Harper: "The politics of ruthlessness"

[Tupac Shakur]

A pipeline going to BC means that much of the oil currently going to the US will be going to China. That means you will need to import more oil from your friends in the middle east. And despite what you think, it costs a LOT more to ship oil from Saudi Arabia and Iraq on tankers to the Gulf than it is to shoot it down a pipeline.

No, it doesn't, which is why you've yet to produce any evidence that it does.

[Asher]

Yes, only .01% of the public understands that oil is good for shipping to refineries to make gasoline. But, they instinctively know how much, say, a 1% increase in the price of oil would increase the price of the gasoline they buy.

Actually, they've no ****ing idea...and neither do you. a 1% increase in oil does not mean 1% increase in gasoline.

[gribbler]

Actually, they've no ****ing idea...and neither do you. a 1% increase in oil does not mean 1% increase in gasoline.

No ****.

[Asher]

No, it doesn't, which is why you've yet to produce any evidence that it does.

Sorry, what evidence are you looking for?

That it costs a lot more money to build triple-hulled tankers with obscene insurance premiums to haul oil from Arabic countries to the other side of the world, to build massive storage facilities at both the source and destination, to operate the very expensive (and time consuming) transferring equipment to load and unload the containers and then ship it to the refiners...than it does to send a steady supply of oil through a pipeline from your closest neighbour direct to refineries?

I can't give you the gift of critical thought.

[Asher]

And I haven't even yet mentioned the cost of political fear/posturing on oil -- every time there's conflict in the middle east, WTI futures soar in price. Why? Because that's the premium you pay for importing oil from unstable theocracies and dictatorships.

There is no reasonable informed argument at all that would say it doesn't matter to the cost of oil in the US if Canada ships much less oil to the US. There is absolutely no doubt that this would increase the price of oil to the US. If you can't see that, no one can help you.

[Tupac Shakur]

Sorry, what evidence are you looking for?

I'd settle for pretty much anything at this point.

[Asher]

I'd settle for pretty much anything at this point.

What I've done is laid out a logical, reasoned, rational, and frankly irrefutable argument on why it would raise the price of oil in the US. This argument aligns itself with current behaviour and why the UK and US have such different prices for oil.

I also have a father who worked in the industry for 30 years in both the US and Canada and whose job was to build the economic models and present options. He's done this for oil sands projects in Alberta as well as off-shore projects in Nova Scotia/Newfoundland and one in the Gulf as well. I've heard all about this from a primary source.

My SO is a chemical engineer working currently on a major pipeline project that's been mentioned in this thread.

Meanwhile, what have you provided? Nonsensical arguments that rely on the premise that it doesn't cost anything to ship oil anywhere in the world? Arguments that rely on the premise that there are tanker fleets large enough to compensate for lack of oil from Canada? Arguments that ignore the obvious fact that if the US suddenly needs more tankers, the cost of those tankers will further increase... Arguments that ignore the fact that shipping via tanker is inherently less efficient than pipelines, and will therefore reflect in the price?

[KrazyHorse]

Who cares? Oil is fungible.

When you're discussing oil tranportation infrastructure, this is moot.

[Tupac Shakur]

What I've done is laid out a logical, reasoned, rational, and frankly irrefutable argument on why it would raise the price of oil in the US.

That's not evidence.

[KrazyHorse]

No, it won't.

Yes it will. A pipeline is the cheapest available way to ship oil. With a pipeline the price of oil at destination will drop.

[Asher]

That's not evidence.

Unfortunately I cannot provide evidence of a prediction.

[Asher]

Yes it will. A pipeline is the cheapest available way to ship oil. With a pipeline the price of oil at destination will drop.

Sanity

[Tupac Shakur]

Yes it will. A pipeline is the cheapest available way to ship oil.

I don't disagree with this, but the difference is negligible.

[KrazyHorse]

Sorry, but I don't consider a dollar a barrel or so (reasonable estimate of spread across different NA cmls) negligible. The US consumes 20 million barrels a day...

[Tupac Shakur]

Yes, if Canada could supply all US demand with pipelined oil, it would make a significant difference. That's not what we're actually talking about, though. We're talking about the cost to the US of allowing some small percentage of Canadian oil to be sold to China rather than the US, which is negligible.

[KrazyHorse]

No it can't, of course. The point is that this is a substantial efficirncy upgrade on a substantial portion of US demand. Damage is being done to people in both countries by this delay.

[Tupac Shakur]

Actually, if Asher's article is to be believed, the US is benefiting from the lack of sufficient pipeline capacity to take Canadian oil all the way to the Gulf. Delaying the Keystone XL might very well be in America's best interest.

That being said, I agree with your efficiency argument.

[KrazyHorse]

That argument makes no sense. There is no possible equilibrium in which restricting capacity like that would improve the lot of the US.

[Tupac Shakur]

Why doesn't it make sense? Excess Canadian oil that can't reach the global market because of pipeline constraints is sold to American consumers at below market rate. Canada and global consumers lose, American consumers win.

[Asher]

It's not that it can't get to the global market, it's that it can't get to the idle refineries in Texas while it sits in storage in the mid-west as the mid-west refineries are already pretty much at capacity.

[Tupac Shakur]

Let's get as much cheap Canadian oil as we can while they build more pipelines to the Pacific.

“My sense is that it’s a really hollow threat,” Marx said. “That oil is not going anywhere, and in fact, the government is concerned that the tar sands are landlocked, which makes the Keystone the critical pipeline to get it to a coast where it can then be exported.”

http://www.politico.com/news/stories...#ixzz1ehEMgeun

Right on. Call that bluff.

[notyoueither]

Thw West Coast pipeline will get built.

[notyoueither]

As for how, see title of thread.

He is also from Alberta.

[Tupac Shakur]

Thw West Coast pipeline will get built.

Good.

[notyoueither]

Less good than having access to the oil all to yourselves.

Asher has tried to mention security of supply, but you have ignored him.

[Tupac Shakur]

We can secure your supply any time we want in a serious crisis. Less serious instability like Asher mentioned would raise global oil prices (including Canadian oil), so it wouldn't matter where our oil was coming from excepting the minor efficiency losses KH highlighted.

[notyoueither]

I have mixed feelings about Keystone.

As a native, I'd like to see more of the upgrading and refining done domestically. The new premier of the province is looking to make friends in parts of Canada where historically there has been friction. She was recently in Ontario talking to their premier. The topic was making Canada an energy super-power. My mind wandered to the idea of large trans-Canada pipelines to upgraders and refineries in Ontario with access to the US and the Atlantic.

Hmmm, markets.

[notyoueither]

We can secure your supply any time we want in a serious crisis. Less serious instability like Asher mentioned would raise global oil prices (including Canadian oil), so it wouldn't matter where our oil was coming from excepting the minor efficiency losses KH highlighted.

When you can't get enough as you need, period, access is an issue.

[Tupac Shakur]

I don't even know what you're trying to say there. I suspect it's dumb.

[notyoueither]

Your hint is 1973.

You should really read a history book sometime.