Welcome to 2011; another year for President Barack Obama, whose energy policies are dictated not from the White House but from Abu Dhabi and Riyadh.
Obama’s Christmas gift to the nation was the December announcement by the President himself to clamp down further on domestic oil and gas drilling. Welcome to the New Year where pump prices now average more than $3 per gallon.
Despite the worst recession since the Great Depression, we are paying the highest gas prices since 2008. All thanks to Obama’s need to go Green, which is enriching Arab oil producers while putting America’s future at risk.
Obama regulators have been busy slipping in ill-advised energy policies. First came the pre-Thanksgiving announcement that oil exploration and drilling in Alaska would be curtailed. All for a good cause, said the Obamaites, to help save vast expanses of polar bear habitat. Then Obama’s Department of the Interior made a pre-Christmas policy change that would further cut domestic oil supplies by making energy-rich lands untouchable.
It seems that Obama forgot that designating Federal lands as wilderness areas was supposed to require an act of Congress. Yet the day before Christmas Eve, Obama’s Department of the Interior did a coup d’état. As a result, the Obama administration alone is able to judge where oil can or cannot be drilled. In doing this, Obama has thwarted George W. Bush’s policy that restricted unilateral action by the White House.
Then there is the drilling in the deep-water Gulf of Mexico. Nearly three months after the Obama administration lifted its ban, oil companies are still waiting for approval to drill the first new oil well in the Gulf. In fact, the petroleum industry expects the wait to continue until the second half of 2011, and perhaps well into 2012.
This long delay by the Obama administration is costing Big Oil billions of dollars that they have tied up in Gulf projects; projects that are now on hold while petroleum companies pay out thousands of dollars every day on rigs that stand idle.
Last week the Wall Street Journal wrote this indictment of Obama’ energy policy:
“Their impact goes beyond the oil industry. The Gulf coast economy has been hit hard by the slowdown in drilling activity, especially because the oil spill also hurt the region’s fishing and tourism industries. The Obama administration in September estimated that 8,000 to 12,000 workers could lose their jobs temporarily as a result of the moratorium; some independent estimates have been much higher.
“The slowdown also has long-term implications for U.S. oil production. The Energy Information Administration, the research arm of the Department of Energy, last month predicted that domestic offshore oil production will fall 13 percent this year from 2010 due to the moratorium and the slow return to drilling; a year ago, the agency predicted offshore production would rise 6 percent in 2011. The difference: A loss of about 220,000 barrels of oil a day.”
All of which leaves America more susceptible to an Arab oil embargo. The last one happened in the 1970s when the U.S. was pumping twice as much oil as it is now.
With the U.S. gulping more foreign crude than ever, Arabs could bring America to its knees. You would think that a President as smart as Obama would understand the risk he is putting the nation in; a nation which he has sworn to protect.
Perhaps the greatest waste of American resources is out West where there is potentially hundreds of millions of barrels in oil reserves and trillions of cubic feet in gas deposits; all of it just waiting to be drilled and pumped to a thirsting nation. Yet our President is obstructing America from meeting its energy needs.
Ben Lieberman of The Washington Times explains:
“Utah is particularly hard hit, with up to 6 million acres in jeopardy of being locked away from development. Rep. Rob Bishop, Utah Republican, told The Salt Lake Tribune, “[This decision will seriously hinder domestic energy development and further contribute to the uncertainty and economic distress that continues to prevent the creation of new jobs in a region that has unduly suffered from this administration’s radical policies.”
But there is more. Two days before Christmas the Environmental Protection Agency (EPA) undertook a Pearl Harbor-like pre-emptive attack on U.S. refiners with an order that will place severe limits on carbon-dioxide emissions. The EPA, in language Joseph Stalin would have been proud of, said: “The details have yet to be determined.”
The Moroccan Candidate
The bottom-line is that under Obama, Washington is certain to increase the cost of converting oil into gasoline. If you are looking forward to spending $5 per gallon at the pumps, you will love Obama’s bold new move to make America more green.
The $5 per gallon is not just a number I picked out of the air. The former president of Shell Oil says that’s entirely possible as high demand pushes the price of crude oil higher and higher.
Culminating some time by the third quarter of 2012, retail pump prices in places like California and New York will reach roughly $5 per gallon, said former Shell Oil president John Hofmeister.
Former energy secretary Bill Richardson was asked about Hofmeister’s stark prediction: “I hope he’s wrong, but this is a very volatile energy market and we haven’t moved as fast as we should in America towards reducing our dependence on fossil fuels.”
Hofmeister underscores the urgent need to develop domestic oil production and he even accuses the Obama administration of being anti-oil.
“I have no problem moving beyond oil but not today, not tomorrow, not 2011 or 2012. We can’t. It’s simply impractical and unreal,” Hofmeister said.
Meanwhile, the Department of Energy (DOE) has put out a statement saying it will continue to pursue responsible oil and gas production while focusing on vehicle efficiency standards and investing in electric vehicles, bio-fuels and mass transit.
Obama’s DOE must think America alone can make the Earth green. What the President seems to forget is the fact that China, India and Russia, along with a host of Third World polluters, are using coal and even wood furnaces to drive their industries.
It appears to me that Obama’s Green policies are nothing more than collateral damage to a nation that needs domestic petroleum and the jobs that that industry provides. Instead Obama’s policies seem to be helping Arab oil exporters.
If you think I exaggerate, consider this from the Dec. 29 Economist, not known as a bastion of conservative ideals: “Mr Obama’s team of managing the Middle East is even more inept than Mr Bush’s. The American right and many Israelis think he is too pro-Arab.”
Dubya Billboard: “MISS ME YET?”
People in the petroleum industry don’t believe Obama is pro-North America, at least not when it comes to energy. Canada’s oil sands — which help keep America on the road every day—have been labeled “dirty oil” by Obama Democrats (as if the crude they pump out of the Saudi desert was somehow clean). And given the political realities that exist in many parts of Alaska, Sarah Palin has a greater chance of hitting a gusher with an errant shot from her AR-15 than Big Oil has with a drill-bit.
Despite Bush’s multiple mistakes in the Middle East, he was a patriot who at least wanted to ramp up domestic oil and gas production. That’s not true of Obama, who seems intent on increasing America’s dependency on Arab oil.
As I write to you, oil has topped $90 per barrel. I believe that by summer it will break over $100 per barrel. That makes Big Oil a good investment. But at what cost?
Under Obama’s presidency we are headed for an energy crisis worse than anything President Jimmy Carter could have engineered. Just how high oil prices will go I don’t know. Much depends on what happens in the 2012 election.
Yours in good times and bad,
Myer’s Energy and Gold Report