Oil

This seems to be vexing a lot of people.

Oil prices tumbled below $130 a barrel for the first time in more than a month Thursday, as crude’s dramatic slide entered a third day accompanied by a sharp sell-off in natural gas.

The declines accelerated amid growing concerns that the weakening economy and creeping inflation are eroding demand for fossil fuels in the U.S. and other large energy-consuming nations.

Gee, think this might have something to do with it?

The Interior Department on Wednesday made 2.6 million acres of potentially oil-rich territory in northern Alaska available for energy exploration.

It’s not cause and effect — the prices started dropping Tuesday, and the announcement was on Wednesday. But can there be much doubt that the drop is being sustained, at least in part, by the availability of new domestic drilling? How much more of a price drop would we see if we announced — just announced — that we would allow drilling in ANWAR?

I mean, the only way that new oil sources in the future could effect today’s prices would be if there were people speculating on the future price of oil, and we all know that speculation is bad, right?

What really worries me is this issue.

President Bush’s lifting of the executive ban on offshore drilling this week is more than a symbolic gesture. It means the only thing preventing expanded offshore oil-and-gas development is a temporary, one-year congressional ban set to expire on September 30. While Congress has a habit of re-imposing this ban each year, it has never gotten around to writing it into permanent law. This creates a key opportunity for supporters of domestic energy production, including the president, to force a showdown.

I see this as an issue that could kill the Democrats in November. If Congress reaffirms this ban, then gas prices will continue to rise. The RNC can run ad after ad that says, “John McCain and the Republicans did everything they could to allow more drilling in international waters off the coast of America. They were blocked by Barack Obama and the Democratic Congress. Gas prices rose even higher. Are the Democrats and Barack Obama ready to run America? Put the party that stands to lower gas prices in Washington.” Throw in an ad or two showing Barack talking about wanting higher gas prices (just gradually) , and the election is done.

And with gas at $4.50 or $5 a gallon, the Democrats would get pounded. The problem with that strategy is that it requires gas prices to keep going up. I would rather they do the right thing now and trust the American public to remember for at least four months. Do the Republicans have the backbone to stand up and keep the ban from being reinstituted, either by vote or veto, or will they go with the easy, November oriented strategy?

What am I saying? Any plan that involves Republican backbone vs. the Democrats is made of fail. Get ready for gas prices to become even more of a political football.

3 Comments

  1. R says:

    “How much more of a price drop would we see if we announced — just announced — that we would allow drilling in ANWAR?”

    Definitely.

  2. I watched oil prices last week, with bated breath. Every time oil plunged, my 401K went up. Fuck oil. I wanna retire some day. And today, oil went back up a little and the market went down.

    YUCK.

    We need to drill, drill, drill, drill, choke a few environmentalists and then drill some more. We must control our own energy destiny. Yeah, we need to look into alternative sources of energy, but we ALSO need to drill, drill, drill, drill. Last time I checked, my car used gasoline. Wind power ain’t gonna get me to the grocery store.

    I wish I was Superman and I could just fly to the damn store.

  3. […] it looks like I wasn’t the only one thinking this way.  And I’m chagrined to see that I may be right, […]