Get Ready for Higher Gas Prices

Get ready to dig a little deeper; via Heritage:

The EPA’s new Tier 3 regulations require a reduction in the amount of sulfur in gasoline to an average of 10 parts per million (ppm) by January 2017, down 70 percent from the current average of 30ppm today. The new regulation is similar to those standards of California, Japan, and South Korea. 

A study commissioned by the American Petroleum Institute found that reducing sulfur to 10ppm will increase gas prices 6 cents to 9 cents per gallon—although the study does not specifically analyze the newly proposed EPA regulation. The analysis also mentions that if the EPA proposes an additional vapor reduction regulation, that cost increase will skyrocket to 25 cents per gallon.

The environmental impact is expected to be negligible.

The best part:

Because refineries operate on such thin margins already, implementation of these regulations could result in a number of refinery closures. Such closures could squeeze supply chains and further increase the price of gas.

EPA unhinged.  Just in time for summer.

Governor Jindal Has Some National Energy Suggestions for Obama

In his weekly address, Obama attempted to perpetuate the myth that he is trying to bring down gas prices and make your life easier:

“I’m going to keep doing everything I can to help you save money on gas, both right now and in the future,” Obama said. “I hope politicians from both sides of the aisle join me.”

He myopically says "we can't just drill our way to lower gas prices," leaving the impression that his pet green energy projects are our only answer; that and to quit using so much oil.

If he is sincere in reaching across the aisle to lower energy prices he might take a look at Governor Jindal's suggestions for a clear national energy policy.

In Monday's Wall Street Journal, Jindal outlines an energy policy driven by opening drilling fields, a more rational tax code, and reversing "a series of cabinet-level decisions that are at odds with a strategy of affordable domestic energy production." 

Governor Jindal refers to Steven Chu, for example, who advocated raising gasoline prices to European levels.

Additionally, Jindal calls for Obama to approve the Keystone pipeline:

Finally, the president should announce today that he's going to reverse his decision on the Keystone XL pipeline. This pipeline would produce 20,000 construction jobs and 100,000 indirect jobs, and it would provide a much-needed transportation line between oil refineries along our Gulf Coast and production facilities in Canada, not to mention the booming Bakken oil fields of Montana and North Dakota. Our friends to the north have been reliable and steadfast trading partners, and the president should be making this pipeline decision on policy grounds instead of cheap political appeals to his liberal base.

While Obama would like to have us believe he is trying to lower gas prices and claims that drilling is at an all time high, Jindal disagrees:

While the president is quick to tell anyone who will listen that domestic oil production is higher today than at any time since 2003, that's not the whole story. The truth is that today's production levels are not based on anything this president has done, but on the decisions made by private companies before he took office. And much of this production is taking place on private land.

Even Mary Landrieu understands this.  Obama's claim is disingenuous. 

Jindal spoke about this last month in attempting to explain the slow permitting process in the Gulf.   Permits are still lagging and people down south are hurting. 

It's clear there is much this president could do to lower energy prices and in turn boost the American economy yet instead he has opted to prop up failing green energy companies, threaten us with cap and trade, and use increasingly stringent EPA regulations to shut down coal power plants. 

That's not a national energy policy; that's an economy crippling plan sure to drive investors away and put the burden on the average American consumer.

Gas Prices Are Rising and Obama is Sticking With Solar

In a speech last week at a New Hampshire community college, Obama called for an end to subsidies for oil companies:

“You can either stand up for the oil companies, or you can stand up for the American people,” Mr. Obama said. “You can keep subsidizing a fossil fuel that’s been getting taxpayer dollars for a century, or you can place your bets on a clean-energy future.” 

Wow.

I bet that makes folks down on the Gulf coast feel all nice and fuzzy.

While I've never been a big fan of Senator Mary Landrieu, she does at least understand the problems down on the Gulf with regard to drilling and the Obama moratorium (via Hot Air):

I want to say that, despite the Administration’s arguments that are laid out, that you all are all guns blaring and green lights for drilling, the facts that I checked, and if you disagree tell me, only 21 permits for offshore drilling have been issued by this date. In 2010 there were 32 permits. I just left the annual conference of LOGA, which is Louisiana Oil and Gas Association, Mr. Secretary, yesterday. They are beside themselves with not being able to get their permits processed and to answer you, Mr. Franken, let me just say Exxon and Shell may be making record profits but according to a study recently done by the Greater New Orleans, Inc., 41% of our oil and gas independent operators and service companies, I’m not talking about Exxon and Shell that have operations all over the world, I’m talking about companies in the Gulf Coast, in Texas, Mississippi, Louisiana, and Alabama. Let me tell you what the studies show about their profits: 41% of them are not making a profit at all, 70% have lost significant cash reserves, 46 have moved operations away from the Gulf, and 82% of business owners have lost personal savings as a result of this slow down.

There's more at the link, including video, but suffice to say that the folks down south are hurting.   I guess it is their misfortune that they are sitting on millions of gallons of oil rather than having the foresight to open a solar panel company, get a loan from the government, and go broke that way.

Either way, they lose.

With an end to subsidies, your price at the pump will necessarily go up:

The CRS [Congressional Research Service] says there are two ways of looking at the impact of the tax increases: 1) They will increase gasoline prices and dependence on foreign oil; or 2) They will and should increase gasoline prices, because gasoline is “artificially inexpensive.”

Rep. Doc Hastings (R-WA) gave the GOP response today with a focus on energy exploration:

“Though the president now claims to support ‘all-of-the-above,’ he has consistently blocked American energy production, most recently by rejecting the Keystone XL pipeline. In addition to that, he has restricted drilling in offshore areas while encouraging other countries, including Brazil, to expand their own exploration. And while the president says oil production alone can’t solve our problems, his administration has proposed costly regulations that would hurt the supply of other domestic sources. Instead of placing his bet on American-made energy and the workers who produce it, President Obama has wasted taxpayer dollars on Solyndra and other unproven technologies.

But, Obama's plan is to stick with solar.   We'll see how that works out for him.  I mean, the last time I checked, my car ran on gasoline.

I guess I could always get a Volt.  Or maybe not.

Your "Silver Bullet " is a Fountain Pen

Mark Tapscott shares a chart which shows how a "silver bullet" can work against oil prices.  What is it?  A fountain pen:

Notice what happened on July 14, 2008? Oil prices suddenly plummeted from their historic high of $145 a barrel. Why?Because that was the day President George W. Bush signed an executive order lifting the moratorium on off-shore drilling in the eastern half of the Gulf of Mexico and off the U.S. Atlantic and Pacific coasts. Overnight, the price per barrel of oil plunged, and that plunge was reflected at the pump soon thereafter. 

In other words, Obama could with the stroke of a pen sign an executive order telling his appointees at EPA, the Department of Interior and the Department of Energy to stop throwing up obstacles to increased U.S. oil and natural gas production and instead work with the energy industry on a crash program to "drill here, drill now."

Read the rest and see the chart here.