Yesterday, the White House released a data filled look at oil prices and production in response to GOP claims Obama is to blame for near $4.00 a gallon gasoline prices. The station at Garnett St and Raleigh Road intersection seem to always have the lowest prices in town. But the gas prices have been this high before, under Bush’s presidency. So I’m confused why GOP says its Obama’s fault for our current prices.
Apparently, one particular news station generally accused to be aligned with the GOP has been trying to convince viewers that it’s Obama’s fault, that Obama is ordering the prices up to destroy America. The White House says the President has no control over oil prices. So which one is right? Apparently the news station can’t get their story straight either. In 2008 during a spout of high prices, the GOP was under fire then defending Bush against high oil prices, with the station running such gems as:
Fox News, March 21, 2008
BILL O’REILLY: Next time you hear a politician say he or she will bring down oil prices understand it’s complete BS. Americans want lower gas prices — cut back. Sell those SUVs. Ride a bike when you can. If every one of us bought 10 percent less gasoline, prices would fall fast. That’s what the candidates should be saying. We need a strong leader who’s honest, smart, courageous and willing to explain dubious associations. That’s what we need.
Fox News, June 27, 2008
UNIDENTIFIED EXPERT: It is so painful what is going on with Americans across the country. And what they should do — and this is what I would advise — get rid of those gas guzzlers. Buy decent insulation for your house. And tell your local elected officials, Get on the stick and more mass transit infrastructure spending. Because those kinds of fixes could really help Americans across the country.
Fox News, July 1, 2008
CHERYL CASONE, Fox Business News: You know, at this point, it really is tough for this president. I have to be honest with you, because he really does not have any control what’s gonna happen with the markets and with the economy, and with oil prices and supply and demand and gasoline, it really is out of this president’s hands.
Fox News, Nov. 22, 2008
CAL THOMAS: Well, one of the problems we’ve had for a number of years in the media — and the entire media, mostly journalists, is that these charges get put out there, against the Bush administration or somebody else. And journalists don’t really examine the substance of it like they do during a political campaign. At least in the Washington Post and sometimes on O’Reilly with his “Reality Check” on this channel, they look at certain claims or promises to see what the facts are behind them.
And the facts are, as you suggested, no president has the power to increase or lower gas prices. Those are market forces.
Some blame oil speculators as a source for high prices, some disagree. Check this news article from back in 2009:
Dan Gilligan, president of the Petroleum Marketers Association, represents more than 8,000 retail and wholesale suppliers, everyone from home heating oil companies to gas station owners. When 60 Minutes talked to him last summer, his members were getting blamed for gouging the public, even though their costs had also gone through the roof. He told Kroft the problem was in the commodities markets, which had been invaded by a new breed of investor.
“Approximately 60 to 70 percent of the oil contracts in the futures markets are now held by speculative entities. Not by companies that need oil, not by the airlines, not by the oil companies. But by investors that are looking to make money from their speculative positions,” Gilligan explained.
Gilligan said these investors don’t actually take delivery of the oil. “All they do is buy the paper, and hope that they can sell it for more than they paid for it. Before they have to take delivery.”
“They’re trying to make money on the market for oil?” Kroft asked.
“Absolutely,” Gilligan replied. “On the volatility that exists in the market. They make it going up and down.”
In early 2009, here’s some reports of oil companies holding whole tankers full of oil in the ocean, with the explicit purpose of keeping supply back to increase prices, with at the time of that report 80 million barrels of crude waiting at sea in tankers.
Citigroup Inc.’s commodities-trading unit hired a second vessel for storing crude to profit from higher prices later in the year, shipbrokers said.
Phibro LLC booked supertanker Ashna to store crude for as many as three months, according to the reports by SeaLeague AS in Oslo and Athens-based Optima Shipbrokers. The tanker was booked for storage on the U.S. Gulf Coast, SeaLeague said. Citigroup spokesman Jeffrey French declined to comment.
Phibro is also storing North Sea Forties crude on a 1 million barrel vessel off Scotland’s Orkney Islands. Royal Dutch Shell Plc and BP Plc are keeping crude on vessels to profit from so-called contango, a market where buyers pay more for delivery later in the year than today. A purchaser buys oil now, keeps it for months at sea, and sells oil futures that are higher than the spot price.
Shell, Europe’s largest oil company, hired a supertanker earlier this week to store crude off the U.K. coast, according to shipbrokers. Morgan Stanley is also seeking a vessel to store crude, four shipbrokers said yesterday.
Traders have hired tankers to store at least 15 million barrels of North Sea oil, according to the median estimate of six North Sea traders and analysts surveyed this week. As many as 80 million barrels of crude are being stored at sea globally, Frontline Ltd., the largest owner of supertankers, said yesterday.
Here’s another gem from a report on the leaked US cables:
When oil prices hit a record $147 a barrel in July 2008, the Bush administration leaned on Saudi Arabia to pump more crude in hopes that a flood of new crude would drive the price down. The Saudis complied, but not before warning that oil already was plentiful and that Wall Street speculation, not a shortage of oil, was driving up prices.
Saudi Oil Minister Ali al Naimi even told U.S. Ambassador Ford Fraker that the kingdom would have difficulty finding customers for the additional crude, according to an account laid out in a confidential State Department cable dated Sept. 28, 2008,
“Saudi Arabia can’t just put crude out on the market,” the cable quotes Naimi as saying. Instead, Naimi suggested, “speculators bore significant responsibility for the sharp increase in oil prices in the last few years,” according to the cable.
Prince Abdulazziz was “extremely worried” that high prices would destroy the demand for oil, according to the May 7, 2008, account of his meeting with embassy officials.
“Aramco is trying to sell more, but frankly there are no buyers,” the cable quoted him as saying, referring to the Saudi state oil company. “We are discounting crudes.”
Another confidential document from the embassy in Riyadh, dated Feb. 14, 2007, indicates that Saudi officials had concluded years ago that speculation played at least as big a role in setting oil prices as traditional issues of supply and demand did.
And then the argument is “But.. Keystone”. The same news station flopping around above had this to say in January, 2012 entitled Six reasons Keystone XL was a bad deal all along:
1. Keystone XL Would Not Reduce Foreign Oil Dependency
2. Keystone XL Would Have Increased Domestic Oil Prices
3. Keystone XL Overstated Number of Jobs to be Created
4. Current Keystone Pipeline Leaked 12 Times in Last Year
5. The Environmental Concerns About Oil Leaks Are Justified
6. Mining Tar Sands Would Worsen Global Warming
I’m tired of the political and what I can only see as propaganda he said she said. To now say speculators aren’t causing oil prices to increase and blaming it all on Obama when last election season Bush couldn’t do anything to help prices.. Whatever is the right thing, just get the story straight. It’s instances like this why people see the channel as untrustworthy.
Discuss and more on today’s Open Lines!
The Department of Social Services Board meeting scheduled for today at 2:00 has been cancelled.
Wasn’t it during President Nixon’s tenure that he penalized the oil companies for “wind fall profits” deriving from inflated oil prices? Regarless of who it was, the administration ONCE UPON A TIME believed that the improper gouging of the American citizens was a crime subject to major fines.
In an updated sent to us today by the White House: As gas prices rise, oil companies just watch their profits increase. And yet, they’re still subsidized by Congress to the tune of $4 billion a year. That’s about $7,610 every minute.
My words:
Gary, The White House has tried to stop the subsidies and tax breaks, but the GOP disagrees from these recent news reports :
“The speaker wants to increase the supply of American energy and reduce our dependence on foreign oil, and he is only interested in reforms that actually lower energy costs and create American jobs,” said Boehner spokesman Brendan Buck. “Unfortunately, what the president has suggested so far would simply raise taxes and increase the price at the pump.” Other Republican leaders also tried to pull away from the suggestion that they would support the subsidy rollback. “If someone in the administration can show me that raising taxes on American energy production will lower gas prices and create jobs, then I will gladly discuss it. But since nobody can, and the President’s letter to Congress [Tuesday] doesn’t, this is merely an attempt to deflect from the policies of the past two years,” said Senate Minority Leader Mitch McConnell, R-Ky.
Senate Republicans on Tuesday blocked a Democratic bill that would have repealed about $2 billion in annual tax breaks for the five biggest oil companies, though Democrats say they’ll push for the measure during negotiations to increase the nation’s debt limit.
Democrats say it’s wrong to subsidize big oil companies when they are making record profits while the price of gasoline has skyrocketed.
“They’re doing just fine at almost every level of their business, and we’re giving them a taxpayer subsidy at a time when we have record deficits,” said Sen. Charles E. Schumer, New York Democrat. “Give me a break.”
But Republicans said the bill would unfairly punish oil companies and that it wouldn’t help lower the price of gas at the pump.
Minority leader Sen. Mitch McConnell, Kentucky Republican, said the bill was nothing more than a Democratic smokescreen to disguise their lack of a plan to deal with rising gas prices.
Officials from the five oil companies – Shell Oil Co., ExxonMobil, ConocoPhillips, BP America and Chevron Corp. – defended the tax breaks at a Senate hearing last week, saying they just want the same tax advantages enjoyed by other industries.
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So from what I can tell, Dems have and have had a plan on gas price help, but have been repeatedly denied implementation of any plans. And then the GOP says look at how high our gas prices are!
Is high gas prices criminal? No, it’s just business doing business. Just like the financial sector caused our current economy, not a lot of what they did was illegal.
What should the White House do, that appeals to the GOP, to help gas prices?
Should the government have influence on private sector prices? Doesn’t that go against GOP thinking as well?
The sad thing about all of this is we(the end user) has to pay the price for this mess; nott only at the pump but in everything else.
I agree with you Phil, but if the GOP relaxed on the issue and considered the tax break repeals, would we then see a number of Dems come out against the repeal? I almost think so … as if it is a play with each actor reading a script.
But also interesting hidden within the comments from Big Oil. “they just want the same tax advantages enjoyed by other industries”.
All tax breaks need to be on the table.
If the GOP is afraid the democrats will block the appeals, so be it. Let the dems try. If the GOP believes that’s the best thing, then just do it and stop politicing around. At this point, both parties have lost my trust.
How about no tax breaks for anyone? I don’t understand why there can’t be just a flat % tax on gross
Seriously Phil,
Did they ever have your trust? People earn trust. The politicians of the last 20 yrs have stolen, robbed, lied, murdered, been unprofessional ………. the list could go on forever. The real fools in this set up are the american people. We keep letting them do business as usual and the only people it really benefits are those who they want it to benefit. They’ve got us right where they want us. We provide the money and power, they direct the flow where they want it to go. Everyone of them are dirty. They all make back door deals. We should never talk about other countries and their corruption with the mess we have going on.
Now that you mention it, no they didn’t. I had never voted before the last election, and decided I’d give it a go with so many promises. But I’ve seen bickering and stalling and blocking on both sides still, and now that I pay attention to it a little bit it can really make my blood boil.