The Republicans are doing a good job of painting Obama and the DNC as part of the current economic problem, due to the argument over drilling. However, what no one seems to be discussing is the true state of oil supply and the real reasons for the current price spike.
More after the fold.
The reality is, the US is currently EXPORTING OIL at record levels. Don't believe it ? This was reported on the very pro-business and conservative site, Fortune.com (Fortune magazine).
The article is here - ANALYSIS-US oil firms seek drilling access, but exports soar - dated July 3rd.
Some juicy quotes :
WASHINGTON3 (Reuters) - While the U.S. oil industry want access to more federal lands to help reduce reliance on foreign suppliers, American-based companies are shipping record amounts of gasoline and diesel fuel to other countries.
A record 1.6 million barrels a day in U.S. refined petroleum products were exported during the first four months of this year, up 33 percent from 1.2 million barrels a day over the same period in 2007. Shipments this February topped 1.8 million barrels a day for the first time during any month, according to final numbers from the Energy Department.
The surge in exports appears to contradict the pleas from the U.S. oil industry and the Bush administration for Congress to open more offshore waters and Alaska's Arctic National Wildlife Refuge to drilling.
"We can help alleviate shortages by drilling for oil and gas in our own country," President Bush told reporters this week. "We have got the opportunity to find more crude oil here at home."
Interesting hmmm ? Clearly we are being played by the dirty oil men of the Republican Party. This is utterly disgusting.
In addition to record oil exports, anyone taken a look at the US refinery industry stats on refinery utilization lately ?
Hmmmm - Crude Oil : Low Refinery Utilization & High Prices
So we have record exports, we have refinerys strangely operating well below peak levels even though profits and prices are through the roof - anyone smell an Enron here ? Anyone living in California back in 2000-2001 will know what I am referring to - the deliberate outage of electric generating power through unscheduled maintenance to push up utility prices.
The Republicans with their oil industry friends are pulling off mass deception and profiteering off of the backs of the regular American public. This has got to get out. People need to know this. This needs to be in Obama's speaches. Get the word out, do what you can to get this message out there, we have to fight the concept that just a little more drilling will fix things.
Finally, of course there is speculation. How does speculation impact prices - quite simply, its profit taking by a middleman. To pay the speculator, obviously the price goes up for that profit margin. Its like the old analysis of the cost of buying a CD or DVD at Best Buy. How much goes to the artist, the manufacturer, the agent, the store etc. etc. When you have rampant speculation, that price you pay at the pump is that bit more higher, to pay that slice of cash to the speculator.
Quite simple really, not sure why the msm can't get it.
Those are the three key drivers behind oil prices and the Democrats have to hammer this home. The Republicans will do everything they can to aid Big Oil. Why ? Because Big Oil pays well.
Edit - another quote, related to the refinery utilization scheme
In April and May, utilization remained low, averaging 86.1 compared to an average of 94.1 for the two months during 2001-2005. While petroleum product prices are continuing to break new records, why is refining capacity utilization low? And would increasing refinery utilization reduce those prices?
Refinery outages seem to be running at relatively normal levels in 2008, implying that discretionary cutbacks represented a 4- to 5-percentage-point reduction in utilization during the first quarter, and about an 8-percentage-point reduction in April and May.