Thursday, October 23, 2014

For Russia, U.S. Oil Production Is Doing More Harm Than Sanctions

One thing is sure, the Democrats hate oil companies; and they want you to hate them too.  This year they are demonizing the Koch Brothers. In the past, Exxon Mobil and other big oil companies were the targets of their wrath.  Every time gasoline prices jumped significantly, the Democrats held hearings to publicly flog the oil company CEO's for manipulating prices so that they could fatten their already fat profits.

But, nothing ever came out of all those hearings. That's because, secretly, every Democrat wants high prices at the pump.  Only then will consumers shift to alternatives to oil or buy more fuel-efficient vehicles or drive less.

Barack Obama is no different.  Since coming to office, he has used EPA lawsuits -- most of which were found to be without merit -- to stop oil production and fracking operations in places like West Texas. He has blocked the Keystone pipeline project in order to restrict oil supplies. Following the BP Deep-Water Horizon oil spill in the Gulf, he has effectively used that as an excuse to limit what had been a previously fast-growing and vast area of oil production.  At the same time, federal oil leases -- both for offshore and federal lands -- have been severely restricted by this President.  Lastly, he has attempted to use questionably endangered species like the Lesser Prairie Chicken and the Greater Sage Grouse to stop oil drilling and production in vasts swaths of the U.S.

But, despite all those efforts, and thanks to private and state oil drilling, America is set to be the world's largest oil production country by sometime next year.  And, we are all the beneficiaries because there is now a glut of oil and prices are falling; with lower prices at the gasoline pump to follow.

Even more interesting is the fact that lower oil prices, as a result of rising U.S. production, might be doing something to Russia that the President's own sanctions over the Ukraine haven't done.  That is, to severely hurt their economy.  Russia is heavily dependent on oil production and exports.  But, as the Russian Central Bank so noted, lower oil prices are threatening their economy. and, that comment was made when Brent Crude was at $98 a barrel.  Today, Brent is selling at about $86 and will probably fall even lower as world inventories continue to rise.

So if President Obama wanted to hurt Russia even more, he could approve the Keystone Pipeline.  Approve more federal leases and back off litigation and the EPA's abuse of the Endangered Species Act to restrict production.  However, given the political influence of the environmentalists and the Democrats, he would rather the Ukraine be handed over to Russia than increase U.S. oil production by one drop.


Venezuela blames U.S for global oil price slump:

Massive Rise in Crude Oil Inventory Sends Prices Tumbling:

U.S. to Be Top Oil Producer by 2015 on Shale, IEA Says:

Russian Central Bank Fears Weak Oil Price Could Threaten Economy:

Court backs Texas revolt against EPA's new greenhouse gas rules:

Oil and gas production on federal lands is in free fall under Obama:

Save a Chicken, Drill a Well - Wall Street Journal:

Critics cry foul as feds place lesser prairie chicken on threatened species list:

EPA backs off on fracking contamination claims in Texas:

EPA’s Abandoned Wyoming Fracking Study One Retreat of Many:

EPA drops action against Range Resources over Parker County water wells:

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