It is old news that the oil industry has in the past left oil rigs inactive/nonproducing simply because it was "Not Profitable" to be running those rigs at the time/price of crude.
Yes, because the price of crude has risen, primarily because of investment speculation and not due to demand. That would be referred to as "artificial cost enhancement"
I was recently advised by "party A" that friend in the know "Party B" has indicated that because we in the U.S. have reduced our fuel consumption for the past quarter to the point that they are exporting the excess that we did not use. Will the price/gallon go down... NO, because by their exporting of that excess fuel they have artificially created a shortage and in doing so will drive the cost of fuel higher because of "demand" put on the refineries after they have depleted their "excess inventory".
It's all about money in their pockets regardless of how you look at it.
Was Bush or Obama the driving force in your initial query... No, I don't think so.
Conventional wisdom and the fossil fuels industry tells us that under the Obama Administration domestic oil production has fallen — which has in turn, hurt the economy and prevented job growth. A recent examination of annual domestic oil production tells a different story.
Robert Rapier, who writes the R-Squared Energy blog, recently finished a chapter on politics for his new book, which includes graphics to show movements in oil prices, production, imports and consumption throughout the last eight presidential administrations. Today, he published one of those graphics, which at the very least is thought-provoking, and is, as he describes it, “one of the more counter-intuitive graphics that you will ever come across.”
In short, the graphic above shows that annual domestic oil production fell every year during the eight years of the Bush Administration. Meanwhile, production rose in the first three years of the Obama Administration. Rapier doesn’t offer up his views (we’ll have to wait for the book).
What do you think? Is Obama benefiting from Bush-era policies that took time to take effect? Or can Obama take credit?
My take: Advances in oil recovery technology and the development of shale oil plays, plus high crude prices were responsible for the rise.
[Via: Consumer Energy Report]
Photo: White House
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