Oil prices have been on the rise recently, with supply worries from the unrest in the Middle East pushing prices past $106 a barrel this morning, the highest in two years. Americans are feeling the sting of an average $3.50 a gallon price at the pump, with prices as high as $5 a gallon in some areas such as L.A.
The Obama administration has issued contradictory statements on the high oil prices. On Friday the Obama administration appealed a judge’s ruling that the Department of Interior stop holding up the application process of several deepwater drilling permits. The move effectively continues the de facto ban on deepwater drilling in the Gulf. On Sunday however, White House Chief of Staff Bill Daley said the Obama administration is considering tapping into the U.S. Strategic Petroleum Reserve as one way to help ease soaring oil prices.
Interior has imposed a de facto moratorium on deepwater drilling since the BP oil spill last year.
Legally, companies can still apply for permits, but they are generally either refused or held up indefinitely with bureaucratic red tape. Since the spill, only one new permit has been issued — that occurred last Monday. The recipient was Noble Energy, and for a well partially owned by BP.
The administration’s foot-dragging is cutting off access to several large proven reserves, as the Gulf Region accounts for one-third of U.S. crude oil production, according to the U.S. Energy Information Administration.
The SPR is far less useful to the economy than newly producing oil wells. It holds only 726.7 million barrels — that’s enough to keep running America for 34 days in the event of a catastrophic oil cutoff, but the distribution capacity is limited, allowing for only 4.4 million barrels of oil to be withdrawn each day.
Read more at the Washington Examiner.
- As Gas Heads To $5, Obama Seeks To Block New Drilling (thedaleygator.wordpress.com)
- Administration ACTS To Block USA OIL PRODUCTION (dewgeneral.wordpress.com)
- Gas Prices Head Toward $4.00 Per Gallon & Obama Admin Appeals Oil Drilling Ruling (scaredmonkeys.com)