A gallon of regular gas in Caracus,Venezuella, costs 12 cents. In Saudi Arabia, gas is at 91 cents a gallon. So, why, when we have more fossil fuel deposits in America on shore and off shore than either of those countries, are we paying $4.00 a gallon or higher? Could it be unbounded politics?
As an op-ed piece in the Wall Street journal put it: “For decades—going back to Jimmy Carter—politicians have been peddling an America free of fossil fuels…” President Obama has raised the anti-petroleum ghost to a new level of fear linked to the misguided theory of global warming.
To satisfy his left-wing base of narrow-minded environmentalists, along with his own twisted ideals, Obama’s administration has blocked drilling for oil and gas, proposed new taxes on oil companies, and called for costly restraints on carbon emissions while persistently touting the ethereal promise of green energy.
Although the bloated Federal budget, deficit, and debt are drawing the focus of political Washington, our stifling energy policy is contributing to the economic conditions which, in turn, influence our spending and debt as well as our high unemployment.
Increased access to domestic oil and natural gas—rather than increased taxes on the U.S. oil and gas industry—is the best strategy for increasing government revenue, jobs and energy production, according to a new study by Wood MacKenzie, the global research and consulting firm.
What the political know-it-alls won’t tell the public is that America has more recoverable fossil fuel resources than any other country on earth. More than any Middle Eastern country, more than Russia, more than China, the Congressional Research Service (CRS) reported recently. It compared various countries in terms of estimated amounts of oil and gas discovered or existing in unexplored areas but considered recoverable using present technology.
The CRS estimate of oil and gas doesn’t even include coal, with U.S. reserves of 262 billion tons. That’s 28 percent of the world’s coal. It doesn’t attempt to quantify the new frontier of methane hydrate (methane locked in ice). This gas source has “immense” energy potential, possibly exceeding the combined energy content of all known fossil fuels, according to the Congressional Research Service. It could eventually be available if the environmentalists of the Left will permit it.
Nor are shale oil deposits included in the CRS estimate. Shale oil and gas are being uncovered rapidly with the new technology of fracking—pumping water and chemicals at high pressure far below the surface to break up the shale and release gas.
The environmental extremists are already whining about fracking, claiming the drilling fluids applied to get the oil and gas from deep shale formations contain carcinogens hazardous to clean water.
These charges, according to a Wall Street Journal story April 18, are being supported by Senate Democrats who are always ready to spoil technological advances. Industry says there’s no evidence these fluids have found their way into water supplies. Nearly 800 million gallons of drilling fluids have been pumped deep into the earth in the past few years.
The White House defensively bragged that last year U.S. oil production reached its highest level since 2003. Obama apparently was unaware that it takes years for a leased area to begin producing. So, the credit for last year’s rise really goes to the Bush administration. Once again the administration had its facts wrong.
The Left seems tied to the stake of green energy, even though it holds little promise today or in the foreseeable future. Green energy, be it windmills or solar panels, exists only because the Obama administration is causing the cost of its competition to soar and because Obama has dumped billions of dollars into the pockets of his cronies to subsidize green projects.
But for the immediate future, U.S. oil and gas companies are a major force in our economy. “These companies produce most of the nation’s energy, put millions of people to work and deliver billions in taxes and royalties to our government.” as American Petroleum Institute President Jack Gerard pointed out.
The Wood MacKenzie study looked ahead. It said increased access could by 2025 create 530,000 jobs, deliver $150 billion more in tax, royalty and other revenue to the government, and boost domestic production by four million barrels of oil equivalent a day….Raising taxes on the industry with no increase in access could reduce domestic production by 700,000 barrels of oil equivalent a day (in 2020) and reduce revenue to the government by billions of dollars annually.
Although more access would eventually replace oil imports, it would not necessarily drive gasoline down to dime-store prices, an API senior manager explains. “We are in a global market for crude oil. Even if we were entirely self-sufficient in crude oil, the price of that crude would be determined by all the thousands of buyers and sellers in the world’s market, not just by us…All we know for sure is that the benefits—jobs, tax revenue, energy security—would be greater.”
Strident environmentalists have long predicted that we will soon be running out of oil. To the contrary, over the past 30 years, the world’s proven reserves have increased 130 percent.
Some Democrats also are calling for a “use it or lose it” policy regarding oil and gas leases. They claim companies are sitting on scores of leases that could be used to search for oil. Obama said in a speech that the industry “holds tens of millions of acres where its not producing a drop.” But the problem is not with leases. It’s with permits. Permits have been tied up with over-burdensome regulations. Again, Obama speaks with a forked tongue.
Adding a spit in the face to industry, the Administration saw fit to lend $2.84 billion to Columbia for an oil refinery, it was revealed April 19. According to reports, the money would go to Reficar, a wholly owned subsidiary of Ecopetrol, the Columbian national oil company. This is part of a $5 billion refinery upgrade project supplying petroleum, products for domestic and export purposes. Who knows what energy misdeeds lie ahead?