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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Slagle who wrote (63685)	5/9/2005 1:03:42 PM
From: energyplay	Read Replies (2) \| Respond to of 74559

Slagle - That's a significant question. I think historical evidence would tend to make the case that the foreign policy side of the US government pays a lot of attention to oil. The courting of Saudi Arabia in the 1930s, when there were few wells there, might be considered an example. ******** >Sometimes the current administration will not hear what it does not want to hear. Best example would be the Carter administraion , who fired the head of the US Geological Survey, for not conforming to Carter's belief that we would 'run out of oil' within a decade or so. They (the Carter crew) did not mean peak oil and then a slow decline, but a rapid decline in oil availibility, with little response to higher oil prices. Most independent oil men and geologists thought there would be sufficent oil for a much longer time. No big surprise, the Carter ideologs were wrong, and oil keep dropping in price through the 1980s. ************* There is considerable evidence that the Reagan and GHW Bush administration used oil as a strategic weapon against the Soviet Union, and to boost the US economy to help pay for the defense build up + tax cuts. Note that GHW Bush was a SUCCESSFUL oil man, and later head of the CIA. The Clinton administration did seem to do much except lock up more land to make their enviromental supports happy. They then play some games with the Strategic Petroleum Reserve that weren't well thought out. Remember the hustler from New York who was living with his mother and bid successfully for oil ? Pretty sloppy for an administraion that had Bob Rubin in Treasury, Richard Holbrooke, etc. ************* >Early in the GW Bush administration (2001) there were some external people concerned about oil but more about natural gas. There was an administrion 'noise' in the press that no change was needed and market forces would deliver more NG. Seemed like there was some effort to get critics to shut up. That 'no change needed' position went away - that may have been a temporary position for the new Administration. Maybe the administration was deciding how much of an 'Environmental President' GW Bush would be...;-) The emphasis on 'market solutions' continued, with some initiatives favoring drilling in ANWAR, and expanding Rocky Mountain drilling. Interesting to note that some of the groups saying we are headed for much tighter oil are the same who said there was plenty of oil twenty years ago. Positons seemed to shift around the middle 1990s. So most of these independent oilmen are not Perma-Bears or Perma-Bulls. So for a period of about a year, the GW Bush administration did NOT want to hear about oil supply problems. The NEW energy bill takes the peak oil issue seriously, there is much more emphasis on conservation, more drilling, more LNG imports, etc. Pretty far from the "What me worry ?" attitude of early 2001.... As an aside, in the past 9 months or so there has been a low key re-positioning of the administration's position on the existance and causes of Global Warming. ************ A few points - Dick Cheney did work for Halliburton, an oil service company, for a few years. Not the depth of experience of GHW Bush, but some, and the right set of personal contacts. Several of our 14 + intelligence agencies maintain their on separate independent gorups of oil analysts. Defense department (mainly Navy), CIA, Department of Energy. So is considerable weight on the reality based side. On the flip side, GWB likes "principle based leadership" - which often is capable of ignoring facts, underestimating difficulties, and wearing rose colored glasses and assuming that God will provide. **************** Okay, to sum up - >>>Yes, very likely that the executive branch knows the situation. >>>Open question if they will act correctly on the knowledge. I want to thank you for the question - I think I learned some things in answering it.