The decision by President Bush to revoke an old Executive Order prohibiting offshore drilling for oil and natural gas on the outer continental shelf was a good move, and helped contribute to the drop in oil prices that followed over the next two days.
Demand is down for oil, and any sustained drive to open up new sources of production --even those sources that will take years to tap-- impacts the futures market by increasing the probability of greater-than-expected oil supplies in the out years.
The Obama-Pelosi-Reid Don't Drill Democrats aren't budging in their opposition to seeking new oil supplies, as the electoral benefits they envision from high gas prices far outweigh their concern over the damage done to individual Americans and the U.S. economy from the oil shock. They'd rather win the presidency and expand their majorities in the House and the Senate than bring price relief to average Americans and shore up a shaky manufacturing sector buffeted by skyrocketing energy costs.
Democrats of course say in unison "We can't drill our way out of this," but in fact we can. More oil production means lower gas prices --it is that simple.
Democrats say it will take too long, but markets react to short and medium term developments, and a firm commitment to new supplies would immediately impact those markets.
Democrats try and throw dirt in our collective eyes, using the most inane talking point of the year about unused leases --as though Americans don't understand that not all leased land holds oil and that oil companies don't sit on proven reserves that they lose control of over time.
The recognition has broken through and is spreading that a vote for any democrat is a vote for soaring gas prices and a shrinking economy. Add in Obama's feverish tax hike plans, and the recipe for an economic disaster is on the table to go along with Obama's incredibly risky plans to retreat from Iraq and sit down with Ahmadinejad and Chavez for "no-preconditions" talks.
But President Bush's action is just a start. The focus has to be maintained, and the Administration must act as though it really means what it says it believes.
I interviewed both White House Communications Director Ed Gillispie and Interior Secretary Dirk Kempthorne this week. I pushed both men on the need to get stand-by leasing of the outer continental shelf under way. Stand-by leasing would award the tracts to oil companies for set terms, conditional only on the action by Congress to remove the ban or allow it to lapse. The bidding process, which is normally managed by the Department of the Interior Minerals Management Service, should be directed by the president to prepare a plan within 30 days on how the areas offshore would newly authorized for leasing would in fact be leased, and on how to include incentives in those leases to get the oil above water and into pipelines much more quickly than normal. The opportunities to expedite new supplies are enormous: Offer a lower royalty rate for oil pumped within two years of the lease date, or extend the lease term as a bonus for early delivery.
There are numerous ways a government acting in an emergency setting would be preparing now to use the authority it was confident that Congress would give them down the road. The president's announcement was just the first step. Now he has to demand the rest of the executive branch devote its time and resources to preparing the bureaucratic ground.
Every day Republican candidates should follow the lead of the president and focus on the Congress-made shortage of domestic oil supplies. We are watching the effects of a Democrat-created oil shock, and Democrats on the Hill --led by Obama-- are very bit as responsible as the OPEC countries for contriving to foist these absurd prices on us when oil sits under the full control of the U.S.
Voters know the score, and they know more oil is better than less oil.
But they won't fall for a political ploy. The offshore and ANWR oil is important. But if it is that important, shouldn't the Bush Administration be doing more than talking about getting to it and blaming Congress for blocking the effort?
Push the point, of course, every day and every way.
But also take every step now that will be necessary later to take advantage of the democrats' surrender to the needs of the American economy when voters' anger peaks.
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