Bill Phillips Comments On Oil Prices
 

Bill Phillips spent nearly 50 years in the US oil and gas industry; most of his career was with the Phillips Petroleum Company. Bill is a descendant of Frank Phillips. Frank Phillips, along with his brother Lee Eldas (L.E.) Phillips, Sr., founded the original Phillips Petroleum Company in 1917 in Bartlesville , OK . Do you remember Phillips 66 gas stations? Phillips Petroleum Company merged with Conoco, Inc. in 2002 to form the current ConocoPhillips oil company.

So, when Bill talks about oil and gas issues, I tend to listen - very closely. I think that you will find Bill's thoughts and facts very revealing, very compelling and very difficult to argue with.

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May 28, 2008

"Big Oil"

Did you know that the United States does NOT have any big oil companies. It's true: the largest American oil company, Exxon Mobil, is only the
14th largest in the world, and is dwarfed by the really big oil companies--all owned by foreign governments or government-sponsored monopolies--that dominate the world's oil supply.


With 94% of the world's oil supply locked up by foreign governments, most of which are hostile to the United States , the relatively puny American oil companies do not have access to enough crude oil to significantly affect the market and help bring prices down. Thus, ExxonMobil, a "small" oil company, buys 90% of the crude oil that it refines for the U.S. market from the big players, i.e, mostly-hostile foreign governments. The price at the U.S. pump is rising because the price the big oil companies charge ExxonMobil and the other small American companies for crude oil is going up as the value of the American dollar goes down. They will eventually bleed this country into printing even more money and we will go into runway inflation once again as we did under the Carter Democratic reign.


This is obviously a tough situation for the American consumer. The irony is that it doesn't have to be that way. The United States --unlike, say, France --actually has vast petroleum reserves. It would be possible for American oil companies to develop those reserves, play a far bigger role in international markets, and deliver gas at the pump to American consumers at a much lower price, while creating many thousands of jobs for Americans. This would be infinitely preferable to shipping endless billions of dollars to Saudi Arabia , Russia and Venezuela to be used in propping up their economies.


So, why doesn't it happen? Because the Democrat Party--aided, sadly, by a handful of Republicans--deliberately keeps gas prices high and our domestic oil companies small by putting most of our reserves off limits to development. China is now drilling in the Caribbean, off Cuba , but our own companies are barred by law from developing large oil fields off the coasts of Florida and California . Enormous oil-shale deposits in the Rocky Mountain states could go a long way toward supplying American consumers' needs, but the Democratic Congress won't allow those resources to be developed. ANWR contains vast petroleum reserves, but we don't know how vast, because Congress, not wanting the American people to know how badly its policies are hurting our economy, has made it illegal to explore and cap those reserves, let alone develop them.


In short, all Americans are paying a terrible price for the Democratic Party's perverse energy policies. I own some small interests in tiny, 4 barrel-per-day oil wells in Wyoming . We have 14 agencies that have iron-hand jurisdiction over us. If we drop any oil on the ground when the refinery truck comes to pick up oil from our holding tanks, we are fined. Yet down the road the state will spray thousands of gallons of used oil on a dirt road to control dirt. When it rains that oil runs into rivers and creeks. Yet a cup of oil on the ground at our wellhead is a $50,000 EPA fine plus additional fines from state regulating agencies. They treat oil as if it were plutonium that has the potential to leak into the environment.


We are fined if our dirt berms are not high enough around a holding tank, yet the truck that picks up our oil runs down the road at 60 mph with no berm around it. People wonder why there is no more exploration in this country. It's because of the regulators; people who have lived their whole lives doing nothing but imposing fines on small operators like us for doing mostly nothing.


So, America enjoy your $4.00 per gallon gasoline. Your dollar is now worth 0.62 Euro-Cents. The lack of American production of GNP, the massive trade deficit (as labor markets have moved overseas to fight insanely high union imposed labor costs in America ) and the run away printing of money (backed by nothing of value here in America ) has caused the dollar to become more worthless on the international market. And that's where our oil comes from. It's paid for with dollars that become more worthless everyday. If we had just kept par with the Euro we'd be paying $62 dollars per barrel for oil (42 gallons) or about $1.50 instead of $2.50 a gallon for crude oil.


What the US government also does not tell you is that it is the leaseholder and royalty recipient of most oil production and receives
25% of the gross oil sales before we pay for electricity to lift the oil, propane to keep the oil-water separators from freezing in the winters. We pay a pumper to visit each well everyday plus we have equipment failures all the time. We pay for that out of our
75% of gross sales. The government does not share in any expenses to run any production well.


So, if the Big Oil Companies are making record profits, then so is the federal government from it's 25% tax on every molecule of oil sold to a refinery in this country. Why isn't the government on the stand for "Record" profits? What you don't see is this
25% of the sales price of crude oil being siphoned away by the government. That money plus the road taxes, state taxes, etc. amounts to over $1 per gallon of gasoline you are buying while the governments only admit to about 50 cents per gallon.


To all you Democrats, when you go vote for your candidate, a blazing liberal like Barrack Hussein Obama or Hillary Clinton, just keep in mind that their liberal spending habits will further decrease the value of the American dollar on the world market and your gasoline costs will hike even higher. As they introduce more give-away programs, raise taxes on everyone to pay people not to produce or work, your dollar will continue to dwindle on the world market and you will be paying $10.00 per gallon at the next election.


Cheap hydrocarbon fuel is all over. Enjoy! Enjoy the fruits of your decision to elect these folks when you are there in that voting booth and you stab your pin through a Democrat's name.


William "Bill" Phillips

that article is politically & selfishly motivated. If you already want to believe that the Democrats are bad and Republicans are good, you will like it and believe it; if you have different beliefs, you won’t. If you are like me, and don’t believe either party is taking care of America and its citizens as a whole, including our oil crisis, you will question everything Phillips says, just as you should with any article like this, whether it is slanted in favor of the Republicans or the Democrats.

to blame either politically party for the oil crisis is beyond ridiculus.


also, there is no "official" publication of that letter which leads me to believe it's internet bull.

the part that got me is that America's largest oil company produces 10% of it's oil and broker's the other 90%.

and that's the best we have.

I do not care if he is politically motivated in what he says but he does point out some facts about US oil that most people do not realize. Vote for whomever you want but make sure they believe in a small government, a balanced budget and line item veto for the president if you want America to rebound.

It would also be nice if it was not an email circulating and then being blogged about. Snopes has not said it is fake (yet). http://www.snopes.com/politics/gasoline/bigoil.asp

News flash a Republican Administration with power in the house and senate created this mess not the democrats. During the democratic presidency before this one there was great prosperity and gas was 69 cents a gallon.

the Democrats have not passed one single piece of legislation in the past 18 months that has caused the price of crude oil to rise. (That’s the time they have been in control of Congress during the Bush administration.) Thus, about the only thing Phillips and others can say about that is that prices have risen simply “because Democrats have controlled Congress”. Naturally, they could not produce any evidence of support, but they could say it without fear of anyone producing evidence to the contrary. But there is one fact they can not deny; oil prices have risen 600% over the past 7 years. And guess who’s been in the White House for those 7 years; Republican George Bush. And that party also controlled Congress for almost 6 of those 7 years.

Thats what the 40 hrs of right wing talk are pushing.Everything was good til the democrats took back over. I was at lunch with a friend who is an educated man he said that and I almost fell off the chair.

This guy makes some good points but the main problem is that many of the problems we are facing have been created by republicans. How are they suddenly the good guys. I'm not saying the democrats are blameless or that they would have done better but it has been the republicans that have overseen the rampant spending, dilution of the dollar, exodus of jobs from the country, tripling of cost of oil and more than doubling the cost of gas.

There's just a few problems with what he says.

#1 - Wells are capped in the US that were said to not be profitable at $40 a barrel. At $140+ a barrel, shouldn't they be uncapped? And why aren't the oil companies exploring where they already have leases before opening up new territory?

Even if more oil is made available, refineries are only running at 82% capacity. Why aren't the oil companies refining more gas to bridge the shortage?

#2 - The weak dollar is a result of the runaway spending by a Republican president who has turned a budget surplus into a national debt that is greater than the combined debt of all administrations before him combined.

#3 - The rampant oil speculation that is driving the cost of oil futures was caused by legislation hurriedly passed just before Bush I left office to deregulate the financial and commodities markets. The Gramm-Leach-Bliley Financial Services Modernization Act was passed while Phil Gramm was the chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs.

His wife Wendy Gramm resigned from the Commodity Futures Trading Commission and took a seat on the Enron Board of Directors after the CFTC exempted Enron from regulation in trading of energy derivatives.

Mr Gramm is a principal economic advisor to John McCain. No wonder John McCain says he needs to be educated about the economy. After Dubya admitted he got a C in economics in college, but bragged about getting an A+ in tax cuts, we need better leadership than that in the White House.

Mr Phillips' "article" appears to be an untruthful attempt to spin facts to keep an inept Republican in the White House.

T. Boone Pickens is another Republican oil man originally from Oklahoma who actually has a plan to reduce American dependence on foreign oil.

Read about it at http://www.pickensplan.com.

Gee, I wonder who Mr Phillips votes for.. What a load of horse shit. Does he really believe Americans are so stupid to think the Democrats are at fault somehow after 8 years of Republican power??

Maybe he's the only one that stupid, and doesn't realize. Just cuz you're rich doesn't mean you're right.

I actually really like his plan. There are some who criticize him saying that he is just trying to cash in on the next wave of energy, but who cares. We need to major change in direction if we want this country to have a stable future and a plan like this could really be the backbone of that change