[vaseline2008]

Hi everyone, you all have heard the phrases "get off foreign oil", "oil independence" and "energy independence" from politicians to T. Boone Pickens. So I started to examine what this means.

It seems like a giant fallacy for this reason: The phrases are meant to mean that if we stop importing oil from other countries then the price of oil/energy will go down.

Oil is traded on the global market with the sale going to the highest bidder.

Currently the US is a net exporter of gasoline but prices continue to increase. Doesn't this alone point out the error of reason to "get off foreign oil"?

Now discuss

[BasilBoy]

Anything that politicians say, or guys like T. Boone Pickens say, is likely to be a fallacy. They're all salesmen so take what they say with a grain of salt. What their words really mean is that we (Americans) have to cut back, but many Americans don't want to hear that their way of life is about to change and change quite dramatically. So, our magnificent leaders put a spin on the reality of the situation to try to get elected or sell whatever it is they are selling...

[FarQ3]

The USA is still the worlds largest importer of crude oil is it not? And USA don't export much crude either do they? The phrase "Currently the US is a net exporter of gasoline" is a play on words really when CRUDE OIL is the real game. I don't think countries with good refining capacity generally import a lot of gasoline (petroleum).

What energy independence increasingly means for the USA is a fucked up water supply.

Investigative journalism, video available on ABC iView.
Episode - 28th Feb 2012

Video link here

Energy at all costs just isn't worth it.

[Cloud9]

We can become energy independent when two thirds of the population switches to scooters.

[Cog]

Or dies.

[babystrangeloop]

A Fog of Mendacity
James Howard Kunstler / CF Nation / February 27, 2012

The political spin is a quixotic effort to promote another commonly touted lie about the future: that the US is approaching a point of "energy independence." You'll know we got there when you have to walk to your new job weeding the potato fields.

US Energy independence: walking to your new job weeding the potato fields.

[babystrangeloop]

Currently the US is a net exporter of gasoline but prices continue to increase. Doesn't this alone point out the error of reason to "get off foreign oil"?

US can get rich selling gasoline to the EU while WTI is $20/barrel cheaper than Brent.

1. Lock down WTI to US PADD II
2. Due to having only limited buyers, supply and demand causes WTI price to be lower than world crude price.
3. Make gasoline with, say $107/barrel oil and sell it to Europe at a premium (as if it was made from, say $127/barrel oil)
4. Profit!

WTI arbitrage is a PADD II windfall
Izabella Kaminska / FT Alphaville (blog) / January 28, 2011

... The implications are that US PADD 2 refiners are enjoying a de facto subsidy that has boosted their profitability far above competitors elsewhere. ...

[Cog]

I'm liking the idea a lot. The USA could establish itself as the refinery capital of the planet. We all win.

[ian807]

Or dies.

Scooters should help with that.

[vaseline2008]

I'm liking the idea a lot. The USA could establish itself as the refinery capital of the planet. We all win.

This is the point that I was trying to make. How do "we" win? I think Chris Rock said it the best, "Don't let Shaq fool you, we don't all get a piece of his check."

In a globalized free market (relatively speaking of course) there is no "we". The only ones winning will be the owners of said commodity and they will sell to the highest bidder. No matter how much we produce in this country, if there is another higher bidder, then "we" lose (the sale).

The bottom line is that the only way we could benefit from "getting off foreign oil" is if we nationalize oil and make it the property of the state and not private business. So basically T. Boone Pickens is stating that he wants a socialist state that nationalizes the oil. Correct me if I'm wrong.

[Cog]

Under what possible right would we nationalize private companies? Are you going to compensate my losses being a shareholder in several oil companies?

No thanks and I'm positive T Boone Pickens has not intention of you nationalizing his investments.

[vaseline2008]

@ Cog you wrote:

I'm liking the idea a lot. The USA could establish itself as the refinery capital of the planet. We all win.

Under what possible right would we nationalize private companies? Are you going to compensate my losses being a shareholder in several oil companies?

No thanks and I'm positive T Boone Pickens has not intention of you nationalizing his investments.

So basically since you are a shareholder of oil companies then "We all win" means "we who have investments in oil companies win". Please clarify if I have misunderstood your posts.

The point I'm trying to make is that all the chants of "Drill Baby Drill" and "get off foreign oil" doesn't benefit the non-invested citizens of the US. I am not suggesting we nationalize anything. I believe in competition and winner takes all. I believe in Evolution. I am an Atheist. I'm just saying that the masses have been misled with such statements coming out of the mouths of said politicians and media. More drilling and cutting off foreign oil imports would do nothing to ease prices at the pump. The fact remains that the US has reduced gasoline consumption and prices continue to go up. That only means that someone else is buying up the gas and raising the prices.

[Cog]

I agree that prices will never come down again for the reasons you have stated. There are other reasons for "Drill, Baby, Drill". That being, survival of the United States with our own domestic oil production and Canadian imports on the downslope of global production. In the times to come, when dieoff becomes a reality, we will want all the oil we can get our hands on to mitigate such things happening here. I don't give a flip if the rest of the world dies-off in mass numbers. I do care quite a lot about what happens here.

This is also why I want us to lock Canada into infrastructure planning(keystone pipeline) to focus their supply to the USA. Its not to defeat global peak oil. That can not happen. But the winner in this die-off game is to have oil in some quantity flowing to you as opposed to someone else.

[Cog]

we are talking about Canadian oil sludge. That is different than American oil sludge. Regardless, by your breathless patriotic reasoning, we would be better served by leaving the tar in the ground until we really really need it?

Since we are using it for consumption and refining it into exports, I think that qualifies as needing it now.

[babystrangeloop]

Currently the US is a net exporter of gasoline but prices continue to increase. Doesn't this alone point out the error of reason to "get off foreign oil"?

US can get rich selling gasoline to the EU while WTI is $20/barrel cheaper than Brent.

1. Lock down WTI to US PADD II
2. Due to having only limited buyers, supply and demand causes WTI price to be lower than world crude price.
3. Make gasoline with, say $107/barrel oil and sell it to Europe at a premium (as if it was made from, say $127/barrel oil)
4. Profit!

WTI arbitrage is a PADD II windfall
Izabella Kaminska / FT Alphaville (blog) / January 28, 2011

... The implications are that US PADD 2 refiners are enjoying a de facto subsidy that has boosted their profitability far above competitors elsewhere. ...

No. the cost to ship the landlocked gasoline remains $20 and parity is once again achieved.

One pipeline would take care of that.

[vaseline2008]

I agree that prices will never come down again for the reasons you have stated. There are other reasons for "Drill, Baby, Drill". That being, survival of the United States with our own domestic oil production on the downslope of global production. In the times to come, when dieoff becomes a reality, we will want all the oil we can get our hands on to mitigate such things happening here. I don't give a flip if the rest of the world dies-off in mass numbers. I do care quite a lot about what happens here.

This is also why I want us to lock Canada into infrastructure planning(keystone pipeline) to focus their supply to the USA. Its not to defeat global peak oil. That can not happen. But the winner in this die-off game is to have oil in some quantity flowing to you as opposed to someone else.

Their supply to the USA? That supply doesn't become the property of the USA. That supply will be sold to the highest bidder. Like I said, the USA is not a socialist state that has nationalized oil and so the ideology of thinking any oil sent to the US or produced by the US stays in the US is not true.

[Cog]

I don't think you have thought about how desperate things are going to get on the downslope of global oil production not only in the US but around the world. Canadian oil is going to become American oil in very short order. Having a supply that ends up in the USA is a very useful thing looking forward.

[vaseline2008]

I don't think you have thought about how desperate things are going to get on the downslope of global oil production not only in the US but around the world. Canadian oil is going to become American oil in very short order. Having a supply that ends up in the USA is a very useful thing looking forward.

I don't think you have read my Human Evolution post in the Open Topic section. To summarize, I have posted that the 1% will not only survive the die off but thrive. The rest of the 99% will struggle to survive and die off.

BTW the only way that the supply of oil stays in the US will be if the US (nationalized oil?) buys the oil in the US or uses Eminent Domain. As far as Canadian oil becoming US oil...you mean the oil companies will buy it all up and resell it to the consumers?