Peter says in a few places that the moratorium will send all that drilling machinery to other parts of the world, since they won’t hang around here idly for six months.
OK, that makes sense. But he then concludes that this will drive oil prices much higher in the US. And I don’t get why. The drillers will find the new oil, increasing the supply, and we will buy it. The rise in price because it’s imported shouldn’t be that much.
In short, what difference does it make if new oil is found here or somewhere else?
I appreciate any replies.
They drill the oil where its cheapest first. There are a lot of reserves we can get at, they’re just expensive to drill/produce.
I think that there will be a short price hike because major plans are being shifted at BP. However, those drilling rigs should head up to the Marcellus Shale and get us some natural gas!
I haven’t checked but a few months ago natural gas was being stored at its highest historical level…
here’s the link, BTW. At around the five minute mark.
Can’t edit the original post, so I’ll say it here.
My bad, he doesn’t say it. Just that the trade deficit wil increase, as will unemployment, when those rigs move on.