Oil Reserves?

[Dave Schwartz]

On the evening news tonight there was a story about the price of gas going above $5 per gallon before summer is over. A thought struck me:

There are two things we could do that would put our country on the road to a very quick recovery:

1. Begin using those national oil reserves.

2. Nationalize oil production for the U.S. such that gasoline stays at a constant price of (say) $2.00 per gallon.

What are we saving the oil reserves for? A time when fossil fuel is no longer needed?

So, imagine if we were to nationalize it so that ALL the potential profit was used to lower the cost of fuel to the purchaser. Imagine the impact that this would have on our economy. Instead of having some of the highest transportation of goods costs in the world we would instantly have one of the lowest.

Now, I realize that it would take some time - perhaps several years to actually get the oil out of the ground and actually reducing the price of gas, but just knowing that it is coming would make a huge difference. It would even become a bargaining chip with the world's existing oil producing nations: lower the prices significantly or this plan will become reality.


I am sure there are more learned people on this forum than me. Please tell me what is wrong with this plan?


Regards,
Dave Schwartz

[Tom]

WE need to keep the reserves for a real emergency.
Like we get shut out of the Suez Canal.

But, the oil should belong to all the citizens- I don't see why we are paying such a high price to private companies for our own oil. This needs to be looked at closer.

What we can do, if first, lift ALL bans on off shore drilling and start pumping asap.

Second, we can tell the EPA to dump all those stupid blend requirements and cut it down to a couple or three and free up refinery capacity.

Obama can do both.

[prospector]

saudi arabia said this weekend the world had too much oil, so they were reducing their output...
also 95% of our energy is denied us by our government forbidding us to get it..we never should pay any country for energy..
drill baby drill is for real..

[JustRalph]

The U.S has 100 years worth of natural gas in the ground.

Incentivize the move to CNG right away and also start drilling the he'll out of Alaska

Problem fixed

[bigmack]

he'll out of Alaska
North Carolina left you with quite a heavy drawl. :cool:

[JustRalph]

North Carolina left you with quite a heavy drawl. :cool:

what can I say...........?

nope.....the Ipad likes to correct things on Vbulletin before you post. In fact I just noticed it changes "hell" to "he'll" no matter where I type it.

[Dick Schmidt]

Dave, to get back to your original suggestion about developing the oil reserves here in the U.S. There are two such reserves, the one you mention and the strategic oil reserve, which is to keep the army and navy going in case of war. Most of this is oil we purchased and pumped underground. As for developing the other oil reserves in the U.S. the big problem is that all the easy oil has been found and developed. What is left is oil that costs a lot of money to get at. Shale oil? When prices hit $250-300 a barrel it will start coming online. Until then, it just isn't worth the cost of relocating a large part of the Rocky Mountains to get at. Alaska? Been there, done that. The easy to get at oil is already gone and plans are underway to shut down the Alaska Pipeline.

The only thing that has been driving continued exploration for oil is the rising prices. No one is going to do deep sea drilling or small pocket exploring for $35 oil. Cap the prices of gas? Sure, if you want to see all the Mideast oil go to China, India and Japan. We live in a world market and if we don't pay the going rate, someone else will. Rising gas and oil prices aren't much fun, but they are the only thing keeping the oil flowing.

Dick

Who's wife just paid $9.60 a gallon for gas in Ireland last week.

[plainolebill]

The U.S has 100 years worth of natural gas in the ground.

Incentivize the move to CNG right away and also start drilling the he'll out of Alaska

Problem fixed

I completely agree with you - the Pickens plan was introduced as a bi-partisan bill in congress last week and it's a step in the right direction: Giving financial incentives to the trucking industry to convert to cng.

**There are different kinds of shale formations, those in Colorado bear kerigen, basically like tar - others have ng and ng liquids - some like the Barnett in Texas and (hopefully) the Utica in Eastern Ohio contain light oil.

[Marshall Bennett]

WE need to keep the reserves for a real emergency.



Especially when comparing the amount of oil we consume in relation to how long the reserves would last. It would disappear almost overnight. I would expect Obama to designate it's use for military purposes anyway. Again it would disappear almost overnight. We're not the least bit prepared for a real meltdown of imported oil. Even if all bans were lifted immediately and we increased drilling by 50% we'd still be years behind in lowering our need to import oil. Drilling & production takes years, we don't have years to wait. We're in deep shit now.
We're completely at the mercy of imported oil and that stinks. Means we're at the mercy of others, none of which really care about us anyway. As soon as the dollar becomes a worthless form of exchange, they certainly won't.

[prospector]

they could suspend the taxes on gas till the price of oil comes back down..the tax originally was to fix the highways..wonder what happened to that? where is the money going?

[HUSKER55]

gee, I wonder where?

[ceejay]

2. Nationalize oil production for the U.S. such that gasoline stays at a constant price of (say) $2.00 per gallon.

I never thought I would see something like this come from you. Are you recommending that the government take individual private property? Many onshore oil reserves are owned by individuals and leased to oil companies in exchange for one time bonus payments plus royalties.

1. Begin using those national oil reserves.


I do not think that the strategic petroleum reserve is big enough to have anything more than a short-term impact.

[Marshall Bennett]

The more practical idea would be to increase our reserves while we can still afford to rather than tinkering with the notion of using it. Imported oil may one day not be as convenient as it is now. Of course the whole idea of conserving for the future doesn't make sense to Obama.

[ceejay]

Shale oil? When prices hit $250-300 a barrel it will start coming online. Until then, it just isn't worth the cost of relocating a large part of the Rocky Mountains to get at.
Actually, some oil shale plays are commercial at today's price. These are viable because we can apply fracturing technology previously used in shale gas development to oil reservoir rocks that would otherwise be impermeable.

In fact, I am working on an oil shale prospect today.

As was reportedly said by Wallace Pratt, "oil is found in the minds of men [and women]."

[ceejay]

The U.S has 100 years worth of natural gas in the ground.

Incentivize the move to CNG right away
probably more than 100 years. I've been hearing about the CNG for 25 years. We are no closer to it now than we were then.

Did you know that the futures price of natural gas today on a barrel of oil equivalent is about $25 per barrel.

[Greyfox]

http://www.businesstravellogue.com/files/2007/05/gas-prices-cartoon.jpg

"I'll need your leg as well..."

[TJDave]

probably more than 100 years. I've been hearing about the CNG for 25 years. We are no closer to it now than we were then.

Did you know that the futures price of natural gas today on a barrel of oil equivalent is about $25 per barrel.

Relatively easy to convert to propane, CNG or dual use.

[Tape Reader]

[QUOTE=Dave Schwartz]
1. Begin using those national oil reserves.

2. Nationalize oil production for the U.S. such that gasoline stays at a constant price of (say) $2.00 per gallon.

I'm in shock that more members are not in shock by these two ideas. Where are all the free market capitalist?

The price of oil is going higher for the same reason gold, cotton, zinc, silver and all the other commodities are going to the moon. It is because of Bernanke's insane monetary policy.

As the dollar goes down, everything else goes up. Eco 101.

[Dave Schwartz]

Tape Reader,

Good point. I certainly got that. That is why the stock market returning to 11,000 does not make us even because they are 2011 dollars.

I was really addressing the whole supply and demand thing. Increasing supply would certainly cause the price to go down. Applying pressure to the oil-producing nations to produce more would also make the price go down.


Dave

[plainolebill]

Relatively easy to convert to propane, CNG or dual use.

CNG yes, but propane is a different product found along with methane, butane, etc. in petroleum wells.

[Tape Reader]

Tape Reader,

Good point. I certainly got that. That is why the stock market returning to 11,000 does not make us even because they are 2011 dollars.

I was really addressing the whole supply and demand thing. Increasing supply would certainly cause the price to go down. Applying pressure to the oil-producing nations to produce more would also make the price go down.


Dave

I should have added the Obama administration's moronic anti drilling and anti everything. (Except for all that stupid green s--t, that will cost us all more in the long run.)

If America can't beat the Arabs in capitalism, we should hang up our jock.

[TJDave]

CNG yes, but propane is a different product found along with methane, butane, etc. in petroleum wells.

Propane is a distillate of LG and oil however the point was that all these fuels are basically interchangeable and conversion is simple rather than complex.

[plainolebill]

I didn't read your post correctly, sorry. Let's get the pols off their collective asses.

[Robert Goren]

You guys are talking like there is an oil shortage. There is no oil shortage. Every oil storage falicity is full. There are tankers off our coast waiting to unload, but there is no place to put it. This is nothing more than 2008 all over again. Drive the price up on futures markets then dump it when the suckers start to buy. We will see $70 a barrel or lower by end the year. Try watching any news channel, even FOX has reported the full storage tanks.

[FantasticDan]

Yep, it's the bizarro world of weak demand + plentiful supply = $$UP-UP-UP!$$ :mad: :ThmbDown:

http://news.yahoo.com/s/ap/20110419/ap_on_bi_ge/oil_prices;_ylt=AqnsqdhbLLZMmhJdrERnA2gb.3QA;_ylu= X3oDMTMwNmxtN2IxBGFzc2V0A2FwLzIwMTEwNDE5L29pbF9wcm ljZXMEY2NvZGUDbXBfZWNfOF8xMARjcG9zAzEwBHBvcwMxMARz ZWMDeW5fdG9wX3N0b3JpZXMEc2xrA29pbGhpZ2hlcmFmdA--

[PaceAdvantage]

Yep, it's the bizarro world of weak demand + plentiful supply = $$UP-UP-UP!$$ :mad: :ThmbDown:

http://news.yahoo.com/s/ap/20110419/ap_on_bi_ge/oil_prices;_ylt=AqnsqdhbLLZMmhJdrERnA2gb.3QA;_ylu= X3oDMTMwNmxtN2IxBGFzc2V0A2FwLzIwMTEwNDE5L29pbF9wcm ljZXMEY2NvZGUDbXBfZWNfOF8xMARjcG9zAzEwBHBvcwMxMARz ZWMDeW5fdG9wX3N0b3JpZXMEc2xrA29pbGhpZ2hlcmFmdA--Why no post or thread criticizing and mocking Obama for this? From 2001-2008 I've read how much influence the President of the United States has on the price of oil...after all, Bush and his BIG OIL cronies were always blamed as the reason why oil and gas cost so much.

So where is your post and threads condemning Obama for the price of oil and gas today? After all, if the Prez has the ability to make oil shoot to the moon, should he not also have the ability to cut the price when necessary?

[Mike at A+]

DRILL BABY DRILL. WTF are we waiting for?

[Robert Goren]

DRILL BABY DRILL. WTF are we waiting for?Some place to store it.

[bigmack]

Some place to store it.
Boom chaka-laka. If we only had a place to house it, we'd be ducky. :rolleyes:

But where... You got any room out back?

[FantasticDan]

Why no post or thread criticizing and mocking Obama for this? From 2001-2008 I've read how much influence the President of the United States has on the price of oil...after all, Bush and his BIG OIL cronies were always blamed as the reason why oil and gas cost so much.

So where is your post and threads condemning Obama for the price of oil and gas today? After all, if the Prez has the ability to make oil shoot to the moon, should he not also have the ability to cut the price when necessary?
Tell you what, if you can find a post from me criticizing Bush for the price of oil anytime between 2001-2008 (hint: you won't), I'll be happy to make a post criticizing Obama.

Has there been a shortage of folks here ripping Obama on gas prices or anything else? I hadn't noticed.. :rolleyes:

[RichieP]

This is nothing more than 2008 all over again. Drive the price up on futures markets then dump it when the suckers start to buy.



What ever happened to the talk of the govt stepping in and making those "buying" actually take delivery of the product? Wasn't that going around a couple of years ago? :confused:

Regular unleaded now over 4.00 here in New Rochelle

[plainolebill]

What ever happened to the talk of the govt stepping in and making those "buying" actually take delivery of the product? Wasn't that going around a couple of years ago? :confused:

There's a proposal to change the margin requirements for oil futures traders excluding those with legitimate needs to hedge futures: airlines, oil producers, etc.

At least that's what I recall from the article I read.

[Tape Reader]

What ever happened to the talk of the govt stepping in and making those "buying" actually take delivery of the product? Wasn't that going around a couple of years ago? :confused:

Regular unleaded now over 4.00 here in New Rochelle

By doing this one would take away the other side of the market. It would fix prices at "limit up."

Please don't give Obama any more of these bad ideas. IMO, he is already looking for public support for blaming "speculators" for all the evil in the markets. "Golly gee, that's plausible."

Note to Obama: You can take the other side of the trade.

AND, if I were in charge, and sincerely wanted to bring prices down, I would do it by simply raising interest rates. It would cause the price of all commodities to tumble. Good for America, but not good for his re-election.

[Robert Goren]

By doing this one would take away the other side of the market. It would fix prices at "limit up."

Please don't give Obama any more of these bad ideas. IMO, he is already looking for public support for blaming "speculators" for all the evil in the markets. "Golly gee, that's plausible."

Note to Obama: You can take the other side of the trade.

AND, if I were in charge, and sincerely wanted to bring prices down, I would do it by simply raising interest rates. It would cause the price of all commodities to tumble. Good for America, but not good for his re-election.Obama does not control interest rates. The Fed does. Presidents and the Fed have a long history of not agreeing.

[Tape Reader]

Obama does not control interest rates. The Fed does. Presidents and the Fed have a long history of not agreeing.

Oh.

[RaceBookJoe]

There's a proposal to change the margin requirements for oil futures traders excluding those with legitimate needs to hedge futures: airlines, oil producers, etc.

At least that's what I recall from the article I read.

Currently the margin requirements for trading the CL ( crude oil contract ) is $2000 for an intraday trade, $6750 is held overnight. There is also a "night" session margin rate of $3000. rbj

[Steve 'StatMan']

You guys are talking like there is an oil shortage. There is no oil shortage. Every oil storage falicity is full. There are tankers off our coast waiting to unload, but there is no place to put it. This is nothing more than 2008 all over again. Drive the price up on futures markets then dump it when the suckers start to buy. We will see $70 a barrel or lower by end the year. Try watching any news channel, even FOX has reported the full storage tanks.

So why do the Saudi's say they need to get $88 a barrell just to break even?