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Public Statements

Failed Energy Policy Leads to Record High Gas Prices

Statement

By:
Date:
Location: Unknown

The media may no longer be paying attention to gas prices, but the American people are fully aware that fuel costs are on the rise again. The $3.72 national average gas price recorded on August 20 was the highest ever observed on that date. Prices have risen 9 percent over the past few months, making 2012 the most expensive year ever for drivers. According to USA Today, industry experts predict average prices could rise as high as $3.90 and remain above $3.00 even into autumn.

The good news is there are numerous policy changes we can implement to protect American energy prices from global market fluctuations and OPEC whims. Unfortunately, President Obama is pursuing an energy policy that does the opposite and recently released a plan that promises even worse.

The five-year drilling plan announced by the Interior Department in July would reinstitute a moratorium on offshore energy exploration, placing one of most promising sources of domestic oil off- limits. According to the Institute for Energy Research, there are nearly 86 billion barrels of oil reserves yet to be tapped on the Outer Continental Shelf. That includes 130 million barrels of oil and 1.14 trillion cubic feet of natural gas off the coast of Virginia and 24 billion barrels of oil off the Alaskan coast. Writing in the Washington Times, Institute President Thomas Pyle explains these restrictions have "embargoed nearly 200 years of domestic oil supply" while "oil production on federal lands dropped 13 percent last year, and the number of annual leases is down more than 50 percent from the Clinton era."

Although President Obama touts his energy policy as an "all-of-the-above" approach, when it comes to drilling his motto is more like "anywhere but here." On a trip to Brazil last year, President Obama encouraged drilling in that country, stating, "We want to help with technology and support to develop these oil reserves safely, and when you're ready to start selling, we want to be one of your best customers."

In addition to prohibiting domestic oil and gas producers from accessing American energy resources, the president also wants to raise taxes on the energy sector by removing the domestic manufacturing deduction enjoyed by every other industry to compensate for equipment depreciation. This expense would certainly be passed along to consumers in the form of even higher prices at the pump.

The billions of barrels of oil and gas the Obama administration has placed off-limits represent tens of thousands of jobs that either aren't being created or are heading overseas to nations that are willing to produce and sell their natural resources -- often at greater environmental risk than U.S. standards tolerate. The Keystone pipeline alone would create an estimated 20,000 direct jobs and 118,000 related jobs while transporting Canadian oil safely through Oklahoma and Texas. Instead, the president's resistance may well send those jobs and energy to China via the Pacific Ocean.

President Obama is not solely responsible for the 97 percent jump in gas prices since he took office. Yet the fact remains that the average price for a gallon of gas was $1.89 when his term began, and his administration's policies have failed to advance American energy independence in the three and a half years since.


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