishing supply of oil will, like, totally lower the price

That’s what you claimed, so where is it?

Then we have this tidbit:

Of course I would fight drilling in ANWR, even if it were conducted by the government.

You. DW, are the perfect example of the obstructionist mindset.

You have no good reason not to drill, you just don’t wanna.

Sort of like a two year old child.

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Opening new areas up for drilling just postpones the inevitable. Arguing about friggin’ free market economic policies over this issue is like fighting over who gets to choose the next CD when your car is driving off the cliff.

Postponing is the game of life, DW. We postpone death in terminal cancer treatments using known remedies – all in the hope that a real cure would come along in the interim.

I cannot agree with your analogy that because something appears inevitable today (of which we really don’t know this about peak oil), we abandon the “chug along” solutions prematurely while seeking to advance alternatives. All indicative of a defeatist attitude towards life.

Mike’sA… stop running into the wall. I believe DW’s last “confession” post said it all. “Of course I would fight drilling in ANWR, even if it were conducted by the government. ” Reminiscent of a college student or professorial mentality. Only time and events can change it.

In the meantime, most of us would prefer your head stay intact…

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It’s like banging my head into the wall to try and get through to that DW (stands for…).

How much more clear could I have made it than to present President Bush’s four part plan for the immediate future which leads to this goal:

In the long run, the solution is to reduce demand for oil by promoting alternative energy technologies. My administration has worked with Congress to invest in gas-saving technologies like advanced batteries and hydrogen fuel cells. We’ve mandated a large expansion in the use of alternative fuels. We’ve raised fuel efficiency standards to ambitious new levels. With all these steps, we are bringing America closer to the day when we can end our addiction to oil, which will allow us to become better stewards of the environment.

In the short run, the American economy will continue to rely largely on oil.
–President Bush

President Bush has been beating this drum for YEARS! What do I have to do, reprint every White House press release on the subject?

Meanwhile, Congress has done NOTHING!

Here’s some more news in case DW missed it:

President George W. Bush talks about energy issues and the importance of developing and using alternative fuels Thursday, Sept. 28, 2006, during a visit to the Hoover Public Safety Center in Hoover, Ala. The city has just opened an alternative fueling station to provide E85 (ethanol) and biodiesel fuels for public agency vehicles.

President George W. Bush and Dr. Subhendu Guha, President of United Solar Ovonic LLC, tour the company’s solar cell production area in Auburn Hills, Michigan, Monday, Feb. 20, 2006.

President George W. Bush views a hybrid vehicle powered by Lithium-ion batteries during a tour by Johnson Controls’ CEO John Barth, far right, and employee Mike Andrew at the Johnson Controls’ Battery Technology Center in Glendale, Wisconsin, Monday, Feb. 20, 2006.

President George W. Bush listens to AC Transit Employee Jamie Levin while standing in the doorway of a bus powered by fuel cell technology during a tour of the California Fuel Cell Partnership in West Sacramento, California, Saturday, April 22, 2006.

President George W. Bush gestures as he addresses an audience at the Limerick Generating Station in Limerick, Pa., Wednesday, May 24, 2006 , urging the the advancement of nuclear energy as part of a diversified U.S. energy policy that will make America less dependent on foreign sources of oil and more dependent on renewable sources of energy.

President George W. Bush greets audience members after his remarks on energy initiatives at Hotel Du Pont in Wilmington, Del., Wednesday, Jan. 24, 2007.

President George W. Bush holds a jar of spruce wood chips during a tour of the labs at Novozymes North America, Inc., Thursday, Feb. 22, 2007 in Franklinton, N.C., during a demonstration on how cellulosic ethanol can be produced from bio mass materials.

President George W. Bush talks to the media after a demonstration Monday, March 26, 2007, of alternative fuel vehicles on the South Lawn drive of the White House. Standing with him from left, are: Rick Wagoner, Chairman and CEO, General Motors Corporation; Alan Mulally, President and CEO, Ford Motor Company; Tom LaSorda, President and CEO, DaimlerChrysler Corporation, and Secretary of Transportation Mary Peters.

President George W. Bush stops to talk to the manufacturers of a converted plug-in hybrid electric vehicle during his tour of the Washington International Renewable Energy Conference 2008 Wednesday, March 5, 2008, at the Washington Convention Center in Washington, D.C.

President George W. Bush delivers his remarks on energy initiatives following his tour of the Browns Ferry Nuclear Plant in Athens, Ala., Thursday, June 21, 2007. Speaking about the energy needs of the nation President Bush said, “Nuclear power is America’s third leading source of electricity. It provides nearly 20 percent of our country’s electricity. Nuclear power is clean. It’s clean, domestic energy.”

President George W. Bush is shown alternative fuel development technology Tuesday, July 10, 2007, during his visit to GrafTech International, Ltd. in Parma, Ohio. GrafTech is developing new fuel cell components from natural graphite to increase efficiency and reliability.

Is that enough or would anyone like more?

The point is that Bush has been pushing, AGGRESSIVELY, for alternatives to petroleum, but fully realizes that until those are viable we MUST use the oil we have right here, right now!

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So, DW, can we assume you’re not much on capitalism in general? Or is it only capitalism that is “too successful”?

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Ummm…. you’re gonna have to show your work on that one.

Okay. Here were a couple of my main points in this thread:

1. Oil is a limited resource, even if we do open new areas up for drilling.

2. Demand is increasing for oil, not leveling off or dropping.

Except for one or two thoughtful and detailed posts in reply, most blew that off and rhapsodized about the wonders of the free market and how everything would be all right if we would just get off the oil companies’ backs.

Oil is the problem. Opening new areas up for drilling just postpones the inevitable. Arguing about friggin’ free market economic policies over this issue is like fighting over who gets to choose the next CD when your car is driving off the cliff. The priority needs to be to steer the car away from the cliff.

Of course I would fight drilling in ANWR, even if it were conducted by the government. I was interested, though, in seeing whether Mike’s push for opening up drilling there was motivated by a real desire to get more petroleum to Americans who need it or if it was motivated by a desire to do whatever he could to see big business get even bigger (4% margin or not–the oil companies are doing fine).

Given a situation in which he fished his wish–theoretical drilling in ANWR, albeit by (gasp!) a government drilling operation–he blew that off and fought for OilCo. The point for him is not acquiring the oil; clearly, it’s all about lining people’s pockets. Figuratively speaking, I offered Mike the option of choosing the next CD if we could just turn the car away from the edge of the cliff. He wasn’t interested.

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The reality is, no matter how much we may want to do it, we are years away from widespread alternative energy.

What the future holds, most likely, will be a mixture of all sorts of different options, blended together to make a workable, effective whole.

A great deal of the mess that we find ourselves in today could be alleviated rather easily by getting the obstructionist mindset out of the way.

Until we can do that, we are going to continue digging ourselves into a rut.

There’s nothing I would like better than to see this country send a message to OPEC which says “Screw you….we don’t need you anymore!”

ANWR is one piece of the puzzle. Offshore deposits are another. Coal to oil is a third. There are lots of different options. Some have horizons that are further out than others. The coal to oil option seems to have the shortest lead time.

The point is that there are tons of different options out there. None of them alone will totally replace oil but meshed together we could see our dependence, even on our own oil, dramatically reduced.

The ANWR and offshore options will give us some breathing space to get the other things done.

The sweet, sweet irony is that I have people here ridiculing my lack of understanding of supply and demand, then turning around and saying, “Yeah, baby! There’s no doubt that the increasing demand for this diminishing supply of oil will, like, totally lower the price! Adam Smith himself told me so!”

Ummm…. you’re gonna have to show your work on that one.

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I don’t see that the will is there right now to make this happen.

DW, you don’t know what’s going on behind the scenes. There is a will by any private company to fill a marketing need. And the marketing need for alternative energy is massive. If they are not addressing it full bore, it’s because government constraints are making it cost ineffective. Again, I must point out how many drugs do not make it to the market because of licensing, R&D and government regulations.

ANWR is not a myopic focus. It is, however, a grand poster child of what is wrong with Congress…. i.e. refusing to opt for solutions to a looming problem. This is why it dominates the blogs. Not that it’s supposed to be the “only” source.

The sweet, sweet irony is that I have people here ridiculing my lack of understanding of supply and demand, then turning around and saying, “Yeah, baby! There’s no doubt that the increasing demand for this diminishing supply of oil will, like, totally lower the price!

Maybe I’ve missed something, but I’ve seen no one saying increasing demand for diminishing product lowers prices. What they’re repeated over and over is increased output by add’l production sources lowers prices. I think you agree with that, as a foundation.

The main argument with you is that you believe the government should take control and direct it to the US market for cost. And I’ve pointed out the “cost” to you will be masked, and offset, by a rise in your taxes. You’ll pay less at the pump, and more in taxes. Private companies will steer clear, and production output will diminish… just as demonstrated by Venezuela.

Reality is: The supply is diminishing because the demand from developing nations is increasing, and there is the same ol’ production facilities supplying the same ol’ amount. The Middle East guards their output because they know once their oil is depleted, they will return to being a sand dune, with little to offer the world. I’m not wholly surprised the Saudis finally agreed to increase output. They know if the world’s economy (and the US is not the only gas “crisis” location) is in the toilet, their market and profit fails anyway. What good is having rare expensive oil if no one can afford to buy it?

The cure is to increase production output worldwide…. which will lower the prices, and buy time for other technology R&D to catch up.

Our peak oil is not the cause of the lack of supply now. Peak oil is still debatable in many circles. But for safety’s sake, I’ll go with the idea that it takes a long time for Mother Nature to create it, and we may be pulling it out faster than she can keep up.

Oil companies are energy companies. They are more aware than you or I of any possible finite supply of their financial bloodline. As I said, they are in the energy business. When they can provide the market with what it demands, and still make enough to remain in business and continue progress on technology, they will do just that.

But not with a Obama presidency and this Congress.

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MataHarley:

Thereby we need to buy more time to put the nose to the grindstone to finesse the technologies.

I don’t see that the will is there right now to make this happen. The Right blogosphere is focusing myopically on ANWR, as if it will be the solution to all problems–most of the Righty posters I read are not looking at the big picture, the way you are.

The way people work is this: “Ah, now we’re drilling up there in Alaska. Problem solved! Money for alternative energy research? What are you, some kind of Commie? Next up on The Factor: ‘Solar power generation–an Islamofascist plot?’”

The sweet, sweet irony is that I have people here ridiculing my lack of understanding of supply and demand, then turning around and saying, “Yeah, baby! There’s no doubt that the increasing demand for this diminishing supply of oil will, like, totally lower the price! Adam Smith himself told me so!”

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DW, in response to your #53 post:

You want to sell it to whoever will pay the most for it, unless something has changed in the way capitalism works. The price is set at “whatever the market will bear.”

Sorry… wrong answer. You sell it where ever it yields the most profit. If France will pay $15 US more for a gallon than your local community, but it costs you $14 US to ship it, plus import taxes and licensing, you sell it local. It is not about high price. It is about P & L.

Why turn these drilling leases over to private companies? If we’re going to break thirty years of protection for ANWR and conceivably destroy it in the process…

First of all, the North Slope has proven we will destroy nothing. Secondly, we’ve made tech strides even since them. As for private vs govt? That brings us to your next comment:

Oil companies go ahead and do what they do–no nationalization of the oil industry.

You keep ignoring an ugly fact INRE prices, oil companies and governments. 93%… do I need to repeat this louder? 93% are directly or indirectly controlled by governments. If your argument had a lick of logic, it is blown here. Were the majority of the oil controlled by the free market, history proves life would be considerably different.

To add yet another government to screw up the works only compounds the problem.

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