OPINION:
The Obama administration’s decision to release 30 million barrels of oil from our Strategic Petroleum Reserve is a wrongheaded strategy with the false premise of propping up the economy.
I won’t argue the politics of it - everyone wants lower gas prices at the pump - but as a 35-year consultant to the energy industry, specifically oil and gas markets, I know government intervention at this time can only hurt us in the long run. And why now? Saudi Arabia recently started pumping more barrels, and prices have fallen by $15 since the peak in April and May. Will Saudi Arabia start to withdraw the incremental production it started? Does anyone believe for a moment that this amount can be sustained over time to affect the price of oil? These oil reserves were intended to manage short-term shocks, not longer-term market conditions.
The administration wanted to show a strong response to the rapid run-up in crude oil and gasoline prices occasioned by the insurrection in Libya and other world events. Unfortunately, the message affirmed that the United States continues to rely on benign neglect as the cornerstone of its energy policy. Nothing of substance has been accomplished to deal responsibly with our energy-supply condition.
The administration’s impediment to domestic oil and gas development, and the aggressive actions of the EPA to impede the development of vast new shale-gas resources is consistent with our historic pattern of failing to be disciplined.
With advancements in renewable-energy technologies, the availability of domestic natural gas, access to prudent offshore drilling opportunities and the major advancements we have made in energy efficiencies, the United States is truly in a position to materially alter the equation of our dependence on imported oil and oil products.
But we need a comprehensive plan that balances environmental risk with economic and security risk and that considers the balance of public- and private-sector roles as well as the early and proper deployment of funds to accelerate renewable energy sources.
TIMOTHY F. SUTHERLAND
Chairman and chief executive officer
Pace Global Energy Services
Fairfax
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