Thursday, July 17, 2008

U.S. Executive Ban on Offshore Oil Exploration Lifted

Sources: Financial Times, BBC

President George W. Bush put the future of offshore oil drilling in Congress’s hands this week when he lifted the Executive Order issued in 1990 prohibiting offshore oil exploration. Now Congress alone has the key to releasing an expected eighteen billion barrels of oil. This oil, which rests under eighty percent of the U.S. coastal waters, is said to be enough to match current U.S. oil production for ten years. Congress’s legislative ban on coastal drilling has been in place for twenty-eight years and is seen as a protective shield to the potential environmental harm associated with oil drilling.

With oil prices hitting a new high of $147 per barrel last Friday, this move by the Republican president throws another coal onto the political fire. Republicans predict that offshore drilling will signal a reduction of American dependence on expensive foreign oil, a welcome idea to those paying more than $4 per gallon of gas. Democrats, including the likely presidential nominee Barack Obama, say that the effects of drilling will be far from immediate. Mr. Obama further stated that, "It would merely prolong the failed energy policies we have seen from Washington for thirty years." Environmentalists agree and fear widespread destruction of U.S. coastlines.

As the presidential election approaches and oil prices remain high, Congress will be pressed to take a stance. Sources disagree as to the position Democratic legislators will take. Some foresee Capitol Hill following the wishes of two thirds of its constituents who favor coastal drilling. Others expect Congress to remain within party lines to show support for their respective candidate.

1. Will Congress vote on the issue of lifting the ban? If it does, do you think the ban will be upheld?
2. If the ban is lifted, will it significantly change oil prices in the U.S.? Will the exposure to oil below eighty percent of U.S. coastlines change the U.S. economy beyond oil prices?

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