Redstate...
More Residual Effects
of Obama’s Anti-Oil Policies
The depletion of our oil production is corroding the Alaska pipeline
and widening the trade deficit.
by Daniel Horowitz
Wednesday, May 11th
Obama’s oil free utopia is precipitating yet more mayhem on our
economy. Today, two major news stories concerning our lack of oil
production highlight just how profoundly oil affects our economy.
The first story concerns the Trans Alaska Pipeline. The pipeline
employs 2,000 workers and delivers 11% of our domestically produced oil
to the other states. During its early years, when we weren’t
impounding the oil in Alaska, the pipeline transported 2 million
barrels of oil per day. Now, less than a third of that volume
flows through the pipeline, with the trajectory spiraling sharply
downward. The Wall Street Journal reported today that there is
growing concern about the adverse effects of decreasing oil flow on the
pipeline itself:
Now, dwindling oil production along Alaska’s northern edge means the
pipeline carries less than one-third the volume it once did—and the
crude takes five times as long to get to its destination.
That leisurely flow means the oil is above ground longer and more
exposed to Alaska’s frigid weather; the crude sometimes arrives chilled
to 40 degrees. As the flow and temperature continue to drop, experts
say the risks of a clog or corrosion increase, as do the odds of
ruptures and spills.
Unless a technological solution can be found, the arcane physics of
crude flow may force the multibillion dollar, 48-inch-wide steel
pipeline to shut down—and determine the fate of the largest oil field
ever found in the U.S.
There’s one other, seemingly simple fix: Add more oil.
Unfortunately, Obama only has plans to decrease the oil flow even
further. In addition to locking up new areas in Alaska for
domestic drilling (like ANWR), the EPA, in conjunction with frivolous
lawsuits from environmental legal defense groups, has blocked Shell Oil
from exploring an estimated 27 billion barrels of oil in the Beaufort
and Chukchi Seas.
Republicans must continue to focus their attention on more oil
production so we can replenish the supply of the pipeline. They
should fast track Bob Latta’s H.R. 1777, which would open up ANWR,
streamline the permitting and application process, cancel onerous
regulations, and reform the lawsuit process. It would be good for
Alaska and the rest of us; bad for Obama and the environmentalists.
The other big story of the day is the widening trade deficit.
Government officials have been trying to mimic the Chinese by boosting
exports through the devaluation of the currency. To that end,
exports grew 4.6% to a record $172.67 billion in March; the biggest
monthly gain since 1994. Yet, astoundingly, the trade deficit
still jumped 6% to $48.18 billion. Why? The Wall Street
Journal reports that we paid roughly $8.5 billion more for “all types
of energy-related imports” in March then in February. The annual
pace of our trade deficit is currently running at $562.8 billion, $67.5
billion more than last year. Thus, even a concerted effort to
attenuate the dollar cannot stem the tide of the trade deficit which is
exacerbated by sluggish domestic oil production.
Today’s news simply reinforces the self evident fact that oil is the
bloodline of our economy. The cheap and free flow of oil affects
every corner of our economy and virtually every facet of our
lives. Sadly, Obama understands this as well. As he seeks
to replace our free market society with a centrally planned one, he is
going for the jugular.
Ever since the killing of Bin Laden, Obama has been promoting himself
as if he was one of those Navy SEALs. There is some truth to that
notion after all. Obama is the Navy SEAL of economic warfare.
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