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This is interesting as a curiosity. But the fact that oil is (generally) fungible means that the particular proportions are completely coincidental, based on re

This is interesting as a curiosity. But the fact that oil is (generally) fungible means that the particular proportions are completely coincidental, based on relative pricing levels, probably largely dependent of transportation. Did you know that America exports oil? See http://www.huffingtonpost.com/david-sassoon/us-oil-exports-hit-record_b_120058.html http://www.huffingtonpost.com/david-sassoon/us-oil-exports-h... -- in 2008 we were shipping out 1.8 million barrels per day. It's all determined by how expensive it is including how far it must be transported. Things shuffle all around, and a change at one point causes lots of lines in the graph to be pushed and tugged, until a new equilibrium is found. One can't just say that Canadian oil is twice as important to us as Saudi oil.

kevbin 17y ago
One of the interesting bits to come-out of the alaska gas line debates is the apparent unwillingness of producers to develop fields even when they are economically feasible (whether on their face or through incentives). Leads me to believe that the oil companies—despite their reputations—have accounted for socio-political externalities, and see some wisdom in leaving oil & gas in the ground in relatively stable, free nations while producing the heck out of fields elsewhere. Whatever the combination of risk assessment and bird-in-handism, this seems like a pretty good strategy for the companies and their customers (i.e., us).
- jrockway 17y ago
  Good analysis. Eventually we are going to start running out of oil, and this will be a good time for unstable nations to fuck up the economies of the stable ones. (Our fault for not investing in alternative energy systems, but I digress...) With a strategic reserve that we can tap into, though, these unstable countries are kept in check -- charge a fair price, or we don't buy at all. It is sort of like "mutually assured destruction", but better... (The similarly is that the protection of each does not come from the actual use of the system, but rather from the fact that it exists.)

kevbin 17y ago

One of the interesting bits to come-out of the alaska gas line debates is the apparent unwillingness of producers to develop fields even when they are economically feasible (whether on their face or through incentives). Leads me to believe that the oil companies—despite their reputations—have accounted for socio-political externalities, and see some wisdom in leaving oil & gas in the ground in relatively stable, free nations while producing the heck out of fields elsewhere. Whatever the combination of risk assessment and bird-in-handism, this seems like a pretty good strategy for the companies and their customers (i.e., us).

jrockway 17y ago
Good analysis. Eventually we are going to start running out of oil, and this will be a good time for unstable nations to fuck up the economies of the stable ones. (Our fault for not investing in alternative energy systems, but I digress...) With a strategic reserve that we can tap into, though, these unstable countries are kept in check -- charge a fair price, or we don't buy at all. It is sort of like "mutually assured destruction", but better... (The similarly is that the protection of each does not come from the actual use of the system, but rather from the fact that it exists.)