President Obama’s climate bill and US energy security could prove the ultimate victims of the Gulf of Mexico oil spill, the Datamonitor Group has warned.
The independent market analyst believes the explosion on board the Deepwater Horizon rig could leave President Obama’s climate bill, which would have finally resolved US energy security issues, effectively dead in the water.
Gregory Lemaire-Smith, associate energy analyst at Datamonitor, said: “The US is struggling with a stifling oil import dependency, which demands increased domestic production.
“The US had been extremely frugal in allowing the development of its offshore regions in the past so the recent opening of some of these regions was a welcome relief. Nonetheless, this disaster prompted a predictable response from California’s Republican governor, Arnold Schwarzenegger, who has now confirmed that the state will not be pursuing any offshore plans.
“Datamonitor’s Global Oil and Gas Analyzer draws attention to the production and trade forecasts for the US ’ key suppliers and highlights their poor correlation with US demand growth. The picture is not ideal for a country whose energy security is already weak. It will be even worse if drilling in the Gulf of Mexico is delayed or banned as an estimated 76 million barrels per day were due to be extracted in 2013 from approximately 40 new fields.
“Most importantly of all, Obama’s decision to open certain offshore regions to drilling was the key to gaining Republican support for a vital climate change bill that would have once and for all resolved the country’s energy security issues.”