Tag: Oil

Categories
Economy

Monday Japan Tsunami Economic News Roundup

The economic impact of the tsunami is hardly the most important thing. But this being the day when I normally blog / link economic news, I figured it would be worth checking in on what is going on there in this context.

The least surprising news is that the Nikkei, Japan’s stock market, took a huge hit as a result of the chaos. That index is down 6.2% this morning. They’ve been suffering from the same cash flow problem that the United States has been for the last few years – it is primarily the lack of cash and readily-available credit in the marketplace that’s been shutting down business as usual here and abroad. And just like the United States, Japan has been venturing into the world of Quantitative Easing. Now with the disaster, they’ve opened up the QE floodgates in the hopes of injecting more than 10 billion yen into the market.

Interestingly, this has to be the first international crisis in the past twenty years that caused the price per barrel of oil to decrease, on concerns about Japanese consumption drops. At least as interestingly, Business Insider is speculating that it may also have to do with Saudi troops moving into Bahrain. Not sure I understand that at all.

And here’s something I understand even less, but love more: Japanese officials are urging their residents to – wait for it – *not* go to work today. Apparently, this kind of thing presents a problem in Japan, whereas in this country when times of crisis hit us, we’re urged to shop.

Categories
Politics

President Obama: “I’d Tap That!”

Every major spike in oil prices brings with it a major spike in bullshit discussions of the Strategic Petroleum Reserve. Right on queue, here’s President Obama:

Obama: Ready To Tap Oil Reserve If Needed : NPR.

Trouble is: there’s about 600 million barrels of oil in the SPR and we use about 20 million a day. So, that gives us about a month’s supply, after which time, we won’t have any more reserves. Filling it back up again will require us to – oh yeah! – buy more. So even if the cost of oil goes down slightly as a result of us relying on the SPR, it goes right back up again when we need to fill it up.. unless of course you’d like to go without?

Categories
Uncategorized

The Libyan Disruption

So, now that prices at the pump have risen to the level the national media has decided is worth investigating, maybe we aught to see it in the context of other disruptions to the oil flow. And what is the result of that analysis? Well, Business Insider gives us the chart of the day:

CHART OF THE DAY: Where Libya Ranks Among The Worst Oil Disruptions Of All Time.

I notice that neither Katrina nor the Gulf Oil Spill rank. But it does rank above the Iraq War, and we know what that did to oil prices.

Categories
Uncategorized

Drilling Our Way Out: Quick and Sexy Math

Since the announcement that Governor Sarah Palin would be the Vice Presidential pick for the Republican ticket, a lot of people have had drilling on their minds.  Many people, including Sarah Palin, seem to think that if we just keep drilling – deeper, harder, faster and in more places – our nation could finally find the satisfaction its been craving, without having to rely on foreign pipes.

But as hard as we drill, we only produce about 10 percent of the gushers in the world, while we receive the fruits of about 25% of gushers worldwide.  That’s a lot of extra pumping for one nation to do, almost twice as much, if we’re going to give as good as we get.  In fact, the Adonis of oil drilling, Saudi Arabia, only produces about 12% of the gushers in the world.  Do we really think we have that much stamina?  Just because we can do the pumping doesn’t mean we’ll get the gushers we’re looking for, anyway.

Because if you ask other nations honestly, they’ll tell you that after a certain point, too much drilling is just a bad thing.  It’s a tiring waste of resources that damages the environment and just gets kind of sad after a while.  Worse than that, once you’ve drilled one hole dry, even if you’re allowed to go for another hole, it’s not really going to produce any gushers and it’s probably just going to be a shitty situation for everybody.

In fact, most nations would tell us that if we were just a little less selfish, we wouldn’t need to work so hard in the first place.  If we didn’t spend so much time trying to show off and act cool around our friends, we wouldn’t have to worry about living up to an impossible image or dealing with our inadequacies. If we just appreciated what we have a little more, took it less for granted, maybe we might find out that quantity is no substitute for quality.

After all the latitude and patience we’ve been given, to insist that finding new and interesting places to drill – especially those we’ve worked so hard to keep clean – just isn’t the right answer to the problem.

Categories
Uncategorized

Life is Full of Surprises

Well, whaddaya know?  CNN Money is reporting that oil prices are holding steady at around $119 a barrel despite a major pipeline in Turkey being cut.  If you recall just last month back, every time a pipeline anywhere was damaged, the price went up by five bucks at minimum.  So, what accounts for the sudden change in the market moves?  Well, most experts point to declining demand in the U.S. . .  Demand goes down, prices go down.

So, John McCain, tell us about your drilling plan again?