Oil Economic Geography

How do the economics deniers explain the $50 drop in oil prices?

Lets consider the argument i heard two weeks ago that opening Anwar would only reduce the price of oil 42 cents per barrel. All Bush had to do was lift the Presidential moretorium on Anwar and it fell $20 a barrel. McCain chooses Palin and it drops another $20 a barrel. Does anyone still hold to the principle that we can't drill our way out of this problem?

Public Comments

1. Dude, while I agree that we need to utilize our domestic natural resources to our best advantage (including drilling our own oil), the global increase in demand for oil will continue to outstrip production even if we ramp up our production by 10% per year. I hold fast to "the principle that we can't drill our way out of this problem." Ramping up our domestic production will be a TEMPORARY, PARTIAL solution to our current gas price problem. Obama is a complete moron for asserting that drilling now won't help us until we actually start pumping five or ten years later--he obviously doesn't understand commodities futures markets, in which a subtle hint of increased supply ten years off can dramatically reduce prices TODAY. Nevertheless, the fluctuations in the commodities market that we've been seeing lately are still theoretically fluctuating around a market supply/demand equilibrium that is much higher than it was just a few years ago. Cheap oil is gone, my friend. So guess what--suddenly there's all kinds of (highly successful) research going into battery technology! My official prediction: within a decade there will be one electric car (with or without a gasoline-powered range extender) for every two gas-powered cars. Within two decades, gasoline-powered cars will be seen mostly at antique car shows. I really don't understand why my fellow right-wingers are so resistant to the idea of not being so dependant on oil (oh yeah, I know why--it's because we're all big-shot Texas oilmen--right, liberals?) No, I just think it's because we don't want to be associated with the current "green" movement, in which you're a hero if you make bad economic choices--like paying 12 grand more for a hybrid car that gets about 8 mpg more than its conventional equivalent. I'm not talking about screwing the country to "save the planet." I'm talking about retaining our moblity without having to import 80% of the fuel we burn. Think about it--genuine energy independence. Wouldn't that be cool?