Supply and demand
In Mike Argento's Sunday July 27th Viewpoint, Mr. Argento becomes an expert on the Oil Crisis, where he gets his information from, and criticizes McCain for changing his mind on drilling. When crude oil is selling for $40 a barrel, and the pump price was around $150.9 there is not much need to drill for more oil. When the crude oil price goes about $130 a barrel, common sense would tell you that circumstances have changed.
He mentions that new drilling, would take "about a decade" to produce oil. If he would ask drilling companies about his forcast, he would find out, the timing would be two to three years. Then he goes on to say that action would not be enough to affect prices. He is wrong again. The effect would be almost immediate, as the speculators would know that we are serious about new drilling, and the futures market would take a dramatic drop. Mr. Argento, read up on the law of supply and demand.
John T. Tuleja
Spring Garden Township
John, not sure where you are getting YOUR info from, but the oil co's themselves agree that it will take 10 year to find and begin to develop new offshore sources, and another 5 years beyond that to reach full production. More important is the estimate of how much might be there-- the Govt claims there may be as much as 18 billion barrels. That amounts to... drum roll please... 6 months of current world usage. THAT is why Mr. Argento is correct when he says offshore drilling will not lower the price.
John, not sure where you are getting YOUR info from, but the oil co's themselves agree that it will take 10 year to find and begin to develop new offshore sources, and another 5 years beyond that to reach full production. More important is the estimate of how much might be there-- the Govt claims there may be as much as 18 billion barrels. That amounts to... drum roll please... 6 months of current world usage. THAT is why Mr. Argento is correct when he says offshore drilling will not lower the price.