Oil Drilling Redux

Is it only me or do you all have an automatic response when politicians say "We should stop sending all our oil money to people who hate us." My automatic response? "Damn those Canadians!" Our leaders are fiddling with their naughty bits in public while Rome burns. Don't let them get away with it.

Have I been writing too much about this issue? Probably so, but it really pisses me off (I commute 38.6 miles one way per day). Our politicians are saying the equivalent of "The Internet is... a series of tubes," only nobody is laughing at them.

So you've heard about how wonderful it would be if we opened off-shore drilling, right. You might remember my earlier post about it. If we could get all 18 Billion Barrels (a statistical mean, more than likely much less) of oil right now, and it was the type of oil we could process, it would only stop imports for 5 years. That's if we continuing our other domestic production. There is also no guarantee than the oil would be sold here to the US (oil is sold on a world market, no matter where it's pumped).

But now we have estimates on how much oil we realistically could be producing in 15 years (any talk about seeing oil from these leases before 10 years are simply lies, we don't have the equipment, we don't have the infrastructure, and we don't have enough engineers to do the job - see the industry's excuses on why they haven't drilled on the land they currently own leases to). Most people are talking 200,000 barrels a day (the far end is 800,000 barrels a day). We import 2.36 Million barrels of oil per day. Until recently (the time that the DoE figures referenced in the link above) we were filling the strategic oil reserve to the tune of 79,000 barrels per day (that's now at an end).

So let's say we could get 200,000 (800,000) barrels of oil per day. That's only slightly more than what we import from Equador, #12 oil importer (Iraq, #6), and is 11% (44%) of what we import from Canada (our #1 importer). It's the output of roughly 2000 (8000) US wells, but only 2 (8) middle east wells. Saudi Arabia is already over producing (they used to be #4 or 5, now they're #2) and are beyond their comfort zone. They would love to cut back and would only have to cut their production by 12% (50%) on just the oil they sell to us and we would be equal.

The best thing we can do to drop the price of oil is conserve. Most countries are still expanding their need for oil (China and India continue at the pace they have for the past three years). However here in the US gasoline and diesel consumption (from retail sales) has dropped by 2-3% in the past few weeks. The price of oil has also dropped to below $120 a barrel. Properly inflating tires could cut another 3-4% on consumption. These are things that have a real impact right now.