GREETING AMERICAN BIPEDS AND ENGLISH LANGUAGE READERS EVERYWHERE!
Namazu, Giant Japanese Catfish, former demigod, now featured analyst .
EDITOR'S NOTE: 1/24/2015 There may have been mid term elections since April 2014 but so far nothing has changed . What Namazu was saying back in April is as true today as it was then. However now with Republicans taking control of both houses it is actually possible to accomplish the energy reforms the Great Catfish describes. Even as we await an act of common sense out of Congress as described in another post, the oil export band has been dying a slow death of regulatory exceptions and at least one LNG plant export conversion has been permitted. In another post some time ago the Great Catfish explained gasoline prices at the pump explaining how the most expensive gas to recover usually drives pump prices. The minute that the previous "system" started to work to U.S. advantage our "friends" the Saudi's decided to take actions that cost them dearly, but are driving the price of gas so low as to make economic production of the vast U.S. reserves uneconomic. While Americans are generally enjoying drastically falling gasoline prices at the pump, the situation is artificially induced and unsustainable. The U.S. is already shutting in wells, and the Saudi treasury is suffering. Gasoline prices at the pump will start to "yoyo" as the world struggles with a glut of oil from sources with unequal production costs. In the long term the price of gasoline at the pump, heating oil , and lubricants should eventually settle well below peak prices of two years ago. Hwere is how the Great Catfish saw the situation last Spring.
America it is time to fish or cut bait on your oil and gas reserves.
As most of you know I don't take human form and travel to the AAB /AAIS offices in New Orleans or Annapolis very often. Most of my contact is via our special hydrophones while I work from the relative comfort of my own living room on the floor of the sea of Japan. I'm not able to get cable or satellite TV but obviously I have access to the internet, and the internet gives one quite a bit of access to American news sources. If one follows American so called news sources one would still think that America suffers from a terrible dependence on foreign gas and oil. NBC, CBS, ABC, CNN, and to a lesser extend FOX net works, as well as most radio and print media have barely mentioned the fact that the U.S. is now in possession of more proven and producible oil reserves than any other nation on earth. Nor has the fact that America has more natural gas than the nation could consume in centuries been seen outside of gas producers commercials. * Since original publication the national media has finally begun to notice America's tremendous oil and gas production, and they don't approve.
America also has a mountain of debt. There are a lot of things that need to be done about that, becoming an oil and gas exporting nation is one of them. among the other things that need to be done is an expansion of the tax base so that the rich, the corporations, and the 41% of Americans who now pay virtually no income tax join the shrinking middle class in supporting the cost of government. Of course that would require the Republicans to tax their biggest campaign donors, and the Democrats to tax their voter base. Don't hold your breath. However, there is a chance that the excuse you have for a federal government might actually cross the isles and sing "Cum Bi Ya" over exporting oil and gas. * They actually now seem ready for this but acted too late to prevent Saudi counter measures.
There are Democrats holding office in oil producing states who are in favor of drilling, producing, refining , and yes, exporting petrochemical products. The Republicans invented the "Drill Baby Drill" slogan and the Democrats will split on the issue, but somebody has to bring it up. Does every member of your own Congressional delegation even know that we are now in a position to export oil? Despite the popular image of the United States as desperately dependent on foreign oil, that just isn't the case. The United States is already the world's largest exporter of refined product. The lack of decrease in imports of late has nothing to do with a domestic oil shortage. We still have a ban on exporting domestically produced oil. The U.S. is importing crude stocks in order to export refined product at a profit and net contribution to our balance of payments. The U.S. would do much better cutting out the middle man and exporting our own growing excess.
America , your Congress and White House desperately need adult supervision. The electorate is the only available source. Dump the Democrats whole sale at every opportunity but be sure the Republicans know that they have to produce pragmatic solutions that incorporate contributions from everyone including their fat cat donors and corporations. Elect independents and third party pragmatists at every opportunity. Eventually these folks will force some common sense on the Republicans without making every issue an ideological battle royal and making it impossible to govern.
Some members of Congress, even the Democratic energy secretary, many energy analysts, and energy company officials are all on record being in favor of lifting the ban. If you think America is in bad shape our economic problems are a minor headache compared to Russia after the fall of the Soviet Union. Their government wasn't strained with debt, it was dead broke. Their armed forces were having a fire sale on equipment, people were going hungry. Not today! Russians are living a lot better and the Russian armed forces are on the rise. How'd they do that? Well, it wasn't the sudden on set of capitalism generally, its called being an oil exporting nation. * Of course now (January 2015) the Russians are suffering economically from the Saudi driven fall in oil prices.
Don't get me wrong, exporting oil isn't going to lower gasoline prices at the pump, pretty much nothing will. * Even the Catfish acknowledges this proved wrong in the short term. If enough shale oil comes on the market too soon, the cost difference between U.S. on shore produced oil and the more expensive offshore U.S. oil could widen, which in the short term wouldn't be good for the domestic offshore oil industry. But U.S. offshore oil is competitive with a lot of other offshore oil out there and India and China aren't consuming any less, the offshore industry would recover, and if managed well perhaps not suffer at all. Its time to authorize exports. And with Russia threatening to cut off natural gas supplies to parts of Eastern Europe if NATO doesn't roll over and play dead, liquefied natural gas (LNG) exports from the U.S. could fill the gap with a big boost to our balance of payments. The hold up? The Obama administration still hasn't signed off on the permits to reverse engineer our former import terminals to export use. We don't anticipate any need for import terminals for at least 100 years even with maximum exporting.
American bipeds regardless of party affiliation, tell your Congressional representatives and senators that they really need to get working on this immediately. They should be able to handle it, it is after all....a "no brainer". *But now since the moment was lost due to Democratic obstructionism and an Administration intending to ruin the U.S. economy the needed response has to go beyond just lifting the export bans. We will probably need some national security based laws that assure a preference for domestically produced product, enough to assure national independence from Saudi manipulation of minimal acceptable U.S. production. This would mean some pain at the pump for American motorists due to the elimination of the artificially low Saudi manipulated price. That price has to come up eventually anyway because Saudi Arabia can't sustain their loss forever. Will the Republicans have the moral courage to incur voter anger over the necessary measures? Will the Saudi's blink in time for Congress to take action after a "natural price rise" so that the true cost of national energy security wouldn't be so noticeable? The situation is so unstable that even the Great Catfish doesn't want to make predictions, and that is unusual. Johnas Presbyter, editor