I always warn that when the US Senate votes unanimously on something outside of national security, Americans should beware.

Congress voted overwhelmingly to suspend putting 70,000 barrels/day (the US consumes about 21 Million/day) of oil into a strategic reserve facility. This reserve allows the US to operate for a short period of time should oil deliveries cease for some reason or demand increases exponentially for some reason.

The measure is likely to be one of the few Congress approves this year in response to public angst at the pump. Democrats and Republicans agreed on little else Tuesday to bring down prices.

Senators approved the measure by a veto-proof majority of 97 to 1. The two Democratic presidential candidates, Sens. Barack Obama of Illinois and Hillary Rodham Clinton of New York, returned to the Capitol from the campaign trail to vote for the measure. Sen. John McCain of Arizona, the presumptive GOP nominee, supported the measure but was absent for the vote.

The House later followed suit, approving it 385 to 25.

Since everyone is campaigning, they want to be seen as people who make it better for the American people. This move is likely to impact fuel prices by about a nickel a gallon. However, the average fuel price is expected to rise more than that over the summer. So, the real impact to your pocket is going to be nil, zilch, nada. The government is going to tell you that you saved money that you will never see. We are talking about oil that represents less than 1% of consumption. This is the most expensive possible way to save Americans money because it actually does nothing of the kind.

Rather than do something significant - maybe actually act toward some smaller level of foreign oil dependency, these knuckleheads are going to risk our ability to use stored fuel if some disaster (earthquake, hurricane anyone?) impacts the flow of oil to the US.

Vote-mongering.

Nancy Pelosi is sending President Bush a letter.

WASHINGTON, April 22 /PRNewswire-USNewswire/ — Speaker Nancy Pelosi sent the following letter today to President George W. Bush urging him to sign into law legislation that Congress has passed to help American families with the rising price of gasoline.

“I respectfully ask you again to work with the Congress to allow the Justice Department to pursue oil cartel price-fixing, allow the Federal Trade Commission (FTC) the authority to investigate and punish price gougers, end taxpayer subsidies to Big Oil and invest those funds in renewable American energy. Lastly, your Administration must use the authority given to it by the Congress to end market manipulation. We cannot wait to act in the face of these prices increases,” she wrote.

Big Oil! Boy they are just soaking us, are they not?

The US Consumes 388,600,000 gallons of gasoline per day. This is 141,839,000,000 gallons per year.

Big Oil and Retailers markup represents about 9% of the cost of a gallon of gasoline. About 32 cents per gallon profit at $3.50 a gallon. The Federal Government gets about 19 cents per gallon in taxes and the states average about 23 cents per gallon in taxes.  So taxes represent 42 cents per gallon. Now, you tell me who is gouging.

Out of a cost per gallon of $3.50, Big oil makes 32 cents. The rest is cost of oil, refining, transpertaion and distribution, and taxes.

Both John McCain and Nancy Pelosi have called for legislation to help Americans struggling with fuel prices. Notice the differences in approach. With John McCain’s model - the price of gasoline can be reduced almost instantly and push money into the economy almost immediately. With Nancy Pelosi’s model, oil companies will start cutting costs - which always means cutting jobs - which takes money out of the economy. Yet, with her way the government will get paid at the detriment of Americans.

The difference is Pelosi wants the oil companies to give the fuel away, and John McCain wants the government to stop gouging Americans.

This should be seen as the Kremlin further flexing its muscle toward Europe.

Gazprom set to take over Serbian oil and gas company

The European Commission is worried about energy giant Gazprom’s regional expansion because it is ready to buy a controlling stake worth a billion euros in Naftna Industrija Srbije (NIS), or the Petroleum Industry of Serbia, the largest state-owned national oil and gas company.
Experts said the deal would be closed during President Vladimir Putin’s visit to Serbia on January 18.
Other customers were deterred because of the minority stake’s $550 million price, the need for additional investment and other prohibitive barriers.
Troika Dialog analyst, Valery Nesterov, said the Serbian company now offered more attractive terms for would-be investors.
Serbian authorities decided that a strategic investor would first buy a minority stake, and that majority stakes would subsequently be sold and top managers hired.
Nesterov said Gazprom had made the most attractive offer, and one that Belgrade could not refuse because otherwise it risked losing a promising gas project.
Gazprom will pay 400 million euros for a 51% stake in NIS and will invest the remaining 600 million euros into corporate development. The energy giant also promised to assist in the construction of the 400-km South Stream gas pipeline system worth $800 million, due to pass through Serbia.
Moreover, Gazprom offered strategic partnership in building a gas reservoir in Banatski Dvor, Serbia.
Timur Khairullin, an analyst with the Antanta Capital brokerage, said politicians and corporate officials had virtually coordinated the deal, and that Serbia’s Minister of Economy and Regional Development Mladan Dinkic who had previously claimed that the NIS stake was worth 2 billion euros, would resign from a commission examining the bilateral contract.
Commenting on the European Commission’s nervous reaction, Khairullin said any company had the right to sell their assets to anyone, and that its objections seemed far-fetched.
Nesterov said Gazprom had recently eliminated gas shortages in Greece and Turkey after Iran curtailed gas exports. The company did this by pumping more gas along the Blue Stream pipeline linking Russia and Turkey via the Black Sea.
“Instead of trying to create artificial competition for Gazprom, the European Commission should adopt a more constructive stand,” Nesterov said.

Here are some things to consider:

Oil:

• 45% of EU oil imports originate from the Middle East;
• by 2030, 90% of EU oil consumption will have to be covered by imports

Gas:

• 40% of EU gas imports originate from Russia (30% Algeria, 25% Norway);
• By 2030, over 60% of EU gas imports are expected to come from Russia with overall external dependency expected to reach 80%.

Coal:

• By 2030, 66% of EU needs is expected to be covered by imports.

Russia does not need to join the EU - the EU will be at the Kremlin’s feet.

Recently, it has come to light, that the oft believed idea that Oil is a finite resource, may not be correct.

HOUSTON — Something mysterious is going on at Eugene Island 330.

Production at the oil field, deep in the Gulf of Mexico off the coast of Louisiana, was supposed to have declined years ago. And for a while, it behaved like any normal field: Following its 1973 discovery, Eugene Island 330’s output peaked at about 15,000 barrels a day. By 1989, production had slowed to about 4,000 barrels a day.

Then suddenly — some say almost inexplicably — Eugene Island’s fortunes reversed. The field, operated by PennzEnergy Co., is now producing 13,000 barrels a day, and probable reserves have rocketed to more than 400 million barrels from 60 million. Stranger still, scientists studying the field say the crude coming out of the pipe is of a geological age quite different from the oil that gushed 10 years ago.

Imagine what our “friends” in the Middle East will think, or what they will do, when it is confirmed that oil didn’t come from dinosaurs or peat moss. What will happen to the Global Economy when we can drill for our own oil right off the coast or go back to oil fields long thought empty?