Federal government can’t solve alone

EXT – Doesn’t Lower Prices

not enough oil in the ocs to affect prices

Robertson ’11 (Joseph Robertson, founder and director of Casavaria Publishing, where he edits CafeSentido.com, Elindulnek.com and TheHotSpring.net. He also teaches at Villanova University, where he co-edits the online art and literature magazine, Naufragios, 10-20-11, “Nuclear Power & Offshore Drilling May Keep Oil Prices Artificially High,” http://www.casavaria.com/hotspring/2011/10/20/1474/nuclear-power-offshore-drilling-may-keep-oil-prices-artificially-high/)

With gasoline prices at record highs in 2008, 2009 and 2010, 2011 has looked like a microcosm of the longer oil-market trend: consistent increases in pricing, fuel costs hurting small business and the middle class, slowing the pace of economic growth in the US, and—maybe most strangely of all—no national policy to motivate a rapid, comprehensive transition away from fossil fuels and the volatility and cost inefficiency of their products to the wider marketplace. Instead, we have seen a recommitment to ramping up production, expanding drilling and exploration, and prioritizing local importation (from Canada and Mexico), instead of real coordinated policy planning to end dependency on foreign-sourced fuels.¶ With the oil strain on an already precarious American economy at an historic extreme, Pres. Bush in 2008 pushed Congress to hold an “up-or-down vote” on renewed exploration of the Outer Continental Shelf (OCS) before its August recess. Opponents protested vocally that none of any oil found there would be available for production for 10 to 15 years, the total amount would do little to ease the overall dependency on foreign-sourced fuels, and that the OCS plan was little more than an aggressive attempt to deliver to hugely profitable oil firms an unjustifiable gift, taking advantage of the pressurized situation of exorbitant prices.¶ The Energy Information Agency (EIA), evaluating the OCS strategy, found that opening offshore sites in the Pacific, the Atlantic and the Gulf of Mexico would still not produce enough oil and natural gas to have a significant effect on domestic reserves, even as far out as the year 2030. In July 2008, as the debate raged over drilling, CNN reported that Democratic members of Congress were saying a preliminary investigation was attributing more than 50% of the soaring oil prices to speculation, while traders were saying OPEC had deliberately held production low in order to drive prices up. Dependency on speculation-susceptible foreign-sourced fuels was building unaffordability into the US economy.

OCS drilling doesn’t solve prices or independence

McAuliff ’11 (Michael McAuliff, a senior congressional correspondent and blogger for HuffingtonPost.com and a former Washington reporter and editor for the New York Daily News, 7-6-11, “More U.S. Oil Drilling Won't Lower Gas Prices, Experts Say,” http://www.huffingtonpost.com/2011/05/06/more-us-oil-drilling-wont-help-gas-prices_n_858473.html)

"You might, under really optimistic scenarios, over five or six years, add 2 million barrels a day of production," said Lynch, who favors more drilling, even if he rejects the politicians' arguments. "On a global scale, it's significant. But we would still be big importers -- we would still be dependent on foreign oil."¶ And prices would not move much because of it, the analysts explained. Oil is traded on a world market, and the United States does not have enough petroleum to increase the global supply, which would reduce demand -- and thus the price -- for fuel.¶ "In 2009, the U.S. produced about 7 percent of what was produced in the entire world, so increasing the oil production in the U.S. is not going to make much of a difference in world markets and world prices," said the EIA's Martin. "It just gets lost. It's not that much."¶ And boosting drilling in the outer continental shelf?¶ "What comes out of the OCS is about 1 percent of the world total, and that's not enough to affect world prices," Martin said, even noting that she believes there are even more untapped reserves than officials can estimate at the moment.¶ Republicans are right about some things, the experts agreed. More drilling would mean more jobs and more tax revenue, if the industry's subsidies and tax breaks were revoked. It could also reduce oil imports -- even if gas prices wouldn't drop.¶ More offshore drilling, in fact, would be a huge boon for the oil and gas companies that could do it.¶ "It would be a lot of money for a lot people, but it's not going to make us energy independent," said Lynch, the analyst.¶ The oil and gas industry has poured $8.8 million into the campaigns of the drilling bill's lead sponsors.¶ Lynch wouldn't rule out the idea of the United States becoming energy independent, someday, but rated the odds as slim.¶ "On a scale of Osama bin Laden going to church with Pat Robertson -- it's close to that," he said.

ocs drilling can’t solve prices even with high reserve projections

Martin ’09 (Phyllis Martin, a Senior Energy Analyst in the us Department of Energy, 8-19-09, “Impacts of Increased Access to Oil and Natural Gas Resources in the Lower 48 Federal Outer Continental Shelf,” http://www.eia.gov/oiaf/aeo/otheranalysis/ongr.html)

Assumptions about exploration, development, and production of economical fields (drilling schedules, costs, platform selection, reserves-to-production ratios, etc.) in the OCS access case are based on data for fields in the western Gulf of Mexico that are of similar water depth and size. Exploration and development on the OCS in the Pacific, the Atlantic, and the eastern Gulf are assumed to proceed at rates similar to those seen in the early development of the Gulf region. In addition, it is assumed that local infrastructure issues and other potential non-Federal impediments will be resolved after Federal access restrictions have been lifted. With these assumptions, technically recoverable undiscovered resources in the lower 48 OCS increase to 59 billion barrels of oil and 288 trillion cubic feet of natural gas, as compared with the reference case levels of 41 billion barrels and 210 trillion cubic feet. ¶ The projections in the OCS access case indicate that access to the Pacific, Atlantic, and eastern Gulf regions would not have a significant impact on domestic crude oil and natural gas production or prices before 2030. Leasing would begin no sooner than 2012, and production would not be expected to start before 2017. Total domestic production of crude oil from 2012 through 2030 in the OCS access case is projected to be 1.6 percent higher than in the reference case, and 3 percent higher in 2030 alone, at 5.6 million barrels per day. For the lower 48 OCS, annual crude oil production in 2030 is projected to be 7 percent higher—2.4 million barrels per day in the OCS access case compared with 2.2 million barrels per day in the reference case (Figure 20). Because oil prices are determined on the international market, however, any impact on average wellhead prices is expected to be insignificant. ¶ Similarly, lower 48 natural gas production is not projected to increase substantially by 2030 as a result of increased access to the OCS. Cumulatively, lower 48 natural gas production from 2012 through 2030 is projected to be 1.8 percent higher in the OCS access case than in the reference case. Production levels in the OCS access case are projected at 19.0 trillion cubic feet in 2030, a 3-percent increase over the reference case projection of 18.4 trillion cubic feet. However, natural gas production from the lower 48 offshore in 2030 is projected to be 18 percent (590 billion cubic feet) higher in the OCS access case (Figure 21). In 2030, the OCS access case projects a decrease of $0.13 in the average wellhead price of natural gas (2005 dollars per thousand cubic feet), a decrease of 250 billion cubic feet in imports of liquefied natural gas, and an increase of 360 billion cubic feet in natural gas consumption relative to the reference case projections. In addition, despite the increase in production from previously restricted areas after 2012, total natural gas production from the lower 48 OCS is projected generally to decline after 2020. ¶ Although a significant volume of undiscovered, technically recoverable oil and natural gas resources is added in the OCS access case, conversion of those resources to production would require both time and money. In addition, the average field size in the Pacific and Atlantic regions tends to be smaller than the average in the Gulf of Mexico, implying that a significant portion of the additional resource would not be economically attractive to develop at the reference case prices.

Consensus of experts agree that offshore drilling doesn’t affect prices

Fong 12. Jocelyn Fong, researcher Media Matters for America. ClimateProgress - ThinkProgress March 22, 2012. 20 Experts Who Say Drilling Won’t Lower Gas Prices. http://thinkprogress.org/climate/2012/03/22/450136/20-experts-who-say-drilling-wont-lower-gas-prices/ //NM

Ken Green, American Enterprise Institute, “If the U.S. produced more of its own oil, it would probably reduce imports, but it’s not likely that it would reduce prices … We probably cannot produce so much oil to exert downward pressure on prices compared to the world market.”¶ Peter Van Doren and Jerry Taylor, Cato Institute: “Sure, more domestic oil creates the possibility of fewer refined imports tied to the price of Brent crude, but given that the price of Brent sets the price for crude generally, the result would be more profit for domestic crude producers rather than significantly lower gasoline prices for Americans (not that there’s anything wrong with that).”¶ Doug Holtz-Eakin, American Action Forum: “Domestic action to increase production will not lower gas prices set on a global market.”¶ Christopher Knittel, MIT economist: “There are not many markets where the United States can’t impose its will on market outcomes … This is one we can’t, and it’s hard for the average American to understand that and it’s easy for politicians to feed off that.”¶ Pinelopi Goldberg, Yale economist: “US domestic policy has only tiny effect on the world price of oil. US foreign policy is probably more relevant than energy policy.”¶ Steve Koonin, Institute for Defense Analyses: “When you hear the international oil companies advocating for energy independence, it’s really about making money, which isn’t a bad thing … If they produce a million more barrels a day, they’re not going to change the global price much. And since they know the global price is going up, they’ll just make more money. There’s nothing wrong with that, but it doesn’t solve the price problem or the greenhouse gas problem.”¶ Michael Levi, Council on Foreign Relations: “The amount of oil you produce at home doesn’t affect the price … You can lower your vulnerability to price by lowering your consumption of oil, but not by increasing your production.”¶ Severin Borenstein, UC Berkeley economist: “Producing more oil domestically will enrich the U.S. economy, particularly U.S. oil companies and their workers. With oil so valuable, it may be a good idea, though the value must be weighed against environmental consequences. But it will have no discernible impact on gas prices, because it will change the world’s supply/demand balance for oil by less than 2 or 3 percent over a decade or more.”¶ David Peterson, Duke statistician: “U.S. production and demand have little to do with the price of gasoline in the U.S.”¶ Edward Melnick, NYU statistician: When U.S. production goes up, the price of gas “is certainly not going down … The data does not suggest that whatsoever.”¶ David Sandalow, Department of Energy: “Drilling offshore to lower oil prices is like walking an extra 20 feet per day to lose weight. … It’s just not going to make much of a difference.”

Domestic offshore drilling will never make a difference to oil prices

Weiss 11. Daniel J. Weiss, MPP, Senior Fellow and Director of Climate Strategy at Center for American Progress, February 2, 2011, The False Promise of ‘Drill, Baby, Drill’ - Ignoring Real Solutions to Promote More Domestic Drilling. Center for American Progress. http://americanprogress.org/issues/green/news/2011/02/02/9122/the-false-promise-of-drill-baby-drill/ //NM

Think Progress noted that allies of big oil “exploit[ed the] Egyptian uprising to shill for more domestic oil drilling.” This began after oil prices climbed nearly $7 per barrel between January 27 and 31 because of fears about the security of the 2.5 percent of world oil transported through Egypt.¶ Yet more drilling would provide zero relief from high oil and gasoline prices now, and make a scant difference in 10 years. The Energy Information Administration noted that the “long lead times from discovery to production limit the increase in production, particularly offshore.” This means that an increase in U.S. oil production will make little or no difference in the world oil price or what Americans pay at the gas pump.¶ Ken Green, resident scholar with the conservative American Enterprise Institute, has explained that crude oil is a global commodity whose price will be unaffected by new U.S. production. Greenwire reported that:¶ “The world price is the world price. Even if we were producing 100 percent of our oil,” Green said, if prices increase because of a shortage in China or India, “our price would go up to the same thing…We probably couldn’t produce enough to affect the world price of oil,” he added. “People don’t understand that.”¶ Two weeks ago, Green astutely predicted that some politicians would exploit higher oil prices to boost Big Oil’s desire to drill on fragile lands and in coastal waters. “We’re likely to see a replay of the McCain-Palin ‘drill, baby, drill,’ ‘drill here, drill now.’ It will probably be a cause célèbre for the tea party.”

Drilling won’t affect prices – empirics prove

McAuliff 11. Michael McAuliff, Huffington Post Reporter. 5/6/11. More U.S. Oil Drilling Won't Lower Gas Prices, Experts Say. Huffington Post. http://www.huffingtonpost.com/2011/05/06/more-us-oil-drilling-wont-help-gas-prices_n_858473.html //NM

WASHINGTON -- Republicans used the politically potent argument about the cost of gas Thursday to pass a bill expanding offshore oil and gas exploration. But analysts say there's a major flaw in their case: More drilling will barely budge prices.¶ The Restarting American Offshore Leasing Now Act, which passed 266 to 144 with 33 Democrats buying into the scheme, orders the Department of the Interior to move quickly to offer three leases to drill in the Gulf of Mexico and one off the coast of Virginia. The bill demands that the leases be executed by next year.¶ But the legislation won't reduce the price at the pump, experts said. Nor would a vastly more ambitious effort have much impact.¶ "It's not going to change the price of oil overnight, and it's probably not going to have a huge impact on the price of oil ever," said Mike Lynch of Strategic Energy and Economic Research, Inc. referring not just to those four leases, but to expanding all U.S. drilling.¶ Yet House Republicans -- backed by nearly three dozen Democrats -- held out their push for exploitation of the four tracts as a panacea for the weak economy and high gas prices.

Expanded offshore drilling would do nothing to affect dependence or prices in the short term

Rob Portman, Politifact, 4-26-2011, "Sen. Rob Portman says easing access to drilling would immediately reduce dependence on foreign oil ," PolitiFact Ohio, http://www.politifact.com/ohio/statements/2011/may/04/rob-portman/sen-rob-portman-says-easing-access-drilling-would-/

U.S. Sen. Rob Portman weighed in by saying that price fixing, if there is any, should be prosecuted, but that it’s also time to harness energy sources "in our own backyard." "As an immediate bridge, we should increase access for oil exploration and production in energy-rich areas of the country like the Outer Continental Shelf, and in parts of Alaska," the Ohio Republican said in his column, which ran on his Senate website as well as on RedState.com. "This will create jobs, drive investment, and immediately reduce our dangerous dependence on foreign oil." Immediately? Not so fast, say the experts. Pretend that environmentalists dropped all objections to drilling for oil on the Outer Continental Shelf -- that area that lies offshore between states’ jurisdictions and the end of United States oceanic boundaries. Also pretend that the public decided its need for oil trumped what environmentalists see as the sanctity of the Arctic National Wildlife Refuge, or ANWR. Since we’re just pretending, everyone join in: Drill, baby, drill. Then wait. See ya around 2021. These things take time. The process would have to start with bidding for government leases -- normally a two- to three-year process -- which could lead to the establishment of exploratory wells just to see what, exactly, lies below. Only then is it time to firm up plans for production while drilling more wells, building offshore platforms, assembling and inserting pipelines and, finally, bringing the oil to refineries. "It’s quite a while before it can go into production, and the lag time is significant," Phyllis Martin, a senior energy analyst with the U.S. Energy Information Agency or EIA, told us. As a general rule, "it could be anywhere from three to 11 years, and three is really fast-track and that’s for shallow offshore" production with little or no need for exploration or lease negotiations. The price differential, too, is misunderstood, she said. That’s because gasoline prices are set on the global market, and as various studies have noted, OPEC and other foreign oil producers could cut back or respond in other ways to keep prices high. "So it’s not going to have a major impact," Martin said. "There’ll be a few pennies, but not major" savings. Besides talking to Martin, we looked at several studies. Among the highlights: The Outer Continental Shelf of Alaska’s Beaufort Sea could produce its first oil in 2019, and the Chukchi Sea area in 2022, according to a February 2011 analysis by Northern Economics for Shell Exploration and Production. Access to the Continental Outer Shelf off the Pacific, Atlantic and Gulf of Mexico "would not have a significant impact on domestic crude oil and natural gas production or prices before 2030," said a 2009 update of an earlier EIA study. That was two years ago, when EIA said that "leasing would begin no sooner than 2012 and production would not be expected to start before 2017." Push that back by two years now. ANWR drilling would take 10 years to actually produce oil, according to an EIA analysis in 2008 requested by the late U.S. Sen. Ted Stevens, an Alaska Republican. That 10-year timeline would be pushed back if there were protracted legal battles or delays in getting government permits, the analysis said. Portman’s claim seemed off base when we first saw it, but that’s only because we had seen something similar to it before. It was voiced by Sen. John McCain, an Arizona Republican, in 2008 when he was running for president and gasoline prices spiked. A number of other GOP officeholders have repeated it in recent weeks, each wanting to lift federal drilling prohibitions more quickly and more extensively than President Barack Obama and Democrats have been willing to do. PolitiFact ruled McCain’s claim False in 2008, noting that while some economists and energy experts agreed that producing more American oil would be good for jobs and, eventually, the trade balance, it would have no immediate effect on gasoline supply or prices. "I have a problem linking the drilling to current gas prices for political reasons," Dr. A.F. Alhaji, an associate professor of economics at Ohio Northern University and an international expert on oil markets, told PolitiFact nearly three years ago. "The reality is there is no correlation between today's prices and what gasoline will be discovered in the outer shelf." Before researching this subject, we asked a Portman spokeswoman, Christine Mangi, about the source of her boss’s claim. Her response in an e-mail: "Sen. Portman was referring to, among other things, the situation in the Gulf. The Obama Administration was not processing deep water permits in the Gulf which contributed to a 13 percent reduction in oil production there. By freeing up our domestic, energy rich resources in a place such as the Gulf, we can immediately reduce our reliance on foreign sources of oil." Yet Portman said nothing about the Gulf of Mexico (which accounts for about 30 percent of U.S. oil production, according to the EIA). His column took a big-picture view of energy needs and did not engage in the dispute about the government’s speed in granting permits since the BP oil spill in the Gulf in 2010. But most of the Gulf drilling is in fact on the Outer Continental Shelf, so we asked Andy Radford, a senior policy advisor at the American Petroleum Institute, an oil industry trade group, about it. He said that at a high point before the spill, the Gulf produced about 1.7 million barrels of oil a day. That’s down by 10 percent to 15 percent today, he said. And if we had that oil now? There would be little to no effect on prices because oil trades on a global market. India and developing nations are consuming more. Turmoil in the Middle East plays a role, too. As for the drop in the Gulf of Mexico, "The Saudis can make that up in a few hours," Radford said. "The effect would be more psychological than anything." In fairness, Portman spoke of reducing reliance on foreign oil, not of reducing the price. But he spoke of an "immediate bridge" to harnessing America’s natural resources by increasing oil production and exploration "in energy-rich areas of our country like the Outer Continental Shelf, and in parts of Alaska." This would "immediately reduce our dangerous dependence on foreign oil," he said. All evidence is that it would not. The current reduction in oil flowing from the Gulf, which Mangi mentioned in defense of her boss’s claim, represents a tiny portion of this country’s oil output, and the reduced flow is not entirely attributable to the post-spill slowdown in issuing drilling permits. In some cases, Gulf fields were simply tapped out, ending their productive life, said Richard Charter, a senior policy advisor for the environmental group Defenders of Wildlife. Furthermore, issuance of new permits has picked up, according to records from the U.S. Bureau of Ocean Energy Management, Regulation and Enforcement. New permits can lead to more exploration, but there is no guarantee that new exploration will lead to a specific amount of oil. As we said already: It takes time.