"A wise and frugal government which shall restrain men
from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government."
(Thomas Jefferson)

Friday, June 24, 2011

White House Move to Tap Strategic Petroleum Reserve for Political Purposes

During the last few weeks we have been noticing the price for a gallon of gas has been dropping steadily at our local gas stations which is a welcome sight.  Frankly it was a shock when we heard that Obama was going to release oil from our Strategic Petroleum Reserve which is there for emergencies.  High prices for a gallon of gas is not an emergency but it hurts Obama politically.  It didn't take long to put 2+2 together and come up with it is a political move by Obama.  When did the United States start buying oil from Libya?  We didn't but Europe does import oil from Libya so we are releasing our oil reserves to help Europe?  Would they do the same for us? Doubt it.

Congressman Cole in one short paragraph has stated why this tapping of the Strategic Petroleum Reserve by Obama is being done for political purposes (Obama's reelection campaign).
June 23, 2011 
Cole Statement on White House Move to Tap Strategic Petroleum Reserve 
WASHINGTON, D.C. – Rep. Tom Cole (OK-04) released the following statement after the Obama administration announced its decision to release 30 million barrels of oil from the nation's Strategic Petroleum Reserve:  
"This is a bad decision driven by political considerations rather than sound policy. The Strategic Petroleum Reserve should only be used in cases of national emergency -- not as a gimmick to artificially reduce gas prices. If the president truly wants to bring fuel prices down, he should stop blocking American energy production at every turn. Relying on our reserves without justification is short-sighted and irresponsible."
Another reason this is a bone headed move is the fact that some of our refineries are near capacity and others are at capacity because the last new refinery built in the U.S. was Marathon Oil's Garyville, Louisiana, plant, which opened in 1976

Yet the U.S. Export-Import Bank is loaning $2.84B to Columbia to expand and upgrade an oil refinery:
The U.S. Export-Import Bank, an independent agency of the federal government, is now planning a $2.84-billion loan for a massive project to expand and upgrade an oil refinery--in Cartagena, Colombia. 
The money would go to Reficar, a wholly owned subsidiary of Ecopetrol, the Colombian national oil company.
Why is the United States not upgrading our own oil refineries instead of loaning money overseas for foreign refineries?  Does Obama want to put the US oil and gas industry on its back?
Obama's Oily Desperation 
By on 6.24.11 @ 6:09AM 
In a move that has everyone from oil analysts to traders to petroleum producers scratching their heads, the Obama Administration announced on Thursday morning that the U.S. along with over two dozen other nations will release 60 million barrels of oil from emergency oil stock piles. Half of the total release, or 30 million barrels, will come from the U.S. Strategic Petroleum Reserve. 
News of the release, which will be 2 million barrels per day for 30 days beginning about a week from now, hit oil prices in futures trading. West Texas Intermediate crude oil trading in the U.S., which was already down about $1 on the day, fell more than $3 further to about $91 per barrel. Brent crude, which trades in London, fell almost $7 per barrel. 
The excuse being used by the Obama Administration and the International Energy Agency for the oil release is that reduced oil exports from Libya are raising energy prices and thus hurting world economies. 
However, the Saudis have already said they would increase production to offset losses from Libya -- and they have done so. More importantly, and partly in reaction to the Saudi move, oil prices had fallen almost 20% in about six weeks since peaking near $115 in early May over fear about Libyan and Middle Eastern unrest. 
The idea that the federal government needed to knock oil prices down further or faster for economic purposes while oil was already in what would be considered a dramatic sell-off is simply not credible. 
More likely is that the Obama Administration is sinking into desperation as its economic policies lengthen and deepen the economic downturn -- just as similar (and one would have therefore thought discredited) policies in the 1930s were substantially responsible for turning a serious recession into the Great Depression.
Excerpt:  Read More at Spectator.org
If Obama thought this release of oil was going to go unnoticed that it was a political ploy and people would be applauding him for lowering gas prices, think again.  There can be no credibility left for this White House with a majority of Americans after all of their bone-headed moves.  The moratorium in the Gulf is loosening but why did it take so long?  The Gulf is still not back to where they were before the BP spill (125 rigs were drilling ):
The Interior Department has issued 53 shallow-water permits since last June, when new safety standards were imposed, Stevens said. Permits for 14 deepwater wells have been approved since late February, when industry demonstrated it could meet new standards on containing oil spills.
What about the permits that are lying on someone's desk waiting for a permit for new drilling?  Yet Obama for political purposes talks about we need to drill more which is a bad joke because it takes forever to get a permit to start a new well offshore not to mention that Obama has put a lot of offshore drilling off limits to oil producers.  It made a good sound bite but anyone who thinks just shakes their heads thinking he will say and do anything if he thinks it will help get reelected.

Releasing 2M barrels a day for 30 days is not going to have a long term effect.  Gas prices have already been dropping at the pump but Obama isolated in the White House except for fundraising events wouldn't have a clue.  All he sees is that for his political purposes gas prices have to fall.

If paying $3.79 a gallon which is the most I paid would ensure that Obama was defeated, I would gladly pay that a gallon and more because his policies are driving up the price of groceries as well.  Is Obama going to call for the end to ethanol subsidies?

1 comment:

SJ Reidhead said...

This doesn't make sense at all. If he really wanted to do something, he would give a pass to the summer gas blends and regularize blends throughout the country. That would bring the cost down, even more.

President Screw-Up in Action.

The Pink Flamingo