Friday, June 22, 2007

Oil and Gas 101

As some one that does work for an oil company, let me respond. Economics 101: each day more countries are becoming industrialized (think China and India) thus, more people are using oil/gas which creates a larger demand. At the same time, we are slowly depleting our world supplies and decreasing the amount of crude available to the world. So, what do we have: we have much bigger demand and less total oil. Capitalism 101 again, we have price increases because more competitors are willing to buy oil and there is less oil.

The other big factor is the low hanging fruit has been picked, thus it takes more money even with better technology to get the oil. The good news is that we can get to more oil than in the past, the bad part is that it is still very expensive.

Anwar should be open, Congressman Ralph Hall said it is like putting posatage stamp on football field the amount land that is Anwar compared with total square miles in Alaska. it would not have major affect on the environment there. The more open fields and more oil production then more likely a decrease in price. That is why hurricanes and wars effect the price greatly. There is some shady business like raising prices on holidays and the summer which is the gas stations not the oil companies according to repots, but for the most part the oil companies are being legit with prices.

The real bad news is the prices will continue to rise. We must start switching to other sources of energy, not because I'm an environmental not or green peace freak, but because nuclear, wind, coal, solar, sugar cane ethanol (not corn), and methane will help stabilize the prices for time being. They will help our grandkids when we eventually run out of gas. We have enough to last for our lifetimes I suspect, but not much further.

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