Obama Plans to Lower Fuel Prices by Raising Cost of Oil?

Posted by on Mar 17th, 2012 and filed under Federal, Government, Headline, National, Opinion, Politics. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.

(Thomas Mitchell/4TH ST8) Snake oil salesmen seldom lied outright, but they never really told the whole truth.

In today’s radio address Obama told us with a straight face, “Under my administration, we’re producing more oil here at home than at any time in the last eight years, that’s a fact.”

Yes, that’s a fact.

What he did not bother to mention is that all that production is taking place on private land. As the Washington Times reports, oil and natural gas production on federal land is off 7 percent since 2009, and in 2011 oil production on federal land dropped 14 percent from the prior year alone and gas production dropped 11 percent.

Obama also repeated the old canard from past speeches, saying, “But we can’t just rely on drilling. Not when we use more than 20 percent of the world’s oil, but still only have 2 percent of the world’s known oil reserves.”

Those are proven reserves, actual oil fields currently in production. According to the Institute for Energy Research, the U.S. and its offshore waters hold 1.4 trillion barrels of oil, enough to last two centuries. Then there is 2.7 quadrillion cubic feet of natural gas and 486 billion short tons of coal.

Then in a brilliant leap of incomprehensibility the smartest president in the history of the nation called for attacking high gasoline prices by demanding Congress vote to repeal what he calls $4 billion in subsidies — really the same tax breaks every other industry gets — for big oil companies.

“In the next few weeks, I expect Congress to vote on ending these subsidies,” Obama said. “And when they do, we’re going to put every single member of Congress on record: They can either stand up for oil companies, or they can stand up for the American people.  They can either place their bets on a fossil fuel from the last century, or they can place their bets on America’s future. So make your voice heard. Send your representative an email. Give them a call. Tell them to stand with you.”

And that $4 billion is going to come right out of the hip pocket of fat cat oil company executives, right? No, it is going to come out of your pocket at the pump and Obama will not be standing anywhere near you with his credit card out.

Nor did he bother to mention the huge federal subsidies his Department of Energy is larding up for his beloved wind, solar and biomass industries — none of which would survive a nanosecond in the free market but are being propped up for decades to come with production tax credits and direct grants. Taxes come out of one pocket to pay for their construction and out of the other pocket when we pay power bills that will necessarily skyrocket because the production cost per kilowatt-hour is four times as much as fossil fuel, natural gas or coal.

Nor did the president deign to mention that Interior Secretary Ken Salazar, as a part of Obama’s 2013 budget with the $1 trillion dollar deficit in one year, has announced he unilaterally will raise royalty rates for oil and gas produced on federal lands by 50 percent, from 12.5 percent to 18.75 percent. That’ll sure reduce the price of oil — or the incentive to even bother to try to drill on public land, considering all the hoops companies already must jump through to muddle through the bureaucracy. Also in the Obama budget are new fees for inspections and lease application reviews.

Then the president waved his magic wand and told the engineers at all the car makers to increase the fuel standard to 55 miles per gallon. “That means you’ll only have to fill up every two weeks instead of every week. And that will save the typical family more than $8,000 over the life of the car – just by using less gas.”

Even more if gasoline is $9 a gallon as Energy Secretary Steven Chu said it should be. But what will that 55 mpg car cost to manufacture?

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