Gingrich's $2.50-a-gallon gasoline farce
Yael T. AbouhalkahWill someone please wake up Newt Gingrich and explain how the world of pricing works for oil?
Gingrich is trying to revive his moribund GOP presidential campaign with a Facebook petition calling on people to sign it if they are in favor of moving back to $2.50-a-gallon gasoline.
It’s well-timed, I’ll give Gingrich that much.
The price of gasoline is going up around America, prompting Republicans to start highlighting that fact in their battle with President Barack Obama and fellow Democrats for votes this fall.
Here’s what the petition says:
“We the undersigned petition President Obama to act immediately to lower gasoline, diesel, and other energy prices and reduce our dependence on overseas energy sources from unstable countries by enacting Newt Gingrich’s plan to lower gas prices to $2.50 per gallon, including the immediate authorization of the Keystone XL pipeline and aggressive development of more North American oil and natural gas.”
Now for a few facts that make Gingrich’s idea a farce.
First, authorizing aggressive development of U.S. petroleum fields wouldn’t create a single extra gallon of gasoline for many years - up to 10 or more, especially if you’re talking about despoiling the Alaskan Arctic area. Drilling for oil in Alaska or the Gulf takes time, as does setting up transportation systems.
Second, the president of the United States - no matter which party - has almost zip power over the international price of crude. No one “sets” the price. But the Middle East countries have had the power for many years to jack production up and down to help set ceilings and basements for the cost of petroleum.
Finally, even completing the Keystone pipeline - which would increase the flow of oil to the U.S.- isn’t going to bring in enough to have much if any influence on the cost of oil around the world.
Remember, the United States uses about 19 million barrels of oil a day. And other countries use about 62 million more.
Simple points:
Drilling for domestic crude could - in a decade or so - produce a fe more million barrels of oil for consumption in the United States. But that’s not going to bring $2.50-a-gallon gasoline back to U.S. service stations.
George Hunsucker
Northland
1 year, 3 months agoearth to YT #1….
Are you disputing the economic fact that increased supply, or the expectation of same has or will have no effect on price? Surely that is not lib econ 101 now????
Your messiah has had 3 years to develop an energy policy and all he has done is refuse to allow the START(expectation of supply increases) or the harvesting process, demonize the producers and of course throw billions of dollars to his donors e.g. Solyndra to develp “green energy”.
He refuses to get govt. out of the way since it provides so many jobs to libs. Not PRODUCING jobs since govt. PRODUCES nothing, but high paying, low work but good donating jobs(to jimmy obama’s party of course)…
I am not for $2.50 gasoline since I think price will continue to drive America to conserve. The big 0’s policies are driving America to destruction, which I am also against….
Hank Burns
1 year, 3 months agoIt seems that the U.S. needs to take a lesson from OPEC—call it the USFMDO—United States Food and Money Dole Out (empower this organization to stop or start any foreign aid within 24 hours).
We just have to tie the cost of a bushel of corn or wheat to the cost of a barrel of oil.
Since the president absolutely refuses to allow American companies drill for oil, it doesn’t matter how much time it takes to get gasoline to $2.50 per gallon, does it?
Dan Wood
1 year, 3 months agoDrilling for oil or natural gas or whatever isn’t going to do anything about the price of gas in the immediate future. However, the USA, for the first time in 50 years, started exporting gasoline. What needs to be done, if we’re gonna stick with oil, is to increase the number of refineries to increase the amount of gasoline. And maybe have the government check into price gouging because current refineries are making way more money now than they have in the past.
Optimally, we need to get off the need for oil and move to other sources. I just watched a video yesterday about a guy who converted a car to run on water without using a bunch of money to do so. On the same page was another person who converted his house to be completely off the electrical and natural gas grid using water and solar.
The technology is out there, but until we start embracing it, enjoy the 4 or 5 dollar a gallon gas.
Steven Fetter
66223
1 year, 3 months agoI wish you would have explained this when Bush was President. Back then, it was Texas oilmen conspiring with Halliburton to manipulate the price of oil for the benefit of Exxon. It was totally Bush/Cheney’s fault. Our current President rode to office making these accusations. Just Google “Obama blames Bush for gas prices” and play back the President’s speeches. Great fodder for the upcoming campaign.
I guess I am naive enough to think that if we increase our supply, prices will fall. But hey, I remain an idealist.
Mark Hastert
1 year, 3 months agoEr, somebody want to explain why we’re exporting gasoline? We apparently have all we need with enough to spare so why will prices rise? The Canadians claim they could produce about 1 million barrels per day. That’s a bit more than 1% of daily world production. The increase in demand from China, India, and the rest of the world as it comes out of recession will sop all that up so it’s unlikely that prices in the long run will go anywhere but up. We can run on natural gas as Boone Pickens is suggesting but a big increase in the use of natural gas will decrease those reserves more quickly. Wee need to diversify.
Maybe Newt’s on to something! Let’s make Obama sign an emergency executive order authorizing the XL Pipeline in exchange for all the $2.50/gallon gas we want! They can go on exporting the rest at world prices and will still make a butt load of money!!!
George Hunsucker
Northland
1 year, 3 months agoWe will give this another go at pleasing to YT’s sense of, I guess, lib reasonableness…
Here is the the big 0’s plan:
http://www.foxnews.com/politics/2012/02/19/domestic-production-eyed-as-gas-prices-head-toward-record-breaking-height/
What a “leader”…..
Kent Mueller
1 year, 3 months agoEr, somebody want to explain why we’re exporting gasoline? We apparently have all we need with enough to spare so why will prices rise?
Read more here: http://voices.kansascity.com/entries/gingrichs-250-gallon-gasoline-farce/#storylink=cpy
Er, Mark. What part of world markets do you not understand? Let’s see……why does Kansas send wheat out of state? Most likely wheat and wheat products come back into the state. Not a big deal, Mark. Really.
Do really think markets work by suppliers checking all local outlets to make sure their needs are sated? Or do commodities enter the world market? Yeah, it’s the latter, Mark.
George Hunsucker
Northland
1 year, 3 months agoNo, no, no Ken… It is a conspiracy by those terrible big oil companies!!! Why, world demand for finished products has absolutely nothing to do with shipping product overseas…
Geeez libs just don’t have much economic sense!!
Mark Hastert
1 year, 3 months ago“Or do commodities enter the world market?”
Read more here: http://voices.kansascity.com/entries/gingrichs-250-gallon-gasoline-farce/#storylink=cpy
Exactly! I couldn’t have said it better myself and it’s all the more gratifying that you’ve said it for me. It is a world market and the Canadian oil is a drop in the ocean. We’ll pay whatever the world market demands. Drill baby drill won’t get us $2.50 gas unless the world price allows it. The XL pipeline will fill tankers bound for global destinations.
Gingrich’s and the Republican position is nothing more than pandering to the ignorant.
Kent Mueller
1 year, 3 months agoMark, don’t get carried away with a stupid comment by Gingrich. That doesn’t change the debate.
You are saying that we can’t put enough into the world market to change prices, so f it. And that is so stupid. Really stupid.
We can develop the resources we have be them coal, oil or gas, plus other renewable resources. But this administration, and good ol Mark, are adamantly standing against developing our own fossil fuels.
Mark, just how is that solar energy toasting your bread in the mornings?????