Letter to the Editor: Messing with our energy system has consequences on prices

Ralph Ragsdale

It is assumed by many, apparently including President Joe Biden and his many White House advisors, that increasing the supply of gasoline will result in a price reduction. So, he has asked the refiners to ramp up production to create a glut to drive down the price through simple supply and demand.

At the same time, Biden’s advisors are accusing the oil companies of price gouging. These advisors apparently also believe that requesting crude oil producers to increase available crude on the market will drive down crude oil prices, resulting in price reductions of all refined products. The real experts know this: the supply and demand strategy may work on crude oil pricing, but usually not on product prices. Those prices are often influenced more by the futures activity in the stock market. Those who are bidding up futures are apparently responding to the unstable condition of the refining industry. Unstable because the president vowed during his campaign to shut down the industry, and his actions have been in that direction. His stated reason is that the perceived global climate crisis trumps all else. It’s ironic, in my honest opinion, that he should beg the “bad” Saudis to increase the production of this bad stuff and beg our price gouging (his words) refiners to process more of it.

The U.S. was energy independent after slant drilling and fracking were combined to become horizontal drilling. That advantage has disappeared due to poor policies, according to the president’s detractors.

Energy makes the world go ‘round, not love. Messing with our energy system has consequences you may not appreciate. There are immediate priorities and perceived long-term priorities. We need for our leaders to balance them with wisdom, not political motives or outright ignorance.

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