I hate gross numbers: Billions of dollars in profits means what? How does that translate to $/gal? Or $/kwh for energy? You decrease price by decreasing demand or increasing supply. If decrease the profits available to oil companies, you will decrease supply. And since we all have to go to work, demand is relatively inelastic.
If you want to decrease price, increase supply. Drill in the Gulf Coast where the Chinese are already drilling beyond our nautical borders. Drill in Anwar in the small area required.
If we are spending less to import oil, what effect will that have on the value of our dollar? That impacts our $/gal now, too.

Let’s talk about the domestic oil once again.
Despite the ’60 million cars for 60 years’ spiel you’ve been hearing, the numbers are much clearer when you look at what even the OIL companies have admitted is the full amount of domestic oil available (yes, including continental shelf and ANWR) vs. our actual usage.
Ever wonder where they pulled that ’60 million cars’ bit? I mean, it doesn’t even say what kind of cars (60 million Hummers is going to be different from 60 million subcompacts), or exactly what they meant by ‘running’ those 60 million cars. Is it 24/7, is it 55 mph with few stops and starts? Or is it 20 miles per week, highway speed, etc? The amount of gas for either can differ dramatically.
Added in to there’s more like 250 million licensed vehicles (and you do have to count trucks, etc.) That there’s vehicles that aren’t licensed that use gasoline (airplanes, freighters, farm vehicles) and that transportation itself only accounts for about 65 percent of total petroleum usage. You have to count lights, heat, plastics…
The usage is actually 21 million barrels… a DAY. That’s just US.
The amount of oil within our borders, by OIL company standards (if anything, its estimated high, given they want to justify drilling in those areas) is 112 billion barrels.
Now, simple division will tell us that is, total, not counting the oil it will take to get TO that oil (every step of just about every industrial process, from building the infrastructure, to running the equipment uses energy), is a total of 15 years worth of oil.
Not 60, 15.
That also doesn’t count the 10 years it will take to set this up, and that refinery capacity matters as well.
And if anyone brings up ‘But if we started it during Clinton years’ (noting that we did NOT during the Republican majority ones), the oil would’ve been gotten to, sure.
And already almost gone.
Domestic oil is not any kind of magic bullet. We don’t have this hidden ocean of oil underneath our soil. Nature, divine providence, fate, who knows, has decided to put most of the oil, the easiest accessed, and the most easily refined oil in places that don’t like us much.
Of course, we have to factor in fallen human nature. (See, fitting in the theme). They don’t like us much to a large extent because of how we’ve treated them because they have the oil.
Chicken…egg, who knows. Either way, domestic production is never going to make that much difference because, flatly, we don’t have that much to produce, and we don’t have the means to increase production in the first place.

Political problem, political solution. The next Congress should be told that they have until the next election to get the price of gas down and if they do not, they’re fired.
It’ll come down.

My guess is a majority of readers of this board voted for an oil man for President twice. That gas prices would shoot up just as he is leaving office really shouldn’t be a surprise, should it? And if now there is a demand for lower prices that results in a gasoline shortage, will the same people in 2016 demand that Congress raise prices to increase supply? Anybody here old enough to remember rationing in World War II and (in our family) stuffing the gasoline bottles in the piano for times we didn’t have ration cards? This was in the US, folks. The price didn’t go up, but the supply was very limited. Ditto when there were price controls in the Nixon administration. Ancient times for many you, I know.
Michelle, I see the tax issue as more nuanced. If each and every oil company faced a windfall profit tax, you’re absolutely right, they’d simply pass along the price. But not every oil company will have to pay the tax, so the smaller companies may–or may not–be able to attract market share by keeping their prices lower. It’s still a complex judgment call. And Venezuelan-owned Citgo may make the whole proposition interesting any time they choose.
It’s not a broad swath of black or broad swath of white issue. It’s itty bitty specks of black and white that move around a lot. Hard to make the right call. I’m pretty sure the country didn’t in recent years.

What I would like to know is what the oil companies did with all those refineries they took offline in the late 80s and 90s. Rememeber when excess capacity was the reason for poor oil profitability back in those years?
Have those refineries been brought back online?

The only result of this is that oil company stocks will tank, leaving the average saver on the street in the lurch. Oh, but I forgot, if you save and invest money you’re just a plutocrat.

As someone who voted for Gore in 2000, and Kerry in 2004, and who thinks the Bush Presidency has been among the worst in our history, I still have to say that I think this windfall profits tax idea is a much worse “pander” than the gas tax holiday, and shame on the Democrats for proposing it, and shame on Barack Obama if he endorses it.
From everything I’ve read, a windfall profits tax wouldn’t work, but it would provide a temporary “rush” for those who think if we just punish the oil companies for their record profits, all will be well.
And, no, I definitely don’t think the solution is drilling in the area in Alaska that has been off-limits. That seems to be a catch-all solution for those who really want to drill there.
Unfortunately, I think the solution is much more long-term, and involves conserving resources and working with the oil companies to develop greater energy efficiency. I think some combination of conservation, belt-tightening, and investment in new technologies may be the best way out of this predicament, but it is definitely not a short term solution.

Extra taxation could reduce the oil companies’ committment to exploration, but at what point? There’s some evidence that the oil companies are not using the massive profits they have now to look for new sources.
On the other hand, Mexico and Russia are experiencing production declines because they used their oil profits as cash cows for the rest of the economy. In Mexico, 40% of government spending has come from oil profits. They haven’t invested in exploration and haven’t anticipated the situation they are now facing, which is a production decline of the present fields.
Increasing domestic production is worthwhile, any way you look at it. There are over 2 trillion barrels of oil that are tied up in shale rock formations in Colorado and Wyoming. Production has started, on a small scale, in bringing that source of oil to the market.
A modest increase in taxation of the oil companies probably wouldn’t hurt exploration budgets. But, a major looting of these companies would be very unwise.

Our military is an arm of the government that works very well to protect us. This is an institution of the government even to which Republicans pay positive lip service.
Bob Herbert has an interesting Op-Ed in the NY Times today about government institutions of which Americans have high opinions. He tries to make the case that Republicans might not rail against government with success this election year.
Honestly, with all the subsidies that our airlines, health care companies, drug companies, etc. get; if they screw us around enough… I say nationalize them &/or put them in a public trust.
If the Republican god is the almighty dollar, so be it. I don’t think the government is the solution all the time either. But, if all an industry can put up is robber barons that could care less about the common good; then, I say screw ‘em.
We are living in a society about which conservatives boast. Sadly, many institutions aren’t able to even provide folks on the lower end with basic needs. Private interests have proven in a major way that they can’t always be trusted.
I think some Asian folks and Western Europeans come here and see the state of our civil society the way gringos look at Mexicans when they go vacation in Cancun.

“Sadly, many institutions aren’t able to even provide folks on the lower end with basic needs.”
What “institutions” are you referring to? Isn’t it up to “fokes on the lower end” to provide for their own “basic needs?”

“I think some Asian folks and Western Europeans come here and see the state of our civil society the way gringos look at Mexicans when they go vacation in Cancun.”
Given our prices and relatively light tax burden, I bet they wish they could stay.

Michele,
Why do all these big businesses need government subsidies? Let’s address corporate welfare? Do you support socialism for the rich?

I work for a very big company and we don’t get one bloody dime from the government. Give examples if you’re going to hurl slogans.

Haliburton gets no-bid government contracts. Bear Sterns gets bailed out. Auto companies get subsidies and don’t have any bona fide fuel efficient vehicles. Tax payers foot the bill for R&D on drugs. BLM sells land to Bush cronies for bargain basement prices.
There’s a lot more!

I don’t agree with the Dems on the taxing of the oil companies.
But Its equally wrong to give tax breaks to the oil companies, or to do a gas tax holiday so the gas companies can pocket the money.
Neither side is helping the situation.
As for ANWR — GOP members in the senate were hardly unified. It wasn’t entirely the Dems fault. Besides we don’t know if the oil found there would have been enough our consupmtion has increased a lot in the last 8 years — hmm I wonder why……….
I’ll give you a hint its not consumers. The market has spoken on that front.

What really needs to be done other than stopping the war. Is state govt’s need to stop forcing prices to be within a few cents of each other for gas. In minnesota I think you can only be 8 cents different than your competators. So you can never lower your price more than 8 cents. Its state sanctioned price fixing. Iowa has a similar law. As does much of the country.

You have to remember, this isn’t about lowering gas prices, it’s about getting their hands on more money and thus power. They want the gas prices high, you can tell by their actions: none taken to lower them, none taken to increase supply, they’ve even blocked efforts that could get us cheaper gas from Canada.
It’s all about the money.

Well, just to offend everyone, I am for a $5 or $6 tax per gallon balanced by an elimination of the personal income tax. An oil company tax only effects American companies, but an oil consumption tax hits both foreign and domestic production. Since American oil companies must compete against much larger government entities like Aramco, I would eliminate all of their corporate tax regulations. Mainly I want to de-fund terrorists and madmen like Chavez, but it would help the Chicken Littles (Al Gore, and others) to sleep better at night and we would all be less stressed as a result.

“If decrease the profits available to oil companies, you will decrease supply.”
that’s ridiculous. it might be sensible statement IF oil companies were turning those profits into greater oil production or other energy exploration, but that just isn’t so. the top dogs are rolling in their (i mean OUR) cash.
i’m not as much for new taxes for big oil companies, but i’m all for taking away their tax breaks.
ALICIA: “Unfortunately, I think the solution is much more long-term, and involves conserving resources and working with the oil companies to develop greater energy efficiency. I think some combination of conservation, belt-tightening, and investment in new technologies may be the best way out of this predicament, but it is definitely not a short term solution.”
i agree, wholeheartedly. which is one of the major selling points to my support for obama. he’s thinking long-term (not like mccain and other republicans who just want to drill in all of our national parks – oh yeah, they want to start drilling in the rocky mountain national park and other parks here in colorado, too). check it out: http://www.barackobama.com/issues/energy/
did you know that biofuels are more efficient (provide more horsepower) than conventional gasoline and can be run in any diesel engine? big-oil doesn’t want you to know.

not to worry, the Grand Oil Party just managed to protect their interests by using the filibuster to block the legislation. by the way, the tax was for the top 5 largest oil companies only, and they could have avoided the new proposed tax by using their windfall profits to push alternative energy programs or refinery expansions.
in addition to protecting their tax breaks, the republicans also crushed an opportunity to help alternate energy development by blocking another proposal that extended tax breaks to solar, wind, and other energy development companies through the end of this year.
it’s pretty clear where republican interests are, and it has nothing to do with getting away from foreign oil, or clean energies, or competition to oil.

The Grand Oil Party – under Bush, it certainly was that.
However, I take some comfort from the fact that neither candidate represents the Establishment, even though McCain is currently “running to the Right” to appease conservatives. In fact, I think this is shaping up to be the best debate between to contenders for the Presidency in many years. On Hardball today, one of the guests (or it may have been Chris Matthews, I had the sound turned down because I was at work) reminded viewers that those who backed the Iraq War promised that we would end up paying cheaper gas prices as a result.
NOT!

Scientists prove Politicians Stupid
Recent studies of the human brain have discovered many distinct features. Scientists have realized that inside our brain is a reptilian brain. Reptiles having among the least amount of intelligence in the animal kingdom. This area of the brain is responsible for the dominance hierarchy behavior in animals. Meaning it’s function is basic survival and climbing the status ladder so to speak. So invariably people always trying to rise to the top of the social/economic ladder are using the least intelligent area of their brain. Thus politicians being among the highest positions in our society are the epitome of this.
http://www.truenewspaper.blogspot.com

Anonymous, where exactly are oil companies supposed to “turn those profits into greater oil production.” Congress has made it explicitly clear that oil production is not going to be increasing within the U.S.; and American companies have little say in the way OPEC or Russia conduct their business.

“… those who backed the Iraq War promised that we would end up paying cheaper gas prices as a result.”
yeah, i’m reminded of that every time i fill the tank. apparently iraq was supposed to be our 51st state? gee, where could they have gone wrong? thankfully i only fill my tank about once a month (better than the once per week that i used to do).
as for mccain on the issue, i do give him credit for his acceptance of global warming and of voting against drilling in anwr. but then he claims that we can achieve independence from foreign oil in just 5 years but earlier he voted NO on reducing oil usage by 40% by 2025. he clearly has no idea what he’s talking about, because 5 years is a pretty impossible goal and moreover, his voting record shows that his heart’s not in it. he has flip-flop-flipped on the benefits of ethanol (and on the kyoto treaty). he’s pushing nuclear power as the only solution to our energy and environment problems while he neglects the national security risks involved and neglects to address the nuclear waste issue.

“Anonymous, where exactly are oil companies supposed to “turn those profits into greater oil production.” Congress has made it explicitly clear that oil production is not going to be increasing within the U.S.; and American companies have little say in the way OPEC or Russia conduct their business.”
i didn’t say that oil companies were supposed to “turn those profits into greater oil production.”
considering that the u.s. most likely passed its peak oil production sometime in the 70s, it’s going to be tough going, right? the easy oil is dwindling so they need to start going after heavy oil, extra-heavy oil, or bitumen. the problem with those is that getting refined oil from those creates even more greenhouse gas emissions than the standard processes of “producing” easy crude and such processes were banned by congress (the energy independence and security act). so, what can they do? they can invest their profits to expand refineries or into the development of alternative energies.

Tax Breaks for Oil Companies
The Chicago Sun Times is not happy about welfare payments to oil companies:
Now’s a curious time to be dishing out oil welfare, Editorial, Chicago Sun Times: The U.S. government over the next five years will give a windfall of $7 billion to oil companies — yes, the same oil companies that reported record profits last year. But wait, it gets worse: If one oil company that is suing the government succeeds, that windfall could hit nearly $35 billion. Oh, and one more thing: There appears to be little anyone can do about it. Think about that the next time you pay a small fortune to fill your tank.
There is nothing illegal about the program… In fact, some folks might argue its goals were laudable 10 years ago, when the federal government with bipartisan support tried to encourage oil companies to drill in the deep waters of the Gulf of Mexico by promising to forgo the normal 12 percent or 16 percent royalty payments on leases there. Oil and gas prices were relatively low at the time, and it was deemed too financially risky for oil companies to invest in deep water drilling without the incentive. But isn’t taking risks in hopes of gaining future profits what the market is all about? This was a bad idea from the start. …
Many companies stopped claiming relief when oil and gas prices rose above certain trigger points built into the leases — about $35 per barrel for oil. But those price triggers were waived in leases signed in 1998 and 1999 because companies still weren’t investing … and those leases will account for most of the $7 billion windfall. And several companies are challenging whether the Interior Department had the authority to include those price triggers in the first place. …
While some lawmakers said they will try to undo the terms of leases that are in some cases 10 years old, they will probably fail. … While we don’t favor a new tax on the oil companies’ record profits, those firms aren’t doing themselves any favors by refusing to pay royalties while they’re rolling in the dough. They might find it hard to win incentives the next time their industry is in a slump. We can hope so. The oil industry can make plenty of money without the benefit of corporate welfare.
I don’t know much about the challenges to the price triggers, but on the $7 billion I am not quite as shrill. This isn’t what I think of as welfare, this was an attempt to use incentives to encourage more investment by oil companies. The debate on whether incentives should be offered in the first place aside, if profits are dangled in front of firms as an incentive to encourage investment or other behavior, then it undermines the policy the next time you try to use it if you take the profits away from the firms that act on the incentive because they are excessive by some definition. If excess profits are a worry, then write the policy to cap or limit profits up front (or in this case leave them in place) so that firms know the true reward for investment, don’t take the profits away or use the profits as political weapons after the fact.