Posted tagged ‘Carpe Diem Blog’

Economic Forces Eventually Win: Let’s Look At Oil

March 2, 2016

Mark J. Perry’s recent post at Carpe Diem Blog titled; Some Charts And Updates On America’s Amazing Shale Revolution, It’s Not Over Yet, shows how economic forces are always in play even when we think they’re not. When the price of oil was over $100 dollars a barrel and gas was close to $4 a gallon in 2014, who thought oil would get down to $30 dollars a barrel and gas would sell for under $2 a gallon?

The law of supply and demand states that more will be produced at a higher price than a lower price. Higher oil prices made fracking economically viable. The American shale industry took off, in spite of the Obama administration making oil rich government land off limits to fracking. The shale industry started drilling on private land. Even though a portion of the investment in the shale industry may be an artificial bubble, thanks to the fed printing money, the reality is that fracking is now viable at lower and lower prices per barrel. Some marginal companies are going bankrupt because of the lower prices, but you can rest assured these evil oil companies won’t be bailed out by our green energy loving government, which is good. These marginal producers will be purchased by more viable companies and whatever malinvestment the Fed created will be purged from the shale industry. The housing bubble should have been allowed to find the bottom, instead of the Fed pumping money to keep the correction from happening. This is what should have happened to GM instead of being bailed out by Bush and Obama.

Economic forces are always in play even though government tries to keep them at bay through regulation, taxes, or money printing. Even though it may take some time, economic forces always win. Just ask the leaders of the former Soviet Union.

Here are some charts and quotes from Mark J. Perry’s article (click above).

US oil production is almost up to early 1970s levels.

oil

US natural gas production is at all time highs.

natgas

Low oil prices have had a positive economic impact, even though the Wall Street experts say the low prices are bad. In fact the Obama administration couldn’t claim any US job growth if it wasn’t for the jobs created in the fracking industry. And the Obama did everything it could to halt fracking. Excerpt from the article.

“The plunge in energy prices is driving a U.S. building boom for plants that turn crude oil and natural gas into motor fuels, chemicals and fertilizer. Energy companies proposed or received approval to build 140 petrochemical projects in the last five years as falling oil and natural gas prices made it cheaper to refine and process the raw materials…

We are becoming more energy self sufficient. The OPEC Cartel has been brought to its knees by the American shale revolution.

netoil

Excerpt from the article:

“America’s Amazing Shale Revolution is arguably one of the most remarkable energy, economic, entrepreneurial, and technological success stories in history. The charts, data and reports above help to tell part of that remarkable story.”

“And make no mistake, the shale revolution is not going away, it’s here to stay and will be part of the global energy landscape for a long time. Despite a temporary slowdown and setback in domestic oil production in response to low oil prices, America’s bonanza of shale resources won’t vanish, but will remain available and accessible when needed…. America’s petropreneurs….stand ready to start drilling shale oil again as soon as oil prices rebound back above $40 per barrel. And the shale producers will come back leaner and meaner than ever in the upcoming Shale 2.0 period, thanks to ongoing technological improvements in drilling and extraction technologies, less costly and shorter drilling times for new wells, and increases in the initial shale output flowing from new wells…

America’s shale revolution isn’t going anywhere. In fact we are probably at the end of the beginning of the revolution.

Related ArticleFree Market Fracking Trumps Government Solutions When It Comes To Producing Energy, at austrianaddict.com.

Related ArticleWind And Solar Energy Is Diluted and Intermittent, Which Means More Costly, at austrianaddict.com.

Free Market Fracking Trumps Government Solutions When It Comes To Producing Energy

June 23, 2015

Mark J. Perry at CarpeDiemBlog visited the Bakken oil fields in North Dakota and has written about what he learned in these two must read posts titled, Ten Things I Learned On My Summer Trip To The Bakken Oil Fields Part I click here, and Part II click here. These articles tell the story about every aspect of fracking. You will be amazed when you read how fracking works, from walkable drilling platforms, directional drilling, frac sand, 3-D seismic imaging, and geo-steering to name a few.

Even though Saudi Arabia is trying to drive the price of oil down in an attempt to make it unprofitable for American Fracking to produce oil at the lower price, hydraulic fracturing is becoming an increasingly more cost-effective way of extracting oil from the ground due to the advances in technology and human ingenuity. What’s left of Americas culture of freedom has produced a fracking miracle. There are so many known and yet to be known areas of our economy that are poised for a miracle if Government will just get out of the way.

ANIMATION OF HYDRAULIC FRACTURING

 

GOVERNMENT IS AGAINST LOW COST ENERGY

The Federal Government has spent billions of our tax dollars trying to make “green energy” a viable alternative to fossil fuels, at the same time they are trying to hamper the fracking revolution. Here is what I wrote in a previous post titled Politicians “Affordable” Ideas Must Obey Economic Forces.

“Market forces are more powerful than the hoped for results of central planners. The most recent example of this is the boom in oil and natural gas production, created by hydraulic fracturing [ fracking],which is taking place on private land in spite of Government policies. Our politicians shut down some Government lands to oil exploration, and made the process of getting permits for exploration on remaining lands more time-consuming [costlier]. They used their power, and our tax dollars, to promote and invest in, “green energy”. Green energy was going to create new jobs and lead our economy into the future; do you remember Van Jones the Green Jobs Tzar. As always, the plans by our best and brightest politicians, must be obedient to economic forces. Green energy has, and is, going bankrupt, in spite of being propped up by Government incentives  and our tax dollars. They tried to make carbon based fuels more expensive through regulation, and green energy more affordable through tax payer subsidies; and even with all this Government help, the economic reality that green energy produces less energy at a higher cost, and carbon based fuel produces more energy at a lower cost, can’t be overcome.”

“This article titled, “Fracking Revolutionized American Energy As Green Energy Failed“, by Conn Carroll at washingtonexaminer.com, shows how the President went all in on green energy, at tax payers expense. We are witnessing what Robert Bradley Jr., at masterresource.org, has stated so well, “When Government tries to pick winners and losers, it typically picks losers. Why? Because in a free market consumers pick winners to leave the losers for Government”

Related ArticleGovernment Investment Or Government Waste, at austrianaddict.com. Look at the list of failed government subsidized  green energy companies in this post.

Related ArticleThe Hidden High Cost Of Green Energy, at austrianaddict.com.

 

Must Reads For The Week 3/28/15

March 28, 2015

The Grand Canyon Filling Up With Fog – And Why – In 60 Seconds.

 

California Raisin Farmers Get Another Day In Court, by Bonner Cohen, at cfact.org. The Government through the USDA has the authority to confiscate half of farmer’s raisin crop and sell it abroad at a discounted price in order to keep prices in the US high. The fifth amendment of the Constitution states, “…nor shall any person’s private property be taken for public use without just compensation.” As Joseph Sobran stated, “The constitution is no threat to our current form of government”.

Guiding The Blind Through London’s Subway With Estimote Beacons, at wired.com. Blind people are navigated through the subway via spoken instructions through their mobile device. Where is the seeing eye dog lobby complaining about putting these dogs out of work?

Don’t Call An Ambulance, Call Uber, at medium.com. The median response time for an ambulance in NY City is 6.1 minutes. The median response time for an Uber is 2.42 minutes. It is much cheaper to be transported by Uber than an ambulance. Does this outweigh the medical expertise of the EMT’s? People have another choice when deciding how to get to a hospital. I saw this at Carpe Diem Blog.

Oil And Gas Exports – One Policy Change Many Benefits, by Marita Noon, at cfact.org. Did you know that oil produced in the US is not allowed to be exported to foreign markets? Another example of Government interfering in the market.

Venezuela Oil Wealth Doesn’t Stop Gas Shortages, by Jeremy Morgan, at laht.com. Who would have ever thought that Government price controls, labor union disputes, and socialist distribution collectives would lead to shortages of gasoline?

Venezuela: All Day Shopping Trip For 8 Basic Items.

Prices ration scarce resources in a free market. Waiting in line is part of the rationing process in a socialist paradise. People in the former Soviet Union used to say, “if you see a line forming, get in it”. I saw this at Carpe Diem Blog.

 

EPA Wants To Monitor How Long Hotel Guests Spend In The Shower, Elizabeth Harrington, at freebeacon.com. There is no aspect of your life that Government bureaucrats and politicians won’t try to control. Do you want to bet that someday this will be mandated monitoring equipment on your shower at home? No, that could never happen here.

Michigan Tourism Agency Sees Airbnb As A Threat, at michigancapitalcomfidencial.com. Airbnb is to people looking for lodging, as Uber is to people looking for a ride. And just as the taxi monopoly doesn’t want competition from Uber, so the hotel monopoly doesn’t want competition from Airbnb. This another example of the unstoppable forces of economics catching up to crony capitalists, and helping the consumer through lower prices and more choices. I saw this at Carpe Diem Blog.

The Only Truly Compliant, Submissive Citizen In A Police State Is A Dead One, by John W. Whitehead, at targetliberty.com. Excerpt from the article: “It doesn’t matter where you live, it’s the same scenario being played out over and over again in which government agents, hyped up on their own authority and the power of their uniform, ride roughshod over the rights of the citizenry. In turn, Americans are being brainwashed into believing that anyone who wears a government uniform – soldier, police officer, prison guard – must be obeyed without question.”