May 23, 2011
If we'd increased drilling 10 years ago things wouldn't be so bad today
Nearly a decade ago, the retail price for regular gasoline rose 26 cents per gallon in eight weeks to an all-time high of $1.75 per gallon. The government's Energy Information Administration (EIA) was tasked with an "Inquiry into August 2003 Gasoline Price Spike." We were waging the War on Terror, labor unions were striking, hurricanes threatened oil rigs while terrorists threatened refineries, demand for energy was creeping to a new high, and international markets drew down their inventories.
Throughout the debate to stabilize skyrocketing energy prices in 2003, Democratic Rep. Ed Markey of Massachusetts did everything he could to prohibit energy exploration and development in the Arctic National Wildlife Refuge (ANWR). He argued: "We won't see a drop of oil from the refuge for 10 years. ...10 years from now [production] might reduce gas prices by about one cent."
Nearly 10 years later -- had lawmakers ignored Congressman Markey (and others), billions of barrels of crude would be coming on line now. Would that be enough to stave today's escalating price of energy? We'll never know.
What we do know is that most of us are now paying more than $4 a gallon for gasoline because of growing demand, tightening supply, Mideast instability, and inflation.
Here's what else we know:
-- The president's yearlong de facto moratorium on deepwater exploration in the Gulf of Mexico has artificially tightened supply -- by 375,000 barrels of oil a day, or, as the EIA forecasts, a 13 percent drop in offshore oil output from 2010 estimates.
-- The president's choice to prohibit deepwater drilling in the Gulf for a full year costs jobs. Tens of thousands of workers and their families are suffering because the administration's opaque energy policies have kept them from working. In Baton Rouge, the civilian unemployment rate jumped from 6.6 percent to 8.2 percent (from March 2010 to this past March). That 1.6 percent drop in employment was the worst for any U.S. city, followed closely by a 1.3 percent drop in New Orleans .
-- The president isn't opposed to drilling for oil, just not off U.S. shores. The president prefers that Americans enrich Brazil -- both as a customer of its oil exports and as the beneficiary of our experts and innovative technologies leaving the Gulf of Mexico.
-- The president's position on domestic energy production will not put Americans back to work exploring for new sources of affordable, abundant energy, or ease our pain at the pump, or make us less reliant on oil imports.
-- The president could do something about this. He could direct his interior secretary, Ken Salazar, to expedite the release of previously approved permits and start issuing new deepwater permits to explore for domestic oil. But we know that he won't.
So it's left up to Congress to put America back on the right track.
Over the past two weeks, the House of Representatives approved legislation to help create thousands of jobs, lower gas prices, and generate millions of dollars to pay down our federal debt. H.R. 1229, appropriately titled "Putting the Gulf of Mexico Back to Work Act," would set stringent deadlines for the Interior Department to act on drilling permits, H.R. 1230 -"Restarting American Offshore Leasing Now Act"- would require the Interior Department to revive offshore lease sales and just yesterday a large majority of the House approved H.R. 1231, legislation to reverse President Obama's Offshore Moratorium Act. Thanks to Congressional Budget Office estimates, we know that if enacted H.R. 1230 would bring $40 million in federal revenues over the next decade.
It shouldn't take an act of Congress (or two) to compel a federal agency to do its job, and yet we know that it has come down to this. It took two federal court orders and a civil contempt citation before Interior Secretary Salazar lifted an unlawful moratorium on oil drilling in the Gulf and released a paltry number of permits approved more than a year ago.
Our nation needs more jobs, lower gas prices, and less dependence on foreign oil. If President Obama won't lead the way, we simply ask him to stop blocking the way.
Markey was right in one sense: It does take up to 10 years to find a viable well and get that oil to Americans. The question is, a decade from now -- when there's no new oil production off the Gulf of Mexico -- will we be asking ourselves, "What if...?"
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