The Senate Judiciary Committee has been holding hearing and taking dead aim at the executives of the big oil companies. These senators are demanding an explanation as to why gasoline prices are so high. And no, don’t even think about hiding behind some lame explanation of the forces of supply and demand. These senators know that’s nothing but a smokescreen for something nefarious! These guys are mad as hell and I’m right there with ‘em!! I’m sick and tired of these giant oil companies sucking my credit card dry at the gas pump to the tune of $100 a week!! They’re making obscene profits off me just because I drive a big Ford pickup. Who the hell do they think they are!! Shut them down!! Nationalize the oil fields!! Tax them out of existence!!! Throw their employees out of work!! Light the torches and grab your pitch forks!! We’re heading west on I-10 and taking our revenge!!! Come on Everyone!!!! LEEETTTTSSS GOOOOOO!!!

Wait a minute...I should probably take a deep breath and think this through...

The oil markets are global. The Chinese, the Russians, the Japanese and the British are all bidding on the same barrel of crude and there’s nothing that ExxonMobil or ConocoPhillips or ChevronTexaco can do about that. Well, for the sake of folks like me who enjoy driving a V8 powered truck, I guess they could tell their stockholders that they are becoming a charity and are giving away their profits to subsidize reduced gasoline prices for all Americans. Problem is, they can’t. Their stockholders would throw out these executives and replace them with less charitable ones. And who are these evil stockholders? They’re retirees, average working stiffs, school districts, pension funds, mutual funds and more than a few senators and representatives. Corporate profits accrue to stockholders. Even if the stockholders agreed to have their dividends and capital gains given away, it wouldn’t last long. Eventually these companies would go out of business as they would have no capital with which to find additional reserves to replace what they produced to supply us with slightly cheaper fuel.

Back to the global market point...the major domestic oil companies aren’t even making the majority of their money off of us in the US. These are global companies and most of their production and sales revenues come from other countries. Our US based oil companies are competing with the likes of BP, Total, Aramco, Shell, AGIP, Petrobras, Pemex, PDVSA (Venezuela’s state oil company) and China National Petroleum. Each of these companies are competing for new reserves and realizing the same prices for their production and refined products. And while they are in fierce competition with each other, they are also in the enviable position of owning a scarce resource that is in high demand. And there is nothing that anyone, including our congress, can do to change that - or is there?

We Americans are, by far, the largest per capita consumers of petroleum products in the world. In fact, we consume about 40% of all the gasoline produced in the world. We are our own enemy. We’ve bought big cars that burn lots of gasoline and have moved to the suburbs, requiring us to drive 30 miles every morning to get to work and 30 miles every evening to get back home. We’ve grown comfortable and complacent. We expect plentiful energy at cheap prices. Unfortunately, we’ve lost control of our own destiny. We have outstripped our ability to supply our own energy needs and have had to turn to the rest of the world to keep our cars running back and forth from home to office. The US now imports 2/3 of our crude oil needs. We are price takers. The world is setting our price for crude and all the products derived from it that we rely on every day.

And, yet, we yell and scream and whine and complain like a bunch of 4 year olds; demanding that someone change the reality. We want to blame everyone else but ourselves. As the Associated Press noted about the hearings, “One senator after another cited the pain that high energy prices are causing...people trying to find a way to afford a vacation trip this summer.” So people can’t afford to jump into the WagonQueen Family Truckster and haul Russ, Audrey and Aunt Edna across the country to Wallyworld. Sorry. Stay home and play soccer with the kids. Take in the local attractions. Run through the sprinkler in your back yard. Yeah, it sucks you can’t afford Wallyworld this year. And I’m sorry to sound snarky, but you know what; it’s not the fault of the president of ExxonMobil.

It's the fault of every one of us. If high prices force us to leave the Truckster in the driveway this summer, so be it. We’ll use less gasoline and get to spend some time with the family at home. And after being driven insane by the kids, maybe we’ll get angry enough to call our congressmen and demand that they start to develop a real energy policy, one that reflects the reality of a diminishing resource and the need to replace it with something more sustainable. Demand that they develop a policy that embraces nuclear, solar, wind, geothermal, hydro, and cellulous based ethanol. If they continue wasting time railing on oil execs and asking how much money they make, things are going to get a lot worse.

I never thought I would say this, but I’m beginning to believe that maybe we should increase the taxes on gasoline. It would have the positive result of reducing consumption and generating some revenue that could be used to develop the alternative sources of energy that we are going to need in the coming years. If we continue to waste our time moaning and complaining about all the hurt we’re feeling and crafting fables about how J R Ewing-like oil executives are trying to drain us dry, we are going to be in much worse shape in the future when the price of oil goes to $500/barrel and gasoline costs $20/gallon, if you can even find it.

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