Offshore Oil Drilling Bills To Spark Talks In Congress
Following the debacle of the federal budget, the House of Representatives prepares to regroup after its spring break. Among other hot topics, the House is expected to propose three energy bills that Republicans say could spur economic activity and lower gas prices.
The bills promote domestic offshore oil drilling with the goal of reducing dependence on foreign oil to reduce gas prices.
The average price for regular gas today is $3.91, with several states’ prices passing the $4 mark, according to AAA. A year ago, the national average for regular gas was $2.88.
The U.S. Department of Commerce reported Thursday that the GDP increased at an annual rate of 1.8 percent in 2011’s first quarter, but the increase was less than economists’ growth predictions.
In response, Republican House Speaker John Boehner of Ohio criticized President Barack Obama and Democrats Thursday, saying they are not serious about lowering gas prices.
“While any positive growth is welcome, we are still not seeing the type of economic growth and private-sector job creation needed to help Americans who are struggling across this country,” Boehner said. “The Obama Administration is actively making the problem worse by blocking more American energy production.”
But Obama acknowledged the skyrocketing gas prices Tuesday and urged Congress in a letter to instead “eliminate unwarranted tax breaks for the oil and gas industry, and…use those dollars to invest in clean energy to reduce our dependence on foreign oil.”
One of the proposed energy bills, the “Putting the Gulf of Mexico Back to Work Act,” would jump start offshore oil drilling by implementing a 30-day deadline in which the secretary of the U.S. Interior Department would have to make a decision on Gulf drilling permit applications.
Following last year’s Deepwater Horizon oil spill, Obama enacted a six-month ban on offshore drilling. Although the ban was lifted in October 2010, there have been government delays on new permit applications.
A report by the National Center for Policy Analysis, a non-partisan research group, said Wednesday that the U.S. is losing millions because of decreases in offshore drilling activity since the BP blowout.
“The federal government is forfeiting revenues of more than $4.7 million per day. The losses will grow significantly if the federal government does not sell new drilling leases in the Gulf of Mexico this year,” the NCPA study said.
The two other energy bills, the “Restarting American Offshore Leasing Now Act” and the “Reversing President Obama’s Offshore Moratorium Act,” would implement offshore drilling lease plans.
Although the Republican bills aim to address gas prices and increasing economic activity, Obama pointed to other international factors that affect gas prices.
“The recent steep increase in gas prices, driven by increased global demand and compounded by unrest and supply disruptions in the Middle East, has only added to those struggles,” Obama said in his letter to Congress.
Additionally, gas prices typically increase in the spring months because many states require gas companies to switch their formulas to what is called a summer blend of gas, which burns cleaner in warmer weather, according to AAA.
Reach reporter Raquel Estupinan here.