In a dramatic move yesterday President Bush removed the executive-branch moratorium on offshore drilling. Today, at a news conference, Bush repeated his new position, and slammed the Democratic Congress for not removing the congressional moratorium on the Outer Continental Shelf and elsewhere. Crude-oil futures for August delivery plunged $9.26, or 6.3 percent, almost immediately as Bush was speaking, bringing the barrel price down to $136.
Now isn’t this interesting?
Democrats keep saying that it will take 10 years or longer to produce oil from the offshore areas. And they say that oil prices won’t decline for at least that long. And they, along with Obama and McCain, bash so-called oil speculators. And today we had a real-world example as to why they are wrong. All of them. Reid, Pelosi, Obama, McCain — all of them.
Traders took a look at a feisty and aggressive George Bush and started selling the market well before a single new drop of oil has been lifted. What does this tell us? Well, if Congress moves to seal the deal, oil prices will probably keep on falling. That’s the way traders work. They discount the future. Psychology and expectations can turn on a dime.
The congressional ban on offshore drilling expires September 30, so that becomes a key date. A new report from Wall Street research house Sanford C. Bernstein says that California actually could start producing new oil within one year if the moratorium were lifted. The California oil is under shallow water and already has been explored. Drilling platforms have been in place since before the moratorium. They’re talking about 10 billion barrels worth off the coast of California.
Did the taxstud call that or what?
By the way Senator, according to the investment bankers here today, most of the price spikes have occurred as a result of speculation in the market. Many of these people believe that this speculation has resulted in increases of $50 to $60 a barrel.
Why? On January, 2007, when this democratic congress assumed power, light sweet crude prices were hovering around $53 a barrel. Today, those prices exceed $120 a barrel. When this congress took power, the market knew that you idiots would do what ever it took to prevent drilling on US soil in order to protect some musk rat in Manitoba or water moccasin off the Georgian coast.
As a result, speculators know that world supply will be limited due to your inaction, so prices have no where to go but up. But you'd rather come here today and grandstand your fat ass and lecture us about crude prices instead of actually governing in a manner that will help the average American.
Now, do congressional democrats have the stones to support sea otters off the coast of California over the working stiff? We'll see. Of course, McCain will find a way to fumble this one all the way to ANWAR.
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