So you are assuming that there is no such thing as a global market for oil?

ssorenn: "An opinion is what an opinion is and everyone has one. No hard proof there, next." The same can be said about it dropping gas prices, next.
ag: No.

I hope you smoke a ton of dope prado, otherwise I'm not sure you should stay in this discussion.

Where do you go to school prado?, I'll make sure my kids don't go there for encon.

This is you: http://xkcd.com/386/
("What do you want me to do? LEAVE? Then they'll keep being wrong!"

)

Hi guys, economist here. Krellin is right. KXL can only benefit your wallets. Also, due to the increasing number of binding climate change commitments being signed and the rapidly decreasing cost of solar, this likely won't change the investment in renewables that much.

This current drop in oil is (mostly) based on around a 500,000 barrels per day oversupply. $1.5 trillion a year is being transferred from oil producing nations to oil consuming nations (U.S. is net consumer, so our effect will be positive). Inflation will be kept down. You will begin to see air fares and other travel expenses drop. Moreover, this is fucking Putin and all the wealthy Arab nations royally. So I say anything we can do to further their pain and drive our economies more is a plus

It's not as effective on the Arab nations, opec decided to keep production ramping to force the oil sands and fracing companies to go belly up. It really hurts Russia and Putin(love it) but hurt South American oil pricing countries like Venezuela real bad. Also I think the number Is around 1.1 million barrels, but that's semantics. Gold finger is quite correct though.

And what about the fact that we're killing ourselves through burning fossil fuels, which will only be furthered for KXL, as well as the horrible environmental impacts of the Alberta tar sands?

Really, you cut out fossil fuels and back to the Stone Age we go. You all are so self righteous. Everything you do uses some sort of fossil fuel.

Alberta (the Canadian Oil province that wants to build said pipeline) is trying to build several pipeline, Keystone being only one of them. Basically the Alberta government is trying to ship oil in all directions for consumption in overseas markets. It would be nice to see the oil refined and used in North America but the Conservative government doesn't care who gets it as long as they get paid (I didn't vote for the bastards). The oil might affect gas prices as a whole, but not the USA as a target.

ssorrenn - its hurting all of them. There was an article a while back showing at what oil price different nations balanced their budget. UAE and some other key Arab nations will be running budget deficits at this price (not Saudi though). Also, this price will not force the shut down of current production, but will prevent the development of new fields. Prices have a ways to fall still before the fracking fields shut down (profitable down to $42 a barrel, I think). But you're right that Venezuela and Russia are by far the biggest losers from this. Venezuela is actually going to go into social unrest very, very soon.

arborinius - you're correct on the environmental damage. That is always a risk, and one you can't put a price on. And the development of this pipeline won't stop us from burning fossil fuels, or make us burn more. The US has already pledged to reduce emissions by a quarter by 2030 - a huge pledge from the 2nd largest emitter in the world. The thing is, many renewable energy technologies are getting just as cheap as oil, if not cheaper. These low oil prices may be a deciding factor for things such as automobile choice, but not much else.

Goldfinger, you have a firm grasp on this, the oil field through North America have different break even points, but essentially you are correct. WTI though is at a really low cost basis, so it's not hurting the Texans too bad.

Lower oil prices will prevent countries like Iran from supporting terrorism since they have less money. Sure there will be social unrest in Iran, Venezuela, and other state run oil and gas companies since they have been using higher prices to avoid fixing their countries.

http://static.fjcdn.com/gifs/Grandpa_e3efae_976974.gif

Yeah, I was going off of...I think its called the Brakken shale fields in North Dakota? That has one of the lowest break even points.

http://mobile.nytimes.com/2014/12/14/opinion/sunday/thomas-l-friedman-why-2014-is-a-big-deal.html?_r=0

Friedman thinks we should prevent the plummeting gas prices from discouraging development of green energy technologies by slapping a tax on gas ensuring that it stays at $3/gallon. It'll bring in $150 billion a year that we can use to fix our roads, bridges and other infrastructure.

Infrastructure spending is part of how we recovered from the Great Depression and WWII. We need it terribly.

The last 6 years should have had tons of infrastructure spending.

But....Republicans.

I think everyone should boycott this thread until Sandman99 posts again.

@ ssoren

how, exactly, would stopping our consumption of fossil fuels send us back to the stone age? Seems to me more like it would send us back to the 1970s, before hyper-consumption started, and all of the free trade agreements we have today.

Ok, I'm here.

If you want my opinion, I am for it. Even though it could potentially be damaging to the environment, it is alot safer to transport by pipeline than other means, such as trains.

And, most of it is already built. What the conflict is about is Phase 4, which is only meant to shorten the distance the oil has to travel.

@GF
"And the development of this pipeline won't stop us from burning fossil fuels, or make us burn more."

I don't see how you can say with certainty that this is the case. Anything that makes the oil sands (and oil extraction in general) more feasible - by my guess - would extend our willingness to rely on oil for power. There are going to be several Canadian and American administrations between now an 2030. Considering the way we've treated emissions goals in the past, I take that promise with a grain of salt.

The bottom line for me is that if you truly believe that:
a) Anthropogenic climate change is real and is a major threat that needs to be addressed quickly and effectively
b) The current power generation makeup in North America (and even more so in the US) is a major contributor to anthropogenic climate change

Then we need to do whatever we can to accelerate the decline of fossil fuel consumption, even if it comes at the risk of immediate economic consequences. Refusing to allow new modes of fossil fuel transport is definitely a step in that direction. If it wasn't an economic boon for the fossil fuel industry, they wouldn't be proposing it.

"Then we need to do whatever we can to accelerate the decline of fossil fuel consumption, even if it comes at the risk of immediate economic consequences. Refusing to allow new modes of fossil fuel transport is definitely a step in that direction."

Not building the pipeline would do nothing to keep the oil from being burnt. It just means American refineries would not get the oil directly and that American ports would not be place from which the refined oil is shipped. Instead, Canada will ship crude out on its own, which American and other refineries will still buy, and industry all over the world will still use.

All we're doing it throwing away an opportunity to develop infrastructure and create *exactly* the kind of jobs the economy needs. Stopping the pipeline does nothing to decrease consumption or production. The only thing it does is spurn a chance to improve North American energy security.

Yonni - I agree climate change is real, and its a threat that must be addressed soon, but the fact is that oil is mostly used in industry (plastics) and transport. Most electricity generation in the US is still from coal. Switching from coal fired to oil fired plants would actually help the environment, since oil burns cleaner. Also, a substantial portion of US emissions is in the form of cow farts, so that should be just as big of an issue as this pipeline is

@Invictus
Except that it does keep the oil from being burnt long term. If it increases the cost of extracting and refining oil, then the point where it becomes more economically feasible to use alternative sources is pushed forward.

@GF
Yeah, I can kind of ignored that the US is still getting so much from coal. Here, we still get a lot from oil but have phased out the coal. Still, I think my point remains that putting a financial burden on the oil industry is a good thing for the environment. Ideally, it can be done through taxes and regulation but, if I can add to the pressure with my vote, then I'm going to do it.
And,yes, cow farts are bad.

"Except that it does keep the oil from being burnt long term. If it increases the cost of extracting and refining oil, then the point where it becomes more economically feasible to use alternative sources is pushed forward."

But that's not what's happening. For one, the pipeline expansion has no effect on the price of extraction or refinement. Oil is a commodity, so its price is set globally. It's not as if requiring Canada to only uses the already extensive existing pipelines between the oil sands and the Gulf refineries will make oil prices skyrocket. It only means that Canada will sell crude to a lot of countries rather than primarily to America.


Also, increasing the price of oil may be exactly the opposite way to make alternative energy sources viable. Higher oil prices mean companies will invest more to extract oil which isn't worth getting now. That's what's already happened with the tar sands and what spurred fracking to begin with (although now that the technology is widespread the barrier of entry is lowers).

Low oil prices, on the other hand, force energy companies to diversify. When prices are low they make less money, so to make up the slack they would invest in developing new technologies (even more so than they already do).

Also, let's keep in mind that, if man-made global warming exists, it's impossible to stop. China and India, and other developing states, will not hold themselves back industrially to the extent needed to avert the predicted disasters.

It's not impossible to stop, and we need to start somewhere.

I'm not sure if you're 100% correct there Invictus.

We're talking specifically about the Albertan tar sands here. Presumably Alberta's support for Keystone and Gateway is because those two pipelines make things cheaper for them. By denying them access to those pipelines, we make the extraction and refinement more expensive. Like you said, prices are set globally, so the point at which extraction becomes economically unfeasible is brought closer to the present, no?

And, perhaps with a healthy dose of naivete, I'd have to suggest that we have to try what we can to curb the rate of global warming and environmental destruction. There's enough uncertainty in models and maybe additional support via routes like geo-engineering that trying our best to do what we can now seems like the most responsible route.