Popping The OPEC Oil Price Bubble in One Easy Step

Now Playing: Ride 'Til I'm Satisfied from Mr. Trout's classic Go The Distance

An uncompromising commitment from the Federal Government to reawakening American oil production through deregulation and government roadblock elimination, would a.) almost certainly pop that portion of the current oil price attributable to a speculative bubble, and b.) scare the hell out of OPEC by guaranteeing future competition from America in the oil market.

Both would translate as a rapid, dramatic downward pressure on oil prices worldwide.

As I've said here repeatedly, the fact that America has locked away its resources as a shrine to the religion of "environmentalism," thereby granting to OPEC a pledge of non-competition by what ought to be its largest competitor, is ethically obscene.

We have it within our power to relegate OPEC to the status of secondary player in the world petroleum market, if not bankrupt it altogether, even reestablish America as top dog in oil production and export. Economist George Reisman's landmark article Free Markets Would Be OPEC's Undoing discusses the point in some detail. All we have to do is get our power-junkies in D.C. to swear off their legislative hooch, get the hell out of the way and let American producers produce. Just that.

Increasing American oil production, whether today, next week or next decade, will be a vast, no-brainer benefit on multiple levels:

- Every new barrel of oil produced in America is a barrel NOT purchased from OPEC;

- Every new barrel of oil produced in America is a barrel that can be sold on the world market;

- Every new barrel of American oil sold on the world market represents an addition to American GDP;

- Every new barrel of American oil sold on the world market represents an increase in global oil supply vs. demand;

- Every new barrel of American oil sold on the world market represents further reduction in revenues to OPEC, via both downward pressure on oil prices and by drawing international customers away from the OPEC cartel;

- Every new barrel of American oil sold on the world market represents more jobs and income for Americans;

- Every new barrel of American oil sold on the world market represents a powerful shot in the arm of the world economy, with the potential to spur another long-term economic boom cycle;

- History has shown that worldwide economic recession is a catalyst for war, while worldwide economic prosperity is a powerful catalyst for peace - therefore every new barrel of American oil is a brick in a new foundation of world peace.


So...why isn't this simple regulatory tweak being performed by Congress, to set that long-overdue avalanche of oil prices in motion?

Simple: The Democrat-Socialist Party holds the majority in both houses of Congress, and refuses to restore freedom to America's energy industries.



Solution: Oust those neo-Luddite morons in November.

Just In: Saudi King says "Get used to high oil prices"

FYI:

Saudi king urges consumers to get used to high oil prices, from Agence France-Presse

The Earth is Swimming in Oil

Now Playing: The Reason I'm Gone by Mr. Trout, live & loud

Some reference facts:

* America's oil import total from OPEC since 1973: ave. 3.5 billion barrels annually;
* Saudi Arabia's estimated total oil reserves: 260 billion barrels.


Conventional Crude Oil and Natural Gas Resources:

- In a February 2006 report titled EPCA III, the Department of the Interior's Minerals Management Service (MMS) stated that there are 85.9 billion barrels of unrecovered oil and 420 trillion cubic feet of natural gas on North America's outer continental shelf alone;

- That same report estimates America's resources onshore, on federally-controlled land kept off-limits to oil and gas production, at 117 billion barrels of oil and 651 trillion cubic feet of natural gas;

- That same report estimates America's onshore resources on private lands at 139 billion barrels;

- That same report states that 60 percent of the onshore government-controlled lands are presently closed to leasing, and that an additional 30 percent of onshore Federal oil and 49 percent of onshore Federal gas may only be developed subject to restrictions over and above deal-killer environmental regulations;

- In a development sure to drive eco-fascists to apoplexy, the thawing ice on Greenland could yield 50 billion barrels of previously-inaccessible oil, according to Norwegian and British estimates;

- Brazil's government-run oil monopoly, Petrobras (also producers of fine lingerie for fetishists, apparently,) announced the discovery of a huge offshore oil field - "Tupi" - some 200 miles due south of Rio, with an estimated yield of 8 billion barrels. Petrobras' nearby, existing Jupiter field is roughly equivalent in yield to the Tupi discovery;

- An April USGS report estimates that the recently-discovered Bakken Formation oil field in western North Dakota / eastern Montana contains between 3 billion and 4.3 billion barrels of crude;

Tar Sand:

- A couple years ago Raytheon and CF Technologies developed a breakthrough microwave technology that allows an orders-of-magnitude increase in the petroleum yield from tar sands. The Athabasca region of northern Alberta contains tar sands with a potential yield estimated at 870 billion to 1.3 trillion barrels of oil, an amount well in excess of all of the crude oil extracted by man to date, i.e., in all of recorded history;

- Venezuela's tar sand deposits are roughly equivalent in yield to those of Canada, albeit currently infested with a bloodthirsty socialist dictator;

- The tar sand oil yield for the State of Utah alone is estimated at between 12 to 19 billion barrels;

- Russia's Volga-Ural basin and northeastern Siberia contains tar sand deposits with an estimated total of between 76 and 246 billion barrels;

Arctic Ocean Oil Resources:

- The U.S. Geological Survey estimates that the Arctic Ocean contains about one quarter of the entire world's undiscovered oil and gas, somewhere around 400 billion barrels;

- A couple months ago, Anatoly Zolotukhin of Gubkin Russian State University stated in an Anchorage speech that Russia's Arctic shelf holds a potential 580 billion barrels of crude.


...To name but a few.

...That we're aware of.


Once again, with feeling: As Pepperdine University economist George Reisman has said, the Earth is an immense, solidly-packed ball of chemical elements. We, the human race, have not yet made a scratch-within-a-scratch of the surface of that ball of elements.

Read Reisman's articles:

Free Markets Would Be OPEC's Undoing

and

Environmentalism Refuted, both posted at the Ludwig von Mises Institute website.

Future historians will look back at this early 21st Century neo-Malthusian madness with raucous laughter, but we're having to live in it. Hopefully not for long.

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