Reversal On Offshore Drilling To Cost Jobs, Raise Prices

Obama About-Face Likely to Worsen Economic Outlook, Burnett Says

DALLAS (December 2, 2010) - The Obama Administration's on again-off again policy on offshore drilling is off-again, a decision that will restrict domestic production for the next seven years and will adversely affect American consumers, according to National Center for Policy Analysis (NCPA) Senior Fellow H. Sterling Burnett.

"It's a bad decision all around," Dr. Burnett said. "It condemns Americans to paying continued higher than necessary prices for gasoline while wages stagnate, energy prices rise and lower- and middle-income Americans have to make harder household decisions as more of their earnings go to pay rising energy costs."

While the U.S. economy remains in the doldrums and Americans want to reduce our dependence on foreign oil, the Interior Department's 2012-2017 leasing plan for drilling in federal waters will place the U.S. more and more at the mercy of foreign governments, according to Dr. Burnett's analysis. For example:

  • Annual U.S. domestic oil production is declining, from 3.8 billion barrels in 1980 to 1.8 billion barrels in 2008.
  • U.S. oil imports have increased dramatically, from 1.9 billion in 1980 to 3.6 billion in 2008.
  • Offshore oil deposits in U.S. waters include more than 46 million barrels of oil and more than 419 trillion cubic feet of natural gas, according to the Minerals Management Service; areas that will be off-limits due to the Obama moratorium.

"Reimposing the moratorium is bad for the economy and bad for the environment," Burnett added. "Far more oil is spilled by oil tankers than offshore oil drilling platforms."

  • Since 1991, tanks have spilled three times more oil than offshore platforms and more than twice as much as pipelines.
  • Since 1990, less than one one-thousandth of one percent of the oil produced in U.S. waters, including offshore, has spilled; that's less than natural seeps of oil.

"Finally, reimposing the offshore drilling moratorium will cost the U.S. tens of thousands of high-paying jobs," Burnett said. "It will mean that highly skilled workers will move overseas to work in places that are open to drilling, which is every other country on earth with a coastline and oil reserves."