Editorials-> Our View: Limiting oil imports would help to protect American producers

When the price of oil drops, so does the cost of gasoline. But while people are enjoying paying lower prices at gasoline pumps, plunges in oil prices can cause economic damage in Texas.

And it can put American oil producers out of business when the price of foreign oil imports gets cheaper than the costs of extracting oil from the ground in the U.S.

Oil producers in the Panhandle recently announced the Panhandle Import Reduction Initiative. Their hope is to limit the amount of oil that can be imported from other countries.

We wish them success in getting sympathetic ears to hear their initiative and gathering like-minded people to help further it. 

They are right that a limitation should be set on the amount of oil imports from the Organization of Petroleum Exporting Countries. 

Representatives of OPEC’s 18 nations recently met in Doha, Qatar. Among their topics of discussion was whether to freeze oil production levels.

The nations didn’t reach an agreement on the subject.

“OPEC and Russia and various countries met and decided they weren’t going to freeze oil and, in fact, OPEC said they will increase production again. This will drive the price down to $26 (a barrel) again,” said oil producer Tom Cambridge.

The U.S. currently is enjoying a record level of energy production. Between 2008 and 2015, oil production in the U.S. increased by nearly 4.5 million barrels a day.

The increased production had a predictable effect on imports. Light crude oil imports to the U.S. declined from 2.2 billion barrels a day in 2010 to 625,000 barrels a day in 2014.

It’s easy to see why OPEC countries didn’t reach an agreement on freezing oil production. They want plenty of oil to be available on the international market to bring down oil prices.

When the prices get low enough, it hurts American oil producers and hinders domestic production of oil.

This isn’t the first time OPEC has played this manipulative game and engineered economic havoc in Texas — and elsewhere in the U.S.

In the past, after they have lowered our production levels, the OPEC countries haven’t had any difficulty reaching an agreement to freeze production. 

At that point, they will want to increase oil prices by lowering the supply of it.

It’s time to stop this tactic, and the Panhandle Producers and Royalty Owners Association have the right idea.

If oil imports to the U.S. are limited, it means more companies will be buying the oil that’s produced here.

Many American producers have taken economic risks to be part of the record energy production in the U.S. They shouldn’t have to suffer at the hands of greedy foreign oil interests.

Could the Panhandle Import Reduction Initiative be successful? We don’t know, but the Panhandle oil producers are doing the right thing to try. There should be a market for the oil that’s being produced in the U.S.

http://lubbockonline.com/filed-online/2016-04-28/our-view-limiting-...

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Replies to This Discussion

Permalink Reply by Martha Lee Vincent on May 19, 2016 at 6:01am

OBAMA SEEMS TO WANT TO IMPORT EVER MORE OIL FROM HIS ISLAMIC OPEC FRIENDS, HURTING U.S.A. PRODUCERS !!!

Permalink Reply by Joseph-Ohio on May 1, 2016 at 9:21pm

Good vs. bad depends on who you're importing from and to who you're exporting to - especially these days - should you ask me.

Real important that / those details.

JMHOs

Permalink Reply by Barry D on May 4, 2016 at 3:10pm

Let's take a look at history and see what it teaches us about government intervening in the market in favor of a special interest.

In the late 1920's President Hoover and Congress approved of tariffs (Smoot-Hawley) on imported agricultural products to protect ( a special interest ) "American Farmers". The backlash from the international economic community caused a recession. Once FDR was in office he doubled down and created the "Great Depression".

Oil and Natural gas are a part of a global economy (not just ours) any action by our government will be met by qlobal reaction (negative).

Although the rhetoric of import restrictions may be appealing the ultimate results will have a negative affect on our economy.

So yes, by all means let's revisit the days of the "Greta Depression", because we know what a good time was had by all.

"Those who choose to ignore history are destine to repeat it"

Permalink Reply by Joseph-Ohio on May 4, 2016 at 4:00pm

What's more negative to our O & G industry / economy ?

A measured response  to the pressures placed on our O & G industry and economy (by OPEC / SA / ME flooding the market with their production) via trade agreements with our vetted allies and embargoes against those applying those pressures ?

Or.....

No response and bear even more damage to our O & G industry and economy that has and continues to happen ?

I think it's better to issue the measured response myself.

If kicked in the shins it's better to kick back harder IMHO.

Can't forget to recognize that you're in a fight - not too healthy that either.

Permalink Reply by Joseph-Ohio on May 4, 2016 at 4:10pm

BTW - as I see it FDR's Great Depression' was the world's Great Depression and only got cleaned up by WW2.

Permalink Reply by Toytown on May 8, 2016 at 2:37pm
The Big Market crashes came under Hoover and W.
Permalink Reply by Bob Perkins on May 7, 2016 at 4:04am

From the May 3 Wall St. Journal http://www.wsj.com/articles/despite-shale-glut-u-s-imports-more-for... 

"Saudi Arabia also shipped 33% more crude to the U.S. at the start of 2016 than it did during the same period last year, boosting volumes into the country back over one million barrels a day, federal data show, as the kingdom seeks to increase its market share.

Tom Cambridge, chief executive of Cambridge Production Inc. in Amarillo, Texas, said he has been concerned about the increase in imports and the downward pressure that it can exert on U.S. oil prices.

He and a few other oil executives have been trying to drum up support among politicians to push for quotas on foreign oil imports, he said. “If you’re filling up at a station in Texas, chances are you’re running on Saudi gasoline,” Mr. Cambridge said."  Mr. Cambridge is right about Saudi gas and that's the point the American people understand. Working families in the oil patch including the Utica and Marcellus oil regions continue to be destroyed by the price war with OPEC while the fat cats in DC do nothing to help. Hence, import reductions are a grass roots effort. Please sign up for our emails, read our materials and make a donation here-> http://www.panimportreduction.org/ (The Panhandle Import Reduction Initiative)

Permalink Reply by Joseph-Ohio on May 7, 2016 at 11:08am

Embargo Imports from the M. E. (especially S.A. / Iran, Iraq) all OPEC States (especially Russia and those in South America).

Enforce the embargoes with whatever it takes.

JMHOs

0ym9x5ag7ury2Permalink Reply by 0ym9x5ag7ury2 on May 9, 2016 at 10:09am

Don't use my tax money to protect domestic producers who are stealing from landowners.

Speaking of protecting a group, how about protecting US landowners from this theft we are all experiencing from domestic producers.

It would only require enforcing the laws of each Shale Play State, then everyone would benefit. The producers would take their 88% while paying a true 12% royalty. Instead some producers are taking 98% or more by not paying a fair royalty.

Danny, you have the floor.

Permalink Reply by Joseph-Ohio on May 9, 2016 at 4:02pm

Don't use our tax money to protect OPEC / hostile / potential hostile state production for the world market.

Rather spend it to diminish their 'market' and promote ours.

Permalink Reply by Joseph-Ohio on May 10, 2016 at 12:31am

Stop importing OPEC / SA / ME production and develop ours.

Compete with them then - don't buy from them.

It's counter-intuitive to help any direct competitor in any competition.

It only makes sense to the few who gain by it.

Permalink Reply by Martha Lee Vincent on May 19, 2016 at 6:08am

IT doesn't make sense to me to allow OPEC, AND SPECIFICALLY S.A. to SELL MORE OIL TO THE U.S. WHEN THEY ARE  THE COUNTRY THAT IS TRYING TO DESTROY OUR OIL AND GAS INDUSTRY !!!

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