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Update on President's Offshore Drilling Moratorium

We recently discussed the huge economic impact the President’s moratorium on offshore drilling would have on the Gulf Coast.  Two weeks ago, a federal judge in Louisiana issued a preliminary injunction blocking the moratorium on offshore drilling.  His 22 page decision stated that…
 “The court is unable to divine or fathom a relationship between the findings and the immense scope of the moratorium.” “The blanket moratorium, with no parameters, seems to assume that because one rig failed and although no one yet fully knows why, all companies and rigs drilling new wells over 500 feet also universally present an imminent danger.” “The court cannot substitute its judgment for that of the agency, but the agency must ‘cogently explain why it has exercised its discretion in a given manner. It has not done so.”
The Secretary of the Interior, Salazar and Press Secretary Robert Gibbs immediately announced a new moratorium will be put into place very soon to prevent more drilling in the Gulf and the decision will be appealed.

With the President determined to prevent offshore oil drilling, our country will lose up to 30% of our current oil supply, requiring the US to import more oil from foreign countries.  Of course, some environmentalists will unrealistically argue that we simply need to tighten our belts and not consume so much oil-based products to save the planet. 

In fact, I’m sure they will be the first ones to give up – computers, insulation, deodorant, pillows, artificial limbs, life jackets, aspirin, rubber cement, golf balls, credit cards, antihistamines, soft contact lenses, plastic products, footballs, tires, ballpoint pens cameras, cortisone, vitamin capsules, dashboards, dentures, toilet seats, movie film, sunglasses, paint brushes, hearing aids, rubbing alcohol, parachutes, heart valves, motorcycle helmets, house paint, eyeglasses, lipstick, dishwashing liquids, crayons, ammonia, anesthetics, safety glass, panty hose and so much more made from petroleum

The other argument you will hear is we should switch from fossil fuels to renewable resources, like wind.  That would be wonderful except technology does not exist to enable us to do that in the year 2010, or the foreseeable future.  Most wind and solar energy cannot provide us with the massive quantities of energy needed for transportation.  So, for now, we will need to dramatically increase our importing of oil from foreign nations to make up for the oil the President wants deemed off limits.

This begs the next question; from where does the US currently import our oil supply?  According to the US Energy Information Administration, the top exporter of oil to the United States is our neighbor nation of Canada.  The next 4 on the list in order of most to least are: Saudi Arabia, Mexico, Venezuela, and Nigeria.  From there the list goes on to include the top 15 countries.

The majority of imported oil arrives to the United States on oil tankers that cross the ocean.  Historically, oil tankers have a worse safety record for oil spills than offshore drilling rigs.   Importing foreign oil also puts our oil supply at the mercy of foreign nations' supply and price controls and on the political instability around the world.

This discussion also ignores the reality that our country has a wealth of oil that has been put off limits to drilling by Presidents, Congress and environmentalists.  Our country needs to identify the priorities for our energy policy and acknowledge the consequences to these decisions. 

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