Remember Newt Gingrich’s “Drill Here, Drill Now, Pay Less” campaign? Based on the false assumption that if we drill for oil in America, that oil will stay in America? And drive gas prices Americans pay down? Because, you know … supply and demand and all that simplistic Econ 101 crap from the 1920s that people believe still holds true in a global economy?
Yeah, well, it ain’t happening:
Oil boomlet sweeps U.S. as exports and production rise
Looking at your heating bills or gas prices, you may find it surprising that the United States is enjoying a mini oil boom. It’s producing more crude oil and, for the first time in decades, has become a net exporter of petroleum products such as jet fuel, heating oil and gasoline.
The U.S. exported more oil-based fuels than it imported in the first nine months of this year, making it likely that 2011 will be the first time since 1949 that the nation is a net exporter of such goods, primarily diesel.
That’s not all. The U.S. has reversed another decades-long trend. It began producing more crude oil in 2008 than the year before and accelerated that upswing 3% in the first nine months of this year compared with the same period in 2010. That production has helped reduce U.S. imports of crude oil by about 10% since 2006.
Funny because I thought Socialist Obama was a puppet of Greenpeace and the Sierra Club! Oh, and the tree huggers and Dirty Fucking Hippies have blocked all the new refineries! And bargle bargle blargh! And Al Gore is fat!
Hmm. So we’re producing more crude oil domestically, reducing our imports, headed toward energy independence … yet we’re still paying over $3.50 a gallon for gasoline! What happened to the “pay less” part of Newt’s slogan?
What gives? Two things:
American consumers benefit little from the U.S. oil boomlet, because their fuel prices depend heavily on a global oil market that remains tight and has probably already peaked in production, says Jeremy Rifkin, author of The Third Industrial Revolution: How Lateral Power is Transforming Energy, the Economy and the World.
Ah yes that global market thing. Oil is not like oranges or laundry detergent. And then there’s the fact that this “boomlet” comes from new sources of oil (like tar sands and shale and ultra-deep offshore wells) that had been prohibitively expensive to tap before. The price of oil has to reach a certain high price before tapping these sources makes economic sense.
You see, high gas prices are built into the system. So no matter how much we drill and refine here in the U.S., we won’t be seeing cheap gasoline. And as for the rest of it — the poisoned well water and earthquakes from fracking, the crazy, wild weather from increased atmospheric carbon dioxide — we all pay those costs so the oil companies can enjoy higher profits. Privatize the gains, socialize the losses: it’s the way we do things these days.
Of course, those of us who drive electric cars don’t pay too much attention to gas prices.