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1. It is certainly correct to point out that oil is an international market . . . or more precisely, a market driven by profitability and efficiency at the detail level regarding each shipment. It's less costly and less polluting to sell the Alaska northern slope oil to Japanese and then use the money to buy oil from Can/Mex/Vene (short-hands and intentional mis-spellings used extensively for names due to uncertainty regarding posting filter); transferring money is less expensive and less polluting than shipping physical oil.
2. On the macro level, oil price is quite significantly impacted all sorts of political machinations, usually making it more expensive than it has to be. A dictatorship would not at all result in cheaper oil. Otherwise, countries like NorKor would have cheap oil, and Eye-ran would have cheap gasoline. They do not. What dictators*ip can dictate is a fake price: i.e. price available only with presentation of government issued coupon or certificate of privilege. That means even higher prices for the same products on the black market for the rest of the population. When there is a divergence between the "official price" and black market price, only the latter can be considered real market-clearing price. The difference between the two prices reflect the market value for the privilege certificate. Gasoline was rationed in the US during W-W2 and again during "Nikson's"(x) price kontrol(c) disaster. The real market clearing price was the black market price, or the official price plus the coupon value on the black market plus the cost of hiring someone to stand in line and hold the position for you for hours at a time. Currently, there is a class of goods that is under similar government price control: naakodix(r-c-t-cs). Obviously their price is not $zero just because the government bans the sale. The black market price reflects the market clearing price. That is the general rule. The running of two parallel markets carries significant cost to the society: the enforcers and the organized dodgers both have to be paid.
3. If the US were to pump enough oil to turn US net import to zero, that would have significant impact on world oil price(s). The US currently consumes about 20% of total world production, and net-import accounts for about half that. Pumping enough to zero out net-import would mean 10% increase in world production, assuming all other producers do not change. That 10% increase in global total oil production would of course have a significant impact on worldwide oil price(s). Oil price is inelastic in the short term.
4. Massive oil import has been a significant source of taksation(x) on the American people. Those tin pot diktators(c) in the Mideast are essentially tax farmers taking money from American (and European) middle class and conventional businesses, and recycling the money into the western financial/military industries and government bonds (exactly the same as what taxation-"bailout"-"public debt" cycles do in the West). Those foreign tax farmers are allowed to amass some fortune and enslave their own people for a few decades at a time, then "harvested" like cattle when the real owners need the protein that they have converted from grassroots. Qdf(a-a-i)/Mbrk(u-a-a) in this cycle, Shaa(h) in the previous one. Allowing domestic production in the US would result in more transparency and accountability. There is a peace component to domestic drilling.
posted by 75.67.1...
, Fri, 2 Mar 2012 12:55:06
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