Friday, April 1, 2011

Obama the Energy-Idiot

Oil is touching another 19-month high this morning, a barrel of West Texas Intermediate fetching $106.42.
It's at this moment, this week, that President Obama gave a speech on energy — setting out the goal of cutting oil imports by one-third over 10 years. This would be accomplished, he says, by...
  • Finding and recovering more domestic oil
  • Boosting fuel-efficiency
  • Turning to "cleaner" alternative fuels.
"I've been listening to dumb presidential addresses, particularly on the topic of energy, since the mid-1960s," says our resident oil field geologist/associate editor Ralph. "But I have to confess that Obama's speech sets a new low point for utter ignorance, if not conscious mendaciousness, on the topic of energy."
For starters, that reduction of oil imports by a third over a decade? That's not over the next decade. "The start date is Mr. Obama's inauguration, in January 2009," Ralph points out. "How convenient. Just on the basis of the recession, U.S. oil imports have fallen from 11 million to 9 million barrels.
"Perhaps we should morph the current recession into another Great Depression and accomplish that one-third reduction goal quickly, once and for all!
"Then there's the idea of blaming oil companies for not drilling their offshore leases. This from the president whose administration has imposed an almost one-year 'moratorium' on issuing permits for offshore exploration and drilling. And who, by the way, opposes extending all leases, as a matter of course, by the amount of time that the Department of Interior has refused to issue permits.
"The bottom line is that Obama's speech yesterday was one more in a descending series of bad speeches, over many decades, from a long chain of U.S. presidents."
And it does nothing to change Sound Of Cannons's long-term energy investing thesis: The world will continue to run on liquid hydrocarbons (that is, oil) for decades to come… and that fuel source will be more and more difficult (and expensive) to pull out of the ground.

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