Tuesday, August 08, 2006
The Prudhoe Principle
An excellent reason to increase U.S. energy supplies:
"Opponents of opening the Arctic National Wildlife Refuge (ANWR) to oil drilling have long argued that the supply wouldn't make a difference to prices. Well, that claim took a spill yesterday with BP's announcement that it is shutting down its operations at Prudhoe Bay due to a damaged pipeline that could take months to patch.
U.S. crude soared $2.25 on the news, taking oil to nearly $77 a barrel, with experts predicting another five- or 10-cent a gallon price increase at the retail gasoline pump -- possibly to a new high. This market reaction came as some surprise to various newspaper scribes and politicians, given that Prudhoe Bay 'only' supplies about 400,000 barrels a day, or less than 2% of daily U.S. oil consumption.
These are the same folks who've delighted in informing Americans in recent years that opening up nearby ANWR to drilling would 'only' result in an extra one million barrels a day. This argument -- that ANWR isn't worth the effort -- might have some currency if oil were plentiful and gas prices were still 'only' $1.50 a gallon. But with the margin between global oil supply and demand so thin, any supply counts. ANWR is exactly the sort of home-grown oil cushion that would help smooth out supply disruptions from the likes of Katrina or the BP leak, if 'only' Congress could get a clue."
"Opponents of opening the Arctic National Wildlife Refuge (ANWR) to oil drilling have long argued that the supply wouldn't make a difference to prices. Well, that claim took a spill yesterday with BP's announcement that it is shutting down its operations at Prudhoe Bay due to a damaged pipeline that could take months to patch.
U.S. crude soared $2.25 on the news, taking oil to nearly $77 a barrel, with experts predicting another five- or 10-cent a gallon price increase at the retail gasoline pump -- possibly to a new high. This market reaction came as some surprise to various newspaper scribes and politicians, given that Prudhoe Bay 'only' supplies about 400,000 barrels a day, or less than 2% of daily U.S. oil consumption.
These are the same folks who've delighted in informing Americans in recent years that opening up nearby ANWR to drilling would 'only' result in an extra one million barrels a day. This argument -- that ANWR isn't worth the effort -- might have some currency if oil were plentiful and gas prices were still 'only' $1.50 a gallon. But with the margin between global oil supply and demand so thin, any supply counts. ANWR is exactly the sort of home-grown oil cushion that would help smooth out supply disruptions from the likes of Katrina or the BP leak, if 'only' Congress could get a clue."
