How Sex, Politics, Money and Religion are Killing Planet Earth

Monday, May 16, 2011

The Latest Great Republican and Oil and Gas Industry Big Lie

The price of gasoline is up again, causing myriad politicians to stumble all over each other pointing fingers of blame. Republicans would have us believe that prohibitive regulations that prevent the oil and gas industries from exploiting reserves in the Alaskan National Wildlife Refuge (ANWR) and offshore have caused all our problems. Democrats are a mixed bag on the topic, as usual.

In reality, gas prices are subject to the same market forces that set the price of everything else in the world, primarily supply and demand. When demand is greater than supply, prices go up. When the inverse is true, prices fall; hence, a summertime rise in price is predictable when Americans take to the road for holiday making. Also, when Americans conserve due to increased costs, prices inevitably fall.

On Friday, I was fortunate to be invited by a dear friend to attend a luncheon where one of our town’s leading businessmen was speaking. During his presentation, which was largely informative and entertaining, he not so subtlety let drop the idea that the United States has massive untapped oil reserves and that if we would only drill for them, we could not only meet ALL of our domestic demand but that we could be a net exporter of crude too. I was floored by this misinformation, but I was also enlightened. Our local businessman has an honest reputation around town, and he has done a lot for the community, and I have no reason to believe he was being deliberately duplicitous. Rather he was simply giving voice to an idea that is being actively propagated by the Republican Party and the oil and gas industries in order to mislead the American people.

Why would the Republican Party want to mislead the American people? Over the past couple of decades, the oil and gas industries have donated almost $250 million to political campaigns. 75% of these contributions have gone to Republicans, making the GOP is the “Grand Oil Party.” Republicans will promote ideas as instructed by their corporate sponsors. The remaining 25% of contributions also explains the dubious hesitancy on the part of Democrats (1).

Last week, even the Democratic President of the United States caved into pressure, announcing he would open up areas in Alaska for oil exploration in addition to extending offshore drilling leases in the ecologically-suffering Gulf of Mexico citing that the measures, “make good sense.” He should have said that the expansion of drilling for oil into ecologically-sensitive areas makes good “cents” for oil companies. For the rest of us, these actions will have little if any impact on the price at the pump. In fact, everyone in Washington from Republicans, Democrats and even oil industry executives confess that, “there is simply no policy shift that could plausibly come from the federal government that can significantly change [the] dynamic (Pavel Molchanov, a Raymond James oil industry analyst (2)).”

Drilling for crude oil will also NEVER make us energy independent. The United States currently consumes almost twenty million barrels of crude oil per day, but we only produce about 25% of that amount domestically. This means that we must either stop burning so much oil, or import oil from foreign countries. The oil and gas industries would like us to believe the solution to our problems can be solved by expanding drilling operations, which seems logical, but, as with most realities, it’s not that simple.

The cold, hard truth that the oil industry does not want us to recognize is that crude oil is a finite resource. There is only a limited, diminishing amount of the prized elixir in the ground. For all our American hubris, we simply cannot make more of the stuff. To make matters worse, Americans have already tapped out most domestic oil. How do we know this?

In the late 1950’s a Shell Oil executive by the name of Marion Hubbert, noticed a disturbing trend. As an industry insider, he was aware that new discoveries of oil were becoming less frequent and that the peak of new discoveries had occurred in the 1930’s (this is still true today). Hubbert speculated that, based on an average time period of 40 years from discovery to recovery, U.S. oil production would peak in 1970 and that crude oil would be a resource of diminishing return thereafter. Hubbert’s employer tried to keep his hypothesis under wraps, but the data got out anyway. Then, the entire industry dismissed Hubbert as a charlatan. Unfortunately for Shell’s bottom line, Hubbert turned out to be right. The peak of U.S. oil production transpired in 1970, and we have been discovering and recovering less and less of the stuff ever since. Even with modern high tech methods for discovery and production, the United States has not been able to alter the trajectory of this particular slippery slope (3). By the way, the above information is based on actual oil industry data and is therefore not just the “environmentalist” opinion.

Perhaps more important is the fact that globally, new crude deposit discoveries are also in decline. New discoveries peaked in the 1960’s. According to Hubbert’s calculations, this means that we are already at global peak oil, and based on the U.S. (and all other countries with oil reserves) example, we can expect diminishing crude production from hereafter. Coupled with exponentially-increasing demand from China and India, we should be aware that we are staring down the barrel of a full-fledged global energy crisis. But the oil companies tell us that our problems will be solved by simply drilling more wells.

Furthermore, given the ultimate trajectory of the above statistics, wouldn’t it be prudent to maintain rather than exploit U.S. reserves? If crude is becoming an increasingly scarce commodity, which it is, and our current economy and quality of life is totally dependent upon the substance, which they are, then tapping out our reserves now, while foreign supplies are readily available, seems foolhardy and short-sighted.

Why would the oil and gas industries want to mislead the American people? In a word, money. Even though the most profitable companies in the history of the world are petroleum giants like Exxon, they are not satisfied. In fact, these companies know that the vast majority of economically-relevant U.S. oil was tapped out by the 1970’s, but certain perverse subsidies and tax breaks actually make it feasible to go after reserves that cost more to get out of the ground than they will yield. Oil companies basically have nothing to lose, and everything to gain. If they hit pay dirt, they get all the profits. If they tap out a dry hole, the American people pay for the failed exercise. Who wouldn’t want to gamble with such odds?

So, from the people who brought you Saddam Hussein as 9/11 conspirator and climate change denial, we now have the next great lie of the oil and gas industries. Lest there be any confusion, I will be very clear: The United States has tapped the vast majority of its oil and gas reserves, and we will never, ever again, no matter how much we drill, be able to be energy independent unless we adopt other forms of energy such as wind, solar and geothermal, on a massive scale.

The greatest tragedy of the new big lie is that it completely ignores a reality we cannot escape. Oil is a finite resource. Every drop consumed today means one less available drop tomorrow. Eventually, we are going to have to come to grips with this reality and turn towards other forms of energy. The longer we continue to rely on a dwindling resource and try to stave off the inevitable, the worse the crash of reality will be.

History illuminates a long list of peoples who rose to greatness and then crashed into extinction because they did not or were unable to alter their patterns of consumption.

We can be like the inhabitants of Easter Island who consumed every palm tree and land animal without restraint and then found themselves starving to death. We can continue expending vast amounts of tax payer dollars to subsidize a dinosaur industry that can have only one foreseeable outcome, with a catastrophic finale. Or, we can apply our powers of reason and foresight and spend our tax dollars on developing alternative energy instead of using them to line the pockets of the wealthiest entities on Earth before it’s too late. The choice is ours.


2- Quotation from Superville, D. and Capplello, D. Obama Oil Move Won’t Ease Pump Pain. Asheville Citizen Times, May 15th, 2011.

3- Statistics from Tamminen, Terry. Lives per Gallon – The True Cost of Our Oil Addiction. Island Press, Washington. pp. 67-70.


  1. Dear followers and faithful readers,
    Blogger has been experiencing difficulties over the past week, so if you posted comments, I missed them! Please don't think I am not responding due to neglect. I appreciate everything, even the alternative viewpoints that readers have to offer. xox.

  2. I just came to this blog via a comment you made on Huffington Post about how lucky the other planets are that they are far away from humans. I am very impressed with all the articles here. Thank you for your excellent writing. This will help me clarify issues in my own mind as I help local candidates do the same. I really appreciate your work.

  3. Thanks Carolyn. I will look forward to seeing you in the ongoing conversation.

  4. I hate to say this, killing Mother, but speaking as a DFH (urban dictionary definition but don't read the comments), I feel it my duty to inform you (I'm kidding. I suspect you already know.)that they're ALL Republicans now.

    Once again I can only admire your eloquence and grace, killing Mother.

  5. Tsisageya, I had to look up DFH in the urban dictionary. I guess I lead a sheltered life, but I am surprised I have never been thus labeled before. Thanks for teaching me something.

    b.t.w. I don't thing there can ever be too many comments.

  6. Actually, it is possible for the US to become energy independent and produce megabarrels of petrochemicals via conversion from coal. It is very dirty and is not energy efficient, but it is doable, although undesirable and not currently profitable.

    Another point you didn't bring up that conservatives often brandish is that the technology keeps getting better so we can extract more oil than before, even from fields which we had given up for dead. There is some truth in the statement, but it won't quadruple out oil output. Another powerful idea that puts a limit on this kind of wishful thinking is that one used to have to burn one barrel of oil to produce 100 barrels of oil -- a 100:1 return on energy investment. These days, in the US, it is more like 10:1, and dropping. Yes, we can extract more oil, but at higher costs.

  7. Anonymous, Thanks for your point on coal. I tried to keep this post specifically on oil (drill baby drill), but as you note, coal is a whole other package of environmental disaster.

    And thanks for clarifying the technology point. I allude to it in the text but didn't clarify. Even with the advancements in technology, production continues to decline. Thanks for your input.

  8. I'm so glad you cited Open Secrets -- truly one of the best web sites ever. It lays bare the truth about our "democracy" -- that our politicians are able to fund their power thanks to corporations and interest groups. Of course I would NEVER suggest that the legislation that is created and passed by these politicians is in ANY WAY affected by that!