“The supply of oil from [East Texas] was so great that at one time crude oil sank to 10 or 15 cents a barrel, and gasoline was sold in the East Texas field for 2 1/8¢ a gallon. Enforcement by Texas of its proration law was extremely difficult.”
Okay, this is Throughback Tuesday, not Thursday. But some energy history is good from time-to-time on any day of the week. And here in the summer of 2021, with oil prices swinging a bit on a lot of different news, it might surprise the reader that the traditional problem here in the U.S. has been too much oil, not not enough.
Here is the story in the 1920s/1930s as recalled in an antitrust suit under the Sherman Act, United States v. Socony-Vacuum Oil Co.…
“When the black day of August 15, 1971 arrived, we free-market economists predicted that shortages of all sorts of products would result from the price control…. On the day of the freeze, everything seem[ed] to be functioning smoothly, and so the general mood [was] one of euphoric success.”
“When Tricky Dick imposed Phase I in August, 1971, price inflation was proceeding at something like a rate of 4% per year. Now, after 4 1/2 ‘phases’ of varying degrees of price dictation, and continued monetary inflation by the government, we are suffering a price inflation rate of something like 10% per year.”
August 15, 1971, was the day that President Richard Nixon shocked the country, and indeed the world, with a price control order. Everything—all goods and services, as well as wages and interest rates—were frozen for 90 days.…
“Affordable and reliable energy is key to human development. It gives people mobility and comfort in their homes. It provides access to better food and clean water.”
“The reason we made money [during the February Texas freeze] is because we prepared with winterization. And, importantly, we manned our facilities. We had our people out there, some with families at home in the dark and cold. They were keeping our facilities up and running so we had the ability to deliver a lot of gas that otherwise wouldn’t have been available to customers.” (Steven Kean, Kinder-Morgan, August 9, 2021)
The mainstream media might not like it, but there is a tripartite fossil fuel boom underway globally that will outlast the Pandemic–and outlive the repetitive climate scares from the IPCC reports.
A glimpse into the industry’s thinking was provided by the president and CEO of Kinder-Morgan, Steven Kean.…