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“Drill Here, Drill Now!” Resistance is Futile

Now that the right-wing hive mind has decided that today's free-market mantra is "Drill Here, Drill Now, Pay Less!"…resistance is futile.   It's as if the Borg has directed the think tank drones to signal that their assimilation is complete by embedding the moronic meme in their blogs.  Like other examples of right-wing GroupThink ("Lower Taxes, Increase Revenue!"), this one is embarrassingly and demonstrably false.  But why take my word for it…let the Bush Administration summarize their findings from the EIA (Energy Information Administration…The Official Energy Statistics from the U.S. Government).  Completed in early 2008, the EIA study concluded:

The projections in the OCS access case indicate that access to the Pacific, Atlantic, and eastern Gulf regions would not have a significant impact on domestic crude oil and natural gas production or prices before 2030. Leasing would begin no sooner than 2012, and production would not be expected to start before 2017.  Because oil prices are determined on the international market, however, any impact on average wellhead prices is expected to be insignificant. 

Got that, wingnuts?  Nancy Pelosi can agree to allow drilling from here to eternity, and the effects on the price of gas at the pump will be insignificant

But the most ridiculous claim from market fundamentalists is that the recent decrease in crude oil prices is due to merely discussing whether to allow more offshore drilling.  (Go here and here to see examples from local right-wingers.)  The Law of Supply and Demand is immutable, we are told by the drilling dilettantes at Pope, Inc.  Of course, there is plenty of evidence to show that the recent decrease in the cost of crude is due to less demand (ie. conservation, recession), not the potential for increased supply…in 2017.  You have to ask yourself why these guys never talk about decreasing demand (hint: conservation does not increase corporate profits). 

Speaking of the Law of Supply and Demand, what sort of madcap speculator in Freedomworld would decrease prices more than 20% ($140 per barrel to $110) because of the potential for an increase in supply in 2017 of less than one quarter of 1% (200,000 more barrels per day in addition to worldwide production of 85 million per day)?  Geez…hasn't the Law of Supply and Demand ever heard of the Law of Proportionality? 

Using this sort of crazy calculus, inflating our tires and driving the speed limit (measures which truly would decrease demand and lower the amount you spend on gas) should drop crude oil to $30 per barrel.  Which, coincidentally, was about what it was when Bill Clinton left office.  

Drilling Here, Now, and Everywhere will do nothing to ease the pain at the pump for Americans, although it will help fuel the growth of China, India, and Japan.  There are better ways to achieve energy independence.

6 Comments

  1. Adam Linker

    August 22, 2008 at 10:11 am

    Good points Steve. Here is an article about falling oil prices: http://biz.yahoo.com/ap/080723/oil_prices.html

    What’s missing in the political rhetoric is the complicated analysis that goes into pricing oil. To suggest that we could just lift a ban on offshore drilling and see a sustained price decrease is ridiculous.

    Hundreds of discrete events every day help determine the price of oil — not drilling bans or greedy speculators.

  2. sturner

    August 22, 2008 at 12:29 pm

    Thanks Adam…
    The operative phrase being “complicated analysis that goes into pricing oil.” As John Kerry discovered, “complicated = nuanced” (which exceeds the average American voter’s attention span).

    Offshore drilling is the perfect issue for Republicans to demagogue.

  3. Bill Brandon

    August 22, 2008 at 6:34 pm

    Has anyone ever considered the possibility that the idea of offshort drilling is so ridiculous that it is not worth fighting about? Many of the previous comments have already demostrated that drilling won’t work. But are the following observations also not true?
    (1) Although there is not much written about it, is it not the case that all of the offshore drilling rigs are already committeed for years in the future? With the genuinely impressive finds off Brazil, won’t the major oil companies send the free rigs there?
    (2) Is it also not the case that all that has been proposed for the federal government is that it would let the states make the decision for each state’s coast? Isn’t that sure to result in a fight in state legislatures for some years to come, thereby further delaying the drilling? Why not let the States decide to drill but keep all the money from offshore leases for the federal government (maybe dedicated to fixing future Social Security deficit). You can bet few states will rush to drill.
    (3) Because the amount of oil that can be extracted offshore of the U.S. will at best make only a marginal difference, can’t we environmentalists make a more effective stand defending ANWAR if we give the right a sop on offshore drilling that probably won’t happen any time soon & may never happen.
    Partly my feelings on this issue solidified after the election of 2000 when Pres. Bush announced the executive department ban on offshore drilling at the behest of his brother, then governor of Florida. It seemed to me that if the right in Florida gave us an anti-envirnomental president, it served Florida right to have offshore drilling….instread we got one more case of Bush hypocrisy.
    But let’s draw the real line at drilling in the Alaska Wildlife reserves!

  4. Max

    August 26, 2008 at 12:20 pm

    You link to my article. But clearly you didn’t read it. Lemme give you a quote about the effect of prices on demand: “People are already responding to high prices by reducing their fuel consumption—and it hurts. We also have to increase our domestic supply.” But yes, the law of supply and demand is immutable. That’s not market fundamentalism, that’s market fundamentals.

    Oh, and would drilling domestically now lower prices? Yes. Just ask a speculator. (Sorry, you guys are losing this one.)

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