Drilling for Oil Is Not the Answer
Why is Bush the most unpopular president in the history of political polling? Maybe it’s because he thinks Americans are fools. Last Monday, Bush signed an executive order to reverse his 7½ year policy against oil drilling in some offshore areas, falsely suggesting that it will help lower the soaring price of gasoline. Bush’s flip-flop on offshore drilling is just the latest attempt to divert attention from the conservatives’ failed energy policies.
Since George Bush took office, the price of gasoline has skyrocketed. When Bush took office in January 2001, the average price of regular gasoline was $1.47 per gallon. It’s now $4.10 (as of June 30, 2008). Even adjusted for inflation, gas prices have more than doubled under the Bush administration. As a result, the average household will spend about $2,300 more on gasoline this year than in 2000 (adjusted for inflation). [CAF]
Bush and McCain are cynical flip-floppers on oil drilling. Since the Reagan Administration, offshore oil drilling has been banned on most of the outer continental shelf. Until June 2008, Bush and McCain opposed lifting that ban. [New York Times] And while Bush has favored drilling in the Alaska National Wildlife Refuge (ANWR), he could never persuade a conservative-dominated Congress to approve that scheme. Even McCain opposes it. [New York Times]
New drilling wouldn’t bring the first drop of oil to market for at least 10 years—and they know it. Normally, it takes years—to set up operations, dig test wells, and build a functioning oil rig—before any oil goes to market. On top of that, all of the oil drilling ships in the world are booked for the next five years. [New York Times] So it would take 10 years before any oil is pumped out of new offshore wells, and about 20 years before those wells would reach peak capacity. The Bush Administration admits there could be no oil production in the Alaska National Wildlife Refuge until 2018 and production would not peak until 2027. [U.S. Department of Energy]
Even at peak capacity in 20 years, new oil drilling won’t lower gas prices—and they know it. There is simply too little oil in these offshore areas to affect global supply. Bush’s own Department of Energy shows that by the year 2025, ANWR drilling would lower crude oil prices by only 75 cents per barrel (which amounts to about 2 cents a gallon at the pump). [U.S. Department of Energy] The latest government estimate for new offshore wells estimates that, even in 20 years, they would pump only about one-fifth as much oil as ANWR and therefore “any impact on average wellhead prices is expected to be insignificant.” [U.S. Department of Energy]
Since 2001, Bush and his allies have blocked every reasonable measure to promote U.S. energy independence. Bush slashed Department of Energy programs that promoted conservation, efficiency, and renewable energy sources. [Center for American Progress] Bush and Senate conservatives killed 2007 legislation that would have required 15 percent of our electricity to come from renewable sources, and they continue to block the Renewable Energy and Energy Conservation Tax Act of 2008. [Washington Post] And during the years when conservatives controlled Congress, they did nothing to improve fuel efficiency for cars and SUVs. In December 2007, the day after Bush finally signed Democratic legislation which modestly increases fuel efficiency standards, the administration blocked laws enacted in 18 states that would have improved auto-efficiency rules for a majority of Americans. [New York Times]
The Bush-McCain-conservative wail that we should authorize new oil drilling to address gasoline prices is a hoax. They know perfectly well that drilling offshore or in the Alaskan wilderness would produce no oil for a decade. They know perfectly well that even in two decades this new offshore and Alaskan oil would have almost no effect on the price of gasoline—because Bush’s own Energy Department says so. After Bush and his allies have spent the last 7½ years wrecking our nation’s energy security, why would any American believe them now?
It’s time for American energy policy to benefit Americans—not giant multinational oil companies. The current cry to open up risky areas for oil drilling will benefit no one except the big oil companies. These are the same companies that are now raking in record profits. In recent years, the oil industry has given tens of millions of dollars in campaign contributions to conservative candidates. John McCain alone has received over $1 million in contributions from the oil industry. [Center for Responsive Politics] It’s time to stop the special-interest dealing in Washington and enact practical policies that will end America’s dependence on foreign oil.
The oil companies themselves are responsible for the lack of drilling in 68 million acres of federal land. There are 91.5 million acres of federal property onshore and offshore that are currently leased for oil and gas drilling. But only about 23.5 million acres, just over 25 percent, are actually producing oil and gas. [Committee on Natural Resources] There are 68 million untouched acres could produce far more oil than the disputed off-shore and Alaskan areas. Before we consider letting oil companies drill in areas that could ruin the California or Florida coasts, let’s insist that they first drill in the millions of acres that could have been producing oil already.
The short term solutions are: release oil from the Strategic Petroleum Reserve, crack down on speculation in oil futures, and investigate oil companies for price-gouging. Bush should release supplies from the Strategic Petroleum Reserve that now holds close to 700 million gallons to start pushing prices downward. The Bush Administration should reverse its ruling that opened up oil-futures speculation to hedge funds and other new institutional investors. And the Justice Department should begin investigating whether the big oil companies have engaged in price fixing.
The long term solution is to make America energy independent by investing in conservation, energy efficiency, and clean power. Energy conservation is the fastest method to make a major difference in oil prices—we can save millions of barrels of oil much more quickly than we can produce new oil, and the effect on prices is the same. Increasing fuel efficiency standards to an average of 32 miles per gallon would save sixteen times more oil than could be produced by new offshore drilling. [CEPR] Ultimately, the only way for our nation to become energy independent is to invest in clean power sources such as wind, solar energy, and geothermal energy—which will also help solve the problem of global warming.