In the debate over rising gas prices, Washington is creating a massive distraction: whether Congress should eliminate tax “subsidies” for oil and gas companies. Of course oil and gas companies don’t receive checks, grants, or direct payments from the federal Treasury, so the debate is a red herring. What’s really needed is price relief for consumers at the pump. The best way to do that is to produce more affordable energy here at home.
We certainly have plenty of it: according to the non-partisan Congressional Research Service (CRS), America’s combined supply of oil, coal, and natural gas is the largest on Earth. Put another way, America’s recoverable resources are far larger than those of Saudi Arabia (3rd), China (4th), and Canada (6th) combined. And that’s without including America’s immense oil shale and methane hydrates deposits.
The CRS report was requested by me and my colleague, Sen. Lisa Murkowski (R-Alaska). It grew out of frustration with the Democrats’ refrain that America only has 3 percent of global oil reserves, and therefore, under this view, more drilling and production at home is futile. As President Obama put it, “With 3 percent of the world’s oil reserves, the U.S. cannot drill its way to energy security.”
But the CRS shows the full, accurate picture of America’s reserves — and shows that we can produce our way to energy security. CRS shows more than just our proven oil reserves, which are a modest 28 billion barrels. The only way to estimate proven reserves is to drill. But that’s not possible because federal policies, supported by President Obama and many Democrats, put 83 percent of America’s federal lands off limits to drilling. Of course that’s just fine for this administration, as a senior official at the Obama Treasury Department said, “The administration believes that it is no longer sufficient to address our nation’s energy needs by finding more fossil fuels…”
In fact, according to CRS, which relied on estimates from the Department of Energy, the U.S. Geological Survey, and the Interior Department, we have 163 billion barrels of recoverable oil — nearly six times higher than what President Obama and the Democrats like to claim. That amount of oil would replace our current oil imports from the Persian Gulf for more than 50 years.
But this administration is saying no. By restricting supply — through its de facto moratorium on deepwater permitting in the Gulf of Mexico, and its restrictions on production on federal lands — prices have gone up. This is exactly what this administration wants. Energy Secretary Steven Chu, for instance, told the Wall Street Journal that “[s]omehow we have to figure out how to boost the prices of gasoline to the levels in Europe.” Consider just Great Britain: consumers there pay over $7.00 a gallon for gasoline.
Remember that when President Obama took office, the national average price for regular gasoline was $1.84 per gallon. Today, the average price is $3.98 per gallon. Prices are well over $4.00 in many parts of the country.
This mindset — which seeks to make the energy we use more expensive, in hopes of spawning a “green energy” revolution — is encapsulated in the cap-and-trade agenda being implemented by the Obama Environmental Protection Agency (EPA). That agenda is now squarely aimed at gasoline, as EPA is preparing onerous new global warming regulations on petroleum refineries, which will inevitably raise prices at the pump.