Call this a case of sex, drugs and crude oil.
It was recently reported that federal investigators discovered an Interior Department group [1] overseeing the collection of oil and natural gas royalties allegedly had sex with subordinates and customers, engaged in illegal drug use and accepted gifts from oil company employees.
Sen. Bill Nelson, D-Fla., appeared on CNBC’s September 11 “Power Lunch” to discuss the story calling it “a very sad occasion.” Nelson also voiced opposition to opening waters off the western coast of
Immediately following Nelson’s interview, CNBC Media and Technology Editor Dennis Kneale responded. Kneale warned the “sex for oil scandal” would be exploited by Democratic presidential nominee Sen. Barack Obama,
“If this is such a sad story about sex for oil, why was the senator smiling, number one?” Kneale said. “Number two, this will be an Obama ad within about six minutes from now. Number three, not one shred of evidence that I read about says that in exchange for sexual favors and cocaine – some oil company got some big break.”
Kneale reasoned the scandal shouldn’t be used to for political purposes. According to the CNBC segment, oil revenues are the second largest source of revenue for the government, behind taxes. The government actually came out ahead in his estimation.
“In five years, they said, the oil companies collected an extra $4 million because of some adjustments to contracts,” Kneale said. “They have received tens of millions of dollars in extra income to the government because they got oil back. It’s simply, it’s unrelated. This office is collecting billions of dollars from the oil companies and you come up with $4 million in five years that benefited the oil companies and you can’t even prove it was ’cause someone got a fun time?”
Kneale also noted the potential for political motivations behind the report that exposed the scandal.
“The Democrats are going to make use of this,” Kneale said. “They love this. By the way the inspector general who put out this report – just know, he is not a Bush appointee. He happened to come in a year before the Bushies took over. Just an interesting fact.” Bill Clinton was president during that time.