Media Miss Schumer's OPEC Oil Production Versus ANWR Drilling Gaffe

On Wednesday, Schumer once again claimed "if [Saudi Arabia] did a million barrels of oil a day increase from today, it would go down about -- the translation to gasoline would be about $.50 a gallon, maybe $.62."

Yet, on May 7, Schumer felt a likely similar increase from drilling in ANWR would "reduce the price of oil by a penny."

As Marc Sheppard over at the American Thinker cleverly pointed out Thursday, in Schumer's odd calculus, only increases in foreign oil production will bring down the price (file photo courtesy FoxNews.com):

In a Senate floor speech he gave on May 13th, the New York Democrat insisted that:

"If Saudi Arabia were to increase its production by 1 million barrels per day that translates to a reduction of 20 percent to 25 percent in the world price of crude oil, and crude oil prices could fall by more than $25 dollar per barrel from its current level of $126 per barrel. In turn, that would lower the price of gasoline between 13 percent and 17 percent, or by more than 62 cents off the expected summer regular-grade price - offering much needed relief to struggling families."

Schumer repeated these words almost verbatim when grilling oil company executives during yesterday's Senate Judiciary Committee hearings.

SENATOR CHUCK SCHUMER, (D-NY): Next question is for, I guess -- let me ask any of you. If Iraq -- sorry, if Saudi Arabia increased its production tomorrow of a million barrels of oil a day, let's just assume they do -- we know they can, because they've -- it's lower by about several hundred thousand barrels a day than it was in 2005, and they've added production -- how much would the price of oil go down in the next few months? Just if you can give me an approximate guess. Does anyone want to hazard a guess?

Does anyone think it would not go down? Raise your hand if you think it would not go down.

OK.

Do you want to say something on this, Mr. Robertson?

PETER ROBERTSON, VICE CHAIRMAN OF THE BOARD, CHEVRON CORPORATION: No. I mean I think it would go down. I think the real -- what really is important for the market is what's going to happen in the future. Maybe they could produce a million barrels a day for some short...

SCHUMER: Well, what if they committed for two years?

ROBERTSON: I think it would make a difference. And I think if we all, any of us that showed that we were going to increase production by some significant amount over a significant period of time, would make a difference.

SCHUMER: And most people -- the estimates I've seen, not done by me, but from experts, say it could go down -- if they did a million barrels of oil a day increase from today, it would go down about -- the translation to gasoline would be about $.50 a gallon, maybe $.62.

Does anyone think that's out of line, seriously out of line?

STEPHEN SIMON, SENIOR VICE PRESIDENT, EXXON MOBIL CORPORATION: I would have no way of estimating that, Senator.

SCHUMER: Right. How about -- OK, would it go down significantly? Does anyone disagree that it would go down significantly? A million barrels a day?

SIMON: One point I would like to make, Senator, is when you look at the market today, it is well supplied. And so, if you take a well- supplied market and then you throw another million barrels a day in it, yes, it will go down.

SCHUMER: Right. And if you all are preaching to us that you need new exploration so you can find more oil, which is something I don't always disagree with. I support it. I was -- with a handful of Democrats to support more drilling in the east Gulf so we could do just that.

Then clearly a million barrels a day production now would have a significant effect, because you can't -- it's a contradiction, isn't it, that you finding new supplies and producing them will keep the price in line, but Saudi just pumping a million barrels wouldn't keep the price in line? Right?

Mr. Robertson, you're shaking your head.

ROBERTSON: No, I not shaking -- I'm nodding...

SCHUMER: Shaking your head yes.

ROBERTSON: I think that the really critical thing here are signals to the world that there's a determination to increase production for the foreseeable future.

SCHUMER: Correct.

ROBERTSON: We could do that in our country, I believe...

SCHUMER: The Saudis could do it tomorrow, couldn't they?

ROBERTSON: Well, the Saudis are making significant investments to increase capacity. They could.

(CROSSTALK)

SCHUMER: But right now...

ROBERTSON: ... in the world that made a significant -- you're talking about a short term -- anywhere in the world that made a commitment for the long term to increase production by a significant amount would have an effect on oil...

SCHUMER: But here, Senator Kohl was asking you about OPEC and how OPEC restrains supply and that keeps the price high. And you all go along with OPEC.

SCHUMER: Now, the bottom line is, if there weren't an OPEC, and if Saudi -- or within OPEC -- Saudi decided to do what they could do tomorrow -- from what I understand they have 2 million barrels more of capacity -- the price would go down significantly.

And I think there's agreement from all of you about that, not that you can force them to do it. No one is saying that. And I see that everyone's nodding.

Anyone disagree with that?

SIMON: Again, when you look at the market today, though, Senator, it is well supplied.

SCHUMER: I didn't ask you that. I asked you -- well supplied is a very flexible definition. OK? I asked you -- I want to now then ask you, yes or no, if Saudi Arabia tomorrow said for the rest of their -- for the next three years they're increasing supply by a million barrels a day and it will not stop, would the price go down significantly?

SIMON: It would go down today because then you be flooding the market with an extra million barrels a day to a well-supplied market.

SCHUMER: OK.

Why weren't media all over this glaring hypocrisy?

Yes, that's a rhetorical question.

As a post facto sidebar, if McCain made a gaffe like this, Obama-loving media would be all over it declaring the faux pas an early sign of dementia.