Oil Companies

Dear Editor, For the past year, I have read article after article blaming gas prices on Republicans or oil companies. But now that the price has plummeted and a new oil field has been discovered in the Gulf of Mexico, why aren't people singing the praises of the oil companies with the same fervor? The reality is, gas prices are a function of supply and demand, period. Prices rose in the face of a natural disaster that significantly affected refining capacity while demand rose.

Last week we learned that Chevron and its drilling partners discovered oil deep in the Gulf of Mexico. This new field will yield between three and 15 billion barrels of oil. Analysts believe it is the most significant find since Prudhoe Bay in Alaska. Recall, major oil discoveries at Prudhoe Bay, in the North Sea, and in Mexico followed the last major spike in oil prices in the 1970s. It also is worth remembering that we do not allow exploration in parts of Alaska, off the East Coast, and parts of the West Coast.

Dear Editor, I have read any number of articles lately about America's energy crisis which cite overwhelming global demand, restricted supply sources, geopolitical instabilities and divisions, hurricanes, speculators, and pipeline erosion as reasons for high prices. That is why it is so hard to believe there are still those in Washington who think we can get oil companies to lower prices by punishing them with new taxes on energy as are currently being debated in Congress.

Dear Editor, In a Wednesday July 26 Letter To The Editor John Galt defended our nation's oil companies saying they were not to blame for the high price we pay for gasoline. And while economics and world events certainly do play a role in what we as consumers pay at the pump, Mr. Galt left out one key fact. For the past 25 plus years, the large petroleum conglomerates have been allowed to buy out their smaller competitors and close their refineries. Closed refineries translates to reduced supply.

Dear Editor, Thanks to Mr. Galt for the intelligent response to my earlier response on fair admission prices. I believe he misunderstood the message I was trying to convey. Oil "futures" markets are what are at almost $80 a barrel. Because of this and war the other markets and stocks trading slide because of an unpredictable future for our economy. Note that I said futures above because the oil that is currently being refined for gas is already paid for. If oil companies aren't partly to blame for the rise in gas prices, then how come they can post record earnings at a time when people are trying to conserve fuel and look at alternatives to gas-guzzling SUVs?

Dear Editor, In case others misunderstood, I do not blame the fair for rising gas prices. I know the oil companies are to blame for increasing costs of everything. I'm simply stating that I prefer the old policy of charging a standard admission, with the option of buying a ride bracelet. I think this would be the more fair way for everyone to enjoy the fair. As far as how many agree with me this year, I'm not concerned about that. Everyone is entitled to his or her own opinion.

Unexpected increases in gasoline prices result in calls for price controls and invariably lead to accusations of evil intent by the oil companies. The public's financial pain tempts politicians to exploit the situation and the impulse to control prices is either the worst form of political cynicism on their part or a clear demonstration of economic ignorance. Price controls are a very bad idea. Given the importance of markets, it is ironic that so many of us have so little understanding of basic economics.

Energy prices affect the lives of all Americans. Whether you are an individual consumer, farmer, trucker or frequent flyer, the rising cost of energy in this country inevitably plays a role in your life. Families are making tough choices as a result of gas prices reaching $3 a gallon. Many people are altering their lifestyles, while others are simply shaking their heads in disgust. Disgust is certainly an appropriate reaction, especially considering the extensive warning the United States government has had of this emerging energy crisis.