ANALYSIS: Faced with oil crunch, US Nat'l Petroleum Council calls for
'radical measures' (FT)
[On Wednesday the *Financial Times* of London reported that the U.S.
National Petroleum Council is not yet willing to concede that "the
world is running out of oil and gas," but does conclude that "we are
in for a sustained period of tight supply -- and that policy needs to
start responding to that right now" with what the *Financial Times*
characterizes as "such radical measures as the fastest technically
possible increase in vehicle fuel economy standards and an
international framework for managing carbon dioxide emissions."[
The report is very much an Establishment affair. -- Ed Crooks,
commenting on a report released by the U.S. National Petroleum Council
that was commissioned by the Bush administration and overseen by none
other than Lee Raymond, the former chairman of ExxonMobil, "the
epitome of the old-school oilman," and Daniel Yergin, chairman of
Cambridge Energy Research Associates and author of *The Prize* (1990),
said that although "criticized for not taking seriously enough the
case for 'peak oil,'" nevertheless "the core message of the 646-page
study sounds far from complacent. It argues that there are mounting
risks to traditional sources of oil and gas supply that 'create
significant challenges to meeting projected energy demand' and
stresses the urgent need to mitigate those risks." --Mark]
1.
HIGH OIL PRICES THREATEN TO LINGER
Financial Times
July 18, 2007
http://www.ft.
Wednesday's report on world oil and gas supplies from the U.S.
National Petroleum Council was a defining moment in the history of the
global energy industry.
The study, calling on the U.S. to implement such radical measures as
the fastest technically possible increase in vehicle fuel economy
standards and an international framework for managing carbon dioxide
emissions, echoed familiar demands from environmental campaigners.
So in May 2001, just days before Cheney unveiled his long-awaited National Energy Policy, FERC entered into confidential settlements with Williams in which the company forfeited $8 million it was owed by California's grid operator for power Williams sold into the marketplace at inflated prices. Williams did not admit any guilt for the power plant shutdown and, on orders from Cheney, FERC agreed to keep details of the settlement sealed. FERC later entered into a similar settlement with Reliant. The company agreed to forfeit $13.8 million it was owed by California's grid operator, did not admit to any wrongdoing, and FERC kept the details of the settlement confidential.
In May 2001, the PBS news program "Frontline" interviewed Cheney who was asked by a correspondent whether energy companies were acting like a cartel and using manipulative tactics to cause electricity prices to spike in California.
"No," Cheney said during the "Frontline" interview, even though he was personally briefed about energy companies manipulating the state. "The problem you had in California was caused by a combination of things - an unwise regulatory scheme, because they didn't really deregulate. Now they're trapped from unwise regulatory schemes, plus, not having addressed the supply side of the issue. They've obviously created major problems for themselves and bankrupted PG&E in the process."
On May 21, 2001, five days after unveiling his energy policy, Cheney told Tim Russert on "Meet the Press" that Davis was to blame for the energy issues in the state.
"They knew over a year ago they had a problem, and Gray Davis refused to address that problem," Cheney said. "[They] kept putting it off and putting it off and putting it off, with the notion that somehow price caps could be maintained. Now, today, where are they in California?"
At the same time, Reed informed Rove and Cheney that his nonprofit, the American Taxpayers Alliance, a Republican front organization, would begin to air a series of scathing radio commercials taking aim at Davis's failure to tame the energy crisis in June 2001. The ads, Reed said, were aimed to shift attention away from Republicans in Washington and "back to Sacramento where it belongs." Reed added that the ads would leave Davis "bleeding like a stuck pig."
Gillespie also launched a public relations campaign against Davis. He took ads out in print publications attacking Davis. The ads were paid for by Gillespie's 21st Century Energy Project, which he formed in close coordination with Karl Rove less than a month after the National Energy Policy was released in May 2001, according to former Enron executives who worked closely with Gillespie. Enron funneled at least $75,000 to Gillespie to pay for the ads through Grover Norquist's Americans for Tax Reform, according to documents obtained by Truthout.
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