Obama threads political needle on oil drilling

NOAAOilRigshot

Off an historic win on health care reform, President Barack Obama has decided to use the momentum to push forward his next Big Agenda item: energy and climate change.

Much to the chagrin of environmentalists, progressives and many politicians, he made his move with what's becoming his signature tactic: a preemptive attempt to neutralize the opposition.

The opposition is, still, the ultra-right GOP, but now the Republicans' corporate sponsors, the oil, gas and energy conglomerates enter stage right. Their mantra since the John McCain/Sarah Palin campaign has been "Drill, baby, drill."

President Obama announced his own plan to drill. This week he made known plans to open up the southern Atlantic coastline, the eastern Gulf of Mexico and Alaska's northern coast to oil and gas exploration and drilling.

The announcement met a firestorm of criticism.

"Drilling our coasts will do nothing to lower gas prices or create energy independence," Michael Brune of the Sierra Club, said in a statement. "It will only jeopardize beaches, marine life, and coastal tourist economies, all so the oil industry can make a short-term profit."

Politicians from states worried about the impact on coastal economies that rely on fishing and tourism, also, took issue with the president's plan.

"It's fundamentally wrong as an energy policy when we can drive toward renewable energy sources." said U.S. Sen. Robert Menendez, a long time opponent of offshore drilling. "I think it's an effort to bring Republicans on board with broader climate change legislation, and I think it's a dangerous plan," he added.

From the other side of the aisle, Republicans also reacted with criticism, some more muted than others. Coming off their bruising defeat over health care, some in the GOP are cautious about being labeled the "Party of No." Yet, Rep. John Boehner summed up the GOP's position best. He said it didn't go far enough, and the biggest gas reserves, which are on the West Coast, should be opened up too.

The president anticipated the criticisms from both sides in his speech. To environmentalists, he emphasized the transition moment the country is in and that his strategy could move us "from an economy that runs on fossil fuels and foreign oil to one that relies more on homegrown fuels and clean energy."

Worried about an already weak U.S. economy and most importantly, jobs, Obama said, "The only way this transition will succeed is if it strengthens our economy in the short term and long term. To fail to recognize this reality would be a mistake."

He also said drilling alone cannot solve the U.S. long-term energy challenges. "[W]ith less than 2 percent of oil reserves, but more than 20 percent of world consumption, drilling alone cannot come close to meeting our long-term energy needs," he said. "[F]or the sake of the planet and our energy independence, we need to begin the transition to cleaner fuels now."

Obama's attempts to thread the political needle infuriate many of the president's progressive allies, who see this as a threat to ocean eco-systems.

"We're appalled that the president is unleashing a wholesale assault on the oceans," said Jacqueline Savitz of Oceana, reported The New York Times.

Doug O'Malley, of Environment New Jersey said the group was outraged. "It makes no sense to threaten the east coast of America, including the Jersey Shore, with spills and other drilling disasters when we're about to unleash the real solutions to oil dependence -- cleaner cars, cleaner fuels and clean energy."

The Associate Press reports new drilling could "fill coffers" of cash-strapped states who get a share of the royalties. Exploratory drilling could start as early as this summer, AP reports, but the areas are years away from seeing deep water platforms. The drilling is not expected to bring down high oil prices.

Meanwhile, the Bureau of Land Management agreed to stop using a Bush-era provision that fast-tracked oil and gas development on federal lands that conservationists have said could harm a wide variety of lands including parks, refuges, recreation areas, wetlands, floodplains or other ecological significant or critical areas.

Photo: An offshore fisherie cage in the Gulf of Mexico stands near an oil rig off the coast of Mississippi. Tim Reid/ National Oceanic and Atmospheric Administration/Department of Commerce

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  • What President Obama said during his campaign for the presidency is in clear conflict with what he has recently agreed to. I just have one question; Since when is caving in to the right the correct strategy to use to neutralize the opposition?

    One comment stated that Obama is "Just a liberal" and does not understand that you cannot get the bourgosie to sit down at the table.." I disagree. Obama conducts himself more as a neo-liberal. He fully understands the difference between right and wrong. To give the monster more sacrificial lambs is NEVER going to address it's insatiable appetite for power and profits!

    What ever happened to exploring for GREEN alternatives to oil? Or was that just a campaign gimmick?

    Posted by Pancho Valdez, 04/05/2010 1:09pm (4 years ago)

  • I have worked the oilfields in Alaska for a few years now and I believe that no matter which administration enacted this law, how far it reached, or what your definition of success is -- shifting oil/gas supply to domestic sources, lowering oil prices, shoring up state budgets or providing jobs -- this will not really help.

    The thing you have to understand is that the petroleum industry is run by a colluding oligopoly which holds all the cards. These few corporations are handed all the oil & gas leases in the country and, therefor, completely control the supply of American oil. This is why we will never see low oil prices again.

    The industry determines its own minimum rate of return, a profit line below which they will shut down. They could be plenty profitable when oil is $40 a barrel, but they are now spoiled, and refuse to operate at less than $85-90 a barrel. So when oil drops to ~$70, they will simply refuse to drill any more wells in order to tighten up the supply and drive the price back up again.

    My seasonal job with an oilfield contractor has essentially been eliminated because this exact thing happened in September. The contractor's clients called off the winter exploration season and all the trucks sat in the yard. These were existing projects that would have went full steam ahead had the price of oil not dropped to what BP, Conoco Philips, Shell, etc. now consider "low", as has been redefined in the last five years.

    One could argue that easing restrictions on offshore drilling will grant access to reservoirs which are cheaper to develop and allow the companies to meet their MROR even at lower oil prices, but it doesn't take a genius to figure out that offshore drilling is more expensive than land drilling. We will probably see more exploration this year due to the fact that we've got prices north of $85/barrel again, but this law is just coincidence. The oil companies like to play the "open more drilling" card while at the same time they're intentionally creating a supply crisis to trick people who don't understand the industry.

    The problem for working class people is that, on the one end, the oil oligopoly controls the supply, and on the demand side there are no alternatives. I think Obama's heart is in the right place but he's still just a liberal, he doesn't understand that you will never get the bourgeoisie to sit down at the table and do what's right for America. These are transnationals, half of which aren't based in the US. They don't really care about American workers. Assuming that if you give the oil companies more territory to drill that they'll actually drill it is like assuming that if you give the banks a bunch of money that they'll actually lend it (oops!).

    I see two solutions to this. One idea is to take control of the supply by creating a national oil company. If the oil companies won't explore & develop, the government skips over them and does it itself. The other solution, which I think is more realistic considering Obama has mentioned it, though I haven't seen much movement on this issue: pump money into sustainable energy source development. Give people alternatives to fossil fuels so that oil & gas demand isn't as elastic. The other thing to consider is that maybe now is a good time to get some of our eggs OUT of the fossil fuel basket. We all know that we can't continue to guzzle oil & gas the way we do; I'm not sure which one will come first but we will either run out of them or create our own extinction event eventually. If the oil & gas industry wants to play games, fine, let's leave them behind for something renewable & sustainable.

    Posted by Jesse Jack, 04/05/2010 8:34am (4 years ago)

  • If this were carried out by the Republicans, the headline would be much different. "... ultra-right opens the oceans to plunder by oil companies," "... environmentalists and progressives up in arms over drilling," something like that. But since it's Obama the headline is neutral.

    That sort of hypocritical treatment, designed to always try to spin Obama positively, is easily seen through by the masses and makes the PW just another partisan spin-center in the bourgeois politics game.

    This article should be much more aggressive!

    Posted by D. Bester, 04/03/2010 4:01pm (4 years ago)

  • To use the British phrase, we in Virginia were "gob smacked" by Obama's announcement about the drilling plan for the East coast. During the 2008 gubernatorial election, the slogan "Drill, baby, drill" was a major part of the campaign arsenal of the (eventually victorious) ultra-right wing GOP candidate Bob McDonnell. Route 7, the major road which runs between Alexandria and Winchester Virginia and passes right by my home, was festooned with what seemed like thousands of "drill, baby, drill" signs set up by the GOP, and even Sarah Palin got into the act. This coastal drilling had been opposed by McDonnell's predecessor, Democratic Governor Tim Kaine, among other things because it potentially threatens valuable recreational facilities such as Virginia Beach and Cape May, as well as the rich marine resources of the Virginia coast which are already being damaged by other kinds of pollution.

    One of the reasons always given for this sort of thing is "so we can end our dependence on foreign oil". This should be questioned. Maybe it would be better for humanity if the United States were more and not less dependent on other countries' willingness to cooperate?

    Posted by Emile Schepers, 04/02/2010 11:30pm (4 years ago)

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