Comments on: The REAL Reason Why the US Should Wait Generations Before Drilling http://www.darwinsfinance.com/oil-price-drill-us/ Financial Evolution: Education, Adaptation, Achievement Mon, 06 Feb 2012 15:43:23 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Len Penzohttp://www.darwinsfinance.com/oil-price-drill-us/#comment-8322 Len Penzo Sun, 03 Apr 2011 16:10:06 +0000 http://www.darwinsfinance.com/?p=1745#comment-8322 <a href="#comment-8321" rel="nofollow">@ore</a>, "we import oil from other countries because it is cheaper for us." No, no, no. That statement is flat out wrong. Oil is a global commodity whose price is based on global market supply and demand conditions. It doesn't matter where it comes from! As a result, most of your other assertions that follow that specious claim end up failing too. All the best, Len Len Penzo dot Com @ore,

“we import oil from other countries because it is cheaper for us.”

No, no, no. That statement is flat out wrong. Oil is a global commodity whose price is based on global market supply and demand conditions. It doesn’t matter where it comes from!

As a result, most of your other assertions that follow that specious claim end up failing too.

All the best,

Len
Len Penzo dot Com

]]> By: orehttp://www.darwinsfinance.com/oil-price-drill-us/#comment-8321 ore Sun, 03 Apr 2011 00:39:16 +0000 http://www.darwinsfinance.com/?p=1745#comment-8321 I would say you are partially wrong; to nail it down, i would just say we import oil from other countries because it is cheaper for us. Not mainly because of any future prospects of oil. The price of oil has always bieng growing over the years because of the increase in demand. Recently, China and India as their economy grows, their standard of living grows, and with one of the worlds largest population, are gradually increasing the numbers of drivers. The cost of importing oil is lower, than the cost of extracting it from the Green River Formation. But most importantly, oil extraction is a very dirty business, as evident in Gulf of Mexico, and other parts of the world. Even with care, oil shale mining and processing may involve a variety of environmental impacts, such as global warming and greenhouse gas emissions, disturbance of mined land; impacts on wildlife and air and water quality, of which the United States values considerably. Therefore, it is a wiser decision to import oil because if we have to produce our own, we may have a lesser absolute advantage because mining and processing from an oil shale requires more effort than the conventional style used in other countries. We also have a lesser comparative advantage because we may have to give up some vital social and economic benefits with the impacts on wildlife and air and water quality. Having said all this, I believe soon people would gradually reduce their usage of oil. Also, it is notably wrong that oil in all other countries are reducing, or in anyway reucing. This note is too long I dont want to waste people's time. I would say you are partially wrong; to nail it down, i would just say
we import oil from other countries because it is cheaper for us. Not mainly because of any future prospects of oil. The price of oil has always bieng growing over the years because of the increase in demand. Recently, China and India as their economy grows, their standard of living grows, and with one of the worlds largest population, are gradually increasing the numbers of drivers. The cost of importing oil is lower, than the cost of extracting it from the Green River Formation. But most importantly, oil extraction is a very dirty business, as evident in Gulf of Mexico, and other parts of the world. Even with care, oil shale mining and processing may involve a variety of environmental impacts, such as global warming and greenhouse gas emissions, disturbance of mined land; impacts on wildlife and air and water quality, of which the United States values considerably. Therefore, it is a wiser decision to import oil because if we have to produce our own, we may have a lesser absolute advantage because mining and processing from an oil shale requires more effort than the conventional style used in other countries. We also have a lesser comparative advantage because we may have to give up some vital social and economic benefits with the impacts on wildlife and air and water quality. Having said all this, I believe soon people would gradually reduce their usage of oil. Also, it is notably wrong that oil in all other countries are reducing, or in anyway reucing. This note is too long I dont want to waste people’s time.

]]> By: Big Louhttp://www.darwinsfinance.com/oil-price-drill-us/#comment-5541 Big Lou Fri, 30 Apr 2010 20:17:41 +0000 http://www.darwinsfinance.com/?p=1745#comment-5541 <a href="#comment-4099" rel="nofollow">@Len Penzo> I've been saying for years now let's dry up these other countries andhold on to our oil. But I agree with Len as well, you have to know when to ply your hand in regards to releasing the oil. Glad to hear someone else have a similar take, it's hard to convince others ofthis. I wonder if our government is planning for this. Maybe they're not so stupid after all!!! @Len Penzo>

I’ve been saying for years now let’s dry up these other countries andhold on to our oil. But I agree with Len as well, you have to know when to ply your hand in regards to releasing the oil.

Glad to hear someone else have a similar take, it’s hard to convince others ofthis. I wonder if our government is planning for this. Maybe they’re not so stupid after all!!!

]]> By: Bret @ Hope to Prosperhttp://www.darwinsfinance.com/oil-price-drill-us/#comment-4272 Bret @ Hope to Prosper Mon, 15 Feb 2010 20:03:58 +0000 http://www.darwinsfinance.com/?p=1745#comment-4272 There's a book that deals with this subject called Twighlight in the Desert. I haven't read it personally, but I have heard it's good. I believe the future of eneregy lies in electricity, because it has so many different sources, some of which are clean and ubiquitous. I hope the new electric cars take off and people start to consider micro-grids and local generation. Then, paying ransome to unfriendly countries or drilling in our wildlife reserves won't be a choice we have to make. It would be nice if crude oil goes away as our main energy source, just like whale oil did a hundred years ago. There’s a book that deals with this subject called Twighlight in the Desert. I haven’t read it personally, but I have heard it’s good.

I believe the future of eneregy lies in electricity, because it has so many different sources, some of which are clean and ubiquitous. I hope the new electric cars take off and people start to consider micro-grids and local generation. Then, paying ransome to unfriendly countries or drilling in our wildlife reserves won’t be a choice we have to make. It would be nice if crude oil goes away as our main energy source, just like whale oil did a hundred years ago.

]]> By: Teslahttp://www.darwinsfinance.com/oil-price-drill-us/#comment-4183 Tesla Wed, 10 Feb 2010 14:25:02 +0000 http://www.darwinsfinance.com/?p=1745#comment-4183 Right on that! Right on that!

]]> By: Darwinhttp://www.darwinsfinance.com/oil-price-drill-us/#comment-4182 Darwin Wed, 10 Feb 2010 14:18:53 +0000 http://www.darwinsfinance.com/?p=1745#comment-4182 Yeah, surely the US will run into some sort of other financial crisis or deficit spending and it would be "hmm, where can we shift some money from" kind of like how they're depleting the Social Security funds now for other purposes and how they're just using record levels of debt to fund things now that our kids will have to bear in the future. Perhaps it won't be a perfectly orchestrated strategy, but surely we'd be better off tapping it 40 years from now than today... Yeah, surely the US will run into some sort of other financial crisis or deficit spending and it would be “hmm, where can we shift some money from” kind of like how they’re depleting the Social Security funds now for other purposes and how they’re just using record levels of debt to fund things now that our kids will have to bear in the future.

Perhaps it won’t be a perfectly orchestrated strategy, but surely we’d be better off tapping it 40 years from now than today…

]]> By: Roger, the Amateur Finanicerhttp://www.darwinsfinance.com/oil-price-drill-us/#comment-4157 Roger, the Amateur Finanicer Mon, 08 Feb 2010 22:07:37 +0000 http://www.darwinsfinance.com/?p=1745#comment-4157 Diabolical! Rivals the best Bond villains in cleverness and foresight. I doubt it can be implemented effectively though. Even getting beyond the difficulty in properly timing the US oil sell off, there's the fact that we're looking at years (Decades? Perhaps even centuries, if our predictions are really, really off) to see any payoff. Given that politicians operate on time frames no longer than the next election, and as short as the next political poll, getting them to do something that will only benefit us when they are out of office is nigh impossible. Diabolical! Rivals the best Bond villains in cleverness and foresight. I doubt it can be implemented effectively though. Even getting beyond the difficulty in properly timing the US oil sell off, there’s the fact that we’re looking at years (Decades? Perhaps even centuries, if our predictions are really, really off) to see any payoff. Given that politicians operate on time frames no longer than the next election, and as short as the next political poll, getting them to do something that will only benefit us when they are out of office is nigh impossible.

]]> By: Paul Kamphttp://www.darwinsfinance.com/oil-price-drill-us/#comment-4111 Paul Kamp Sat, 06 Feb 2010 18:54:18 +0000 http://www.darwinsfinance.com/?p=1745#comment-4111 Loved this post - may I suggest calling it "The Oil Emergency Fund"? As Len states, it would be hard to nail the timing on this one - recall the populist rage as oil climbed to massive highs in 2008 - just the fact throngs of people were yelling "Drill Baby Drill!" doesn't give me great confidence we could hold off long enough to have it play out like this. However, your reasoning is sound, and hopefully I'm proven 100% incorrect! Loved this post – may I suggest calling it “The Oil Emergency Fund”? As Len states, it would be hard to nail the timing on this one – recall the populist rage as oil climbed to massive highs in 2008 – just the fact throngs of people were yelling “Drill Baby Drill!” doesn’t give me great confidence we could hold off long enough to have it play out like this. However, your reasoning is sound, and hopefully I’m proven 100% incorrect!

]]> By: Len Penzohttp://www.darwinsfinance.com/oil-price-drill-us/#comment-4099 Len Penzo Sat, 06 Feb 2010 01:08:07 +0000 http://www.darwinsfinance.com/?p=1745#comment-4099 Very interesting post, Darwin! And although I would like to think your evil plan might just work, I don't think it would ultimately play out that way. I think the fatal flaw relies on the assumption that the US would know precisely when to turn the spigot back on. Wait too long and oil becomes, as you say, obsolete - at least to the point where the revenues may be large, but unremarkable. Too early and, well... you've blown your opportunity for your monopoly. But it looks good on paper and I like your thinking! Best, Len Len Penzo dot Com Very interesting post, Darwin! And although I would like to think your evil plan might just work, I don’t think it would ultimately play out that way.

I think the fatal flaw relies on the assumption that the US would know precisely when to turn the spigot back on. Wait too long and oil becomes, as you say, obsolete – at least to the point where the revenues may be large, but unremarkable. Too early and, well… you’ve blown your opportunity for your monopoly.

But it looks good on paper and I like your thinking!

Best,

Len
Len Penzo dot Com

]]> By: Matt SFhttp://www.darwinsfinance.com/oil-price-drill-us/#comment-4079 Matt SF Thu, 04 Feb 2010 17:06:37 +0000 http://www.darwinsfinance.com/?p=1745#comment-4079 I agree, the "Drill Drill Drill" argument is largely bunk for economic reasons, but I also think it goes against sound strategic planning from a military standpoint. Reason being: why not hold your keep your most precious wartime resources (like oil) in ample reserves, let your enemy deplete their own in trade for currency, and simply stop paying it in the event of conflict. Sounds like doomsday thinking, but you can be the powers that be have put this into their long term planning when it comes to tapping off shore oil wells. I agree, the “Drill Drill Drill” argument is largely bunk for economic reasons, but I also think it goes against sound strategic planning from a military standpoint.

Reason being: why not hold your keep your most precious wartime resources (like oil) in ample reserves, let your enemy deplete their own in trade for currency, and simply stop paying it in the event of conflict.

Sounds like doomsday thinking, but you can be the powers that be have put this into their long term planning when it comes to tapping off shore oil wells.

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