Environmental groups have railed for years against President Bush and the Republican Congress, calling on them to resist drilling the nation’s public lands.
July 2008
Oil prices could hit $300 a barrel if the United States does not take drastic action to reduce its heavy dependence on foreign oil, but neither of the top presidential candidates is addressing the crisis, Texas oilman T. Boone Pickens said Monday.
With energy prices on a steady climb, consumers have been looking for ways to cut back. They are driving less, turning down the pool heaters and using fans instead of air-conditioners.
Bush administration officials agreed that greenhouse gases could endanger the public and should be regulated under clean-air laws, but later reversed course amid opposition from Vice President Dick Cheney's office and the oil industry, a congressional report said.
The national debate over opening more offshore areas to oil and gas exploration has begged the question: Just what are the companies doing with the tens of millions of acres they're already leasing from the federal government?
President George W. Bush this week rescinded the executive order that his father President George Bush signed in 1990 prohibiting oil and gas exploration in 85% percent of the Outer Continental Shelf surrounding the lower 48 States. He then challenged Congress to remove the congressional moratorium on oil and gas exploration in those OCS waters that has been in place since 1982. He should have done this a long time ago, but now it’s up to Congress to drop the moratorium and then up to the next administration to put some offshore leases up for bid. Don’t hold your breath (see next four items).
House Appropriations Committee Chairman David Obey (D-Wisc.) said this week that he didn’t see any point in trying to pass appropriations bills for the various departments of government until the Republicans on the committee led by Rep. John Peterson (R-Penna.) dropped their demands to hold a vote on lifting the congressional moratorium on OCS oil and gas exploration. The fact is that the House Democratic leadership opposes increasing domestic oil production and favors importing more and more of the oil that we consume. They also support higher gasoline prices in order to reduce greenhouse gas emissions, but of course that is not something they can say out loud.
The House again failed to pass the Drill Responsibly in Leased Lands (or DRILL) Act, H. R. 6515, by a vote of 244 to 173. The Democratic leadership brought the bill up under suspension of the rules, which requires a two-thirds vote. They did that so Republicans could not offer an amendment to open OCS areas to oil and gas exploration. The DRILL Act would prevent oil companies from bidding on new federal leases unless they were producing oil on the leases that they already hold. With oil at $140 a barrel, the oil companies have every incentive to produce as much oil on the leases they have already paid for as they can. But there are obstacles: it takes years to get through the permitting process before you can start drilling and then environmental pressure groups file lawsuits, which can take years to resolve. And even after exploratory wells are drilled, there is another frequent obstacle to producing oil: no oil is discovered. See Oil Leasing 101 below.
Senate Majority Leader Harry Reid (D-Nev.) is going to try to bring a bill to the Senate floor next Tuesday that would go after oil speculators who, it is claimed, are driving up the price of oil. Republican leaders are demanding that votes be allowed on amendments to open OCS areas to oil and gas exploration, so my guess is that it’s unlikely that Reid will move forward. I don’t know what role speculators have played in driving up the price of oil, but there is a simple way to end any speculative bubble: open up federal OCS areas and ANWR to oil and gas exploration. The prospect of increased oil production would bankrupt speculators who have bet the farm on ever higher oil prices.
As the price of oil and natural gas soars, many customers are looking to coal as an alternative fuel. That means a boon for suppliers — and a potential bane for the environment.
Paul Chesser, Climate Strategies Watch
Economist friend Dr. David Tuerck, executive director of the Beacon Hill Institute based at Suffolk University in Boston, had this to say yesterday in response to Al Gore's speech on going 100-percent to renewable sources for energy generation:
"Al Gore wants to be Rachel Carson but has revealed himself to be Carrie Nation. He talks about protecting the environment, when all the while he really just wants to banish fossil fuels from the marketplace.
"There is no better example of his prohibitionist mentality than his recent demand that the United States produce 100 percent of its electricity from renewable and carbon-free sources in 10 years. Only about 30 percent of our electricity currently comes from these sources. The question is what will happen to the fossil fuels that are used to make the remaining 70 percent, once those fuels are no longer used to produce electricity. The answer is that they will find their way to the market place to be used, as they are now, to produce energy, whether in the United States or abroad.
"A “strategic initiative” that is aimed at substituting alternative fuels for fossil fuels in the production of one kind of energy is doomed to failure unless it somehow eliminates the value of using the same fossil fuels to produce other kinds of energy. If Mr. Gore really wants to spur the United States and other countries to use alternative fuels to produce electricity or any kind of energy, he should just sponsor legislation to prohibit the use of fossil fuels. Otherwise, he is just blowing smoke."
Beacon Hill has weighed in on the absurd economic claims promoted by various state climate commissions.
The next blow from high energy prices could come in the dead of winter.
The nation's frantic search for crude-oil sources is leading to one of the oldest, richest and most-elusive prizes in the petroleum industry: oil shale.
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