Wednesday, October 28, 2015

no grain, now no oil? you can print more money, but you can't print more oil....,


marketwatch |  Even though the world is awash in cheap petroleum, Washington thinks the time is ripe again to sell part of the nation’s emergency oil reserves to help cut the U.S. deficit.

As part of an emerging budget deal, the Republican Congress and Democratic White House plan to sell up to 58 million barrels of oil from the so-called Strategic Petroleum Reserve. The reserve was created in 1975 in the aftermath of the OPEC oil embargo to protect the U.S. from another oil shock.
The sale would be spread out from 2018 to 2025 and raise more than $3 billion, based on current forecasts of future petroleum prices. Another $2 billion in oil could also be sold to modernize SPR facilities.

 
It’s not the first time Washington has resorted to oil sales to make its budget numbers work. A Republican Congress and a Democratic White House did the same thing in 1996, selling 23 million barrels to help balance the U.S. budget. Prices ranged from $18 to $26 a barrel back then.
Outgoing House Speaker John Boehner must remember. He was part of the Republican leadership during the 1996 budget talks as well.

Hey, every little bit counts. Although the nation’s deficit fell in fiscal 2015 to the lowest level in eight years, it still totaled a whopping $439 billion.

Some lawmakers have been itching to sell oil from the nation’s stockpile reserve, though for other reasons. A bill circulating in the Senate sought the sale of 100 million barrels of oil to beef up the depleted Highway Trust Fund, a moneypot used each year to maintain the nation’s main roadways.
Not everyone is smitten with the idea.

“The Strategic Petroleum Reserve is not an ATM,” Republican Sen. Lisa Murkowski said earlier this year after colleagues pushed for oil sales. “It is certainly not the petty cash drawer for Congress.”