Bag's Rants

US banking it's oil.

It seems that the US has much bigger oil reserves than I ever imagined. Read here. I'm not an expert anyway so this was a bit of an eye opener.

Now I was thinking that if they have so much oil why are they so dependant on the Middle East? One thing I did think of is that that oil must be an asset that they want to realise in the future and they will put up with a bit of trouble now to ensure that it remains untouched. Sure they are looking at opening some of it now but even starting now it will be decades before the results show. So a dependency on cheap ME oil whilst there is plenty of it whilst your own oil gains value sitting in a bank, well in the oil field anyway.

Just imagine in fifty years time. The Middle East oil could well be running out, if the predictions are correct, the costs of extraction and therefore each barrel will rocket and in the meantime the US oil fields will come online. The US can ensure that regardless of the cost of oil it will be able to keep itself going and sell it's surplus onto the world market at a high rate. Much higher than the ME is selling it's resources for now. It's only resource may I add.

It's better than money in the bank. Oil is irreplaceable and no matter what technology develops over the next few decades there will always be a demand for it.

Seems to me to be a good reason for not drilling and in the land where the dollar is king I don't see the whining of a few environmentalists stopping drilling. Could the US actually be planning for the long term for a change?

posted by Bag @ 2:45 pm