15 billion gallons of oil in the Gulf of Mexico

Chevron Corp. said Tuesday it had successfully drilled for oil in the Gulf of Mexico’s deep waters, and one published report suggested the breakthrough could increase U.S. oil reserves by as much as 50 percent.

The Wall Street Journal cited Chevron officials as estimating recent discoveries in the Gulf of Mexico could hold as much as 15 billion barrels of oil and gas reserves. That would boost U.S. current reserves by 50 percent.

It would seem to me as soon as these new wells come online, our reliance on the Middle East should be marginalized. We’re already been leaning more and more on Mexico and Canada. Once this well, and others yet found in the Gulf and elsewhere, the political dynamics of the US regarding the Middle East should change. No longer will there be any incentive at all to look the other way when Saudi Arabia disses the US. No longer will there be the “it’s all about oil” copout when we try to deal with Iraq. The radical elements of the Middle East are funded by the excessive wealth being generated by oil which the US in large part buys. Although China and other countries will quickly fill our void buying their oil, it eliminates a stigma when the US tries to do something about these radical elements. And, more importantly, it eliminates a weapon the Middle East terrorists have against the US vis a vis attacking oil production facilities. They don’t seem too concerned about attacking Chinese interests there.

Start drilling tomorrow Chevron. If you need help getting it up and going, I’d think it be in the best interests of Homeland Security to help them get it going. And, don’t forget, with the increased reserves and production, I expect a discount at the pump!

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  • http://americancassandra.typepad.com/americanphoenix/ American Phoenix

    One boo boo in your article. The United States only buys about 25% of its oil from OPEC Countries (not all of which are in the Middle East, so the percentage is even lower for countries from the Middle East). We produce about half of what we use and import another approximately 25% from Non-OPEC countries. The problem isn’t the U.S. as much as it is the rest of the world, which buys much larger quantities of oil from the Middle East.

    The best thing about this is that tapping such a huge reserve will bring the price down, sapping a source of income to dictatorships such as Iran.

    One more thing… You can get the statistics at: http://www.eia.doe.gov/oil_gas/petroleum/info_glance/petroleum.html

  • Moonage

    Although I didn’t get into the percentages, when you’re running at maximum demand, even the little players have a disproportionate amount of impact on the price. That, let’s say 20%, that comes from the Middle East is not a real figure in regards to price because even the non-OPEC countries usually allow the OPEC countries to set the price. If we get nothing from the Middle East countries, that allows us to shop at will as opposed to relying on the OPEC countries. I know that doesn’t really make a lot of sense at first read, but look at it this way, if we get nothing from OPEC at all, and beef up our supply a little from Canada, Russia, and Mexico, then we are negotiating individually with non-organized countries and I think that would do more to undermine the OPEC strategy than anything else.

    And yeah, what it does is sap a source of income for tyrants we’d prefer not to deal with, which leaves the only means for negotiating being a common need for something else ( military defense systems, economic incentives, etc.. ).

    The perception of the US being sold to oil interests would change the US political dynamics as well as SOME people won’t have that as a strawman to toss out regarding almost any international policy debate as well.

    The only downside, and it’s a big one, is I hope it doesn’t scuttle the rush to alternative energy sources. Even if they find two or three more of these wells, oil is still most likely a finite resource and with the growing economies of China and India, becomes more finite a lot more quickly than it was in the past. We still need to focus on getting away from oil.

    But, cheaper gas prices would still be a good thing till it happens. It’s a lot easier to adjust when you can afford it.

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