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America Is About To Have Its First Fracking Election

This has never happened before. The oil and gas business – the industry, its health and its impact on inflation and consumer prices – has always played some small role in presidential politics, at least since the oil shocks and embargoes of the 1970s. Most times in the past, the key issue surrounding oil and gas has related to the price of gasoline and what the candidates planned to do about it.

The issue of oil and gas has only arisen whenever gas prices were considered to be too high, never when consumers were benefitting from them being historically low, as they are today. Yet, suddenly this year, this key industry is playing a huge role in the 2020 presidential politics, and it is wholly unrelated to anything having to do with prices at the pump.

The issue in this election campaign is fracking, and whether or not it will remain legal should Democrat candidate Joe Biden become our next president. While this longstanding and well-regulated industrial process has hovered around the periphery of presidential politics since 2008, when the anti-development lobby decided to politicize it with a focused and highly-organized demonization campaign, it has suddenly become one of a handful of crucial issues that dominate the political landscape this year due to its job-creating and economic impacts in a single swing state: Pennsylvania.

How important is it? Early Monday morning, the Trump Campaign announced that President Donald Trump would be holding three separate campaign rallies that day. This is nothing unusual, given that the President has made a habit of holding multiple rallies each day during both of his presidential efforts. On Saturday alone he held rallies in the state of Florida, North Carolina, Ohio and Wisconsin.

What is unusual about Monday, though, is that all three of the Trump rallies will be held in Pennsylvania, which has become perhaps the single most crucial swing state in the 2020 election. Biden is also paying special attention to the Keystone State, holding events there on Friday and Saturday, and sending both ex-President Barack Obama and Senator Bernie Sanders there to campaign on his behalf over the weekend.

Pennsylvania was certainly a key swing state in 2016, but its importance was equaled by Florida, Wisconsin, Michigan and North Carolina as the race played out. This year, though, it has become increasingly difficult to see how either major candidate can prevail in the Electoral College without having Pennsylvania’s 20 electoral votes included in his total.

All of which explains why the issue of fracking and its continued legal deployment has become so elevated in the national discourse this year. Pennsylvania is, after all, the fulcrum for the development of the enormous Marcellus Shale/Utica Shale resource plays, the largest natural gas reserve in the Western Hemisphere.

 

Read the Rest Here

 

That is all.

Today’s news moves at a faster pace than ever. Whatfinger.com is the only real conservative alternative to Drudge, and deserves to become everyone’s go-to source for keeping up with all the latest events in real time.

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Gavin Newsom’s Unbridled Energy Hubris

Three big oil and gas-related stories this week were all interrelated with one another, though few really understand that to be the case. Those stories were:

 

 

For Governor Newsom, banning hydraulic fracturing – or “fracking” as it has come to be called – in his state is a relatively simple matter in what has become, for all intents and purposes, a one-party state. All he has to do is convince his overwhelming majorities in both houses of California’s state assembly to pass a bill mandating that all fracking operations cease within the state’s borders by a date certain.

Such a move would of course eliminate thousands of oil and gas-related jobs in the state, but most of those are concentrated in Republican Kern County and the surrounding parts of the Central Valley, over which the assembly’s Democrats would have little concern. Besides, they can all just respond to Republican and industry complaints with the Obama-era pretense that all those lost jobs and more will be made up by the heavily-subsidized wind and solar industries. It will be akin to former President Obama telling West Virginia coal miners and Ohio steel workers that their jobs are never coming back and they should all go learn to code.

Replacing the state’s millions of gas and diesel autos with electric vehicles will be far more complicated. Newsom’s order gets that ball rolling by requiring the California Air Resources Board to implement the phaseout of new gas-powered cars and light trucks in the coming years, and also require medium and heavy-duty trucks to be zero-emission by 2045 where possible. Sounds simple, right?

But here’s the thing about all of that: The generation and provision of energy is basically a zero-sum game. When you ban one energy source, you must figure out a way to generate the same amount of energy by another source. You either do that or you accept the reality that energy will become scarce, and thus far more expensive so that consumers demand less of it, and write off the negative economic consequences that will inevitably result.

Read the Rest Here

 

 

 

That is all.

Today’s news moves at a faster pace than ever. Whatfinger.com is the only real conservative alternative to Drudge, and deserves to become everyone’s go-to source for keeping up with all the latest events in real time.

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Why Electric Vehicles Don’t Spell the End for the Internal Combustion Engine

The Afternoon Campaign Update
(Because The Campaign Never Ends)

Answering reader mail. – A reader in Houston emailed me this morning ([email protected]) with an energy-related question that is very timely. Here follows the email and answer I provided:

Email:

David,

I really enjoyed listening to your appearance on the BYU podcast and reading this article:

7 Key Things To Know About Oil and Gas

Your last point contained this tidbit that caught my attention:

“The reality is that, despite the growing intervention into the auto market by electric vehicles, the demand for gasoline and crude oil in the U.S. continues to rise, and is projected to keep doing so into the future.”

  • How will the shift to electric vehicles impact the demand on Oil and Gas?
  • Roughly what % of global consumption is for vehicle fuel?
  • Do you think we’ll fully go to electric vehicles and how will this shift effect Houston’s economy in the near and far term?

I’ve got a chunk of my net worth wrapped up in my house [near Houston], and am wondering what a drop in global demand would do to all these O&G companies and the local housing market.

Your daily updates are my favorite read of every morning.  Press on!

Answer: [Edited and expanded slightly for clarity.]

The potential for EVs is wildly over-hyped in the media. The shift to EVs is far outpaced by the ongoing increases in demand for crude oil, not just in the U.S. but even moreso globally. That is not going to change anytime soon.

Why? Because that electricity to recharge them has to come from somewhere, and today mainly comes from power generated by coal and natural gas in the U.S. That’s another stark reality that is not going to change anytime in my lifetime, which I figure is another 25 years or so. [Every reliable projection – even those by the U.N. – project that fossil fuels will still account for the vast majority of global power generation in 2050.]

Here’s reality: The world has a choice where fossil fuels are concerned. First, we could burn more and more coal in power generation because it is not replaceable by intermittent power sources like wind and solar. Germany and Spain have clearly demonstrated this over the past decade, as they almost bankrupted their economies trying to do just that.

The alternative is to burn more and more gasoline in automobiles.  You cannot have a geometric leap in EVs without burning far more coal than we do today, and the alternative to burn more gasoline is a much cleaner environmental solution. It is also a far more affordable solution for consumers.

Thus, it is a virtual certainty that we will continue to burn more gasoline in internal combustion engines for the next half century, and probably beyond.

Houston’s going to be fine.

[Expansion]

Now, to expand on that a bit, here are a couple of other reasons why the world will continue to produce and consume increasing amounts of oil in the coming decades:

First, you have the fact that thousands of other products that ordinary people rely on every day are produced either in whole or in part from petroleum. From plastics to chemicals to polyester to fertilizers to makeup to toothpaste, even to the computer on which I am typing this, people all over the world are heavily reliant on a vast variety of products that use petroleum as a feedstock.

Second, look at this incredible graphic:

What amazing progress in just ten years! Here’s the simple truth: None of that progress would have been possible without oil and natural gas. The developing nations of the world need access to plentiful, scalable and affordable sources of energy in order to join modern society and elevate their people out of squalor. This can only be achieved through the use of fossil fuels.  Period.

So, bottom line, if you are worried about the oil and gas industry collapsing anytime soon, you need to find something else to worry about.

That is all.

 

 

Follow me on Twitter at @GDBlackmon

Today’s news moves at a faster pace than ever. Whatfinger.com is my go-to source for keeping up with all the latest events in real time.

 

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Trump Tweets, OPEC Blinks

The Evening Campaign Update

(Because The Campaign Never Ends)

Tired of all this Winning yet? – If you’ve been irritated by how much it’s cost you lately to fill your car with gasoline, well, cheer up.  President Trump is on the case.

In fact, if you believe the folks at Bloomberg, he’s already caused the Saudis to blink and start working to get up to another 800,000 barrels of oil per day onto the global market in an effort to stabilize the price for crude oil at current or slightly lower levels.  Given that crude is the raw material from which gasoline is refined, a halt to the rapid rise in that commodity’s prices that has taken place in the last year will also stop the rise of the price at the pump.  Crude prices dropped more than $3.00/barrel (roughly 5%) on Friday in response to the Saudi/OPEC announcement of their intention.

So, how did President Trump accomplish all of this?  Optically at least, he did it with a single tweet.  On April 20, the POTUS took to his famous Twitter feed to slam OPEC for the rapidly rising price of gasoline as Americans headed into the summer driving season:

As Bloomberg reports, the Trump tweet produced an immediate reaction among the various OPEC ministers:

OPEC officials were in a meeting at the opulent Ritz-Carlton hotel in Jeddah on Saudi Arabia’s Red Sea coast when Trump tweeted his views and they immediately saw it as a significant intervention.

“We were in the meeting in Jeddah, when we read the tweet,” OPEC Secretary General Mohammad Barkindo said on Friday. “I think I was prodded by his excellency Khalid Al-Falih that probably there was a need for us to respond,” he said. “We in OPEC always pride ourselves as friends of the United States.”

Given that, unlike his immediate four predecessors in office, President Trump does not hesitate to lever negotiations over seemingly unrelated matters into one another, using all of the influence of the United States to obtain positive results, these OPEC countries also have developed a new-found sense of respect – likely bordering on fear – for expressions of concern coming from the U.S., even when they come from a Presidential tweet.  Perhaps even especially when they come from a Presidential tweet, come to think of it.

Now, probably there was more to this new attitude suddenly being expressed by OPEC countries.  The Bloomberg story cites a recent congressional hearing covering proposed legislation that would attempt to make OPEC and other commodity cartels subject to the U.S. Sherman Anti-Trust Act, and there have likely been negotiations between U.S. and officials from Saudi Arabia and other OPEC nations taking place behind the scenes since April 20.   But there is no doubt at all the President’s tweet got this ball rolling.

So, when you next go to fill up your car and notice that the price of unleaded has dropped a dime a gallon in response to Friday’s 5% drop in the price for crude oil, you know who to thank.

Isn’t it nice to have a President who’s looking out for our interests instead of the interests of some nebulous “international community?”

That is all.

Follow me on Twitter at @GDBlackmon

Today’s news moves at a faster pace than ever. Whatfinger.com is my go-to source for keeping up with all the latest events in real time.

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