As oil flirts with $100 a barrel, guess who is getting gold stars for reporting ... NPR.
National Public Radio's "Morning Edition" stories on $100 a barrel oil this week have featured some underreported views on the industry: The economy is surviving the higher costs, and the oil companies are using the profits for future exploration.
Reporter Jim Zarroli told NPR listeners what was supposed to happen, saying, "Time and again, economists from Alan Greenspan on down have warned that oil prices are inflationary ... Interest rates go up, borrowing becomes more difficult, and growth slows."
But, Zarroli also pointed out the unique trend that gets little coverage: Despite the rise in oil prices since March 2007, the economy has continued to grow at a strong pace.
There's more than one way to survive the rising cost of oil.
"Morning Edition" also reported November 14 that even though "high oil prices also help drive up the price of exploration," oil companies are investing now for future fuel.
"Companies often use fatter profits to search for new deposits, or to go back and suck the last drop from retired wells," said reporter Christopher Joyce.
Those $100 bills are going to search for new deposits in places like the Gulf of Mexico, where drillers must drill in deeper water and farther out at sea - making exploration more expensive. Joyce pointed out that higher prices can also help pay for the most current technology needed to squeeze more oil out of those old wells.
Incidentally, The Economist's November 8 print edition cautioned as oil companies released their numbers for the third quarter that "Record oil prices, it turns out, do not translate into record profits."
ExxonMobil, the publication pointed out, reported a 10-percent drop in profits in the third quarter, and profits also fell at Chevron, Eni, BP and ConocoPhillips.
—Paul Detrick is a research analyst at the Business & Media Institute.
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ECON 101...
November 14, 2007 - 17:52 ET by vrwc13But, Zarroli also pointed out the unique trend that gets little coverage: Despite the rise in oil prices since March 2007, the economy has continued to grow at a strong pace.
There's more than one way to survive the rising cost of oil.
"Morning Edition" also reported November 14 that even though "high oil prices also help drive up the price of exploration," oil companies are investing now for future fuel.
...by george I think they've got it!
v
So that what they did
November 14, 2007 - 18:29 ET by general companySo that what they did with all of those Self Propulsion Machine Patents??!!
"Always do right. This will gratify some people, and astonish the rest". Mark Twain
Latency!
November 14, 2007 - 19:31 ET by YaegerMeisterLatency is the key term to describe why the economy is not seeing the full affects of the rise in price of Oil.
Comparing the economy and oil is like Peyton Manning and the...
November 14, 2007 - 20:56 ET by Lame CherryComparing the economy and oil is like Peyton Manning and the price of footballs. The two are related but are not part of the same ball game.
The economy will expand due to inflation which is from printing too much money.......this has nothing to do with the price of oil. Oil price is based upon monopoly factors instigated by inflation so the people with oil will be able to keep up with the 30% loss they have in dollars.
That is called oil revenue blackmail by our "allies".
Americans in the end are the one's paying for it as our savings are burnt up in inflation. Houses, cars, etc... all cost the same, but in inflation dollars it takes more to buy the same objects.
I had an old neighbor who sold at a "big price" half his farmland at $400 an acre in 1970. 4 years later after Nixon and then Carter inflation his 32,000 dollars was worthless and he was poverty broke. For the next 15 years before he died he had to milk cows every day as an 80 year old man just to pay the bills.
All that gets personal when you see Rockefellers screwing Americans over and ruining their lives with politicians signing off on this cancerous economic cycle.
Zarroli is pure ignorance in economics.
*HIC IACET ARTORIVS REX QVONDAM REXQVE FVTVRVS
Funny at the same time I
November 14, 2007 - 22:02 ET by Right2thePointFunny at the same time I was getting ready to head out on a 9 month deployment on my submarine and I locked in the profits from flipping a dozen condos in Hawaii in a little less than three months work and when I came back of the deployment 2 months later the CD's matured and I was up about 125k due to the 17% rate on the CD.
Just where would your farmer friend have been if he had invested some of that profit off his earlier land sale?
Just rolling 3 month CD's over and over would have been enough to more than keep his head above water.
If he had to spend it on true expenses then he was not running a business at all he was indulging in a hobby and poorly at that.
70's
November 14, 2007 - 23:33 ET by Iluvfredum$30,000.00 was a lot of money in the 70's. A loaf of bread was $.30. You could buy a decent house for $20,000.00 to $40.000.00 and a new car was around $5000.00.
Bicycles get infinity miles per gallon!
November 14, 2007 - 21:55 ET by w0tmDoesn't the NPR crowd all commute by bicycle? Or walk? Those that have jobs that is which is not many. Real jobs that is. Not writing grant requests to study the effects of global Warming on (fill in the blank).
Seriously, I've read hard statistics that show the major stockholder owned oil companies spent 121% of their entire profits since 1995 searching for new oil and improving their present means of extracting oil. What's the percentage for dictator or OPEC owned oil companies such as Venezuela's Citgo? Since dictators and OPEC get to keep all their financials secret, there's no way to know. But I bet it is very, very low! Look at the steadily dropping oil output and the POR "Proven Oil Reserves" of Venezuela (for some reason, most everyone releases that information) and even painting a rosy picture, Venezuela is sinking like a rock. This is because they are "tapped out"? Or because the gringos went home when what they had created was nationalized (stolen by the dictator or sheik-in-chief) and the locals have no clue when middle management on up are all political patronage jobs. None have a clue what they're doing. Just keeping their hand out and owing everything to "el commandante".
Anyway, it is hard SEC-type punishable by jail time if you cook the books numbers for the public companies. WHAT would Hillary do with the 100% (all their profits) much less add another 21% from retained earnings from before 1995? Put it all back into exploration as is happening or use most of it to build "Big Hillary Oil" and various vote buying programs? Tough to decide. Hmmm. I'll jump to the conclusion she would not put it into exploration. Anyway, we know where billions of barrels of oil are ready to be safely taken. Much of it on U.S. land! Alaska ANWR, near Florida where the Chinese and Cubans are drilling RIGHT NOW(!!) guessing we don't want it and so on. We have plenty of low cost oil in our back yard but we'd rather finance Al Qaeda, Iran and all the other great friends who wish us well!
Follow what they do, not what they say. Big Oil is making major $$ contributions to Hillary for good reason. They do not fear Hillary. In fact, they know they'll be safer than they are now with people in office who believe gas at the pump comes some super expensive government program 100 feet below that has become ecology friendly because a (D) now runs things.
Exactly how will all the gas credits they'll be showering on their many victim groups that put them in office work if some pedal to work. EPC (Earned Pedal Credit) maybe? That will be an added line on the new IRS 1040.
To finish this ramble, did you know how the oil companies pays OPEC will catch up this quarter or next with the new much higher prices? Virtually every contract with an oil-rich country is written such that it doesn't turn on a dime. Expect that to change in future contracts but it's in very few today. Oil company profits are about to really get squeezed. The oil companies take of well under 10% of what you pay at the pump is about to nose dive. When they begin to report huge drops in profit, will the libs jump to their aid? Will the media (other than financial news) even mention it? Beating up on Big Oil is not going to be a 2008 election issue as much as Hillary and others were counting on it. They've most lost immigration, now they're losing beating up on Big Oil. The "Surge" is working so Iraq - we have lost" has to be steered clear of. What's left? Maybe start running ads on Craig's list "irrational and stupid kneejerk mindless issues wanted for 08 election".
OPEC
November 15, 2007 - 06:42 ET by AgnosticOne interpretation of the latest responses from OPEC, subject to speculation of course, is that they want America to supply more refining capability and tap some of our own reserves instead of increasing OPEC volume and therefore reducing price.
Regardless we know the government will tax the gas into profits for D.C. that would make Exxon blush and all the while trying to "take the profits" from the oil companies. D.C. greed is truly awesome to behold.
We pay them to hate us,.
November 15, 2007 - 20:08 ET by general companyWe pay them to hate us,. Everything we should be doing we refuse to. Refining more and Drilling our own would starve our enemies and make us less dependent, what is so hard to comprehend about that? This is really the bases for a lot of the animosity we bring upon ourselves. Take our $ off of that market and see how many friends we make then. Our Gov should build refineries and lease them to the oil Co's and refine Canada"s and Central American oil. We could increase the flow of oil in our Country, but have a much better handle on the market. Least it sounds good from where I sit.
"Always do right. This will gratify some people, and astonish the rest". Mark Twain
Oil prices
November 15, 2007 - 08:38 ET by Straight8I frequently make trips from my home in NE South Dakota to Colorado Springs. Along the way, primarily in NE Colorado and W. Kansas are a few operating oil wells.
This past October I noticed, for the first time, new wells being drilled in both Colorado and Kansas. Apparently the price of crude had reached the profitability point in these marginal fields back then.
Capitalism in action!