Surging Gas Prices, Dwindling Supply

Gas prices are surging and the national average for a gallon of gasoline is hovering around $4 now.  Despite the pain, the Obama administration continues to pursue a strategy that will actually increase those prices.  Instead, we should be tackling the areas needed for a market-based and growth energy economy that will bring more American resources online and begin reducing the burden on the American consumer.

The Wall Street Journal recently said, “Rising gasoline prices, economists say, have sapped consumer confidence and altered spending patterns. They are slowing U.S. gross domestic product growth from an already sluggish level.”  Fortunately, the House appears ready to act.

On Thursday, the House of Representatives will consider the Restarting American Offshore Leasing Now Act (HR 1230) and possibly the Putting the Gulf Back to Work Act (HR 1229).

HR 1230 would require the Secretary of the Interior to conduct oil and natural gas lease sales in the Gulf of Mexico and off the coast of Virginia that have been delayed or cancelled by the Obama administration.

HR 1229 would simply require the Secretary of Interior to either approve or reject an application within 30 days of receiving it while giving specific reasons for delays or rejections of a permit. It would also establish an expedited judicial review process for resolving lawsuits relating to Gulf permits and require the Secretary to conduct a safety review to ensure that proposed drilling operations meet all safety system requirements.

The Bush administration established the current five year plan for lease sales from 2007-2012 and it included two Gulf of Mexico lease sales in 2011 and one in 2012 as well as a lease sale off the Virginia Coast in 2011.  Virginia Governor Bob McDonnell has recently backed Congressman Hastings’ efforts to move forward with the lease sale in lieu of the administration’s current permitorium approach.  The Obama administration and Interior Secretary Ken Salazar initially delayed the Virginia lease sale until 2012, but then announced all Atlantic Coast sales would not be available for energy development in the next five year plan from 2012-2017.

One year after the explosion of the Deepwater Horizon oil drilling rig, the federal government is still slowing new offshore oil and gas exploration and production. The US Energy Information Administration now projects a decline of 240,000 barrels per day in oil production from the Gulf of Mexico this year, representing billions of dollars in lost revenue and fewer jobs.

President Obama and his allies can continue to push out their myths, blaming speculators and oil profits and more, but the fact is there is simply too little new supply to keep up with growing demand which is even made more difficult by rising demand in India and China.  Congress should support HR 1230 and push forward with further measures to allow American energy potential to flourish in the free-market.

Please Share Your Thoughts