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Message
re: Yellen: Biden Not Responsible For High Gas Prices
Posted on 6/21/22 at 3:27 pm to BlackHelicopterPilot
Posted on 6/21/22 at 3:27 pm to BlackHelicopterPilot
Here’s a simple analogy to help illustrate my point (and keep in mind this is just at the moment, not accounting for the LT volatility)
Supply: 100 apples a day
Demand: 200 apples a day
Excess: 100 apples (prices skyrocket)
Potus (R or D): I’m adding 2 apples per day!
Remaining demand: 98 apples (prices still skyrocket).
I’m not trying to be a dick, I thought we we’re having fun, I apologize. My point is we (the US) do not have the pull that we think we do over gas prices (for a lot of reasons). In B school I read lots of academic papers on the topic, mind numbing stuff to be fair. The correlation between R and D run White Houses & gas prices over the last 70 years is virtually non existent. That same correlation/relationship to the global price of crude & what you pay at pump is VERY positive (nearly perfect).
Then you look at what caused those fluctuations and you see how hard it is to tie them directly to any US POTUS.
Supply: 100 apples a day
Demand: 200 apples a day
Excess: 100 apples (prices skyrocket)
Potus (R or D): I’m adding 2 apples per day!
Remaining demand: 98 apples (prices still skyrocket).
I’m not trying to be a dick, I thought we we’re having fun, I apologize. My point is we (the US) do not have the pull that we think we do over gas prices (for a lot of reasons). In B school I read lots of academic papers on the topic, mind numbing stuff to be fair. The correlation between R and D run White Houses & gas prices over the last 70 years is virtually non existent. That same correlation/relationship to the global price of crude & what you pay at pump is VERY positive (nearly perfect).
Then you look at what caused those fluctuations and you see how hard it is to tie them directly to any US POTUS.
This post was edited on 6/21/22 at 3:41 pm
2
Posted on 6/21/22 at 3:52 pm to Auburn1968
If they have to say it out loud, you know it's a lie
Posted on 6/21/22 at 3:55 pm to BlackHelicopterPilot
quote:Isn't this all just on federal leases, though? And even with that, it's not clear at all that this has significantly impeded production.
Reverse the EOs he signed on his first day to overturn Trump’s easing of restrictions
Stop EPA stonewalling of report reviews that are holding up drilling and production operations
quote:I would hope he would do that too, but come on - that's not making gas prices high.
Immediately “own” and take back his stated position (made during campaign) of intending to ‘end fossil fuel industry’
quote:Oil company execs have been very clear about how they must tend to their battered shareholders first. They have vaporized $1 trillion over the past decade with silly projects and over-promises. We can surely blame politicians for some of this, but why is it I never see threads that say "Oil industry responsible for much of its own predicament"?
BONUS: immediately ask for Oil Co. executives to come and give him council on how to get their industry revved up to highest capacity. Make it TRULY bipartisan at this meeting and promote be open minded.
The number one thing I would do is find some kind of way to convince high-profile institutional investors to start investing in traditional energy again.
Posted on 6/21/22 at 4:01 pm to Big Scrub TX
The drilling permits are NOT just on Fed Land. Just like you can’t build a house on “your land” without a wetlands determination, the drilling has to get certain EPA, etc permits no matter where.
And, there are a LOT of regulations. They can drill and “hit” and then be denied ‘production’ and ‘transport’ permission. So, unless the industry feels safer, they would not risk it.
And, there are a LOT of regulations. They can drill and “hit” and then be denied ‘production’ and ‘transport’ permission. So, unless the industry feels safer, they would not risk it.
Posted on 6/21/22 at 4:02 pm to Big Scrub TX
That kind of investment would help (at least LT, production is expensive and takes forever to get going) but keep in mind the price of gas has absolutely collapsed THREE times in just the last 15 years.
Any new capital/investment is looking for reasonable assurances they can continue to sell at a higher price to make good, that’s a 50/50 shot at best. There’s a world where Russia/Ukraine get their shite together & demand cools, and prices drop 30% 40%, at least for a while.
Then all that new investment is fricked, and the risk of that happening is real. The only way around that is going full commie (federalized gas), what could go wrong???
Any new capital/investment is looking for reasonable assurances they can continue to sell at a higher price to make good, that’s a 50/50 shot at best. There’s a world where Russia/Ukraine get their shite together & demand cools, and prices drop 30% 40%, at least for a while.
Then all that new investment is fricked, and the risk of that happening is real. The only way around that is going full commie (federalized gas), what could go wrong???
Posted on 6/21/22 at 4:04 pm to Big Scrub TX
quote:
I would hope he would do that too, but come on - that's not making gas prices high.
In a way, it is contributing. Refineries are scared to invest billions of dollars to expand and increase production because of statements like this. Oil majors are forward looking companies. They are not going to make that type of investment for now. They make it for the next two to three decades. Would you be confident in approving a billion dollar investment when the commander in chief is talking openly about ending your industry?
Posted on 6/21/22 at 4:04 pm to Big Scrub TX
quote:
The number one thing I would do is find some kind of way to convince high-profile institutional investors to start investing in traditional energy again.
So you don’t think Biden’s open hostility to the industry is causing a lack of investment, but you can’t think of a single thing the administration could do to encourage investment?
How about removing the open vowing to end the O&G industry from his platform?
Why would any rational company invest in something that the government has stated its goal to shut down?
This post was edited on 6/21/22 at 4:06 pm
Posted on 6/21/22 at 4:06 pm to Auburn1968
Yellen must be German for "wrong", because she is a lot.
Posted on 6/21/22 at 4:09 pm to Indefatigable
Even if Biden got on his hands and knees for the O&G folks, they’re still selling whatever they produce at market price (and not just to us, to whoever is buying).
What you’re talking about is trying to flood the market to really drive down prices (not exactly appealing to investors BTW) and not something we actually have the resources to do.
None of the mechanisms the US has access to would produce anywhere near enough to make the change we all want to price at the pump, etc. (due to global supply and demand).
What you’re talking about is trying to flood the market to really drive down prices (not exactly appealing to investors BTW) and not something we actually have the resources to do.
None of the mechanisms the US has access to would produce anywhere near enough to make the change we all want to price at the pump, etc. (due to global supply and demand).
This post was edited on 6/21/22 at 4:13 pm
Posted on 6/21/22 at 4:14 pm to Big Scrub TX
quote:Here's a verbatim quote from Biden during his debate with the Bern right before he secured the nomination:
The number one thing I would do is find some kind of way to convince high-profile institutional investors to start investing in traditional energy again.
quote:I posted the link below, which included that quote, on MT the other day:
"No more subsidies for the fossil fuel industry. No more drilling on federal land. No more drilling including offshore. No ability for the oil industry to continue to drill. Period. End."
Karl Denninger - The Market Ticker
From the linked article:
quote:And that, my friend, is why demand will continue to outstrip supply, keeping prices high for the foreseeable future. No one is going to be willing to sink money into an industry when the country's leadership - including the POTUS, Treasury Secretary, Energy Secretary, and heads of both houses of Congress have publicly stated their desire to put that industry out of business.
Capital cost for improvements and new construction have to be recovered over decades of time and the service life of equipment like that is typically 30, 40 or more years. If you tell me there will be no demand for the product in 10 years you have quadrupled the capital cost recovery required each and every year from now until then and that in turn means the price will wildly escalate and nobody may buy. There is no reason for a private concern to take that risk and you cannot compel them to do so.
Posted on 6/21/22 at 4:17 pm to mwade91383
quote:
they’re still selling whatever they produce at market price
You do know that market price isn't a set number, right?
We do have the resources to flood the market. We have oil, oil companies, and refineries. Now, they may be shy after the last fiasco, but if they are making money with high prices and it's cheaper to produce because of regulations being cut, companies will produce.
It takes a little time to impact the market, but that means start now. Don't sit on your thumb and spin and claim nothing can be done.
This post was edited on 6/21/22 at 4:18 pm
Posted on 6/21/22 at 4:19 pm to mwade91383
quote:
hen you look at what caused those fluctuations and you see how hard it is to tie them directly to any US POTUS.
When one President promises to support oil and gas, cuts regulations, red tape, and taxes and demands government process to be expedited, it inspires investment and development confidence in the industry.
When another president* repeatedly says he's going to dismantle the fossil fuel industry, appoints eco-nuts to head government energy agencies, raises taxes, fees and regulatory red tape, that too has an effect. I don't recall in the past that we had that big of an idiot enemy of fossil fuels in the White House.
Posted on 6/21/22 at 4:22 pm to mwade91383
quote:
What you’re talking about is trying to flood the market to really drive down prices
No, that isn't what I am saying. I am saying that the adminstration should stop committing to destroying the industry, which would encourage more long term investment in refining.
quote:
None of the mechanisms the US has access to would produce anywhere near enough to make the change we all want to price at the pump, etc
Not right this second, no. Would it insulate the US in the future from similar events? Yes, yes it would.
It is called foresight. Oil is not going anywhere. We have to have it, and there are no viable alternatives for it. There won't be for many years if not decades.
Posted on 6/21/22 at 4:22 pm to Auburn1968
Considering she is the Treasury Secretary and was too stupid to see inflation coming, I don’t put much stock in anything she says.
Posted on 6/21/22 at 4:27 pm to Indefatigable
quote:Again, this.
Oil is not going anywhere. We have to have it, and there are no viable alternatives for it. There won't be for many years if not decades.
There is no thermodynamic equivalent to fossil fuels. We cannot support the current level of civilization without them.
Yellen is either shockingly ignorant or deliberately obtuse. Or both. Seems to be a pattern with this administration.
Posted on 6/21/22 at 4:31 pm to squid_hunt
Will you show me your work? How much (more, again the almighty delta) can we produce? What is that relative to current global demand?
Somebody mentioned taxes, that’s tough/complicated too.
1) we’re already near the bottom, not a lot of meat left.
2) let’s just imagine NO tax (I think we avg 50 cents per gal ish?). Whatever price break we had would be quickly sent to Canada & Mex (arbitrage). Think people fueling up tankers here and selling there (Canada already pays more than us, and they drill more per capita!).
Which would in turn spike our demand/consumption (prices back up) and drive down their prices somewhat, at least for awhile until market corrected.
I’m not saying we’re powerless, it’s just pretty complicated. Blaming the POTUS is easy, both sides love to do it, but it’s simply not the difference.
Somebody mentioned taxes, that’s tough/complicated too.
1) we’re already near the bottom, not a lot of meat left.
2) let’s just imagine NO tax (I think we avg 50 cents per gal ish?). Whatever price break we had would be quickly sent to Canada & Mex (arbitrage). Think people fueling up tankers here and selling there (Canada already pays more than us, and they drill more per capita!).
Which would in turn spike our demand/consumption (prices back up) and drive down their prices somewhat, at least for awhile until market corrected.
I’m not saying we’re powerless, it’s just pretty complicated. Blaming the POTUS is easy, both sides love to do it, but it’s simply not the difference.
Posted on 6/21/22 at 5:03 pm to Indefatigable
quote:
Not right this second, no. Would it insulate the US in the future from similar events? Yes, yes it would.
Are you talking about wartime? Hoarding resources? In which case, yes it would offer us that insurance policy. But in general, this is a myth.
"We" are not o&g in this country, It is not federalized. They're private comapnies and they're after one thing, their bottom line. This has always been the case.
Pretend, we (domestic o&g companies, not you and me) produce 1/2 the worlds supply of oil and one day the other 1/2 just forgot how to do it. 100% of oil production is right here in the US of A. Every US oil producer can no now sell their product internationally at 3,4 5x the price or whatever ballooned cost it would take (not counting shipping).
Who do you think would sell to us at cheaper prices in said market conditions? Absolutley no one. We'd be taking it up tailpipe too (no pun intended).
Short of war/hoarding (or a another trade war, god forbid), we cannot insulate ourselves from the global oil market (and it's fluctuations). Sellers will always find the buyers paying the most, that impacts all of us.
This post was edited on 6/21/22 at 5:08 pm
Posted on 6/21/22 at 5:10 pm to Auburn1968
I hope this is a lesson to the 495 of the Fortune 500 companies who support the left on donations, policy, and speech.
The Left will use the government to attack your business then blame you for it.
The Left will use the government to attack your business then blame you for it.
Posted on 6/21/22 at 5:15 pm to Auburn1968
Potato Admin Just ignore everything and if asked it doesn’t exsist
Posted on 6/21/22 at 5:16 pm to Auburn1968
quote:
Biden Not Responsible For High Gas Prices, Only Way to Fix It Is a Shift to Renewables To Address Climate Change
What a nonsensical statement made for the dumbest people in the country
Same woman who said inflation was transitory.
This post was edited on 6/21/22 at 5:17 pm
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