The United States Oil Supply: A Tale of Congressional Meddling
Oil and gas prices are at record highs, yet solutions are held hostage to political posturing. The energy market is relentlessly regulated by the federal and state governments, drastically limiting our access to domestic oil supplies.
For instance, in the last 20 years or so, Congress has banned oil development in 300 million acres of land and 460 million acres of offshore seabed. Yet, an estimated 67% of US oil reserves and 40% of US natural gas reserves are in federal lands (mostly in western states). In 2005, to offset citizen concern, Congress cynically mandated new oil inventories be taken, but only gave Interior six months to perform them and $0 with which to do it. Therefore, most of our knowledge of oil reserves dates to the 1970s, before computer imaging and sensor technology, and will be on the low side.
Regulations have also hurt gasoline supply by requiring different "boutique" blends of auto fuel in different areas of the country, despite the fact that only one new refinery has been built since 1976.
There is oil that the United States can tap domestically. All we have to do is get it. Drilling in the Alaskan National Wildlife Refuge (ANWR) would provide at least 16 billion barrels of oil - equal to 30 years of Saudi imports. Doing so would only affect 2,000 acres out of the Refuge's 19 million acres. Even better, the pipeline to deliver this oil is already built (Alaskan Pipeline). Besides producing oil, Wharton Econometrics estimated over 735,000 jobs would arise from full production in ANWR. The Office of Management and Budget (OMB) estimated that royalties and taxes would add $152 to $237 billion to the federal treasure over the oilfield's life. Alaskans of all political parties overwhelmingly support drilling in ANWR, as do the Inupiat Eskimos who live near the proposed site.
Critics charge it will take 8 to 10 years to get ANWR's oil into national use. Well, we have to start sometime. If we had started when the issue was first raised almost 8 years ago, that oil would be coming online now. Twenty years ago critics also said Prudhoe Bay only amounted to a "few months supply", yet since 1977 the Alaskan Pipeline has delivered over 13 billion barrels of oil without environmental mishap. Additionally, Prudhoe Bay natural gas reserves are at 30.9 trillion cubic feet.
An April, 2008 United States Geological Survey (USGS) report estimated a mean of 3.65 billion barrels recoverable oil in the Bakken formation that covers 200,000 square miles over Montana, North Dakota, and Saskatchewan. Since estimates for total oil reserves there range from a low of 10 billion barrels to a high of 503 billion barrels, future technology should allow even more oil extraction.
Added to the above two oilfields is Outer Continental Shelf (OCS), or offshore drilling. It is estimated there are at least 18 billion barrels of oil in the OCS. Critics worry about environmental impact, but NASA and the Smithsonian calculated that offshore drilling technology has less than one-fourth the impact on our oceans than normal background leaks from naturally-occurring oil deposits. Even Hurricane Katrina couldn't get the Gulf of Mexico's oil rigs to leak.
Just the above three sources would supply at least 38 billion barrels of oil. Simply put, the oil is there - Congress just needs to let us get it.
