Friday, December 19, 2008
How Low Will They Go
I read and printed out three days ago a New York Times Obed piece on the fall of gas prices and that it was putting Big Oil projects in jeopardy: "From the plains of North Dakota to the deep waters of Brazil, dozens of major oil and gas projects have been suspended or canceled in recent weeks as companies scramble to adjust to the collapse in energy markets."
When we were called a nation of whiners by the current administration I thought they meant the little guys but it seems those that whine the most are the big CEO's and corporations all rushing to the bailout trough with the rest of the political pigs. What did Big Oil do with all those quarter after quarter record profits? Give them as bonuses to their CEO's? I suppose it is only a matter of time before Exxon execs fly into Washington in their corporate private jets and beg for funds to continue their plans for new refineries in Saudi Arabia, Kuwait and India.
Help me here - didn't they just claim the reason gas prices were so high a few months ago was because they had built no new refineries? And now they are suspending their plans to build at least three? And they wanted the right to be able to drill where they had never drilled before like the Alaskan wilderness. Now they are daily shutting down wells across the United States.
Not to mention they are now saying that this fall in demand for their fuel supplies (yes, there is a glut being stored in tankers because they ran out of storage space) globally could curb investment and research alternative clean energy resources. Doesn't that seem rather short sighted? I suppose the Big Three Auto makers will now argue that they do not need to produce more energy efficient cars since there is ample energy just sitting around waiting to be burned.
If Big Oil cuts back dramatically on investments as they seem to be doing we could end up in a situation where supply growth goes flat when the economy starts to recover. Said on analyst: "The steeper the decline, the steeper the response."
It would seem that Big Oil (not unlike investment firms and the auto companies) look only toward the next quarter's profits. They do not take the long term five and ten year plan approach that would make for more stable markets and supplies. And yet Bush and other Republicans stay committed to the free market approach. And yet deregulation has worked so well as the current economic situation proves. We clearly cannot expect capitalists to look beyond immediate profits and bonuses and the annual corporate meeting at a five star hotel in Hawaii.
Obama is promising regulation of the banking and investment industry. I think we need regulation of Big Oil and the Big Three and all imports from China (just thought I would throw them in since they are now poisoning dog treats). I think they have all proven there is no limit to how low they will go to insure record profits at the expense of the economy and the American people.