Monday, April 25, 2011

Political Angst & Rhetoric Abound Over High Gas Prices

April 22: As the national average for a gallon of gasoline approaches $4.00 and is well over that in many parts of the U.S., Republicans and Democrats are trading barbs about who is at fault.
    In his weekly address on April 23, President Obama laid out his plans to address rising gas prices over the short and the long term. He said, while there is "no silver bullet to bring down prices right away, there are a few things we can do." He said the Attorney General launched a task force dedicated to rooting out fraud or manipulations in the oil markets. He called for ending the $4 billion in taxpayer money that the oil and gas companies receive annually. And, he said we need to continue "safe, responsible production" of oil at home." And, in the long term, "we need to invest in clean, renewable energy." He said he strongly disagrees with a proposal in Congress that cuts our investments in clean energy by 70 percent.
    Senate Majority Leader Mitch McConnell (D-KY) said there are: "Simple Solutions to Provide Relief at the Pump." He said, "Increased energy costs are forcing some Kentucky businesses to lay off employees. A truck plant in Louisville has temporarily shut down due, in part, to high fuel costs. And Kentuckians across the state cringe every time they pull up to the pump. Gas prices have nearly doubled over the past two years. In some parts of the country gas costs more than four dollars a gallon. How did it come to this? President Obama's policies certainly haven't helped..."
    House Natural Resources Committee Chairman Doc Hastings (R-WA) issued a statement after the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) announced the completion of the draft supplemental environmental impact statement (SEIS) for oil and gas lease sale 218 in the Western Planning Area in the Gulf of Mexico. He said the announcement comes on the heels of the Natural Resources Committee passing H.R. 1230, "a bill that would reverse the Obama Administration's actions and proceed now with the scheduled lease sales in a prompt, timely and safe manner." Hastings said, "As Americans brace for $5 gasoline, the Obama Administration has quickly realized the outrage that would follow if 2011 was the first year since 1958 without an offshore lease sale. . . the Administration should move forward with other sales in the Gulf of Mexico and offshore Virginia that were scheduled to take place this year. The Administration has already determined that offshore drilling can move forward safely and responsibly, and now it's time to hold lease sales and issue permits to create jobs, lower prices, and produce more American energy."
    The Washington, DC insider publication, The Hill, published a timely analysis which they called, "Fact-checking the Washington rhetoric on oil, drilling and energy." The article addresses a number of questions and generally cites answers from the Energy Information Administration (EIA). Questions include: What impact will additional drilling have on gas prices?; How much oil did the United States produce in 2010?; Who is responsible for the increase in oil production in 2010?; How much oil will the United States produce in the coming years?; How many barrels of proven oil reserves does the United States have?; How does that compare with other countries?; What's the best way to determine how much oil the United States has?; How much oil does the United States consume?; and How much oil does the U.S. import?
    On the major question of the impact of more drilling on gas prices at the pump, the article cites EIA Administrator Richard Newell, in written testimony delivered to the House Natural Resources Committee March 17, saying: "Long term, we do not project additional volumes of oil that could flow from greater access to oil resources on Federal lands to have a large impact on prices given the globally integrated nature of the world oil market and the more significant long-term compared to short-term responsiveness of oil demand and supply to price movements." But Newell said that longer-term domestic production "would impact local economic activity, net oil imports, and the associated U.S. international trade balance resulting from oil imports."
    Also noted is that in 2010 domestic oil production reached its highest level since 2003 -- 5.5 million barrels of oil a day. U.S. oil production peaked at 9.6 million barrels a day in 1970. The U.S. consumed 18,771,400 barrels of oil per day in 2009, or a total of 6.85 billion barrels and in 2010 the figure was 6.99 billion barrels -- about one-fourth of the world's oil.
    Access the President's address (click here). Access a release from the U.S. Attorney General (click here). Access Sen. McConnell's release  (click here). Access the release from Rep. Hastings (click here). Access the fact check article from The Hill (click here). [*Energy]
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