Vegas Moves to Wall Street, or Maybe…
…Vegas has been on Wall Street all along? Today’s headlines scream of oil prices skyrocketing upwards, like so many mortar shells over Tripoli lately. Uncle Sam, the major consumer of the black gold, reads the headlines and takes another sip of coffee and shakes his head. And then we collectively will soon be opening our wallets to shell out 4 bucks for a gallon of gas.
It’s not us. It’s not Big Oil, as good a villain as Central Casting could ever come up with. It’s not Libya. Or any other OPEC nation. It’s our good buddies making bets down on Wall Street about oil futures.
It’s not us: We’re not consuming like we used to. Better cars, less people on the road (that would be the jobless people that are not driving to work anymore, thanks!).
It’s not Big Oil: everybody hates ’em, but the boys with the drilling rigs punching holes in dirt, seawater and everywhere else there might be oil (fun places like Angola, Russia, and other “off the tourist map” locales) have done their job in getting the stuff to us.
It’s not Libya: this little country in flames (and I think we’re all hoping they can oust Crazy Guy into exile ASAP) is way down on the list of OPEC producers’ tally sheets. It pumps up about 1.2 million barrels a day. And get this. At one facility recently completed in Saudi Arabia—Khurais—the capacity is (you guessed it) 1.2 million barrels a day. One facility. “60 Minutes” was there and saw it. And you can You Tube that episode and see it for yourself. Khurais is a monstrosity, and all Saudi Arabia has to do is open the valves. And heeerrrrreeeee’s your oil! And the Khurais Field doesn’t come close to matching the Ghawar Field there, the world’s largest.
Here’s your culprit: It’s the guys and gals down on Wall Street betting oil futures. They’ve bet so much (to pad their wallets) that Cushing, Oklahoma, has orders right now for six times its capacity. Six times capacity! There’s nowhere to put the oil, even if Saudi Arabia and every other OPEC member turned on the faucets, ran the stuff through pipelines to tankers and pointed them for the USA.
You can’t blame the Wall Street crowd. It’s a gamble and they’ve got the money. I go to Vegas, walk up to a craps game and I’ve got maybe $300 bucks to throw in to lose. Everybody else around the table (wow, there’s Charlie Sheen, Crazy Guy #2) has got around $50,000 and they’re ready to play. They could crap out and then, voila, we’ve got $2 a gallon gas. Sometimes you win, and sometimes…
I think I’ll leave the craps game and go down The Strip to one of the magic shows. I’m not driving there. I’m walking.