In 2008, Candidate Obama campaigned against Republican-era high gasoline prices. Now that pump prices are high with a presidential election looming, President Obama disclaims responsibility. “We cannot drill our way to lower gas prices,” he says.
Crude oil is a fungible commodity, the argument goes. So why should we Drill, Baby, Drill when any domestic supply we might add is a relative drop in the bucket? Nice argument, except that it could be used against having any new production. (And U.S. CO2 emissions at the margin are a drop in the bucket, right Mr. President? ) And as the economic revolution of the 1870s taught, economic value and thus prices are set at the margin.
Marginal Economics
The United States is the world’s #3 oil producer. Domestic policy decisions in the U.S.…
Continue ReadingThe major federal tax and grant subsidies for windpower and other qualifying renewables are scheduled to expire at year-end. And claims of robust economics, competitiveness, and growth have given way to fear of a freer, less preferential market in 2013 and beyond. Wind’s artificial boom/upcoming bust is the risky business of political capitalism.
Last Friday’s edition of Environment & Energy Daily ran this story (sub. req.):
… Continue ReadingThe American Wind Energy Association estimates that 10,000 jobs will be lost by September — primarily among manufacturers of wind turbines and components facing a dearth of orders for next year. By the end of the first quarter of 2013, the industry will have shed about 37,000 jobs without quick action on a PTC renewal, according to a widely cited study AWEA commissioned from Navigant Consulting.
“We should never forget that the oil industry, whatever its problems (and most of those are caused by bad government policies) is the single most vital industry in the world.”
This election year, America faces many crucial legislative choices in the oil/gas industry–and the PR strategy of oil companies will certainly affect the outcome.
What should oil company executives do to improve their industry’s reputation and secure their freedom to produce the lifeblood of civilization?
Unfortunately, the conventional answer is: pretend they’re not oil companies. BP’s John Browne some years ago infamously declared his company’s aspirations to be “Beyond Petroleum”–a slogan that obviously does not aid the industry’s desire for more petroleum drilling rights. (BP, to its credit, no longer trumpets this slogan, which defaults BP back to the implicit original, British Petroleum.)…
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