A crisis flares in the Middle East. Russian military forces subjugate a nation desperate for freedom. Europe searches for new sources of energy.
Such was the situation in 1956. War raged over the Suez Canal, blocking shipping for half a year, and a crucial pipeline from the Persian Gulf to the Mediterranean Sea was sabotaged. Meanwhile, the Hungarian people rose up against their communist oppressors in October, precipitating a Soviet invasion days later. The Cold War turned hot and, as winter approached, American allies in Europe lost access to Middle Eastern oil.
President Dwight Eisenhower’s response was swift and resolute. Domestic oil production skyrocketed and shipments from the Gulf Coast stabilized world markets during this critical period, all to relieve what the press termed “Europe’s oil famine.” A study by the Rand Corporation in 1962 noted, “Both economically and politically (as was seen at the time of Suez), Europe’s essential energy needs involve the United States and other Western Hemisphere suppliers.” By July 1957, the crisis was over. American energy had come to the rescue.
Today, US allies are once again under threat and, once again, our nation’s resource abundance places us in a position to render vital assistance. [full story]
With crude oil supply in flood stage and prices downshifting, America’s political elite still finds itself unable to lift the outdated ban on US exports of crude oil.
Ditching the export ban, Baker Institute research shows, would accomplish at least two worthy goals. First, it would raise domestic prices of US crude oil, providing relief to the struggling US shale patch. Second, allowing US crude to reach global markets might reduce international crude prices, which would, in turn, reduce gasoline prices.
This unlikely sounding scenario is possible because the ban has led to a glut of un-exportable light crude that is sitting in storage tanks around America. Since it cannot reach international markets and U.S. refining sector is not configured to run this much light crude oil, American crude sells at prices well below those of comparable international grades. [more]
US Senator Lisa Murkowski (R-AK) stressed the economic and national security benefits of ending the 1975 federal ban on exporting domestically produced crude oil at a hearing before the Senate Energy and Natural Resources Committee.
“It’s time to reexamine the decades-old ban on crude oil exports and modernize our energy policies,” Murkowski said. “Our nation’s energy landscape has changed dramatically in the last decade alone. Lifting the export ban and allowing oil to be traded freely will put downward pressure on prices and encourage additional production, which in turn will help create jobs, boost economic activity, and send a strong message to the world that we are ready to lead.”
Murkowski, chairman of the Senate Energy and Natural Resources Committee, questioned witnesses about public concerns that exports could negatively impact domestic gasoline prices. The response she got was overwhelmingly ‘no.’ [more]
Here's toast to good old American ingenuity — and a renewed call to end a bad old American energy policy.
In this we’re seconding what Harold Hamm, CEO of Continental Resources Inc., said last week during in his keynote speech to the Society of Petroleum Engineers conference in Oklahoma City.
Technological advancements — primarily horizontal drilling and hydraulic fracturing — have led the boom that has seen America become the world’s top producer of oil and natural gas.
Together, the Bakken field in North Dakota and the Permian and Eagle Ford fields in Texas — “Cowboy-istan,” Hamm called it — have accounted for half of the global production growth since 2008. Those three fields alone would be the world’s seventh-largest liquids producer, Hamm said.
“A lot of people thought this would spread around the world, but it’s not happening anywhere else to the extent it’s happening here,” he said.
The boom has produced hundreds of thousands of good-paying jobs in the United States. But some of those jobs, in Oklahoma and elsewhere, are now peeling away and companies are shutting down rigs as energy prices have tumbled, the result of production exceeding demand. [more]
Wall Street Journal
Six years after the Great Recession officially ended, most Americans can sense that the US economy is still operating below its full potential. Far too many Americans remain unemployed, underemployed or stuck in jobs with stagnant wages and narrow horizons.
Many are beginning to wonder: Is this the new normal?
We don’t believe it is. We believe that America’s best days are still ahead. But we also recognize that restoring the shared prosperity that comes from a strong economy requires reforming the most antiquated and dysfunctional government policies, beginning with the federal tax system.
The tax code’s failures are manifold—impeding growth, discouraging investment, and restricting freedom on the business and the individual side—but they are all rooted in the same fundamental unfairness and inequity of a government that picks winners and losers.
A tax code that works for, not against, American businesses, families and individuals must be built on the twin pillars of equal opportunity and fair treatment for all. [more]