Keystone Pipeline Cancellation--What does it mean?

In light of gas prices over $3.50 and forecasts of $5.00 per gallon; threats of closing the Straits of Hormuz; the Chinese appetite for oil, one would think that the President would be doing everything in his power to increase the supply, yet it is reported today by Reuters in an article by Jeff Mason, that he will reject the Keystone oil pipeline.

It might come down to a political calculation. He does not want to upset his "green" base. Environmentalists have been pressuring him to cancel the pipeline, so it appears he has caved therefore ensuring that he gets their vote in November.  Our question is, where will they go? They would not vote for a Republican and voting for anyone else would mean throwing their vote away. So what else could be the reason?

The labor unions have been in favor of the pipeline as they feel there will be jobs for their members. So, Obama is willing to anger the unions but not the environmentalists? Does that make sense?  Why would he do that?

Complicating the picture even more, Canadian officials have reportedly been telling the White House that if the pipeline is not built, they will build their own and send the oil to China. The Chinese have been aggressively been looking for alternatives to Middle East oil so this would be a windfall for them. Why would Obama put us in this position?

There might be many answers, all of which  could be partially correct, however, we feel that the reason is simple. He wants the US economy to crash which it would do at $4 per gallon or more. 

If one would take a flyer and  suppose that one or more the following events occur:

    --The Straits are closed by Iranians sinking a tanker in the shipping channel

    --One or more US refineries are hit by terrorists

    --Canada ships its oil to China

    --Mexico's oil fields are closed down to violence

    --South American sources of oil are purchased by China

    --All Gulf drilling is suspended

    

What would be the result? Prices would jump significantly forcing the economy into a major decline. Unemployment would increase dramatically. Dissatisfaction indexes would hit new highs.

Would that not hurt his re-election chances?  Isn't that why he is not doing the pipeline? NO, not if there are no elections! If he can make the situation deteriorate over the next ten months to the point where civil disturbances (riots) are occurring, he can declare martial law and suspend elections!

Whoa there Conservative Tom, we can hear you saying, isn't that a bit "out there?" Yes it is, however why else would he not be doing everything in his power to make the US energy independent. (I am not convinced that "green" energy will anytime in the near future provide the necessary supply to replace oil.)  Energy drives our economy yet threats  around the world makes it from other countries not a guaranteed proposition. So there must be another reason.  If not this idea, what is yours?

We are listening. Tell us your idea.

Conservative Tom

 

Obama set to reject Keystone oil pipeline: sources

By Jeff Mason | Reuters – 

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WASHINGTON (Reuters) - The Obama administration was poised on Wednesday to reject the Keystone crude oil pipeline, according to sources, a decision that would be welcomed by environmental groups but inflame the domestic energy industry.

The administration could make its announcement onTransCanada's Keystone XL pipeline late on Wednesday or on Thursday, a source familiar with the matter told Reuters.TransCanada Corp. shares slid more than 3 percent after the news.

"We're expecting the pipeline to be rejected," the source said.

TransCanada's planned 1,700-mile pipeline has become a potent symbol in the battle over of the future of U.S. energy policy.

With environmental groups concerned about carbon emissions from oil sands production, the administration in November delayed a decision on a presidential permit for the project until 2013.

But lawmakers that support the project were able to attach a measure to a tax-cut law passed at the end of last year that set a February deadline for a decision on whether the project is in the national interest.

The pipeline has placed the Obama administration in the middle of a dispute between two key parts of its voting block: green groups who oppose the pipeline over concerns about climate change and some unions who back the project because of the jobs they believe it would create.

The administration has said it needs more time to consider alternative routes for the pipeline, which originally was planned to traverse sensitive habitats and a crucial water source in Nebraska.

(Additional reporting By Roberta Rampton, Jeff Jones; Writing by Ayesha Rascoe; Editing by David Gregorio)