Posted by: Steve Coplan | April 26, 2006

I am not the conspiracy type

but I’ve spent a few minutes thinking about Bush’s speech today about alleviating high oil prices, and I’ve got a few theories. Bush is proposing releasing oil from the US strategic reserves and not adding further to the stockpile in order to relieve the pressure on prices. While this may help to abate some of the political pressure Bush is experiencing – typical duck and weave maneveur – it also removes the incentive for consumers to reduce consumption or systematically respond to persistently high oil prices. Also, it lowers the average price of oil that potential investors in alternative energy use as a baseline assumption to calculate their return. Plus, the Bush administration will have to eventually replenish the stockpile – after all, who knows what might happen with Iran, Azerbaijan and Nigeria? So while oil that was bought at $30 a barrel is being released from the stockpile, the Administration will have to repurchase at prices probably twice that once all is said and done.

And how best to conceal all this manipulation than to make out that the administration is serious about reducing consumption, and nothing is more serious than a tax cut. Fortunately, Bush can only request that Congress provide tax incentives for hybrid vehicles.

Also fortunately for Bush, the fact that Bin Laden is alive and kicking continues to be widely ignored. Oh those ineffectual Democrats!

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Responses

  1. I just want gas to go back to where it was so i can fuel my SUV!! well at least Bush is relaxing some of the requirments to refine such as ethanol that would add costs to gas.. but only for teh summer.. and while there is all kind sof talk about hybrid technology, what about good ol Diesel engines? work great all over the world.. and low sulpur diesel and bio diesel is easy to come about.. we just cant get cars because of teh strict emissions laws.

  2. and oil is down by a little bit over 2 dollars a barrel! keep it going!!!


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