The Politics of Oil
As of today, unleaded regular fuel is selling for about $2.85/gallon in North Carolina. Crude oil is running around $65/barrel. Some have projected $100 oil in the not too distant future, which would mean $5.00/gallon for gas.
As prices rise, those with inventories benefit from the increased value of that inventory, leading to record profits for oil companies like Exxon Mobil. This has led to public condemnation of these firms for "price gouging" otherwise known as sticking it to the American consumer.
But we have done this to ourselves. We haven't allowed a new refinery to be built in the US in decades, due in part to the costs associated with increased regulations. Then we decided to force the oil companies into refining special interest fuels, on a state by state basis, as green politicians caved in to the envirornmentalists. So the old refineries now have to blend oxygenated fuels specifically for political regions, rather than using the economy of national scale available to them.
We won't allow the development of our own nation's oil resources, because we don't like looking at wells, or we're afraid a caribou might die in an uninhabited arctic wasteland.
As a result, gasoline supplies get tighter, and prices rise.
So we deserve to pay $5.00/gallon for gasoline, just for being stupid.
And then there's our buddy, Hugo Chavez. The Venezuelan President, in a speech before the UN General Assembly, said that the area still smelled of sulphur resulting from the devil's presence there the day before. That devil, he said, was George Bush. In 2007, he told US officials, "Go to hell, gringos!". He did it again, yesterday.
Chavez is running his country's oil production facilities into the ground. He fired all the upper management years ago, and output has fallen by some 50% according to some analysts. Now, he has nationalized all foriegn owned oil facilities, siezing the property of US and other international firms. He is getting away with it, too.
Gas costs about 12 CENTS a gallon in Venezuela due to immense subsidies. But the Venezuelan owned CITGO gasoline company sells fuel here in the states at market prices.
And we stupid Americans buy it, and bitch about how we are powerless to do anything about it.
Citgo franchisees need to find another supplier, and US drivers need to boycott Citgo. Let the bastard try to build a pipeline to the Pacific, and a tanker fleet so he can sell his stolen oil to the Chicoms.
posted by Jim Matters @ 11:28 AM
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