“...it would take at least five years for oil production to begin”

That’s decades faster than any so called alternative sources. I don’t believe it would take 5 years. You can go through college in a year less than that. There’s no way it would take 5 years. No way.

any impact on average wellhead prices is expected to be insignificant

BS. Opec would react to our determination by raising production in order to maintain their market share. Prices would drop immediately. Even Bush's threat to seek more domestic production caused them to increase production last week.

And even if we don't get back to $1 per gallon how about the value of maintaining present prices with increased production. If we do nothing prices will continue to rise as demand rises.

This story is funny. First of all if it had any legs at all it would have taken off into a sprint by now from the MSM. Second of all I find it funny that the blowhard olberman keeps making comments about how Graham did this all by himself, like he ran congress or something. This is a non story. Olberman probably thought he had some type of monster story here and it is a nothing!! Way to go blow hard, more propaganda.

because it would take at least five years for oil production to begin.

They have been reciting that tired old line for twenty years now.

Kind of creepy, posting a blog entry from a guy who admires Keith Olberman, and mostly quotes from Keith’s propaganda show.

FWIW - This morning on CNBC Sharon Epperson said that she has been getting E-Mails from refining executives. The executives are telling her that the refineries are not making a profit and that they are going to have to shut down in a few weeks. (Maybe two weeks before the Democrat Convention?)

Somehow, a loophole signed into law by Clinton in 2000, did nothing to the oil markets for 6 years, until the Democrats took control of congress. Then, with the markets assured that no new oil would come from the United States, the oil prices shot through the roof, but not because of the assured shortages making oil consumers scared enough to bid up the price, but instead because of speculators who for some reason had no idea they could make billions like this until the Democrats took over.

The Energy Dept. is ignoring 2 things when they conclude that the economic effect would be negligible:

1) The effect that the drilling would have on the dollar. If we use our own oil instead of importing it from Saudi Arabia, then the dollar will rise as the trade deficit declines, and that will make even foreign oil cheaper here, even though it has no significant effect on the world price.

2) The fact that we’d actually be better off if it had no effect on the price of oil. That’s because the oil is owned by the Federal Government and can be sold to the oil companies as part of the drilling process. The proceeds can then be used to fund the budget, without increasing taxes.

agree.

The headline is ridiculous.
It is pure Rat propaganda to justify doing nothing constructive.
Drill, drill, drill!

Sorry using “Countdown With Keith Olberman” as your main source immediately discredits this report

(Source: Center for American Progress.)

Lemme correct that for ya: (Source: Center for American COMMUNIST Progress REGRESSION.)

But “because oil prices are determined on the international market…any impact on average wellhead prices is expected to be insignificant.

That 'international market' price is sort of a misnomer when it comes to prices we pay in America.

Just because the Arabs or Nigeria (or whatever) is selling crude for $144 a barrel doesn't mean that US companies (Exxon or Marathon or Valero, etc) is paying $144 a barrel for oil they get in the Gulf of Mexico, or Oklahoma, or Texas, or Alaska.

In fact, if we as a country import 50% of our oil from overseas, then only 50% is purchased at a high price... and the rest was produced at ... at the cost of getting it out of the ground, refining, etc.

The gasoline now in tanks at the local gas station was most likely taken out of the ground about six or eight months ago...

shipped, pipe-lined, refined, stored....

Bottom line: a totally American company who gets all their crude oil in America should be at a tremendous advantage because they are not forced to pay cut-throat prices from the Saudi's, Venezuela, Nigeria, etc.

five years is not a long time to wait for a successful national energy policy which includes all forms of energy development.

We’ve been putting off an energy policy since the 70s by saying developing new oil sources will take too long to implement or ‘drilling in the U.S or offshore won’t give us enough oil.”

What do you mean its a non story...it is being debated in Congress. I expect nothing to happen as the public unions of the US are some of the biggest oil futures speculators.

There are people who live in this country and want to see it destroyed.

Speculators only bet on the direction and the direction is more Demand than Supply. We increase Supply and we change the Direction.

If you like $5/gal, Thank Congress. If you want $10, Vote Obama.

Pray for W and Our Troops

You are absolutely correct, and here’s why. The suppliers are selling processed oil to the service stations. The oil that was processed was purchased at a lower price, but the oil to replace that processed oil is now much higher, so the price to replace is passed on down the line and ends with the consumers in all the various forms (your loaf of bread even has oil cost in it). Now, when the supply is expanded, the speculation over tightening supply ends and the speculation over expanding supply takes hold. THEN, the competition for sales reverberates back up the line of the plentiful supply futures and the cost to consumer comes back down. [The cornered silver market of bygone days (by the despicable Hunt brothers speculation) is an excellent object lesson.]

Exactly!

We have done nothing on energy for years,now we are paying the price for that ignorance.

The answer of course to the entire energy debacle is to challenge the rats( who are using their surrogates the wacko enviros and their well heeled lawyers to do their dirty work),to literally do it all.

We simply challenge them to go for broke on wind, solar, bio diesel, nuclear and drill every where a drill will find oil regardless of where it is.

When they still decline for some idiotic convoluted reasoning, since what they really want is the destruction of the us and capitalism, then we can make them out to be the fools they are and hopefully some will be voted out in Nov. It's our best bet, only it takes a little guts for the critters to do it and keep on speaking out.

I doubt the impact would be as immediate or dramatic as you think. The prices for contracts are typically for the next month or two, and it will take a few years to bring these wells online. There will be an impact, and, over time, it would be beneficial for the price in relative terms, but it certainly would not cause someone with a contract due in 2 months to panic and sell.

Evening Bray nice to see you. Another dynamic that is not often discussed is that many gas stations in competitive areas work on 6-10cents per gallon margin.

At a dollar a gallon that would 6-10% gross profit from the sale of gas.

At $4.00 per gallon it's 2% or less.

Add in customer charges on credit cards at 1/1/2 -2% of total sale and the stations are going backwards.

Even the profit from all the other over priced stuff can't make up the difference in most stations. So many are getting out, going bust or like Exxon selling out.

When voters keep returning commies like Maxine Waters and John Conyers and Tom Harkin to office, it shows the voters are clueless just as the demcorat party planned them to be back when the democrap party started desrtoying the education system , in the name of ‘improving education in America’. Maxine even blurted out recently during hearings that ‘they would take over the oil industry’, meaning the democrap controlled government will take over private industry if it doesn’t tow their commie line! And yet that stupid b!tch will be re-elected every time she runs! The democrap party is a criminal enterprise with socialist intent.

I’m not sure I agree. Wouldn’t these same uber-speculaters currently trading unregulated in USA just continue to trade unregulated on British futures markets, where it’s apparently more lax?

The executives are telling her that the refineries are not making a profit and that they are going to have to shut down in a few weeks

obama may have to nationalize the refineries and the price of gas will go to double digits.

Remember all the independent gas stations years ago. They were all put out of business by the enviroterrorists/Congress forcing them to replace their tanks at $500K/pop. Put all but the bigs from staying in business. Now we have no competition.

If you like $5/gal, Thank Congress in Nov.

Yeah, its hard to imagine just how stupid some of the dem/rats actually are.

We really have to concentrate on areas that are not totally rat infested where the populace can still read and write and make some common sense.

The destruction of govt. schools has had major ramifications in the country no doubt.

One thing that is rather encouraging to me however is that many times when I take the time to explain things in a rational manner like drilling etc. to the average guy, much of the time they come around really quick and see the light. I know that won't happen everywhere but it is always worth a try.,p> I personally think that I have changed and influenced many minds simply by pointing out things that we take for granted here but elsewhere are huge secrets.

Traders or no traders as Boone Pickens says as long as we have an imbalance in the market, daily there is a million and a half barrels of oil more demand than supply, prices will go up that simple.

I still say what is going on is the dem/rats/DNC using the enviro wackos to do their dirty work.

They(enviro rat lawyers) have effectively blocked every avenue on land and in the sea where one could drill and so far are getting away with it in the name of ecology not socialism.

What they are doing is a simple concept to tell and if we get it across to the public the rats will probably open up something somewhere, we just have to be persistent and LOUDDDDD!!!

GW should immediately take away the Presidential ban that his father installed years ago. That would be a great start.

In the early twenty's, the boomtowns in Texas and Oklahoma began producing crude and then refining in months. No modern technology either.

“because it would take at least five years for oil production to begin.”

Oh I believe the line - my reply to it is - So?!?

7% production increase is a 7% decrease in imports. It means jobs HERE. Lots of jobs. If you increase the domestic oil supply - you ALSO need to increase the amount of refining done - more jobs NOT created by the government!!!

Back to the statements - I believe the basics that it takes 5 years to do the physical plant development and get the resources on line. I don’t agree with the conclusions.

We are ten million barrels per day short, we could get a million and a half from anwar,same amount or more in the Gulf, who knows how much in oil shale here, nukes could pick up a lot of slack there is more nat. gas than we can ever mine!! All of this can happen in 2-5 years, why the H___ are we not doing it.??

We built the Panama canal, Hoover and other dams, concieved and built atomic weapons in just a few years, put a man on the moon in less than ten years, beat both the Nazi’s and Japanese in just a few years, we have spacecraft on the moon and Mars and outside the solar system and all of a sudden we can’t drill a few wells in less than ten to twenty years.
My guess is that within three years we could have oil flowing from some of them.
We can chant “yes we can” and educate the entire world no matter if they are illegal or not and now the chant is “no we can’t” drill a few holes in the ground.

The day we give the okay to drilling off-shore or in ANWR the price of oil will plummet. The mechanism that will do that is the futures market, the big bad speculators everybody likes to hate so much.

If it is going to take 10 5 years, shouldn't we get started? Drill here, drill now, pay less

...because it would take at least five years for oil production to begin

Absolute bull crap - there are numerous fields that were discovered decades ago, off the coast of California, that have never produced a drop of oil, simply because D@mocrats (federal, State & local) won't allow it [ http://www.mms.gov/omm/pacific/offshore/ofrrpt.htm ]. Several of the fields are of "unusual size" (ala 'ROUSs' - and I kid you not, they're monsters). Production could commence in much less than a year, using floating facilities, if the D@mocrats would just get their sorry @sses out of the way (and out of the courts).

But, in reality, it will never happen - the D@mocrats (federal, State & local) actually prefer extremely high oil prices...

I posted this for discussion purposes. In this great land we have the right to speak, think, discuss, consider...that doesn’t necessarily mean I agree or disagree.

It took until 2005-2006 for the same loophole to be used to manipulate natural gas prices.

I think what has accelerated the rise of oil is due to the opening of the Dubai exchange in 2005.

A large volume of WTI futures are now traded in Dubai:

http://www.eyeofdubai.com/v1/news/newsdetail-23345.htm

They already are.

"obama may have to nationalize the refineries and the price of gas will go to double digits."

He will have to win the Presidency first. And it won't be in the next two or three weeks. :)

...And there is a national security dividend! Sooooo-—drill here, drill now, pay less !!!

I think the futures traders didn’t realize this loophole until about 2 years ago. OR, if they did, they were scared to take advantage of it.

From what I’ve heard in congressional testimony and read, this loop hole is real, and it IS being exploited.

I saw several executives testifying about this last week. THey ALL agreed that the loop-hole needs to be closed yesterday.

because it would take at least five years for oil production to begin.
They have been reciting that tired old line for twenty years now.

Well, a little experiment might be educational...
Just tell the Big Bad Oil Companies, have at it; drill wherever you think the oil yield will be the most productive soonest.

No regulatory hurdles.
No new obstacles and legal barricades.
No allowing the eco-idiots to challenge your every move.

See how quickly meaningful and useful production begins, and then we resume this dialog.

"Where the rubber meets the road is where reality is at", as the stereotypical redneck is assumed to phrase it. Give it three years.

Anybody game?

I don't care if the moonbats' heads explode.

In fact, if we as a country import 50% of our oil from overseas, then only 50% is purchased at a high price... and the rest was produced at ... at the cost of getting it out of the ground, refining, etc.

The last reliable number I remember for producing oil at the wellhead is 2005:

Saudi Arabia, $5 a barrel
The North Slope, $3 a barrel.

That ought to put things into proper perspective.

Assuming that we don't allow the "fungible BS" in the meantime. Even at $60 a barrel, the "unconscionable profit", for both the Big Bad Oil Companies and governments is breathtaking and obvious.

Needless to say, not one drop of this oil would be allowed to be exported, or "traded" for oil from any OPEC nation to save transportation costs. If the world's oil consumers are happy with OPEC, let them continue to be happy with OPEC.

We’ve been putting off an energy policy since the 70s by saying developing new oil sources will take too long to implement or ‘drilling in the U.S or offshore won’t give us enough oil.”

Isn't it amazing that we allowed the nutjobs to say No Podemos for almost 40 years?
And get away with it?

Your figure of per barrel price in one location - the north slope - is not meaningful unless you indicate how much of the US market is supplied by that location.

Having lived near the Gulf, I am aware that the majority of the US supply comes from there - drilled in deep water at much higher cost.

Brilliant post here and this is exactly what it is giong to take.

They may want high oil prices since it's “the European way” but my take is they want the fall of capitalism and the installation of socialism/marxism at any cost.

“I think the futures traders didn’t realize this loophole until about 2 years ago. OR, if they did, they were scared to take advantage of it.”
They knew about it, but they (large investors) was making money on Wall Street (less risk). Then the bottom fell out and they (large investors) turned to the future market.

The best reason to drill here drill now.
In 2007 the U.S. used 543,000,000,000 barrels of oil. 60% of which was imported. That means $469,152,000,000 (@$143.00 per barrel)of our hard earn money went to some other country.
Screw them, DRILL HERE, DILL NOW, COAL TO OIL.