And as far as gasoline prices are concerned, building new refineries will help a lot more in the short-to-medium term than extracting more domestic crude.
That makes sense, but I think most of the Saudi oil goes to Europe. Our imports mostly come from Mexico and Canada.
What about the ChiComs oil demand? They suck a lot.
Cute theory but it just doesn't work economically. If this strategy were attempted seriously on a macro scale as global Saudi output and reserves dwindled, prices would rise to a point where the Permian lease holders would be foolish NOT to sell and produce their reserves.
The fact is, it is not possible to hoard to any great extent a global product like crude oil that is available widely and reserves have been studied for so long. When output declines in one place, causing prices to rise, output will always increase elsewhere pressuring prices back down again. Moreover, Saudi Arabian oil will never run dry, nor will the global supply. You might wind up with some capped wells with very expense reserves, but no one will ever run out as long as the free market is dictating supplies and prices.
I do agree that oil in the ground is money in the bank.
Your geopolitical take may or may not be correct, but oil companies are in the business of producing oil.
Not to worry, the feds are slowing/stopping oil production everywhere they control property, and they control a lot of properties.
The discoveries are great news. Our national security is enhanced. Oil markets will be more stable, oil will be more affordable than otherwise, and wasteful, expensive “green energy” takes another hit.
Great news all round.
And as far as gasoline prices are concerned, building new refineries will help a lot more in the short-to-medium term than extracting more domestic crude.
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That story about the USA not building new refineries has been around for decades. Meanwhile US refining capacity has been steadily rising.
What’s happening? The refiners found it cheaper to expand capacity of existing refineries rather than build new ones. No big deal.
The tough part is that a lot of US refining capacity is designed for sour crude (high sulpher content) oil. But all the new shale oil is light sweet (low sulpher content) crude. There’ll be a cost to reconverting US refineries back over to handle light sweet crude.
Completely agreed. People cannot look at this like “well, that’s the end of the problem”. This buys TIME. I may be OK in my lifetime but the grandchildren of many people here won’t be. Furthermore, I believe that people 200 years from now will wonder how we could have been so stupid as to burn or explode such a useful product. It still blows my mind that people in the NE still warm their homes with OIL in the winter (nowhere else in the developed world is this done). And, you can bet that they vote for the Dems.