I am generally not much for procrastination, but in this case I am guilty. It has been 3 weeks now since I participated in a conference call with API Chief Economist John Felmy. Robert Bluey, one of the participants, wrote up some comments immediately afterward at his blog. I had intended to do the same, but one thing or another has distracted me until now.
I will post some of Bluey’s comments, because all of the pertinent links are there. Just a bit of background. I did not know that there would only be a few of us participating, or I would have spent more time considering my questions. For all I knew, there would be 50 people on the call and I would get to ask maybe 1 question that I would formulate based on Felmy’s comments. So, if my questions and comments seem unscripted, don’t worry, they were. I did not know exactly what we would be discussing.
I will be the first to admit that this was not a hostile audience. I imagine this was just a test run before this message is carried to more hostile audiences; they are the ones who need to be engaged. After all, I am not the one who believes that oil companies are ripping you off. But this is what the average person believes, so it is the average person who needs to hear this message
The intent is to hold such conference calls on a regular basis, so if you have specific questions you would like asked, then post them and I will ask them next time around. (You can’t accuse me of bias if I am asking YOUR questions). So, if you have some questions on climate change, profits, ethanol (I did not ask any ethanol questions, although it was tempting to jump in and answer some questions myself), or energy issues in general, give me some of your questions. I will make a list, and I will try to get them answered.
Here are some of Robert Bluey’s comments:
Yesterday’s call was intended to counter what Felmy dubbed as “repeated attacks on the industry as having excessive profit” — a charge that just doesn’t hold up when compared to other industries. API provided a PowerPoint document (which is publicly available) to prove its point. It’s also set up a website, Energy Tomorrow, to hone its message.
Joining me on the call were Mary Katharine Ham of Townhall, Kevin Holtsberry of RedState, Robert Rapier of The Oil Drum and R-Squared Energy Blog, Geoffrey Styles of Energy Outlook and Jerry Taylor of Cato-at-Liberty.
All of the pertinent links are included in Robert Bluey’s posting. I did get to ask several questions, one of which I flubbed. I asked what their policy was on gas taxes, when I meant to ask about their stance on gas taxes.
As far as the message, I agree whole-heartedly that the public needs to be engaged on these issues. I don’t know how receptive they will be from getting this message from the API, though. I have trouble myself talking to people because I work for an oil company. A lot of people immediately dismiss all arguments on that basis alone. “Of course YOU don’t think oil companies are gouging us; YOU work for an oil company.” However, as I have stated again and again, my arguments are independent of my identity. Question my motives all you want, but that doesn’t address my arguments.
The presentation is very informative, and does a nice job of addressing misconceptions. For example, who exactly is “Big Oil”? I think a lot of people envision former ExxonMobil CEO Lee Raymond, in a smoke-filled room with a bunch of his buddies plotting the destruction of the environment. In fact, pension and retirement accounts hold 41% of the shares of oil companies, and the other 59% is divided among individual shareholders, mutual funds, etc. If you have a pension or retirement account, the odds are pretty good that YOU are Big Oil (albeit just a little slice).
My biggest area of disagreement, being a guy who is quite concerned about future oil supplies, was the message that there is still plenty of oil out there. Undiscovered oil in the U.S. and Alaska was estimated at 112 billion barrels (“enough oil to power over 60 million cars for 60 years AND heat over 25 million homes for 60 years”). To put that in perspective, that is more oil than Saudi Arabia has produced in their entire oil production history.
Given that this oil is “undiscovered”, I think it would be prudent to plan as if it isn’t there; or at least not in nearly the amount forecast. This has been my criticism of cellulosic ethanol. What if it doesn’t pan out? What is the contingency plan? This is the same question we need to ask about these undiscovered reserves. What if they are never discovered, or are never economical to produce? We need to plan a future in which we are scaling down our energy consumption – not a future in which we count on “powering 60 million cars for 60 more years.”
Anyway, check out the presentation and the transcript, and if you have a question that you would like to see answered by the chief economist at the API, I will attempt to get it answered.