This page has been archived and commenting is disabled.

Can The United States Rule The (Energy) World?

Tyler Durden's picture




 

Submitted by Daniel J. Graeber of OilPrice.com,

Geopolitical crises in Eastern Europe have been met with calls in the United States to use energy as a foreign policy tool. With U.S. Energy Secretary Ernest Moniz asking the industry to make a stronger case, however, it's domestic policies that may inhibit energy hegemony.

"The industry could do a lot better job talking about the drivers for, and what the implications would be, of exports," Moniz told an audience at the IHS CERAWeek energy conference in Houston.

The Energy Information Administration said in its weekly report that gross exports of petroleum products from the Unites States reached 4.3 million barrels per day in December, the first time such exports topped the 4 million bpd mark in a single month.

EIA said the United States is a net exporter of most petroleum products, but crude oil exports are restricted by legislation enacted in response to the Arab oil embargo in the 1970s.

In January, Kyle Isakower, vice president of economic policy at the American Petroleum Institute, said reversing the ban would help stimulate the U.S. economy and lead to an increase in domestic oil production by as much as 500,000 bpd. Current export polices, he said, are "obsolete."

This week in Houston, Sen. Lisa Murkowski, R-Alaska, ranking member of the Senate Energy Committee, said oil could help reposition the United States as the premier superpower.

"Lifting the oil export ban will send a powerful message that America has the resources and the resolve to be the preeminent power in the world," she said.

President Obama can show "true American grit" if he acts quickly and according to precedent. If the ban is reversed, it will be for the benefit of the international community, she said.

Moniz, who said in December the export ban deserves some "examination," said he wasn't yet convinced the case had been made to open the U.S. spigot, however.

For natural gas, House Energy and Commerce Committee Fred Upton, R-Mich., said expanding U.S. liquefied natural gas exports could be used to contain Russia, which dominates much of the Eastern European gas market.

Russia caused a stir with its military response to the Ukrainian situation and Upton said Monday foot-dragging at the Energy Department on LNG exports was putting U.S. allies in Eastern Europe "at the mercy of Vladimir Putin."

The U.S. federal government needs to determine that LNG exports to countries without a free-trade agreement are in the public's interest. The United States doesn't have a free trade agreement with any European country and the current transatlantic agreement up for debate has been stymied by EU concerns over the National Security Administration's cyberespionage campaign.

A January report from the Center for a New American Security said the economic connection that would come from oil exports could manifest itself as "coercive political influence" in foreign affairs. Domestic policy, however, needs to be honed first before the U.S. tries once again to tip the balance of power overseas.

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Fri, 03/07/2014 - 15:56 | 4522488 quintago
quintago's picture

China took Africa. That was Europe's savior. That's why they are putting so much on the line for this.

Fri, 03/07/2014 - 16:00 | 4522498 Timmay
Timmay's picture

Global warming libtards go apesh!t in 3,2,1.....

Fri, 03/07/2014 - 16:10 | 4522541 Flakmeister
Flakmeister's picture

Naw...

It looks like you got the stupid angle covered very comfortably...

Fri, 03/07/2014 - 16:17 | 4522583 johnQpublic
johnQpublic's picture

is this a god damn joke?

 

we import a shitload in one door, and they want to export ours right back out another door?

whats the goal here?

nine dollar a gallon gas?

Fri, 03/07/2014 - 16:25 | 4522623 El Vaquero
El Vaquero's picture

It is bizzaro world.  Or retardo world.  Either way, it makes you want to get a little punchy with the cocksuckers, doesn't it? 

Fri, 03/07/2014 - 16:35 | 4522654 Headbanger
Headbanger's picture

Waddya mean "want to"??

 

Fri, 03/07/2014 - 17:18 | 4522865 zaphod
zaphod's picture

This is why I don't understand why the US is not 100% hydro and nuclear. The newer methods are significantly cheaper and safer with no chance for run away reactions. Many smaller countries are around 80% nuclear just to reduce the energy risk equation. Seriously just dam up every river and build out nuclear plants for the remaining power requirement.

If the US was 100% hydro and nuclear we wouldn't have to station the army everywhere else in the world and try to control a NWO. Oh, I see the reason now, sorry just answered my own question.

 

Fri, 03/07/2014 - 17:27 | 4522914 Flakmeister
Flakmeister's picture

Does nothing for transporation...

Oil = diesel = movement of goods

Fri, 03/07/2014 - 16:30 | 4522645 Flakmeister
Flakmeister's picture

I have no idea what you are getting at, but the US refined petroleum products utilizing imported oil...

The US has ~17 mmpbd of refinining capacity while only producing ~7 mmbpd of "oil".....

Fri, 03/07/2014 - 16:41 | 4522716 DoChenRollingBearing
DoChenRollingBearing's picture

True dat.  What is funny is that the USA is one of very few places that can refine the sour (with sulphur) and heavy crude from Venezuela, ha ha Maduro...

Fri, 03/07/2014 - 16:50 | 4522734 Flakmeister
Flakmeister's picture

The largest refinery in the world is in India and it was designed from the get-go to process heavy sour....

But it is true that the gulf coast is home to the most complex refining hub in the world....

And it wants to be fed via Keystone so that the refined goods can be exported, tax free no less..

Fri, 03/07/2014 - 16:58 | 4522780 pitz
pitz's picture

Tax free, not true.  And Canadian and Bakken-derived Keystone oil, at best, displaces, but does not completely replace foreign imports.  Please stop spreading complete misinformation. 

Fri, 03/07/2014 - 17:26 | 4522798 Flakmeister
Flakmeister's picture

You don't understand how FTZs work...

And nobody has ever claimed that Keystone would do any such thing...

Fri, 03/07/2014 - 20:20 | 4523469 Escrava Isaura
Escrava Isaura's picture

pitz, sorry to say it: But you are the one that need to stop spreading misinformation. The ports are 'Tax-free' zone.

Fri, 03/07/2014 - 21:17 | 4523648 post turtle saver
post turtle saver's picture

we import oil, refine it, export it as gasoline & diesel... because refineries...

what part of "fungible" is giving y'all so much trouble?

Sat, 03/08/2014 - 00:22 | 4524161 Errol
Errol's picture

johnQ, I don't think it's a joke, I think the article is propaganda in support of the lie that the US is about to become Energy Independent and Has More Reserves Than Saudi Arabia.  The various shale and tight oil plays are providing a temporary increase in US production until the sweet spots are all exploited, but the BAU interests would like to create a popular belief that this temporary uptick will last for decades and the US will be restored to its manifest destiny as Big Swinging Dick.

I also think the Narcicist in Chief will eat this shit up; because he is no match for Putin in strategic thinking, he needs some kind of blunt weapon so he can get his bully on.

Sat, 03/08/2014 - 11:58 | 4524948 Flakmeister
Flakmeister's picture

What will Putin possibly gain that he did not already have 20 years ago?

Putin is trying to put Humpty Dumpty back together, simple as that...

The Ukraine is splitting in part because because he tolerated complete incompetence and kleptomania in the puppets he trusted to run the crown jewel of the FSU republics...

Hardly the mark of a great strategic thinker...

He is Mobuto with ICBMs....

Fri, 03/07/2014 - 16:21 | 4522599 Levadiakos
Levadiakos's picture

Looks like he picked the wrong day to wear his see through leggings.

Fri, 03/07/2014 - 16:41 | 4522714 Atomizer
Atomizer's picture

Let’s bring back the Solar power energy incentives.

$300 million taxpayer investment in Solyndra sold for … $90.3 million

 

/sarc

Fri, 03/07/2014 - 16:42 | 4522723 DoChenRollingBearing
DoChenRollingBearing's picture

I promise I can put up a profitable solar farm down here in the Peruvian deserts for only $80,000,000.  Promise!  Honest!

Fri, 03/07/2014 - 16:54 | 4522765 Atomizer
Atomizer's picture

As long as you cross your fingers behind your back, we have a deal. I'll set up the insurance provisions to protect our losses.

Fri, 03/07/2014 - 18:34 | 4523148 DoChenRollingBearing
DoChenRollingBearing's picture

No sweat!

1-800 GIMME MO

***

Zero Hedge members!  This is completely legit.  Wire us your money quickly (BTC and gold accepted too)!  Hurry, limited time offer!

Fri, 03/07/2014 - 17:34 | 4522932 Kirk2NCC1701
Kirk2NCC1701's picture

These are all Red-Herring (false, misleading) arguments, because most people here STILL don't understand The Essence of Banking:  DEBT and Debt-based Currency.

Control the Debt, control the Debt-based Currency, and you control... EVERYTHING.

Russia has the LAST chance to "contain the US", i.e. keep the use of the Petro-Dollar from also becoming the defacto Gas-Dollar. 

Russia MUST demand that its gas be paid in GOLD, to stop and mortally wound the Petro-Dollar.  The US (Fed+Big_Oil) are using its MIC to front-run this whole situation.

Most sheeple, politicians and even most ZH readers and bloggers are blissfully unaware of this ultimate truth -- and would rather spout all sorts of funny, cutesy, sarcastic, BS, simple-minded, careerist or diversionary posts.  Sheesh!

Fri, 03/07/2014 - 18:40 | 4523171 CrashisOptimistic
CrashisOptimistic's picture

Gold has no value to Russian society.  So go back and re-design your strategy.

Fri, 03/07/2014 - 17:03 | 4522713 fooshorter
fooshorter's picture

If you have milkshake, and I have a milkshame, and I have a straw... There it is, that's a straw, you see?! You WATCHING!? 

And my straw reaches acrooooooooooooooossssssssss the rooom, and starts to drink YOUR milkshake

And I.

DRINK. 

 

YOUR MILKSHAKE

 

SHHHHHHHHHHHH

 

I DRINK IT RIGHT UP!!

Fri, 03/07/2014 - 18:12 | 4523066 Balanced Integer
Balanced Integer's picture

Great movie. Daniel Day Lewis is the shizzle whatever role he plays, and in whatever movie he plays it in. +1 for the There Will Be Blood reference.

Fri, 03/07/2014 - 16:50 | 4522749 SAT 800
SAT 800's picture

If the ban is lifted it will be to the benefit of the international community. Fuck the International community. I gave at the office. I want a benefit for us for a change; could we possibly get this idea across to the pinheads and UN operatives in Washington?

Fri, 03/07/2014 - 17:06 | 4522819 Atomizer
Atomizer's picture

Armed men in Crimea threaten UN envoy; Ban dispatches human rights official to Ukraine

http://www.un.org/apps/news/story.asp?NewsID=47281

Blue helmets withdrawal, seek well-being in the arms of brown shirts.

Fri, 03/07/2014 - 16:00 | 4522501 Beam Me Up Scotty
Beam Me Up Scotty's picture

"The U.S. federal government needs to determine that LNG exports to countries without a free-trade agreement are in the public's interest"

Meanwhile, there are shortages of LNG at home and people are paying through the nose to heat their homes.  How is that good for the economy?  Sure its good for the few LNG producers and a handful of shareholders, but for the masses who don't get any benefit from the stawk market, they get a good ass raping.

Fri, 03/07/2014 - 16:04 | 4522522 Flakmeister
Flakmeister's picture

Yep.... how else can you make money on fracked NG unless domestic prices are brought in line with global ones??

Fri, 03/07/2014 - 16:20 | 4522594 johnQpublic
johnQpublic's picture

they arent just talking LNG, theyare talking oil and distilates also

this is madness

Fri, 03/07/2014 - 16:54 | 4522762 Flakmeister
Flakmeister's picture

And while the Midwest froze with propane shortages, they were exporting 400,000 bpd from the Gulf Coast...

Propane is counted as "oil" when it is produced, but it is not subject to export bans...

Fri, 03/07/2014 - 16:29 | 4522640 disabledvet
disabledvet's picture

lot of muni debt to pay off too.
And if the best we can do is "spend to create more debt" then the revenue will only come from production.

So sure...prices surge..."but the purpose is only to create more debt."
And shall we even start talking about Wall Street and "bailout tycoons"?
Meh.
Can't return to a gold standard soon enough.

Where's Crimea again?

Fri, 03/07/2014 - 16:49 | 4522745 cossack55
cossack55's picture

Question:

 

How many torpedos does it take to sink a LNG carrier?

 

A- 1

B- 1/2 of one

C- a Zippo

D- a Bic

Fri, 03/07/2014 - 18:37 | 4523165 DoChenRollingBearing
DoChenRollingBearing's picture

E- one bullet (50% W, 25% Ce, 25% La) moving very fast

Fri, 03/07/2014 - 16:00 | 4522503 agent default
agent default's picture

US is bankrupt.  Can't rule shit when bankrupt. 

Fri, 03/07/2014 - 16:02 | 4522510 Kaiser Sousa
Kaiser Sousa's picture

no

Fri, 03/07/2014 - 16:03 | 4522514 Flakmeister
Flakmeister's picture

Not even close....

But having oil priced in a currency that you can print is pretty impressive...

Fri, 03/07/2014 - 16:08 | 4522534 LawsofPhysics
LawsofPhysics's picture

I was going to say, the U.S. has been doing this for 40+ years for christ's sake.

Fri, 03/07/2014 - 16:25 | 4522622 Kaiser Sousa
Kaiser Sousa's picture

and whats the average lifespan of every reserve currency til the present???

answer = tic, toc.......

Fri, 03/07/2014 - 16:19 | 4522586 Harbanger
Harbanger's picture

Petrodollar was part of the war booty after WWII.  The US$ reserve currency hinges on oil being sold only in dollars.  I suspect China and Russia are having some serious talks with the Saudis.

Fri, 03/07/2014 - 16:29 | 4522641 pitz
pitz's picture

Oil has never been "sold only in dollars".  Sellers of oil have always been free to ask for whatever currency they want, and have always been free to trade the US dollars received away for anything they want.  Formerly, the USD$ was a relatively stable store of value as the US had net exports, particularly in manufacturing.  But that era went away many years ago.

Fri, 03/07/2014 - 16:44 | 4522729 Harbanger
Harbanger's picture

"So long as OPEC oil was priced in U.S. dollars, and so long as OPEC invested the dollars in U.S. government instruments, the U.S. government enjoyed a double loan. The first part of the loan was for oil. The government could print dollars to pay for oil, and the American economy did not have to produce goods and services in exchange for the oil until OPEC used the dollars for goods and services. Obviously, the strategy could not work if dollars were not a means of exchange for oil. The second part of the loan was from all other economies that had to pay dollars for oil but could not print currency. Those economies had to trade their goods and services for dollars in order to pay OPEC". (David E. Spiro, The Hidden Hand of American Hegemony

Fri, 03/07/2014 - 16:51 | 4522756 pitz
pitz's picture

No, there is only a single loan, that of the oil producers investing in US dollars.  All other economies that imported oil did not need to, and completely voluntarily made the decision to invest in US dollars to buy the oil with.  Currencies are fungible.  Investing in the US dollar has always been, and always will be, a conscientous decision not forced by the markets.  Unless, of course, one wants to import US produced good and services, in which case, usually the US-based sellers demand US dollars for obvious reasons.

Fri, 03/07/2014 - 17:05 | 4522814 Harbanger
Harbanger's picture

What do you mean by conscientous decision?  Practically 100% of all petroleum sales throughout the World are denominated in United States dollars.  Forced by US/OPEC trade agreements.

http://en.wikipedia.org/wiki/Petrodollar_warfare

Fri, 03/07/2014 - 17:25 | 4522903 Tall Tom
Tall Tom's picture

He is a troll whose intent is to waste your time. Oil Backed Dollars is common knowledge.

 

Furthermore the agreements stipulate that the OPEC Nations must finance US Deficits through buying a substantial percentage of our Bonds. And we agreed to commit our Military Forces to protect the OPEC Nation's Governments and Oil Fields from threat of invasion by other Nations. (That is why we went to War with Iraq to liberate Kuiwait.)

 

This is common knowledge. He is a troll or he is extremely ignorant.

Fri, 03/07/2014 - 18:17 | 4523082 Balanced Integer
Balanced Integer's picture

"He is a troll whose intent is to waste your time. Oil Backed Dollars is common knowledge."

I can easily see this argument being applied to man-made climate change "deniers."

Oh wait...

Fri, 03/07/2014 - 18:44 | 4523190 CrashisOptimistic
CrashisOptimistic's picture

Can you show us the text of these agreements that say this?

Sat, 03/08/2014 - 00:05 | 4524144 Tall Tom
Tall Tom's picture

No. I will not waste my time. I have too many productive things to do. I am starting to fatigue of the trolls.

Sat, 03/08/2014 - 12:00 | 4524955 Flakmeister
Flakmeister's picture

A more likely reason is that you are full of shit...

Fri, 03/07/2014 - 18:30 | 4523127 pitz
pitz's picture

No they aren't.  They might be priced in USD$, but it doesn't matter what currency is actually handed over.  Whether its rubles, gold, euros, Canuck bucks, or in-kind trades of other commodities or manufactured goods.  There are no "US/OPEC trade agreements" that mandate payment in USD$ for oil. 

Fri, 03/07/2014 - 17:12 | 4522846 Tall Tom
Tall Tom's picture

Sellers of oil have always been free to ask for whatever currency they want, and have always been free to trade the US dollars received away for anything they want.

 

So you are unaware of the treaties that the OPEC Nations signed with the United States and brokered by Henry Kissinger?

 

Okay. You can believe what you want. I am not going to waste my efforts attempting to point out the reasons about why the US Dollar is the World's Reserve Currency and why there is a demand for US Dollars.

 

I am tired of being baited into doing time consuming research.

 

Go back to sleep.

Fri, 03/07/2014 - 18:40 | 4523172 pitz
pitz's picture

There was a demand for USD$ because traditionally the US has been a prolific exporter, and has, at least until relatively recently, been one of the most stable regions of the world politically.  That status has been lost, and as such, USD$ reserves have been declining as a percentage of overall forex reserves.  Oil producers are free to sell their oil in whatever currency they want, and the USD$ is only used for pricing.  Settlement can, and is in whatever currency the counterparties to such contracts agree to. 

Sat, 03/08/2014 - 00:06 | 4524150 Tall Tom
Tall Tom's picture

Stop trolling. Try it on Yahoo where you can find stooges.

Fri, 03/07/2014 - 16:36 | 4522677 disabledvet
disabledvet's picture

the whole Qatar thing was interesting.
http://www.aljazeera.com/news/middleeast/2014/03/egypt-envoy-will-not-re...

meh. "talks are talks."
gold is selling off. so is silver.
"mission fail." move along.

Fri, 03/07/2014 - 16:06 | 4522529 pods
pods's picture

Oh sure the TOTUS is going to open up all our collateral for the FED to oil drilling. lol

That, and the "US citizens" are what the gov uses for collateral.

And they sure as hell don't want to see Amerikans wearing bread helmets protesting outrageous inflation.

We will keep printing FRNs and exporting our inflation until the world says Nyet!

pods

Fri, 03/07/2014 - 16:10 | 4522545 Clowns on Acid
Clowns on Acid's picture

Russia caused a stir with its military response to the Ukrainian situation and Upton said Monday foot-dragging at the Energy Department on LNG exports was putting U.S. allies in Eastern Europe "at the mercy of Vladimir Putin."

"Versus at the mercy of the Int'l banking cabal" ?

Fri, 03/07/2014 - 16:11 | 4522549 CrashisOptimistic
CrashisOptimistic's picture

The US imports 7 million bpd of crude.

Undoing the export ban would essentially have the US import some oil and then export it.  Inside that process, a handful of people would get to make some money on the higher price that would result, but the reality is that even if that absurd 500K bpd increase in production mentioned in the article happened, the US would still import 6.5 million bpd and then . . . apparently . . . re-export it.

There would seem to be no point to this other than make a few people some money, paid for by the US consumer in higher oil prices.

Fri, 03/07/2014 - 16:22 | 4522609 johnQpublic
johnQpublic's picture

we export 4.3 million barrels per day of distillates like home heating oil already

Fri, 03/07/2014 - 16:27 | 4522635 El Vaquero
El Vaquero's picture

It is maddening, isn't it? 

Fri, 03/07/2014 - 16:33 | 4522656 Flakmeister
Flakmeister's picture

Not even close....

But if that really pisses you off, you should be out protesting against Keystone...

Once refined, that oil is heading out on tankers, with the refining profits tax free....

Fri, 03/07/2014 - 16:39 | 4522699 disabledvet
disabledvet's picture

yep...
"and Wall Street wins again."
and yes...it is maddening.

Fri, 03/07/2014 - 16:54 | 4522769 pitz
pitz's picture

No its not.  The Keystone-XL oil displaces oil imports from other places, such as Mexico and the Middle East.  Some of the oil from Canada that would flow down the pipeline already is flowing into the US by way of rail car.  Taxes on refining profits, taxes on money paid to refinery industry workers, suppliers, etc., of course, flow to the various taxation entities in the United States in the usual fashion.  As do most of the dividends from such activity.

Sat, 03/08/2014 - 12:15 | 4524981 Flakmeister
Flakmeister's picture

Those taxes etc. get paid no matter where the oil comes from up to a point....

Keystone oil will have huge crack spreads and refined goods from it will be exported benefitting from a sweet heart tax arrangement....

If don't believe me, check this out and the linked Valero Investor presentation therein:

http://priceofoil.org/content/uploads/2011/09/OCIkeystoneXL_2011R.pdf

Fri, 03/07/2014 - 16:28 | 4522636 pitz
pitz's picture

Nothing wrong with capturing value through refining foreigners' oil for export.  Where it makes sense.  Better to utilize American refineries than to have refining value created/captured elsewhere.  The 'export ban' makes zero sense whatsoever and should be repealed in the name of promoting an efficient economy.

Fri, 03/07/2014 - 17:13 | 4522851 CrashisOptimistic
CrashisOptimistic's picture

Not sure who you're replying to, but if the export ban were lifted there would be no refining before export.  Crude export is crude export.  That is, no refining.

And so crude would be imported and then crude would be exported.  No advantage is provided the US as a whole by this process.  All that happens is oil price rises.  Then some people make money on that oil price rise, but the vast majority of consumers lose money on that oil price rise.

I'm in favor of removing the export ban provided there is one condition.  Net imports to the US of crude must be 0 for the export ban to be lifted.  Simple as that.

Fri, 03/07/2014 - 18:33 | 4523144 pitz
pitz's picture

Well, what would be the point of exporting if there is a domestic need?  The market will figure that out.  A 'ban' isn't needed.  For instance, the ban may very well make regional trade in crude oil more difficult, ie: the occasional Canadian refinery that may find it more economic to use local feedstock, some of which is produced on the other side of the border, rather than transporting such from the other side of Canada.  The whole idea that there would be a race to export raw crude from the US, and then, replace it with imports of raw crude, is ludicrous. 

Fri, 03/07/2014 - 18:51 | 4523219 CrashisOptimistic
CrashisOptimistic's picture

Why ludicrous?  If exportable the seller can get Brent price.  If his customer is only in St. Louis, he gets a lower price, and the consumer also does down that chain.

Without the export ban, producers can get Brent pricing.  Refiners, to compete with the Brent price, have to raise their bid to get that oil -- and pass that increase along to the consumer.

America does not benefit from undoing the ban.  Only a handful of oil producers do.

 

The bottom line on this is China and India are the source of demand growth.  Brent is higher priced because it can go to China.  If WTI could, it would rise to Brent's price and the US consumer pays more.

Fri, 03/07/2014 - 18:05 | 4523047 Tall Tom
Tall Tom's picture

How much is the Oil Industry paying you to write this? You are being paid, correct?

Fri, 03/07/2014 - 16:17 | 4522561 earleflorida
earleflorida's picture

so it's taken these fucking dimwits how many years to figure something's afoot...

genius!!!

what a fucking joke these k-street bureaucrats are-- and how dumb is dumber when the american people can't even tell the difference from a unicorn and a centaur drinkin at the frb's liquidity make-believe trough of inequities...

moar dumbness please... with aside of numbness

Fri, 03/07/2014 - 16:14 | 4522569 TheFourthStooge-ing
TheFourthStooge-ing's picture

Dan Graeber, and all of the "experts" he quotes, must be huffing gasoline, and not just generic 87 octane, but Sunoco Gold 94 octane, if they think that their predictions have any more substance than hallucinations.

Of course, his classic OPEC flub is all you need to assess Graeber's "expertise".

Fri, 03/07/2014 - 16:16 | 4522579 Robot Traders Mom
Robot Traders Mom's picture

Can the US rule the energy world? Ask the military industrial complex. They have fun protecting the Petrodollar...

 

www.TopTheNews.com 

Fri, 03/07/2014 - 16:48 | 4522741 KickIce
KickIce's picture

But it's much more than that, the MIC protects the POS currency of every country that has adopted a Rothschild CB.  It's like a huge corporation that divides itself up to look smaller, but instead of companies it's entire countries.

Fri, 03/07/2014 - 16:19 | 4522588 Dollarmedes
Dollarmedes's picture

If energy production is used to promote US energy independence instead of for general export, the energy industry will become another arm of the government. Just like in all the other nations that are oil-rich and use policy to keep the domestic prices low.

And there will ALWAYS be an incentive to reduce prices domestically, even if it doesn't make sound business/economic sense, because it will go towards BUYING VOTES.

Energy production solely for domestic consumption (or, primarily) is an INVITATION TO CORRUPTION.

On top of that, domestic consumption will have little impact on geopolitics. Things like Ukraine will not be preventable with the application of energy policy.

Fri, 03/07/2014 - 16:23 | 4522614 Dollarmedes
Dollarmedes's picture

Domestic consumption will not maximize the profits that can be made from the industry (relative to worldwide export revenues), leading to fewer jobs created. It will also incentivize malinvestment and cronyism.

Think of what Chavez did to the Venezuelan oil industry by installing cronies.

Fri, 03/07/2014 - 17:25 | 4522897 RMolineaux
RMolineaux's picture

The takeover of the Ukranian government by mob violence, fomented by the US, will lead to the collapse of this new hoodlum govenment just like its predecessor "orange" government collapsed due to immense corruption and absence of support from the people.  Don't make any plans based on cooperation with hoodlums.  Any money loaned to them will be lost.

Fri, 03/07/2014 - 16:20 | 4522596 NOTaREALmerican
NOTaREALmerican's picture

We can only enrich the Elysium Class if we have manly men who know how to use Big-MIC to kick other people asses and show the world what this great-n-glorious country's purpose is!

Fri, 03/07/2014 - 16:23 | 4522605 Cold Grub
Cold Grub's picture

American Energy dominance is a figment of some banksters imagination.   Look to the  countries with the worlds largest KNOWN supplies,

such as Saudia Arabia, Venezuela, Canada, Iraq etc.  For sure the US is increasing their Boe/d in the shale with Fracking but  they

are also fighting a decline rate  that will be hard to  stay ahead of.

Fri, 03/07/2014 - 16:23 | 4522615 esum
esum's picture

Dept of Energy...... another "tits on a bull" agency

the SEVEN SISTERS knew how to run the energy world before governments dipped thier greedy beak in the pool... and fucked things up

Fri, 03/07/2014 - 17:18 | 4522870 RMolineaux
RMolineaux's picture

That makes two greedy beaks.   The petroleum companies ae still trying to dictate energy policy to the people.  They know where they can shove that idea.

Fri, 03/07/2014 - 18:53 | 4523228 CrashisOptimistic
CrashisOptimistic's picture

The 7 sisters operated in a world demanding oil for 1-2 billion people, not 7 billion.

 

Fri, 03/07/2014 - 16:26 | 4522629 pitz
pitz's picture

"Export policies"?  Seriously, I'm laughing my ass off.  The US is still an importer of 6-8 million barrels per day.  There may be limited circumstances in which exports make sense, to participate in regional energy markets.  Or to refine Mexican oil for re-export back to Mexico. 

Oil is not 'priced' in US dollars.  It can be quoted in any currency that one wants.  Rubles.  Canadian dollars.  Gold.  There is zero need to hold or to buy US dollars to purchase oil for import.  In fact, it may be better to hold the domestic currencies of countries which are actually oil exporters, rather than rolling the dice on the US dollar's value. 

Fri, 03/07/2014 - 16:36 | 4522669 Atomizer
Atomizer's picture

This was from June of last year. Read the comments. It’s hilarious.

 

UN Climate Chief Welcomes Obama's Plan, Says U.S. Energy Czar Would Be Helpful

Obama: No time for 'flat-earth society' on climate change| Tuesday Jun 25, 2013 11:39 AM

I think Obama may have Executive Functioning LD. This fucker can only organize radical ideas.  Everything he touches turns into the color of his complexion. Not sure if treatment is covered under his medical plan. 

Many people with LD struggle with executive function, which can make activities like planning, organizing, strategizing, remembering details and managing time and space difficult.

Fri, 03/07/2014 - 17:15 | 4522858 RMolineaux
RMolineaux's picture

Report offensive.

Fri, 03/07/2014 - 16:44 | 4522728 Flakmeister
Flakmeister's picture

A repost from earlier today:

-------------------------------

This could be a very interesting summer for NG...

We still have not reached the typical seasonal minimum in storage (~1 month away)...

http://www.eia.gov/naturalgas/weekly/

Stocks are extremely low...

If the Fracking Boom is still truly alive and well, one should see a rapid recovery in storage over the summer...

Download the spreadsheet at the bottom of the above link to see what the prospects are:

The only play showing any growth is the Marcellus...

Haynesville and Barnett appear to have peaked...

The rest are flat...

Fri, 03/07/2014 - 16:49 | 4522748 Atomizer
Fri, 03/07/2014 - 17:38 | 4522958 CrashisOptimistic
CrashisOptimistic's picture

It's not 10 billion.  It is a few 10s of millions to do some exploration drilling.  Only if anything is found do they bring in more money.

This was also done by Exxon in Poland.  They left last year.  Nothing there.

Sat, 03/08/2014 - 00:27 | 4524208 Atomizer
Atomizer's picture

That's why I dated story heading, But you know about the new contract. Opps

Fri, 03/07/2014 - 17:56 | 4522996 earleflorida
earleflorida's picture

there's no need to explain to anyone how these companies exploit governments of corruptible administrations... leaving the land ravaged,unusable and desolate, once their insatiable appetite for energy has been exhausted-- moving on to another sucker!?!

"Fracking and water (shortages) consuption"                          http://www.sourcewatch.org/index.php?title=Fracking_and_water_consumption  

"Ukraine, 'Managed aquifier recharge"   (scroll down individual concern)

http://www.climateadaptation.eu/ukraine/fresh-water-resources/     

Fri, 03/07/2014 - 17:09 | 4522830 Kirk2NCC1701
Kirk2NCC1701's picture

As I have said* since last year -- and Russia, Iran & China please pay attention, because your currency and lives depend on this:

1. The fiat USD/Debt-Dollar mathematically needs to grow beyond its status as Petro-Dollar.

2. The Petro-Dollar needs to become the ENERGY-DOLLAR, to "rule the world". 

3. If it succeeds, it's "Game Over" for Russia, China and Iran. The NWO will have been established, and ONE CURRENCY WILL RULE THEM ALL.  And with it, those who rule the "Issue of that currency", rule as "Kings of the World", for centuries to come.

4. If it fails, and these countries can force NatGas and LNG to remain in ANY CURRENCY, the Dollar will die... eventually.  If they are smart, crafty and move FAST, they will form a GAS-CARTEL, whereby GAS is priced in [drum-roll] (a) "a Basket of Precious Metals", or (b) A Basket of Regional Currencies.  If the US/Fed can't achieve total Global Victory, they will settle for being part of a "Basket of Regional Currencies", since they will still have the additional advantage of having the Petro-Dollar.

5. The G20 needs to adopt a basis for a new global currency system, whereby "A mix of PMs and Energy is used to back a nation's currency".  They can agree on a standard international currency unit and define its PM and Energy content (in a LUT -- Look-Up Table).  All sources of Energy (Electrical, Carbon-fuel or Nuclear) are acceptable, when converted to Joules or Watts.  Thus, solar power and coal qualify also.  The former is renewable/perpetual, the latter is not.

If the US and its G7 lackeys won't go along, the other G20 members (G12) can "go it alone".  If they dare to stand up to the US and its "Spreading democracy one coup at a time" Realpolitik.

 

* I believe I was the first to say so, when the "Qatar pipeline via Syria" discussion went on.

Fri, 03/07/2014 - 17:43 | 4522976 CrashisOptimistic
CrashisOptimistic's picture

PMs have no value to society like calories or joules.

Energy backed currencies would mean that the Swiss franc has zero value.  Ditto Japan.  New Zealand.

Any approach like that has to focus on some calorie/joule combination.  But then you face outright recessions every time there's a crop failure.  You will be at the mercy of the weather.

Fri, 03/07/2014 - 17:10 | 4522833 RMolineaux
RMolineaux's picture

This is a nonsense piece.  As long as the US is a net importer of petroleum it is silly to talk about "controlling" the petroleum market.

Fri, 03/07/2014 - 17:22 | 4522889 TrustbutVerify
TrustbutVerify's picture

Combine energy independence with greatly increased efficiency.  Win/Win!!

Fri, 03/07/2014 - 18:02 | 4523039 Winston Churchill
Winston Churchill's picture

Only if you default on the debt, and then  start manufacturing here again.

The petro dollar ties up the US just as much as the rest of the world.

A geordian knot.

Fri, 03/07/2014 - 20:29 | 4523505 Lumberjack
Lumberjack's picture
Committee passes bill requiring wind projects to lower rates, create jobs http://bangordailynews.com/2014/03/07/politics/state-house/committee-pas...

AUGUSTA, Maine – A Gov. Paul LePage initiative meant to overhaul Maine’s wind energy production goals to require ratepayer benefits and manufacturing jobs, gained tentative approval in the Legislature’s Energy Committee on Friday.

But the bill, LD 1791, sponsored by state Rep. Lance Harvell, R-Farmington, saw a significant revisions including allowing a section of current law to stand, prior to the 6-2 vote to approve the measure.

Initially, the bill would have erased from Maine law specific goals by year for installed wind energy capacity, but an amendment by Harvell Friday left those goals intact, including one for 2015 that state isn’t even halfway toward reaching.

Under current law, the state’s goal is to have 2,000 megawatts of installed wind energy by the end of next year. But, according to industry officials, so far the state has only 676 megawatts of operating wind turbines with another 150 megawatts under construction.

The bill, as amended, still adds new criteria to the state’s wind energy goals including one that says new grid-scale wind power projects in Maine need to show how they will reduce the price of electricity for Maine ratepayers, create jobs and bolster the state’s manufacturing industries prior to approval for construction by the state’s Department of Environmental Protection.

Fri, 03/07/2014 - 22:08 | 4523800 22winmag
22winmag's picture

Three words, baby.

 

Beyond the peak!

Sat, 03/08/2014 - 13:50 | 4525194 Flakmeister
Flakmeister's picture

I would argue the three would be:

On the plateau...

Do NOT follow this link or you will be banned from the site!