follow up to Global Warming Nuts – Answer to a question
Yes, it is a “global problem” and yes even though Russia can and has in the past been “energy independent” they still would rather buy off the “spot” market (which is higher priced oil) rather than futures, just as Japan, China, India and Indonesia do right now. The Arab oil embargo worked back in our day ONLY because OPEC was more united and fewer states produced oil and the only developing country willing to buy off the higher “spot” market was Japan when their industry was at it’s peak. Many middle eastern states that comprise OPEC today have hit their “max” or “peak” production and are pumping up to 50% water into marginal wells to get any return and have resorted to what they call “high risk” drilling (i.e. Saudis are drilling UNDER Kuwait…lol). So, many things have changed since the Arab oil embargo and we can’t compare today with yesterday. Won’t work well now as WE SELL a lot of our domestic oil today to foreign countries since we cannot turn it into gasoline or other petroleum products due to the fact we only had one new refinery open in past 30 years and that was in Mid-west. We routinely sell our North Slope crude that comes down the pipeline to Japan refineries and then buy it back (Obama was correct at least in stating that the Tsunami in Japan affected the price of oil as that was the industrial area that refined our oil). We also need to encourage new refineries or pumping all those new oil reserves will be useless without the ability to turn the oil into useful finished products. Also the refineries we have are producing close to 100% capacity now and have to be brought down for maintenance every year and twice a year they have to totally shut down portions to completely clean them out to switch from gas production to home heating oil production for the NE states that still use that heating method in their homes. Notice the rise in gas every spring and fall?? (that’s why it increases then).