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Oil is all going to get transported by rail or truck. BNSF stock going up should please Buffet.
by protomyth 5y ago
Oil is all going to get transported by rail or truck. BNSF stock going up should please Buffet.
- ArkanExplorer 5y agoThe more fossil fuel infrastructure we build out, the harder it will be to make the transition to clean energy. Adding costs to fossil fuels is not a bad thing.
- toomuchtodo 5y agoAbsolutely. We should be exploring ways to financially disadvantage refineries and fueling stations as well. Have to find every weak point in fossil infra to exploit towards a failure mode. This drives the cost up, making electrified options (that don’t emit carbon) more competitive sooner.
- hogFeast 5y agoMust be nice to be so rich that you can choose to pay more for things.
- deleted 5y ago[deleted]
- toomuchtodo 5y agoI don’t have a solution for the species constantly borrowing from the future. The bill comes due eventually. If you think being poor sucks now, wait for water shortages and crop failures. I get it, everyone wants the benefits without the costs. But there are costs. Obligatory “we should have carbon taxes and cap and trade to help make the transition fair and equitable”. I’m aware the wealthy are culpable for higher per capita CO2 emissions, and as such they should bear a greater burden in this regard. Life ain’t fair unfortunately.
- ericd 5y agoCould always make the carbon tax revenue neutral. Then it mostly becomes a subsidy for the poor who aren't jumping on planes 10x/year.
- skeeter2020 5y ago>> This drives the cost up, making electrified options (that don’t emit carbon) more competitive sooner. Interesting take on "competitive". I guess we could encourage renewables or capture externalities, but why do that when we can rig the entire system "for fairness"?
- toomuchtodo 5y agoIf there were a carbon tax and similar mechanisms, I wouldn’t need to advocate for tilting the playing field, as the market would solve this naturally. Unfortunately, a carbon tax (“capture externalities” in your comment) is untenable in the US and fossil fuels continue to receive hundreds of billions of dollars a year in subsidies. It’s a climate emergency with all of the urgency of afternoon tea. You must destroy demand for the root cause of the situation, as soon as possible (hence my comment). https://www.pnas.org/content/118/14/e2011969118 https://www.pnas.org/content/118/14/e2011969118 https://blogs.scientificamerican.com/observations/fossil-fuel-subsidies-must-end/ https://blogs.scientificamerican.com/observations/fossil-fue...
- deleted 5y ago[deleted]
- make3 5y agoNot sure why you're getting downvoted. Energy is a money game.
- fighterpilot 5y agoAdding costs due to adding inefficiency in the supply chain is definitely a bad thing, since you could easily achieve the exact same outcome with a tax instead.
- apendleton 5y agoThis is true, but if new taxes are politically untenable (which, in the current US political environment, they definitely are), the choice isn't between inefficiency and a tax, it's between inefficiency and the status quo. Politics is the art of the possible.
- fighterpilot 5y agoWouldn't the pipeline operators have willingly agreed to a levy or tax of some sort if the alternative is complete shutdown?
- apendleton 5y agoProbably, but even if they did, it's probably not within the power of the executive to create such a mechanism.
- fighterpilot 5y agoIf that's the case, you have a good point.
- krastanov 5y agoSure, but you should also just not give permits when the project is dangerous (which was what multiple agencies and courts had suggested in this case but one of the last three administrations was trying to overrule them)
- sixothree 5y agoImagine if we seized property and gave it to a private company to build wind farms. I'm sure the response would be worse than what happened here.
- eagsalazar2 5y agoWho is downvoting you? Why? Your comment is perfectly on point IMO.
- bigbillheck 5y agoWhy do we have to do the 'g[i]ve it to a private company' part?
- xenocyon 5y agoYour comment is interesting given that some of the strongest voices against the Keystone XL pipeline are the indigenous tribes whose lands and water would be jeopardized by it.
- bordercases 5y agoThey're also a vocal minority of Canadians.
- Analemma_ 5y ago> Oil is all going to get transported by rail or truck. ... which is more expensive than transporting by pipeline, thus increasing the cost of oil, cutting the development of marginally-viable oil exploration projects, and hastening the point at which it is uncompetitive with renewables and killed. This is working exactly as intended.
- vetrom 5y agoYou could also stretch and call it an indictment of externalizing oil production costs. I'm aware that building and running a refinery is an extremely expensive operation, to the point where it isn't economical to either mobilize a refinery, or base them at the site of extraction. That said, running a refinery also has local costs that are usually externalized, in terms of local pollution and populace movement. Canada itself though has a fairly large amount of space, but perhaps a surfeit of people. Why doesn't TC energy (or other Canada producers) build a refinery somewhere in Canada and transport to there?
- hajile 5y agoAlternatively, it could just encourage fracking and refining closer to the delivery point. Smaller economies of scale would be offset by lower transport cost. At the same time, pollution would likely increase. The only real lever the government has is increasing fuel taxes, but that would result in roots from people who are barely making it before massive increases in transportation costs.
- dblohm7 5y agoI don't know about your second sentence, but your first sentence is absolutely correct. I am an Albertan who lives in Calgary, where TC Energy is headquartered. I am by no means a shill for Big Oil and am thankful that I do not work in that industry. Having said that, I do not think that blocking the supply side of the equation helps as much as certain parties believe that it does. As long as the demand for oil exists, the suppliers will find a way. This also has side effects that some parties do not consider: Railroads have finite capacity, and when more of that capacity is absorbed by oil shipments, there is less capacity for the transportation of other goods, like grain.
- dimes 5y agoThe alternative methods of transport will be more expensive, which will lead to a decrease in demand.
- lettergram 5y agoYeah, I’ll just not drive to work... This has never been true for consumers. The only “demand” it impacts are companies, who then move their jobs to China where they can use coal powered plants. There is no world where this artificial increase in prices is good. Green energy is improving, nuclear is improving. It’s improving because it has to compete with alternatives, like oil. Green energy is not cheap or widespread enough today for consumers or industry. So it’s only the people of the country that lose.
- gpm 5y agoThis has always been true of consumers. - Let's buy a smaller/more efficient car instead of the bigger/less efficient one - Let's move closer to work - Let's carpool - Let's not buy our teenager a car just yet Etc, etc. Cost of ownership effects all sorts of choices, always has, always will.
- okr 5y agoI was wondering, just for the effect, if i could translate this list into the world of computers -Buy smaller/more efficient computers instead of the bigger/less efficient one -let's move closer to work -let's share computers -let's not buy our teenagers a computer just yet Feels strange to read. But ok, who knows, maybe compu, umm, smartphones fall out of favour some day as well.
- newacct583 5y agoOr... maybe the market will react to higher oil prices and choose other fuels? Might be wanting to hodl TSLA and not rail stocks.
- skeeter2020 5y agoOil != gas for your car. It's fuel for millions of homes, transportation of all those goods you buy and out of market food, plastic products, fertilizer that has allowed us to feed millions, etc. Your electric car is a very small part of that.
- newacct583 5y agoYou... can't heat homes with electricity? You missed the point. The upthread poster made a gag about BNSF as a way of arguing that this was somehow a corrupt gift to the transportation industry (which... yeah, whatever). I quipped about Tesla to indicate that, no, the market adapts along every available axis and renewable power is if anything more likely to benefit than some rail outfit that just happens to be owned by Warren Buffett.
- apendleton 5y agoSure, and to the extent that the feedstocks for all of those processes become more expensive, it makes cleaner alternatives more competitive in sectors where they exist, and in sectors where they don't, creates stronger incentives to develop new ones. It's not like this one pipeline will mean suddenly there's no more fertilizer, but any slight increases in cost will help incentivize change at the margins.
- kube-system 5y ago>It's fuel for millions of homes 3% of oil goes towards residential uses. > transportation of all those goods you buy 16% of oil goes to diesel for transportation >plastic products, fertilizer that has allowed us to feed millions, 1.5% of oil goes to all petrochemicals combined https://www.eia.gov/energyexplained/oil-and-petroleum-products/use-of-oil.php https://www.eia.gov/energyexplained/oil-and-petroleum-produc... The vast plurality of oil goes to making gasoline which is used in motor vehicles.
- ayngg 5y agoI think it is a case of popular politics but poor policy. It appears like Canada has decided that they do not want to be in resource extraction for environmental purposes, but in their bid to be socially responsible, they are for the most part ignoring the potential political and social fallout of such a policy. Sure, it will make oil and gas operations more untenable in Canada, but ultimately that probably wont matter much since other producers that already dictate the price through cartels will quickly fill demand to their own benefit. Whether or not people want to think about it, Canada exports a lot of natural resources, and if they want to stop, which is fine, they better have a real plan for transitioning those industries, and have an idea of what they will do in lieu of a that huge chunk of their exports going away. Its really easy to say something like "just transition away from oil" but history has shown that it is very difficult to do, especially for a province beholden to federal policy. These costs are massive but are largely being ignored, or just offloaded as only Alberta's problem. They are running the risk of hollowing out a huge portion of the economy without any real plan which has pretty severe consequences as seen in places like the rust belt, which will end up sowing the seeds of populist resentment amongst communities that will feel used and abandoned, especially in places that already feel largely ignored by federal politics like western Canada.
- SV_BubbleTime 5y ago> It appears like Canada has decided that they do not want to be in resource extraction for environmental purposes Do you have a moment to talk about Calgary? Canada is the fourth largest producer of crude oil in the world. Not bad for a county half the population of California over the same area as the USA. They might talk a good talk, but they aren’t going to stop oil production until they run out. Same as anyone else.
- kevinthew 5y agoYou're right for some oil but there isn't enough rail infrastructure to enable Canadian crude growth without pipelines. Discounting WCS crude diffs to WTI will price out most long term production growth without offsetting higher crude flat price. Demand for oil isn't perfectly inelastic, so higher flat price enables more fuel switching (e.g. electric).
- codeulike 5y agoSo market forces dont get applied in this case and if its more expensive by rail or truck, people will just buy it anyway? How curious.
- protomyth 5y agoAs long as the final price to the customer is at/under the current market price. Producers will make less profit.