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Oil & Gas Journal

Nick Snow
Washington Editor

WASHINGTON, DC, Apr. 30 -- US President George W. Bush urged Congress to send a positive signal to world energy markets by removing obstacles to more domestic oil and gas production. He also rejected calls to quit filling the Strategic Petroleum Reserve while oil prices are near record levels but said he would consider suspending the federal gasoline tax through the summer and other proposals.

"If Congress is truly interested in solving the problem, they can send the right signal by saying we're going to explore for oil and gas in the US territories, starting with [the Arctic National Wildlife Refuge]," Bush told reporters at an Apr. 29 press conference.

"If we're generally interested in moving forward with an energy policy that sends a signal to the world that…we're going to become less reliant on foreign oil, we can explore at home as well as continue with an alternative fuels program," Bush said.

Congressional Democratic leaders immediately dismissed Bush's proposal. "Only President Bush could allow 'Big Oil' to write our nation's energy policy, guarantee billions in oil tax breaks and refuse to stand up to [the Organization of Petroleum Exporting Countries], and then shirk responsibility for [gasoline] prices that have more than doubled and oil prices that have quadrupled since he took office," Senate Majority Leader Harry M. Reid (D-Nev.) said.

"President Bush's 'Rose Garden' rhetoric will not lower gas prices for Americans struggling in a weakening economy. He must work with Democrats in Congress to invest in renewable energy and lessen our dependence on oil," Reid said in a written statement.

'Same failed energy policy'
House Speaker Nancy Pelosi (D-Calif.) termed Bush's call for more domestic drilling "the same failed energy policy that has brought record gas prices." She said, "Drilling has increased dramatically since 2000—the number of wells on land has increased about 66%—and yet the price of gasoline has more than doubled since President Bush took office."

Authorizing leasing within ANWR would not significant reduce US dependence on foreign oil or reduce retail gasoline prices, Pelosi said. "Experts have concluded that opening up the Arctic for drilling would produce only a 6-month supply of oil 10 years from now [but] nothing that will help consumers today," she said.

Bush said a major reason for higher gasoline prices is that global oil production has not kept pace with growing demand. "Members of Congress have been vocal about foreign governments increasing their oil production. Yet they have been just as vocal in opposition to efforts to expand our production here at home," he said.

Bush said the US Department of Energy estimates that ANWR contains enough crude to allow US production to grow by about 1 million b/d, "which translates into 27 million gal of gasoline and diesel every day."

Bush said the country is making a transition to "a new era where we're going to have batteries in our cars that allow people to drive 40 miles on electricity." There will be more ethanol and alternative fuels, he said. "But in the meantime, we need to be sending a signal to the world markets that we intend to explore here in America."