Another reason more drilling won't help the high price of gas

[yesthattom]

We don’t need to drill in environmentally sensitive areas (like off the coast near my house!) because of the 90 million offshore acres leased to oil companies, only 70 million of those acres are being drilled. If oil companies weren’t holding back from the drilling they could be doing...

CNN reports

Comments

[docstrange.livejournal.com]

Heh. At least just about everyone is slowly coming around to the notion that allowing rampant buying of futures on 10% margin has created a real problem. When the demand for -futures- is so much more than product that they're bidding on 10-year-out futures, it of course pushes up the price per barrel delivered today. (The delivery price on 10 yr. oil futures is not all that much more than the price per barrel today - in effect we're paying the 2017 price per barrel... right now.)

There is a shortage - in futures. Change THAT market (by forcing 50% margins) and watch the price per barrel fall.

More production predicted for [n<10] years out will of course lower the price some, since it will increase the effective amount of futures, as will reducing demand for fossil fuels, but either will barely dent the overdemand, especially compared to changing the permitted margin.

I wish we could blame that debacle on either party, but both seemed really happy with the open futures market... until now. Golly, how I lurve our politishuns.

[yesthattom.livejournal.com]

> by forcing 50% margins

That sounds like government meddling, sir. I'm going to have to take away your libertarian card.

[docstrange.livejournal.com]

Please point me to an unregulated market, Mr. Smartypants.

[yesthattom.livejournal.com]

You just made the TrueLibertarian inside me die.

[docstrange.livejournal.com]

*SOB*

And... psssst -- I think that's TrueLibertarian^TM