Infinite Monkeys

Saudi oil or American oil?

Good news: The Saudis agree to pump more oil. According to The Independent, "Next month, the Saudis will be pumping an extra half-a-million barrels of oil a day compared to last month, bringing total Saudi production to 9.7 million barrels a day, their highest ever level."

Half-a-million barrels a day? What does that mean exactly? How will it affect the global market? Hard to say. "Saudi Arabia...says the energy crisis has not been caused purely by market pressures but by a speculative bubble. Saudi Arabia and Opec believe there are no shortages to justify the sudden surge in prices."

So maybe additional drilling here in the United States wouldn't matter much, given the declining value of the dollar. Or maybe it would matter a lot, given the psychology of market speculation. Victor Davis Hanson raised a pertinent question on the Corner early Monday:

I am confused: for years we were told that the projected 1 million barrels per day from ANWR would be simply too small to make much of a difference given our 20 million some barrel a day appetite — and therefore not worth the environmental risk. Now we wait in tense anticipation for a Saudi willingness to pump an extra 1/2 million per day (from where and how we apparently simply don't care), which we hope will send a message that world supply and demand might be in better sync to cut the feet out from under speculators. So how can 500,000 barrels now do what a million once could not?

Here's another question: Didn't we fight a war for oil recently? I thought I read that someplace. Oh, I guess only the big oil companies benefited. Silly me.

Jee-sus.

Posted by Ben at June 16, 2008 09:43 PM