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McCain Drills Obama on Gas Prices

By Howard Kurtz
The Ad: (Narrator:) Gas prices -- four dollars, five dollars, no end in sight, because some in Washington are still saying no to drilling in America. No to independence from foreign oil. Who can you thank for rising prices at the pump?

(Chant:) Obama, Obama.

(Narrator:) One man knows we must now drill more in America and rescue our family budgets. Don't hope for more energy, vote for it. McCain.

Analysis: John McCain may try in this ad to blame rising gas prices on Barack Obama, but after seven and a half years of the Bush administration, that's a stretch. McCain himself said last week that America's "dangerous dependence on foreign oil has been 30 years in the making"; Obama has been in Washington for four.

It's a bit audacious for McCain to charge that "some in Washington" still oppose offshore oil drilling, since that was his position, most notably in his 2000 presidential campaign, until he reversed himself last month and called for a lifting of the 27-year federal ban on such drilling. (McCain still opposes drilling in Alaskan wildlife refuges.) Nor is there any evidence that Obama opposes "independence from foreign oil," although his energy plan is very different. The Illinois senator has called McCain's plan for a temporary gas-tax holiday a gimmick.

Drilling off the coasts would increase U.S. oil production but have no short-term impact on gas prices. While some analysts disagree, an Energy Department report last year said production would not start until 2017 and have no "significant" effect on prices or supplies until 2030.

By picturing Obama next to a gas pump, using audio of his supporters chanting and invoking the Democrat's signature word "hope," McCain is trying to present himself as a hard-headed realist who would boost production. That argument may have some appeal at a time of public frustration with energy prices, but less so in such states as Florida and California, which would bear the environmental impact of renewed drilling.

Posted at 12:07 PM ET on Jul 21, 2008  | Category:  Ad Watch
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Where did everyone go?

Cindy, Tammy, 3:13, and 6:07? This is the first time I've posted on these threads and I figured the readers of the Washington Post would be a little more engaged to follow the thread and engage in a healthy discussion. Unfortunately, all I've seen so far are the equivalent of drive-by flaming (on both sides of the aisle).

(crickets)

Posted by: simon | July 23, 2008 12:06 PM

"I recently related some of this to a friend who is ranting and raving about the new energies. He failed to understand that they are not here yet!"

1. Mercedes Benz has made it a goal to be petroleum free by 2015: less than 7 years away.

2. Tesla Motors just opened up there show room in Menlo Park, CA, yesterday!

The objection of some that it will take too long doesn't really hold water anymore. You're either listening too much to the oil lobbyists or you're inherently pessimistic.

Posted by: Anonymous | July 23, 2008 12:01 PM

9YsM3T gfb07yvt9d6t94wbtx63bgq7d

Posted by: krissy | July 23, 2008 4:49 AM

Drill till your black and blue. No relief for many years to come. However, if we get out of Iraq and let them kill themselves, possibly we could get relief fast. Don't forget how much your military is paying for gas per gallon out there. I believe it's a heck of alot more than the consumer. Post that and a answer would be nice.

Posted by: justadad55+ | July 22, 2008 1:15 PM

The truth is that China and India (and the US) are sucking up much of the oil. You cannot have the type of growth that they've had in the past five years and not burn an unprecedented amount of oil. They are no longer simply backwards rural nations using ox's to plow their fields. They are rapidly expanding and using lots of oil to do so. With more competition for oil comes higher prices. Sure we can drill some more, but there is only so much to be drilled. In the end, we need to get off of our addiction to oil. IT WILL RUN OUT. The technology is getting close. We just have to have the will AND LEADERSHIP to implement it.

Posted by: hesingswithfrogs | July 22, 2008 12:13 AM

"why was oil at $20/bl not too long ago? If big oil/bush/traders can control the price, then why did it trade at such low levels for so long?"

I think we're seeing exactly why levels were at reasonably low levels for so long. Being a provider of a relatively cheap, abundant, and reliable (albeit harmful to the environment), source of energy is great business. In the U.S., those providers have historically/largely been the oil companies. If anything, they'd be the last ones to want to upset this paradigm.

But things changed.

Since 9/11, the adjectives 'reliable,' and 'abundant,' have gone out the door with the tension in the middle east. Additionally, we've recognized that using petroleum-based fuels is doing substantial harm to the environment. Subsequently, oil/gas is no longer 'cheap.'

The high cost of oil/gas at the pumps has been front page fodder for quite some time turning it into a hot button issue for everyone. For others in the auto industry it's created opportunity: Toyota is reaping the rewards while GM has been in a tailspin after pushing Hummers/SUV's. Others like Mercedes, Honda, and BMW are following Toyota's example to push more alt energy fueled cars. Not a good sign if you're in the fossil fuel business.

You don't have to be a conspiracy theorist to know that it is possible to price yourself out of the market.

Posted by: simon | July 21, 2008 7:00 PM

6:07 said: "Sounds good but you can't explain one thing (and this shoots a hole in many of the left's arguments about energy and big oil) - then why was oil at $20/bl not too long ago?"

There's a simple answer for this, friend. Demand for oil has skyrocketed over the last five years, largely due to China and India. Under the concept of elasticity (or in this case, inelasticity) even a small increase in demand can drive the price way up (i.e. a 10% increase in demand does not translate to only a 10% increase in price). It is not even a question of whether OPEC _could_ produce more oil. Of course they could, and in only a year or two. Google this. They choose not to, to maintain the high prices.

Charles L wrote: "Those leases cost money. Why would they want more leases to just sit on and not develop? That argument is crazy. Come up with a new one."

I encourage you to study this issue. Federal leases for oil and gas _rights_ are incredibly cheap to maintain. The only time lessees have to pay is when they start _producing_ oil; they have to pay royalties. Are you suggesting that you don't _believe_ that there are millions of acres of leased land (for which the companies are paying for continuing lease rights) that are going undrilled? This is a verifiable (and true) fact; you can't just choose whether or not you _want_ to believe it. hth!

Posted by: English major | July 21, 2008 6:38 PM

The liberals (like English Major) argue that "this also explains why US oil companies are sitting on millions of acres of lease rights right now while asking for more"

Those leases cost money. Why would they want more leases to just sit on and not develop? That argument is crazy. Come up with a new one.

Posted by: Charles L. | July 21, 2008 6:13 PM

English Major "when he knows he could make $80 profit if he waits to sell until next year"

Sounds good but you can't explain one thing (and this shoots a hole in many of the left's arguments about energy and big oil) - then why was oil at $20/bl not too long ago? If big oil/bush/traders can control the price, then why did it trade at such low levels for so long?

Posted by: Anonymous | July 21, 2008 6:07 PM

Steve M said: "Producers of any good try to achieve prices in excess of their input costs. . . . With prices around $140/bl (and ever-increasing demand) they can make more money by producing more until such time that demand falls."

If you know anything about the economics of nonrenewable resources, you know that your analysis is overly simplistic. Your argument is true for widget-making where an unlimited number of competitors can make unlimited widgets. But it's not true for fixed resources like oil. I don't have time for the details, but try this simple thought experiment: Why would a Saudi sell this last barrel of oil this year for $1 profit when he knows he could make $80 profit if he waits to sell until next year. Read any economic analysis of OPEC's motivations -- their rational objective is to string along the high price of oil for as many years as they can by limiting their production to achieve the high prices. I'm not saying there's anything wrong with them doing that; it's perfectly rational. But this also explains why US oil companies are sitting on millions of acres of lease rights right now while asking for more (this was the original point I was responding to). hth!

Posted by: English major | July 21, 2008 4:51 PM

Re: "Americans are really dumb about oil drilling. Technology has made it safer, the rigs in the Gulf Coast withstanding the last two hurricanes."

Depending on the source, up to 109 oil rigs/drilling platforms were destroyed during Hurricanes Katrina and Rita (source: U.S. Dept. of Interior).

Re: "One cannot see the rigs from land."

While it's not THAT big of an issue, I listened to a radio story that profiled the issue and interviewed people on the Alabama coast that could see them off their front porch.

Re: "Another point: As soon as drilling starts off the E. & W. Coast and in the small area of Alaska, the price of a barrel of oil will go down drastically. One will not have to wait years. It will happen overnight."

I'm making a wild guess that you're not an economist that's been studying the issue for years (apologies if you are), so feel free to elaborate on this one.

Posted by: simon | July 21, 2008 4:24 PM

For the Gas Tax Holiday, unable to read a globe, warmongering, speculation, resigning co-chairs, now pathetic commercials that are approved by McCain...
If the 2000 McCain met the 2008 McCain there would be a fistfight on the senate floor..

What a ridiculous old, out of touch war mongering, ecomomically clueless excuse of a candidate the republicants have come up with. He like Bush have no connection to average Americans and their struggles. McCain isn't capable of representing the people of the U.S. without damaging us worse. Oh yea, Stupid ad. Keep wasting your money RNC.

Posted by: Alex P | July 21, 2008 4:07 PM

two quick points/corrections:

1. Mercedes Benz made 2015 their deadline to only produce cars that do NOT use petroleum-based fuels.

2. Apologies for the dual posts!

Posted by: simon | July 21, 2008 4:02 PM

Re: "The main argument against more drilling is that it will take about a decade to produce results."

Actually, IMO the main arguments are:

1. From what I've read so far, if we opened up drilling in Anwar and off our coasts, the total amount of oil available would only provide enough to supply us for a few months, much less address any long term need.

2. As everyone has pretty much admitted (including W in '05): we are addicted to oil. This addiction has had direct ramifications into the current situations in the U.S.: economic strife/currency crunch, national security, and environmental. Gore summed it up pretty good last week: "We're borrowing money from China to buy oil from the Persian Gulf to burn it in ways that destroy the planet." Along the same lines, we've stretched ourselves militarily in the "long war," to protect our interests/oil.

3. To the point that alt energies are a long ways off, companies are already setting themselves deadlines: Mercedes has made theirs 2015 for cars that use petroleum-based fuels. The VC/business community has been in the game the past few years and should start to see real results.

The main argument is not the time component at all: it is the need to kick our addiction to something that's hurting us in more ways than one.

Posted by: sfjhawk | July 21, 2008 3:57 PM

Re: "The main argument against more drilling is that it will take about a decade to produce results."

Actually, IMO the main arguments are:

1. From what I've read so far, if we opened up drilling in Anwar and off our coasts, the total amount of oil available would only provide enough to supply us for a few months, much less address any long term need.

2. As everyone has pretty much admitted (including W in '05): we are addicted to oil. This addiction has had direct ramifications into the current situations in the U.S.: economic strife/currency crunch, national security, and environmental. Gore summed it up pretty good last week: "We're borrowing money from China to buy oil from the Persian Gulf to burn it in ways that destroy the planet." Along the same lines, we've stretched ourselves militarily in the "long war," to protect our interests/oil.

3. To the point that alt energies are a long ways off, companies are already setting themselves deadlines: Mercedes has made theirs 2015 for cars that use petroleum-based fuels. The VC/business community has been in the game the past few years and should start to see real results.

The main argument is not the time component at all: it is the need to kick our addiction to something that's hurting us in more ways than one.

Posted by: simon | July 21, 2008 3:54 PM

James - you are an idiot! Put away your talking points for one moment. The Democratic controlled House and Senate have had hearing after hearing and not one shred of evidence points to price gauging.

Stop blaming everyone except Congress. The liberals are in the way of lower energy prices.

Posted by: Anonymous | July 21, 2008 3:22 PM

The details of the personal automobiles of the five oil executives that testified
before Congress with full registrations

http://webofdeception.com/#personalcars

Posted by: Robert Lewis | July 21, 2008 3:18 PM

This is the big lie, and the media here lets McCain get away with it.

The oil industry refuses to drill on 75% of the land already leased to it.

And now they want more offshore drilling rights?

This is a boondoggle. When McCain's buddies in the oil industry actually drill the land they already have and stop artificially gouging us at the pump... then the debate over offshore drilling could begin...

but not before.

What a joke. Republicans are scraping the bottom of the barrel.

They're the ones who stopped the legislation to end the price gouging in the first place.

Posted by: James McDouglas | July 21, 2008 3:14 PM

Yeah the good times are coming - democrat style!


Posted by: | July 21, 2008 2:53 PM

-------------------------------
Bush promised in the 2000 race he was going to run the government, seeing how his friends ran HP and Enron I see now what he meant.

Posted by: Anonymous | July 21, 2008 3:14 PM

one of you guys made a statement about BMW,s water car. I just did some research on it and found that they do not have them for sale. Also they don't use water they use liquid hydrogen as a fuel and need special tanks to hold it and they are expensive.Also liquid hydrogen is mostly made from natural gas.If made another way it cost more than twice the amount of gasoline.Hydrogen is a cryogenic and must be maintained damn cold.Usually the way they do this is to release it from the tank to reduce pressure and cause it to boil and cool itself down.The down side to this is after awhile there all of it is gone and what that means is you cannot allow the car to sit very long unused.Also there is no infrastructure for this fuel on a large scale and all storage will have to be refrigerated to cryogenic temps which will have to be done with electricity.There are many things that make this fuel unattractive at right now and will take time for technology to improve to make it economical.

Posted by: Richard | July 21, 2008 3:14 PM

Americans are really dumb about oil drilling. Technology has made it safer, the rigs in the Gulf Coast withstanding the last two hurricanes. One cannot see the rigs from land. Why drill off the Gulf Coast when the West & East Coasts do not permit drilling? Why should states on the Gulf Coast not benefit by getting revenue from this oil since it is gotten off their coast? What will prevent foreign countries in the future with technology such as it is drilling 100 miles off the coast of California, Oregon, the Eastern states? What will you liberals say then?

Another point: As soon as drilling starts off the E. & W. Coast and in the small area of Alaska, the price of a barrel of oil will go down drastically. One will not have to wait years. It will happen overnight. This is what has happened for years when a hurricane is predicted, a crisis is foretold in one of the oil producting countries (Nigeria, etc.). Why are the Democrats so opposed to reaping the benefits of drilling in our territory and harming our country when they love their vehicles even more than the rest of our country. How arrogant and selfish. Start the drilling offshore and look and explore for alternative means of energy at the same time. A Texas oilman is doing that now with funding wind power in West Texas. He is more interested in honoring America than being selfish getting more oil, not like the people who are opposed to offshore drilling but still driving, driving, driving, without a clue as what to do about the high price of gas.

Posted by: Anonymous | July 21, 2008 3:13 PM

That's rich.

McCain, a Republican, a tool of the oil industry... is blaming the party who wanted legislation on price gouging... but had it blocked by Republicans.

Will McCain's flip flopping hypocrisy never end?

Posted by: James McDouglas | July 21, 2008 3:12 PM

"But the government is far less optimistic. it estimates gas prices might fall by a maximum of 3 cents a gallon, and that's only after the many years it would take to bring this new oil to market."
http://money.cnn.com/2008/07/20/news/economy/alaska_drilling/index.htm?cnn=yes

Posted by: Anonymous | July 21, 2008 3:10 PM

"To the last commenter, I want to explain a number of things to your incredibly misguided and uninformed comment. Firstly, there is a difference between natural gas and a gallon of gasoline. Crude oil is not the same as natural gas. Therefore, the nickel drop in natural gas would not be reflected in gas prices at your local retailer..."
Posted by: Truthbetold | July 21, 2008 1:32 PM


My comment pertained to the report's threshold for "significance". Try reading it again now.

Posted by: Anonymous | July 21, 2008 3:08 PM

Never a more accurate statement. A community organizer playing in the big leagues. This reminds me of when Notre Dame hired the high school coach... Hell of a nice guy but he was a total failure at the collegiate level. Don't the liberals get it that you never see an NFL team hire a high school coach? IT'S A DIFFERENT GAME! Different rules, different players, different in every way possible. Obama needs to be elected just so we won't see another democrat in the oval office for another 16-20 years! He will be the laughing stock of the world. Another Jimmy (The good times are over) Carter! Eventually we will be reduced to third world status, was hoping it wouldn't be this soon though.

Which reminds me of the link that was posted. The fact that Obama has NEVER really voted on hard issues is so refreshing that he wants to be the "man" in charge of the free world. Sit back and enjoy the ride, you won't be able to buy tickets to a show this good! $10 a gallon by the time he's done. Interest rates at 13% again. Yeah the good times are coming - democrat style!

Posted by: Anonymous | July 21, 2008 2:53 PM

The solution to high energy prices is a former "community organizer" / freshman Senator who doesn't have the wisdom or spine to tackle even the small problems.

Oh, but he's a minority and I'll feel good about myself for voting for him.

Posted by: Anonymous | July 21, 2008 2:44 PM

Cheney! Cheney! Cheney!


The sad part is that a lot of people are stupid enough to fall for it ...

Posted by: Bud | July 21, 2008 2:43 PM

The main argument against more drilling is that it will take about a decade to produce results. Then do liberals admit that Clinton was wrong to veto such an attempt in the mid 90s?

It would be nice to have that oil online today. Keep postponing more drilling and prices will keep going up. Liberals will have to choose between their environmental nut job backers or the American people. Let's see what they decide.

Posted by: Tammy | July 21, 2008 2:39 PM

McSame is the one who wants high gas prices. He is a secret Muslim who wants to make his Islamic buddies in the Middle East rich.

Posted by: HM | July 21, 2008 2:36 PM

McCain did support all the failed energy policies of the US trying to drill here in the past. He has changed his mind now that America is being held up at the gas pump. Amazing that him changing his mind is a flip flop yet Obama standing firm on denying Americans their basic needs is considered a plus? Give me a break.

Bush wanted to open more land up to drilling and exploration since he came into office. It was his energy plan along with moving to renewable energy sources. The democrats have stood in the way of America accomplishing anything that would help the people. Their continued screams of alternatives are great. Problem is the alternatives aren't there yet! You can't switch if the technology isn't there that allows you to do so. Especially if it's not there at a price people can live with. I recently checked into going solar on my new home. Forget it. To save $400 a year would have cost me over $20,000 up front. And that equipment will need repair and replacement as time goes on. Solar is currently a joke. It's making progress but it is not viable. When I hear people talking about having solar and selling energy back to the local utility I laugh because they are either lying or spent so much money they will never profit from the venture.

When the liberals in CA and FL are willing to allow drilling on their beaches the message is loud and clear. They bought into the green attitude because it was fashionable. But now their vehicles need fuel they can afford. Our beaches in Texas have had oil wells for a very long time. They are fine. In fact the fishermen love the oil rigs since they hold fish. Oil rigs are a win-win situation for us and I suspect for anybody that has oil in the ground.

I recently related some of this to a friend who is ranting and raving about the new energies. He failed to understand that they are not here yet! How many billion have we spent on cancer research and people are dying every day from cancer. It is not that easy to cure something or 'invent' something. These things take time. In the meantime we still need to function and this economy is being killed by the high cost of fuel.

Posted by: Anonymous | July 21, 2008 2:31 PM

Shouldn't McCain be drilling in his own Republican's backyard, mainly Bush and his own to establish exactly where the blame lies with our economic woes? It doesn't take an educated mind to know... 8 years of Bushonomics

Posted by: nerakami | July 21, 2008 2:30 PM

beware of website links in this comments section.

Posted by: Anonymous | July 21, 2008 2:24 PM

On the most important challenges, OBAMA WILL HAVE DIFFICULTY MEETING EXPECTATIONS, INCLUDING HIS OWN ---

Obama's impossible road ahead:


http://pacificgatepost.blogspot.com/2008/07/why-obama-will-win-but-cant-deliver.html

Posted by: PacificGatePost | July 21, 2008 2:23 PM

Truthfully, in spite of all the attacks the WaPo makes on Obama, McCain is NOT FIT to be commander in chief.

Today on Diane Sawyer, he claimed there is an Iraq/Pakistan border. If Obama made the same mistake, it'd be headline news on the Post.

Asked by ABC's Diane Sawyer Monday morning whether the "the situation in Afghanistan in precarious and urgent," McCain responded:
"I think it's serious. . . . It's a serious situation, but there's a lot of things we need to do. We have a lot of work to do and I'm afraid it's a very hard struggle, particularly given the situation on the Iraq/Pakistan border," said McCain, R-Ariz., said on "Good Morning America."
Iraq and Pakistan do not share a border. Afghanistan and Pakistan do.

Posted by: EthanQ | July 21, 2008 2:20 PM

Why don't the oil companies drill using the contracts they already have, and have never used?

Oh right, they want high prices.

Posted by: Anonymous | July 21, 2008 2:16 PM

MarkM - I'm going to try to educate you:

First, there isn't a shortage of supply (no lines at gas stations like in the 70's), but supply and demand are just about at equilibrium. Any short term supply disruption (in Nigeria, for example) sends the price up. That is why we need more production.

Second, no hard data exists, but it is generally understood that OPEC doesn't have a much excess capacity. Plus, why should they increase their production for us while our production goes down?

Third, our reserves are for national emergencies. Remember your liberal buddies voted to stop filling it a few months ago. Furthermore, you claim new drilling is a short term fix. What would releasing oil from the reserve be?

Fourth, now it's the fault of major oil companies' traders? Another post put it well - who is to blame for high coal prices? Do you want to regulate the trading of corn futures? Where does regulation end?

Posted by: Bruce | July 21, 2008 2:13 PM

For some reason the majority of people are blind to the fact that they can do something about this right now. The technology exists to use water in your car. It's been proven to work and improves MPG by as much as 75%. There's a website that shows how to build them: www.iBuyLessGas.com
This could end our love affair with foreign oil. BMW has even invented a water car. Google BMW Water Car and you will be amazed.

Posted by: teknurd | July 21, 2008 2:10 PM

Offshore drilling will have little to no impact on current gas prices.

McCain is doing and saying anything to try to distance himself from Obama yet the more he does the closer he brings himself to Bush.

I hate the term used by so many dittoheads but you gotta call a flip flopper a flip flopper when you see one. McCain is flopping around like a fish on a boat deck.

Posted by: Sparky | July 21, 2008 2:07 PM

If a tree falls in the forest and no one is there, does it make a sound?

Kind of like Obama being out of the country, is anyone listening to anything McCain is saying?

Posted by: Patrick | July 21, 2008 2:07 PM

No Howard, you idiot!
The question you should ask is: what is going to be the short-term impact of the drilling on the gas price.
Everybody knows it's pandering to the voters. Irresponsibly, the media will report with absolute neutrality so they will stir up a controversy, a good old cock fight. This is the same way you morons let GW Bush get away with everything in 2000 and in 2004 and now we have to borrow money from China and other third world countries to feed ourselves and to pay for a unnecessary war. Countries like Brazil or even South Africa are rising and Clowns like you are animating an insane circus to grab people's attention.
Sir, have you no shame?

Posted by: Greg | July 21, 2008 2:05 PM

No Howard, you idiot!
The question you should ask is: what is going to be the short-term impact of the drilling on the gas price.
Everybody knows it's pandering to the voters. Irresponsibly, the media will report with absolute neutrality so they will stir up a controversy, a good old cock fight. This is the same way you morons let GW Bush get away with everything in 2000 and in 2004 and now we have to borrow money from China and other third world countries to feed ourselves and to pay for an unnecessary war. Countries like Brazil or even South Africa are rising and Clowns like you are animated an insane circus to grab people's attention.
Sir, have you no shame?

Posted by: Anonymous | July 21, 2008 2:02 PM

English Major - "the rational producer optimizes its production to maintain high prices over a long period of time"

Not exactly. Producers of any good try to achieve prices in excess of their input costs. It costs oil companies about $60/bl to produce it. With prices around $140/bl (and ever-increasing demand) they can make more money by producing more until such time that demand falls. Global demand isn't waning - thus, they can make even more money by producing more.

Stay in the English department. You may be a good writer but Econ is above you.

Posted by: Steve M. | July 21, 2008 2:01 PM

No Howard, you idiot!
The question you should ask is: what is going to be the short-term impact of the drilling on the gas price.
Everybody knows it's pandering to the voters. Irresponsibly, the media will report with absolute neutrality so they will stir up a controversy, a good old cock fight. This is the same way you morons let GW Bush get away with everything in 2000 and in 2004 and now we have to borrow money from China and other third world countries to feed ourselves and to pay for a unnecessary war. Countries like Brazil or even South Africa are rising and Clowns like you are animated an insane circus to grab people's attention.
Sir, have you no shame?

Posted by: Greg | July 21, 2008 1:56 PM

The funny thing about the ad itself is that McCain's agency that put together the ad found stock footage of a 70's/80's era style pump. It looks as old as McCain.

And here is a quickie Econ 101 lesson to add to the mix:
There is no shortage of supply. OPEC can ramp up production. We can tap our reserves. We can consume less if we drive slower smaller cars, blah, blah, blah. How about regulating the electronic trading of oil futures? The major oil companies' traders are laughing at us as we continue to spend $4.50 for one gallon of gas. They are in complete control thanks to unregulated speculating. Hmmm, the Middle East is in a state of unrest. China and India need more fuel to build their empires. Our dollar is weak. Americans keep driving SUVs. Let's pile on a few more reasons so the traders and the oil companies can continue to screw with us, our economy and our way of life.

Posted by: MarkM | July 21, 2008 1:53 PM

Common sense might have us ask our Pols
just what we might expect from offshore drilling. Are the current estimates of 18BBL - roughly a 2 year supply for US, worth the risk of more Santa Barbara's?

As for the economic impact, the best estimate of offshore drilling impact to prices that I have seen is 75c a barrel, miniscule as the article states.

Chevron discovery 175 miles offshore was in 2006. Who is this Oil "expert" professing there has not been exporation in decades?

I say OK to exporation, but prove to me - 2P to me, that that is more than a 2 year reserve beneath the waves, then we can perhaps move ahead.

Offshore drilling should not be a cornerstone of the next administration's energy policy. McCain is giving offshore drilling way too much focus. As recently as June 24th, the McCain campaign website issues section did not even mention energy. It has just recently been added, the 16th issues area. Priorities eh John??

Posted by: DaveDan | July 21, 2008 1:37 PM

Posted by: DaveDan | July 21, 2008 1:50 PM

Cindy said: "(2) Nobody has suggested oil prices will go down with more production? Dust off your Economics text ... if you attended college."

I think what he meant was that the price of oil will continue to rise over the time the offshore production comes on line. It's not like there's going to be a sharp dip in the global price once that tiny spigot opens, b/c demand is constantly increasing.

"Their current unused leases are on land that either doesn't have oil or the oil in the ground requires technologies that haven't been perfected."

Link? Your "simple economics" doesn't dictate that a producer maximize its oil output at all times -- the rational producer optimizes its production to maintain high prices over a long period of time. Look at OPEC -- it constrains production for the very purpose of driving up prices. American producers do the same thing, although not as blatantly.

Please educate yourself before posting more.

Posted by: English major | July 21, 2008 1:49 PM

If the speculators are responsible for high oil prices (Pelosi's new target) then who is responsible for high coal prices? Keep in mind coal isn't traded on an exchange.

Also, do liberals want to do away with speculators in the grain markets also? Food prices are high, you know.

Posted by: Rashad | July 21, 2008 1:45 PM

Ok, let's remember back awile- OPEC-reason we could get oil cheaper than drilling here. WELL,now we can't. Drill here again and show the world that America takes care of herself. The Arabs will have to drop prices to sell if we take ourselves out of their profits. In ten or twenty years when they can't hardly give it away -AGAIN-then we can start buying again. We drill here and it could also put some AMERICANS TO WORK.

Posted by: Pappy | July 21, 2008 1:45 PM

Returning to sensible regulation of energy trading would have a much bigger impact on the price of gas (both short- and long-term) than any offshore drilling. Who do we have to thank for our current set of laissez-faire rules? Phil Gramm--economic advisor, but no longer surrogate spokesman, for Senator McCain.

Posted by: Early Man | July 21, 2008 1:44 PM

sequoia - you are a perfect example of why compromise can't exist. Your hatred for the right overwhelms logic and common sense. Repeating DNC talking points (some of which are utter lies) makes you look foolish.

(1) 20 years to bring new oil fields online? Really? You completely made that number up. By tomorrow you will be posting 25 years.

(2) Nobody has suggested oil prices will go down with more production? Dust off your Economics text ... if you attended college.

(3) With oil prices at $130/bl even the uneducated would admit that oil companies would extract and sell every drop they can find. Their current unused leases are on land that either doesn't have oil or the oil in the ground requires technologies that haven't been perfected. Again, it's basic economics. You claim oil companies are greedy ... well I agree. So why wouldn't they produce as much as possible?

(4) Why don't oil companies export less? Responding to that question would make me feel like I'm talking to a 3 yr old.

(5) Who is going to pay to "transform our energy infrastructure"? Will this be another BHO entitlement program? Will he buy us all $40,000 hybrids?

Educate yourself before you post. Thanks.

Posted by: Cindy | July 21, 2008 1:41 PM

McCain at least shows he can be flexible to change his stand on drilling when times change and something needs to be done to lower oil prices. New technologies are not ready yet and won't be for quite some time. Obama says he will fast track these technologies but what does he mean,the most brilliant minds are already working on this.If they do come up with something that means everybody will have to buy a new car and they are going to be too high for most.

Posted by: Richard | July 21, 2008 1:34 PM

To the last commenter, I want to explain a number of things to your incredibly misguided and uninformed comment. Firstly, there is a difference between natural gas and a gallon of gasoline. Crude oil is not the same as natural gas. Therefore, the nickel drop in natural gas would not be reflected in gas prices at your local retailer. Also, we've seen in recent months the impact that speculators can have upon crude oil prices, which directly affect gasoline prices. With the news that more oil would be on the market (even if it took 9 years, which is somewhat debatable) oil prices would almost certainly tumble. Thus, I don't think the argument can be made against increased drilling. Everyone wants a sustainable energy source for the future, but that's decades away. Something has to hold us over and that something is going to be fossil fuels. Increased oil drilling and production stimulates the economy, lowers our dependence upon countries not always on friendly terms with ours, and lowers prices at the pump for American consumers.

Posted by: Truthbetold | July 21, 2008 1:32 PM

The subprime crisis,the bear stearns episode,goldmansachs' dilemma,ssn crisis,real estate soup all have to be put on Obama!This is ridiculous.Around the world,we have seen opposition blaming ruling party for a crisis in administration,this is the first time a ruling party is blaming opposition for this!It is cain,s party that led us into it and now they say they dont know.who has enourmous shares in oil industry,in defence contractors...? Must be Obama i guess!

Posted by: mb | July 21, 2008 1:31 PM

Increasing supply will lower prices. That's econ 101 folks. You can debate the amount but you can't refute the laws of supply and demand.

BHO and his enviro nuts want us to transition to "alternatives" in short order. People can't afford to put gas in their cars today - who out there can afford to buy a new car that runs on something new? It's absurd. I'm not in a position to buy a new car just to please Gore.

Posted by: Fomer Liberal | July 21, 2008 1:27 PM

The EIA study Kurtz references needs to be taken with a grain of salt since they projected that oil should cost about $50 a barrel now, not $130. EIA isn't exactly great at projecting the costs of oil in the future, which is exactly what is required to say that additional domestic production will not affect prices.

Posted by: Daniel | July 21, 2008 1:26 PM

LH, Indiana asked: "How can drilling not help the situation? If we open up at least our coasts to further drilling we will have an immediate impact on the price of oil and realistically new oil can be pumped out of the ground within only a few short years (or less)."
____________________

Wrong. It would take up to 20 years for any new drilling here to affect the market - and then it would only be pennies on the gallon. Nobody has suggested that oil prices will go down due to more domestic drilling except Bush, who hasn't got a clue and who has consistently proven he cares more about oil companies than the American people (and of course all of planet Earth).

Why do they need more land? If drilling and domestic production are so urgent, Linda, why don't the oil companies start with the 68,000,000 acres they are already sitting on? Or why don't they EXPORT less? Please ask yourself these questions before buying into Bush McOil's silly political games.

As for what we are going to do about it - we start right now transforming our energy infrastructure instead of drilling to deepen our unsustainable addiction. You don't think we could make substantial changes in the 20+ years this proposed drilling would take to drop gas prices a nickel? I sure do.

Posted by: sequoia | July 21, 2008 1:22 PM

Part of the blame for high gas prices is general instability in the middle east, which in large part stems from the decision made by Bush and supported by McCain to invade Iraq.

Posted by: Paul | July 21, 2008 1:21 PM

"significant"

That sounds like a lot. Interestingly, the cited report does give an expected reduction in the price of natural gas, one it apparently does consider significant. That reduction is 1.7%, the equivalent of less than 7 cents off a gallon of gas.
Is McCain's case for the presidency really a nickel off a gallon of gas in 20 years??

Posted by: Anonymous | July 21, 2008 1:08 PM

I heard Obama is personally responsible for aids and cancer too. Of course McCain has been busy in his basement working on a cure for both and he will provide it if you elect him president.

Posted by: Jeremy | July 21, 2008 1:07 PM

I think McCain has it right and he needs to keep up the pressure on not only Obama, but, on all the Democrats. It's unfair to blame the high gas price on one party or the other. They're both to blame as are all the past Presidents of the last 30+ years (yes even Jimmy Carter). The question is what are we going to do about it? We can drill or we can stick our heads in the sand and wait for something better to come along....which by the way will be a long, long time. Democrats are the Green party, which is why they like high gas prices. They are probably hoping for $5, or $6 a gallon prices so we all conserve even more. How can drilling not help the situation? If we open up at least our coasts to further drilling we will have an immediate impact on the price of oil and realistically new oil can be pumped out of the ground within only a few short years (or less). Obama said he didn't mind the higher gas prices...he was just sorry they shot up so quickly. Nancy Pelosi said back in 2007, when she became House Speaker, that the Democrats would do somthing about gas prices. The price average was about $3.07/gallon then and it is around $4.10/gallon now. Who's to blame?

Posted by: LH, Indiana | July 21, 2008 1:00 PM

Re: McCain Campaign

Senator McCain has to work closely with his spiritual advisors as soon as possible. Someone is spelling against you with his/her huge snake-shape object that has 4-5 different heads. I saw this activity yesterday at 4:20 a.m., and posted here.

I see the house is located in CA somewhere in a Southern part, yet can't see his/her address. It is a very nice house that has high-ceiling (white walls) and huge glass windows toward the garden. The object is located in his/her second floor.

Do not pursue this person. You can't. Just pray for God everyday with your advisors and keep your faith with God.

I will pray for all who believe in God: This nation is gong to a wrong direction. There are so many people who hate others; they do not believe in God at all.

Posted by: premier | July 21, 2008 12:54 PM

Did you know Obama is now responsible for high gas prices?

Man, are the Rethugs DESPERATE! This is awesome.

Posted by: sequoia | July 21, 2008 12:52 PM

Another Republican Lie....do they even know how to tell the truth!?

McCain and his kind are the reasons for these high gas prices, and are the ones profiting off them!

Posted by: Anonymous | July 21, 2008 12:47 PM

McCain must think that everybody is just plain stupid and doesn't understand that the Republicans have been fighting energy independence and a sensible energy policy for the past 50 years. The Big 3 would write big checks to the Republicans and know that they'd never have to worry about efficiency standards. Nixon, Reagan, the Bushs and the Republican congress sold out the people and sold out the earth.

If you believe that Republicans are the green party and that the democrats are to blame for high gas prices then you are a either victim of the Republican failures in educational or health care priorities.

Posted by: JR, Boston | July 21, 2008 12:42 PM

This is stupid, hypocritical and will come to bite McCain in the end. There is probably video footage from 2000 to 2007 in which McCain verbally opposes offshore drilling. Its now only a matter of time before it is shown.

Posted by: Obama-Junkie | July 21, 2008 12:37 PM

A good piece. Nicely analyzed.

I have to say, that I know a heck of a lot of people from both ends of the political spectrum, and I have never heard the Democrats (much less Obama) seriously criticized for oil prices. Maybe this ad will change that, but I doubt it.

Posted by: Cornfields | July 21, 2008 12:21 PM

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