1.
It’s a World Market, Supply Doesn’t Matter. This categorical lie has come out of Obama’s
mouth no less. I’ve already blogged on
how, to the contrary, local gasoline prices, here within a few hundred miles of the North Dakota
oil patch, are significantly lower than elsewhere in the country. That continues. I paid $3.11 a gallon when I filled up my
Jeep last week when national pump prices averaged $3.78 a gallon. On an individual state basis the highest
prices are in progressive utopias California ($4.25 a gallon), New York
($4.01), Hawaii ($4.35) and the District of Columbia ($4.00) where tight
supplies, limited competition, burdensome regulatory requirements, high taxes and anti-consumer policies prevail. The President need not pay much attention to
notice that even when “world” market oil prices are quoted they are typically
broken down into two – West Texas Intermediate Crude and Brent Crude Oil,
currently $93.36 a barrel and $114.26 per barrel, separated by more than 20 percent
difference, not the single, unified, holistic price Obama wants you to
believe. The third most frequently quoted international reference price is the “OPEC Price Basket,” which is itself actually a
composite of 12 distinct crude oil prices prevailing in the various OPEC countries. The next time Obama spouts off on "the world oil price," remember,
he is belying his own Energy Information Administration,
which publishes no less than 29 different first-purchase domestic crude area
prices. When anyone says or implies
there is nothing but a world oil price, or asserts prices are unaffected by
local supply and local conditions, it's liar, liar pants on fire.
2.
Keystone Pipeline Oil Will Be Exported. I don’t doubt that some of the oil
transported by Keystone XL will be processed for export, almost certainly a very
large share during the pipeline’s early years.
But I have been around long enough to remember the same clarion call from the
anti-energy, progressive crowd when the Trans-Alaska pipeline was planned. The progs said don’t build the pipeline and despoil
the environment because the crude oil will be loaded onto tankers and transshipped
to Japan (the big fear then was being taken down economically by Japan, just as
many fear economic Armageddon via China today). At various times during the Alaska pipeline’s
existence petroleum flows were exported.
But by 2004 exports ceased. Over the 36 year existence of the Tran-Alaska
Pipeline, only 2.7 percent of Alaskan crude has been exported. It’s quite normal for supplies to exceed what
is needed locally during the early years of a pipeline project, resulting in exports. But it is also common for a new source of
supply, as it matures, to substitute for other domestic supply
sources that wane over time.
3.
Exported Oil Has No Beneficial Impact on US Petroleum
Markets and Prices. It is
axiomatic that market prices depend not only on the current supply stream, but also
the cost and availability of close substitutes.
It is difficult to imagine a closer and more cost competitive substitute for
domestically produced oil and gas than domestic oil and gas. Even supplies that are exported will have
a dampening impact on US domestic prices.
Furthermore, those exported
supplies would be available domestically, providing energy security, in the
event of a crisis and will serve future domestic needs.
Rich Activists Without Real Jobs Chained to White House Fence |
4.
Exported Oil and Gas Have Little or No
Beneficial Impact on the US Economy or Employment. The
pipeline industry directly employs 44.3 thousand workers, who are very well
paid ($37.62 per hour) and heavily in demand (43.1 average weekly hours). Including the impact of contractors, construction
and demand multipliers, the pipeline industry supports hundreds of thousands of
jobs. Keystone XL will not exclusively
transport Canadian oil. A portion of
the oil transported via Keystone XL will be domestically extracted, helping to
secure employment in the extraction sector, which employs close to 200,000
people directly. Keystone Pipeline Oil
will be refined in the US. Refining is another big value add. Another 100 thousand plus people are directly
employed in high wage refining jobs.
Let’s give a big OK to the XL.
Barack Obama Promoting His None of the Above Strategy |
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