Sunday, February 17, 2008

Free to Use Strategic Petroleum Reserve

Energy Chief Samuel Bodman said the U.S. could give Exxon oil from the Strategic Petroleum Reserve to make up for lost Venezuelan imports. Hugo Chavez quit selling his country's oil to Exxon/Mobil as a result of their legal dispute over the value of Exxon's assets nationalized by the Venezuelan government.

I looked back to find President Bush's other actions in regard to the SPR. In spring of 2004, he resisted calls to open the reserve to stem high gasoline prices. After Hurricane Katrina crimped Gulf oil production, Bush tapped the reserve via loans to various oil companies. They included a loan of six million barrels to Exxon Mobil, another one million barrels to Placid Refining, and 1.5 million barrels to Valero.

In early 2007, he proposed doubling the capacity of the SPR. A NYT editorial commented, "The $2.7 billion the administration proposes to spend on this project each year for the next 20 years is three times the amount that Congress authorized last year for the Energy Department’s entire research and development program for alternative energy sources."

Bush's record is clear. He'll open the reserve to give big oil their needed supplies, but not to help citizen's concerned about high energy costs. The President will expand it, adding additional demand to an already expensive oil market. He does so out of proportion to alternative energy expenditures. The Exxon/Mobil's of the world have to be very happy.

But if Bush is their puppet, and they want back into Venezuelan oil, what might he do? Might it be a CIA sponsored insurrection, a military takeover by a U.S. aligned General, or an engineered financial meltdown? No matter what, the signs are bad for Hugo Chavez. Bush and his buddies like to get their way...