DOWNLOADS: (129)

PLAYS: (615)

Embed

My first post C&L ever linked to was a May 2007 Op/Ed on how oil companies appeared to be shutting down refineries "for maintenance" to deliberately (IMHO) drive up gas prices the same way Enron drove up electricity prices in California in 2000, the year before they collapsed in scandal. You might recall that back in the Spring of 2000, California was plagued by rolling blackouts because of electricity plants closed "due to maintenance". Most people still remember those secret audio recordings (NSFW) on the news of two young Enron Energy Traders joking about having to repay the money they stole from "Grandma Millie" in California, or CEO Jeff Skilling comparing California to the Titanic.

Fast forward 12 years (though I HIGHLY doubt the practice ever ceased) to last May & October. Reports were all over the news of gas prices spiking well over $4/gal in California, despite the fact gas & oil supplies were UP and gas prices were DOWN in the rest of the country. The reason for the 50cent/gallon spike in California? Several large oil refineries supposedly had to be "shutdown for maintenance" (according to McClatchy, May's West Coast spike was partly blamed on a Feb. 18 fire at BP's Cherry Point refinery in Washington. October's California spike was explained as partly a market reaction to an Aug. 6 fire at Chevron's Richmond refinery... both spikes taking place MONTHS after those fires and independent of the "closures" that supposedly interrupted supply.)

A McClatchy News investigation has found evidence that during the refinery closures in May that were behind the spike in gas prices, the plants were actually up & running at least part of that time... perhaps even the entire time... and producing gasoline. So why the spike in prices?

In response to this information, Democratic Senators in Congress (THIS is why Dem majorities are so important) led by Sen. Maria Cantwell have called for a formal investigation into whether oil companies have been deliberately closing... or even entirely falsely claiming the closure of... oil refineries for the sole purpose of market manipulation and driving gas prices up.

Just as we saw with Enron in 2000, and just as I reported back in 2007, the practice of artificially limiting the supply of energy just to push up prices by greedy energy executives is nothing new, but unlike in 2000 and 2007, Democrats now control both the White House and part of Congress, making a serious investigation with tangible consequences that much more likely. A Credit Suisse report last February claims every one-penny increase in the price of gasoline sucks one-Billion dollars annually out of the economy (I'd argue the number is FAR higher, because higher fuel costs means higher transportation costs for stores, increasing prices, doubling the impact. While slower sales mean layoffs that contract the economy still further.)

Tell me again GOP how "deregulation" helps the economy? Please. I really want to hear your answer on this one.

All of the senators representing west coast states -- California, Oregon and Washington -- have introduced a bill banning Pacific offshore drilling.

Cantwell appeared at a news conference at the Capitol with Sens. Barbara Boxer and Dianne Feinstein, both of California, as well as Sen. Jeff Merkley of Oregon. Two other sponsors, Sen. Patty Murray, and Sen. Ron Wyden of Oregon, did not attend.

Feinstein recalled "thick black tar"despoiling the waters after the 1969 oil spill near Santa Barbara, which helped spawn the modern environmental movement.

Absent a permanent ban on drilling, "there is no guarantee whatsoever that this will not happen again," Feinstein said.

I remember the Santa Barbara oil spill too. I took the picture at the top of this post at Surfers' Point in Ventura, less than 20 miles south of Santa Barbara. The beaches in this area are home to endangered birds like these:

The thing is, that Santa Barbara spill took place 40 years ago and it's still not completely gone. If you take a walk on the beach by UCSB in your bare feet, you'll come home with blobs of tar on your feet. The brown pelican is finally making a comeback after fighting back from the Santa Barbara oil spill and then the impact of DDT on its eggs. At sunset, you can see pelicans skimming the shore, looking for that last school of fish before the sun goes down. They're magnificent.

Our coastlines are our first non-renewable resource, not oil.

Advocates for more domestic drilling say the proposed West Coast ban would lead to even more imported oil.

"This is more of the same that we've had for 30 years" under the federal ban, said Dan Kish, senior vice president of policy for the Institute for Energy Research, a Washington, D.C.-based nonprofit group that believes tapping into America's petroleum potential is one answer to energy independence.

Kish said it was particularly galling that California wants to cordon off its coasts when it's the nation's largest energy user. He said polls show the majority of American favor offshore drilling.

Blocking new oil explorations, Kish said, may simply send more ocean tankers carrying foreign oil toward California and elsewhere.

Mr. Kish, we will have to figure it out. I'm just not willing to sacrifice this...

...for the risk of losing it.