Given that Republicans have already said they will not cooperate with the President as a result of his work on healthcare, will opening up a little bit of oil drilling really help his cause with the GOP?

Broadcast on April 7, 2010

Midweek Politics with David Pakman is a nationally syndicated talk radio and television program. Subscribe to our YouTube channel!

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Many people think the search for cleaner energy leads only to renewable resources like sun, wind and water. But it also leads to a fossil fuel. Natural gas is considered the cleanest of the fossil fuels — the fuels created by plant and animal remains over millions of years.

Burning it releases fewer pollutants than oil or coal. The gas is mainly methane. It produces half the carbon dioxide of other fossil fuels. So it may help cut the production of carbon gases linked to climate change.

Russia is first in what are called “proved reserves” of natural gas. The United States is sixth. Over the years, big oil and gas companies recovered much of the easily reached supplies of gas in America. They drilled straight down into formations where gas collects. As these supplies were used up, big drillers looked for similar formations in other countries.

But now the industry is taking a new look. Companies are developing gas supplies trapped in shale rock two to three thousand meters underground. They drill down to the shale, then go sideways and inject high-pressure water, sand or other material into the rock.

This causes the rock to break, or fracture, releasing the gas. Huge fields of gas shale are believed to lie under the Appalachian Mountains, Michigan and the south-central states.

Gas shale exploration is being done mainly by small to medium sized companies.

Eric Potter is a program director in the Bureau of Economic Geology at the University of Texas at Austin. He said the kinds of opportunities that are left for natural gas exploration in the United States have changed. So it is not as easy to develop. He says more than half the gas in the United States is now coming from these new reserves.

But hydraulic fracturing can also produce debate and anger over the risk of groundwater pollution. This method of drilling is not federally supervised under the Safe Drinking Water Act. Some in Congress want to end that exemption from the law.

Natural gas provides Americans with about one-fourth of their energy. And, unlike oil, most of it is produced in America. Gas producers invested heavily in reaching new supplies when prices were high.

But prices are down sharply now because the recession cut demand for energy. So energy expert Eric Potter says it is too early to know how the new gas shale reserves will affect the market.

And that’s the VOA Special English Economics Report.

(Adapted from a radio program broadcast 23Oct2009)

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Worldfocus correspondent Edie Magnus and producers Bryan Myers and Meghan Thompson report from Angra dos Reis, south of Rio de Janeiro, on Brazils unfolding role as oil giant.

Worldfocus video podcast: http://feeds.feedburner.com/worldfocus

http://worldfocus.org/

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UN countries should agree on the creation of a global reserve bank to issue the currency and to monitor the national exchange rates of its members, the Geneva-based UN Conference on Trade and Development said

http://www.bloomberg.com/apps/news?pid=20601087&sid=aSp9VoPeHquI
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The following is a summary of the main economic events from the Asia-Pacific and European sessions:

*UN Trade and Development Agency proposes setting-up a new world reserve currency based on a basket of global FX mediums.

*Former Feds Greenspan tells audience in Mumbai, India, that U.S. banks need to hold higher capital ratios than they do currently to offset any future crises.

*Gold breaks above the $1000-per-ounce mark for the first time since late February 2009.

*Chinese Finance Ministry says it will sell CNY 6.0 billion in government bonds; they will be issued in Hong Kong on September 28.

*PBOC Vice Governor Su tells audience at a finance conference that the central bank will continue providing appropriately loose monetary policy.

*UK Chancellor Darling tells audience in Cardiff, Wales, that while the government will not back away from cutting public spending, it will properly signal the move to market agents.

*Expansion interview: ECBs Gonzalez-Paramo says markets could be overreacting to the recent global wave of positive economic data; adds that excesses are always bad.

*UK industrial production rises 0.5% month-over-month in July, beating calls for a 0.2% increase and below the previous 0.6% gain; annual production contracts 9.3% compared to forecasts for a 10.1% fall and following the previous 10.7% decline.

*UK manufacturing production surges 0.9% month-over-month in July, beating forecasts for a 0.3% increase and the previous 0.6% gain; annual production declines 10.1% compared to forecasts for an 11.1% decline and after the previous 11.3% fall.

* German trade surplus rises to €13.9 billion in July, despite calls for a decline to €11.3 billion from €12.1 billion; current account surplus falls to €11.0 billion, a smaller drop than forecasts for a contraction to €10.0 billion from €13.5 billion the month prior.

*Swiss unemployment rate rises to 4.0% in August, despite calls for an increase to 4.1% from 3.9% the month prior.

*Japanese Eco Watchers current economic index falls to 41.7 in August, despite calls for an increase to 43.0 from 42.4 the month prior.

*Japanese trade surplus (BOP basis) drops to ¥437.3 billion in July, more than the expected fall to ¥495.1 billion from ¥602.2 billion in June; meanwhile, current account total increases to +¥1265.6 billion in July from +¥1152.5 billion, disappointing the consensus call, however, for a rise to +¥1452.6 billion.

*Australian NAB business conditions index rises to a +4 reading in August from +1 the prior month; meanwhile, business confidence component increases to +18 from +10 in July.

*UK BRC retail sales monitor declines 0.1% in August, worse than the expected flat reading but improving upon the prior 8.1% drop.

*Kraft Foods says it will continue its £10.2 billion ($16.7 billion) hostile bid to acquire Cadbury, after the chocolate maker rejected an offer by the American foods giant; Kraft is offering 300 pence, or slightly more than a quarter-of-a-share in Kraft, for every Cadbury share.

*British regulators fine Barclays £2.45 million ($4.0 million) for failing to provide accurate transactions information.

*Toyota announces it will hire 800 temporary employees in Japan in October due to improving auto sales.

*Taiwans PM Liu resigns due to the controversy over the governments response to the deadly typhoon last month.

*BBC: Reyes Heroles, the head of Mexicos state-owned oil company Pemex, is replaced by Juan Jose Suarez; Mexican Attorney General Eduardo Medina Mora, integral to the countrys war on drug cartels, also loses his position.

http://www.fxstreet.com/fundamental/market-view/the-overnight-express-north-american-edition/2009-09-08.html
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The United Nations Conference on Trade and Development said in a report published Monday that the U.S. dollar should be replaced as the worlds standard reserve currency, giving rise to a new global currency managed by an as-yet undetermined financial regulatory organization.

http://rawstory.com/08/news/2009/09/07/united-nations-calls-for-new-world-currency/
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Business operations are complicated and cant just come and go with the moody speed of an extreme crude price volatility; even a lot of oxygen will not do much for a dead patient. The shrinking flow of crude oil had stopped the flow of inflated capital.
Sounds like a straightforward reason why Wall Street was caught with their pants down right after the Peak Oil generated crude oil prize shock and not some other time?

The all important sweet, light crude comes from 400 big, tired fields producing 75% of all oil and representing only 1% of all fields and they are on line since the 70s and from before. After all, the peak of new oil field discovery was in the year JFK was assassinated, 1963, a very long time ago. Between then and now there lies a long, steep and hardened slope of decline for total new oil discoveries. There is no recovery for a national oil economy and not for a global oil economy. Economic activity will feel in a short coupled way the boa constrictor like tightening grip of a more and more shrinking oil production the instant it wants to take a breath. Then the crude prize will spike way up and throttle economic activity.
Crucial time was wasted since Reaganomics killed an already fledgling green energy conversion in the early 80s which we are reminded to by Bushs and Harpers free trade platitudes at the 2008 Doha trade talks and now at the APEC meeting in Lima; At this point Harpers globalization talk scares investors, Reagan had more listeners for his fantasy ideas. Lets all give our heads a shake, walk up a mountain, or do whatever it takes to think it over.
A good time to remember the journalist Edward R. Murrow who fought ideologues and censorship in the McCarthy era and who was known for his trade mark closing line on the CBS evening news casts: Good Night and Good Luck.

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