Saturday, April 22, 2006

Fuel For Thought

So here's the thing which has been puzzling me for a while: Bush and the Republicans are the best friends the oil companies have ever had, yah? And outrageous gas prices are definitely contributing to Americans' dissatisfaction with Bush, the Republicans, and their war, yah? And yet, the oil companies have been reaping windfall profits off of said outrageous gas prices, to the electorally damaging detriment of their Best Friends Forever. Can they not help themselves? Can they not exert even the tiniest bit of self-restraint to preserve their own long-term interests (i.e., keeping the Republicans perpetually in power)?

I have a timeline for a possible scenario which would allow the Republicans and the oil companies to have their cake and eat it too. (Don't worry, nobody reads my blog)

July/August 2006: Bush and the Republican Congress hype and pass a bogus energy bill which they trumpet as a Brilliant And Innovative Solution To Soaring Gas Prices. Krugman writes three or four columns explaining in excruciating detail how this is just another package of corporate welfare and environmental rapine which will do nothing to reduce gas prices.

September/October 2006: Gas prices miraculously fall to the $1.50-$2.00/gal. range. The media acclaim Bush and the Republicans' bold vision, and contrast it with the Democrats' carping and naysaying. The oil companies are walking with a stiff and uncomfortable gait, and appear to have some difficulty breathing. Their profits are unusually low, but no-one notices or cares.

November 2006: Republicans hang on to power in both houses of Congress, possibly even picking up seats as a result of their remarkable success reining in gas prices. The oil companies wink knowingly at each other between gasps.

December 2006/January 2007: Bush invades and/or nukes Iran. Gas prices break the $4.00/gal. barrier, heading towards $5.00. The media points out that it would be at least $8.00/gal. if those narrow-minded Democrats had been in charge. Oil companies and Republicans exchange high-fives.

8 comments:

Interrobang said...

You forgot the part about when the inevitable chorus of voices goes up saying, "Hey, Rube, you've been had! It was all a huge swindle!" and similar sentiments, the chorus is immediately derided by the media as being "shrill" and "out-of-touch," and by the entire right-wing noise machine as being "America-hating" and "unpatriotic." GM and the other Big Two ramp up production of even bigger SUVs and sell them using flag-festooned commercials.

PoliShifter said...

Sad to say, I think you have laid out a very plausible scenario.

I only hope the American Sheeple won't be fooled by these shananigans again.

Ofcourse, they have always been fooled in the past.

"Why the cheap oil from Iraq will pay for the war AND Reconstruciton of Iraq...And a chicken in every pot..."

oldwhitelady said...

Yup, somehow, you've managed to think like them. I wouldn't say it won't happen just as you wrote.

Anonymous said...

im sorry but the oil companies do not control the price of gas. exxon makes money buy finding and producing crude oil, some money from refining, and very little money from marketing. most of the exxon stations are independently owned.

check out the new york mercantile exchange www.nymex.com, crude oil and gasoline, natural gas, gold, silver, copper, etc are all publicly traded. anyone can buy or sell any of these commodities.

as you can see, gasoline is lately trading at 2.2$/gal wholesale, add on about 50c of tax and some markup for distribution and service station profit, and you get $2.9/gal national average.

check out www.theoildrum.com, www.peakoil.com, www.lifeaftertheoilcrash.net

guess what, oil is a fast depleting non renewable resource. ever consider that it may be halfway gone?

Eli said...

I don't doubt that the general trend of oil prices will be inexorably upward. But where exactly are the oil companies' windfall profits coming from, if not from oil/gas prices? The Iraqi invasion/occupation has been awfully good for their business.

Anonymous said...

eli, of course oil companies are making more money when the price of crude oil increases. THAT'S WHY THEY ARE IN BUSINESS. i would like to point out that there is a difference between crude oil and gasoline, which is why i said exxon makes finding&producing crude oil at a cost LESS than people are willing to pay for in on the open market (www.nymex.com). gasoline comes from refined crude oil. furthermore, a company like exxon is largely owned by shareholders & mutual funds, so the dividends and capital gains go to the shareholders & retirement accounts. taxing the oil companies will do nothing to bring down the price of gasoline, just exxon's stock. when was the last time taxing anything made its price go down?

Most people fail to realize that crude oil is a global commodity. demand in other parts of the world affect prices that everyone pays. Demand has been soaring internationally, and supply has been struggling to keep up. Higher prices normally encourage more production, unfortunately, producing more crude oil is become more and more difficult as most of the large oil fields around the world are very mature and depleted (this should cause alarm bells to go off in your head).

we are facing a permanent long emergency as less and less crude oil is produced each year. this is not a partisan issue. everyone needs to understand the world is facing something far worse than the 70s oil shocks.

please visit those websites i mentioned in the previous posts. study them long and hard because this is the most important issue facing the world. and it is not something to be spun around in partisan games.

Anonymous said...

it never ceases to amaze me how people have been snookered by the whole "windfall profits" argument. exxon does $100 billion dollars in sales in a quarter and about 10% of their sales are profit. you know why? because oil rigs and platforms are extremely expensive, and frequently have hurricaine damage, or are attacked by militants in unfriendly countries. there's nothing spectacular about 10% profit margins. microsoft has 25% profit margins and cocacola has 20% profit margins.

Stu in CA said...

Yeah, I guess those are our choices, eh?

1. Too out of control to ever compromise or do anything right.

2. So fucking clever that they know exactly how to manipuate voter tendencies when the chips are down.

I'll take door number 3. (Moving to Canada and living in a cave)