Chuck Schumer.. dumbest Senator ever?

[Parkbandit]

Chucky Schumer on the floor of the Senate - 5/14/08

“If Saudi Arabia were to increase its production by 1 million barrels per day that translates to a reduction of 20 percent to 25 percent in the world price of crude oil, and crude oil prices could fall by more than $25 dollar per barrel from its current level of $126 per barrel,” Schumer insisted during a speech on the Senate floor.

“In turn, that would lower the price of gasoline between 13 percent and 17 percent, or by more than 62 cents off the expected summer regular-grade price – offering much needed relief to struggling families,” he added.


Chucky Schumer - May 7th

"ANWR wouldn't produce a drop of oil in ten years, and it's estimated that if they drilled in ANWR, in 20 years, it would reduce the price one penny. We've been pushing for a long time for energy efficiency."

EIA - the Energy Information Agency estimates that by 2020, ANWR would produce from 780,000 to 1,110,000 barrels a day.


New Yorkers should be so proud to have this idiot representing them. Glad I moved out of that fucking state long ago.

[Bobmuhthol]

Those statements are independent. Drilling in ANWR could aggregately not be very useful after factoring in expenses; Saudi Arabia, however, already produces oil, and an increase in their oil would obviously help. I think he's dumb to say that it would drop oil prices by $0.01 in 20 years, but it doesn't change the idea that it could be very ineffective overall.

[Sean of the Thread]

Chucky Schumer on the floor of the Senate - 5/14/08

“If Saudi Arabia were to increase its production by 1 million barrels per day that translates to a reduction of 20 percent to 25 percent in the world price of crude oil, and crude oil prices could fall by more than $25 dollar per barrel from its current level of $126 per barrel,” Schumer insisted during a speech on the Senate floor.

“In turn, that would lower the price of gasoline between 13 percent and 17 percent, or by more than 62 cents off the expected summer regular-grade price – offering much needed relief to struggling families,” he added.


Chucky Schumer - May 7th

"ANWR wouldn't produce a drop of oil in ten years, and it's estimated that if they drilled in ANWR, in 20 years, it would reduce the price one penny. We've been pushing for a long time for energy efficiency."

EIA - the Energy Information Agency estimates that by 2020, ANWR would produce from 780,000 to 1,110,000 barrels a day.


New Yorkers should be so proud to have this idiot representing them. Glad I moved out of that fucking state long ago.


You lose. Dumbest Senator ever is named Kennedy.

[Renian]

The question that has to be asked in both statements is: Are they talking about nominal or real dollars?



New Yorkers should be so proud to have this idiot representing them. Glad I moved out of that fucking state long ago.

It's Clinton that makes us cry on the inside.

[Bobmuhthol]

The timeframe doesn't change for Saudi Arabia increasing its production, so there are no nominal dollars. Any future predictions also kind of have to be expressed in real dollars, else one could predict that the price of X is going to be $1 billion... nominally, and there's no real way to refute it.

[BigWorm]

Drilling in the ANWR is a total red herring. There's just not enough oil in there to justice the sacrifices necessary to get to it. Schumer does say some dumb things and the first one is an example of the populist bullshit that I'm getting really tired of hearing from both parties.

[Stanley Burrell]

New Yorkers should be so proud to have this idiot representing them. Glad I moved out of that fucking state long ago.

You are the epitome of paranoid butt-hurt. I don't even know if you know it. It makes me laugh, though.

[longshot]

I have no idea how much it costs (MC) to pull out a barrel of oil from the Alaskan thing, so I really can't say.

He's proposed some dumb ideas before (namely the import tax on China that doesn't account for real interest rates), but ultimately he's a politician: hee says and does things to keep his job.

Maybe what he stated is way off, and maybe it's spot on... but I would strongly disagree that he's the dumbest senator ever.

[radamanthys]

Yea... it's not like there's really a shortage of oil (depreciated supply). It's just an increased demand, and people willing to pay a higher price (higher demand). It's like... I have this cookie. You have to buy this cookie. No matter how many more cookies I make, I can keep that price.

How will drilling more decrease the price? Unless there's some sort of world oil market where people bid on what supply they get, and I just didn't know about it...

Oh, and yea... Schumer is an idiot.

[Renian]

The timeframe doesn't change for Saudi Arabia increasing its production, so there are no nominal dollars. Any future predictions also kind of have to be expressed in real dollars, else one could predict that the price of X is going to be $1 billion... nominally, and there's no real way to refute it.

Alright then. Given that, Schumer's not being dumb at all, given the fact that drilling a new area as opposed to milking a current one further will have significantly more fixed costs. So, if the oil company wanted to be profit maximizing, which would likely entail cutting into OPEC's market share by having lower prices--but if their fixed costs are too high, they may slow production and just keep the price very close to OPEC's, thus almost completely negating the point.

[Parkbandit]

Those statements are independent. Drilling in ANWR could aggregately not be very useful after factoring in expenses; Saudi Arabia, however, already produces oil, and an increase in their oil would obviously help. I think he's dumb to say that it would drop oil prices by $0.01 in 20 years, but it doesn't change the idea that it could be very ineffective overall.

Huh?

Let me put it in term you might be able to understand Bobby.

1 million barrels out of Saudi Arabia = $0.62 off the price
1 million barrels out of Alaska = LESS than $0.01 off the price.

This has NOTHING to do with costs associated with the oil.. it has to do with a very stupid person trying to be placate different constituents but getting caught saying something stupid when you look at the 2 statements he made a week apart.

Here's the dirty little secret about ANWR.. we only need to drill in less than 2000 acres of this tundra area where no one lives.. OUT OF 19 MILLION ACRES. Who the FUCK are we trying to save by not doing it? A polar bear?

The Democratic Party has been taken hostage by the hippy environmentalists to the point where they are purposely slowing down the US economy. This country needs energy.. be it solar, wind, nuclear, coal, shale, oil, rubbing two hippies together until they combust... we need energy.

Congress this week has been embarrassing themselves by parading the CEOs of the big oil companies in front of their committees.. clearly demonstrating that most people in Congress haven't a clue on how a free market system works or how the price of oil is determined.

[Renian]

1 million barrels out of Saudi Arabia = $0.62 off the price
1 million barrels out of Alaska = LESS than $0.01 off the price.

This has NOTHING to do with costs associated with the oil.


lol lrn2economics

Saudi Arabia will have less fixed costs (and perhaps variable costs) than Alaska, therefore they can actually drop the price significantly. Alaska would not, because there is no existing labor or capital, and would likely not experience increasing returns to scale.

[Gan]

Schumer does say some dumb things and the first one is an example of the populist bullshit that I'm getting really tired of hearing from both parties.

x2

[Gan]

For the record: I support ANWR development.



1. Only 8% of ANWR Would Be Considered for Exploration Only the 1.5 million acre or 8% on the northern coast of ANWR (http://www.anwr.com/archives/map_of_anwr.html) is being considered for development. The remaining 17.5 million acres or 92% of ANWR will remain permanently closed to any kind of development. If oil is discovered, less than 2000 acres of the over 1.5 million acres of the Coastal Plain would be affected. That¹s less than half of one percent of ANWR that would be affected by production activity.

2. Revenues to the State and Federal Treasury Federal revenues would be enhanced by billions of dollars from bonus bids, lease rentals, royalties and taxes. Estimates on bonus bids for ANWR by the Office of Management and Budget and the Department of Interior for the first 5 years after Congressional approval are $4.2 billion. Royalty and tax estimates for the life of the 10-02 fields were estimated by the Office of Management and Budget from $152-237 billion.

3. Jobs To Be Created Between 250,000 and 735,000 ANWR jobs (http://www.anwr.org/docs/ANWR_jobs_brief.pdf) are estimated to be created by development of the Coastal Plain.

4. Economic Impact Between 1977 and 2004, North Slope oil field development and production activity contributed over $50 billion to the nations economy, directly impacting each state (http://www.anwr.org/STATES/state.htm) in the union.

5. America's Best Chance for a Major Discovery The Coastal Plain of ANWR (http://www.anwr.com/) is America's best possibility for the discovery of another giant "Prudhoe Bay-sized" oil and gas discovery in North America. U.S. Department of Interior estimates range from 9 to 16 billion barrels of recoverable oil.

6. North Slope Production in Decline The North Slope oil fields currently provide the U.S. with nearly 16% of it's domestic production and since 1988 this production has been on the decline. Peak production was reached in 1980 of two million barrels a day, but has been declining to a current level of 731,000 barrels a day.

7. Imported Oil Too Costly In 2007, the US imported an average of 60% of its oil and during certain months up to 64%. That equates to over $330 billion in oil imports. That’s $37.75 million per hour gone out of our economy! Factor in the cost to defend our imported oil, and the costs in jobs and industry sent abroad, the total would be nearly a trillion dollars.

8. No Negative Impact on Animals Oil and gas development and wildlife are successfully coexisting in Alaska 's arctic. For example, the Central Arctic Caribou Herd (CACH) which migrates through Prudhoe Bay has grown from 3000 animals to its current level of 32,000 animals. The arctic oil fields have very healthy brown bear, fox and bird populations equal to their surrounding areas.

9. Arctic Technology Advanced technology (http://www.anwr.org/techno/drilling.htm) has greatly reduced the 'footprint" of arctic oil development. If Prudhoe Bay were built today, the footprint would be 1,526 acres, 64% smaller.

10. Alaskans Support More than 75% of Alaskans favor exploration and production in ANWR. The democratically elected Alaska State Legislatures, congressional delegations, and Governors elected over the past 25 years have unanimously supported opening the Coastal Plain of ANWR. The Inupiat Eskimos who live in and near ANWR support onshore oil development on the Coastal Plain.
http://www.anwr.org/topten.htm

[Parkbandit]

lol lrn2economics

Saudi Arabia will have less fixed costs (and perhaps variable costs) than Alaska, therefore they can actually drop the price significantly. Alaska would not, because there is no existing labor or capital, and would likely not experience increasing returns to scale.

lol lrn2fuckingread:



This has NOTHING to do with costs associated with the oil.. it has to do with a very stupid person trying to be placate different constituents but getting caught saying something stupid when you look at the 2 statements he made a week apart.

[Clove]

lol lrn2economics

Saudi Arabia will have less fixed costs (and perhaps variable costs) than Alaska, therefore they can actually drop the price significantly. Alaska would not, because there is no existing labor or capital, and would likely not experience increasing returns to scale.Saudi Arabia would still have to expand its production facilities which isn't significantly cheaper than expanding production in Alaska. Taxes may vary (that would be a fixed cost) but I think you really mean capital expenses. Variable costs (costs that vary with the volume of production) would largely be labor and (unless anyone has any hard numbers) I doubt that's any cheaper in Saudi than in Alaska.

[Warriorbird]

Long term thinking wise... we should probably save what is in ANWR for a serious crisis. That's not enviro BS... it's future planning rather than populism.

[Tsa`ah]

There are too many assumptions with ANWR ... mainly quality and quantity.

It is absolutely too early (and without basis) to say with any certainty that 1 barrel of ANWR crude would reduce our imports by 1 barrel of OPEC crude. For all we know at this point it could be worse than the grade of crude pumped out by Mexico.

It is also too early to estimate any rate of production .... certainly not 1 mil pbd considering the EIA has summed it up as ...


In all three resource cases, ANWR coastal plain oil production begins in 2013 and grows during most of the forecast. In the mean oil resource case, ANWR oil production peaks at 876,000 barrels per day in 2024. The low resource case production peaks at 639,000 barrels per day in 2024, while the high resource case production peaks at 1,595,000 barrels per day in 2023.

More importantly it wouldn't matter IF ANWR were to produce a million a day starting now. The impact it would have on fuel prices would be (even at the best possible quality) negligible at best considering we consume well over 20 million barrels per day.

[Gan]

In all three ANWR resource cases, ANWR crude oil production begins in 2018 and grows during most of the projection period before production begins to decline. In the mean oil resource case, ANWR oil production peaks at 780,000 barrels per day in 2027. The low- resource-case production peaks at 510,000 barrels per day in 2028, while the high- resource-case production peaks at 1,450,000 barrels per day in 2028. Cumulative oil production resulting from the opening of ANWR from 2018 through 2030 amounts to 2.6 billion barrels in the mean resource case, 1.9 billion barrels in the low resource case, and 4.3 billion barrels in the high resource case.



With respect to the world oil price impact, projected ANWR oil production constitutes between 0.4 and 1.2 percent of total world oil consumption in 2030, based on the low and high resource cases, respectively.17

Consequently, ANWR oil production is not projected to have a large impact on world oil prices. Relative to the AEO2008 reference case, ANWR oil production is projected to have its largest oil price reduction impacts as follows: a reduction in low-sulfur, light (LSL) crude oil18 prices of $0.41 per barrel (2006 dollars) in 2026 in the low oil resource case, $0.75 per barrel in 2025 in the mean oil resource case, and $1.44 per barrel in 2027 in the high oil resource case. Assuming that world oil markets continue to work as they do today, the Organization of Petroleum Exporting Countries (OPEC) could neutralize any potential price impact of ANWR oil production by reducing its oil exports by an equal amount.

High oil prices and high Corporate Average Fuel Economy (CAFE) standards are projected to restrain the growth in future U.S. liquid fuels consumption. In the AEO2008 reference case, total U.S. liquid fuels consumption grows slowly from 20.7 million barrels per day in 2006 to 22.8 million barrels per day in 2030. Lower projected U.S. liquid fuels consumption results in ANWR oil production causing a larger percentage reduction in future oil and liquid product imports than was the case in prior ANWR analyses conducted by EIA.

Every barrel of ANWR oil production reduces crude oil imports by about a barrel (Figure 3 and Table 2). In the AEO2008 reference case, the proportion of crude oil and liquid fuel imports to total supply remains relatively constant during the 2018 through 2025 time period at an average value of 51 percent. After 2025, reference case oil dependency increases to about 54 percent of U.S. liquid fuels supply in 2030. Because U.S. liquid fuels consumption grows slowly during the entire projection period, the lowest import dependency levels occur between 2022 and 2026 across the three resource cases.19 The mean oil resource case projects a minimum import share of 48 percent in 2024, before rising to 51 percent in 2030. The low and high resource cases project minimum import shares of 49 and 46 percent in 2022 and 2026, respectively.

http://www.eia.doe.gov/oiaf/servicerpt/anwr/results.html
May 2008