Civic Register
| 5.16.22
Biden Admin Cancels Offshore Oil & Gas Drilling Lease Sales in Alaska & Gulf of Mexico Amid Record Gas Prices
Do you support or oppose canceling the Alaska and Gulf of Mexico offshore oil drilling leases?
What’s the story?
- The Biden administration announced last week that it will “not move forward” with several high-profile offshore oil and gas drilling lease sales in Alaska and the Gulf of Mexico, sparking criticism of its energy policies as gasoline prices reach record highs.
- The canceled leases included a massive drilling opportunity in Alaska’s Cook Inlet that would’ve opened over 1 million acres for production over at least 40 years and led to the construction of underwater pipelines and drilling platforms. Administration officials cited a lack of industry demand as the reason for the cancellation, but that claim drew pushback from Alaska’s senators.
- Sens. Lisa Murkowski (R-AK) and Dan Sullivan (R-AK) criticized the Biden administration for “falsely” claiming that the oil and gas industry wasn’t interested in the Cook Inlet opportunity and called the moves a contradiction of the president’s pledge to “work like the devil” to bring down domestic energy prices. Murkowski said in a statement:
“Citing a ‘lack of industry interest’ is nothing more than fantasy from an administration that shuns U.S. energy production. Cook Inlet is the sole source of the natural gas that more than 400,000 people in Southcentral Alaska―and significant military bases that are critical to our national security―depend on. I can say with full certainty, based on conversations as recently as last night, that Alaska’s industry does have interest in lease sales in Cook Inlet. To claim otherwise is simply false, not to mention stunningly short-sighted. The Biden administration needs to recognize how this decision is going to hurt Alaskans, reverse it immediately, and get the federal oil and gas program back on track now.”
- Climate and environmental groups praised the decision to cancel the leases, as the Center for Biological Diversity’s oceans legal director Kristen Monsell said the Biden administration should go even further by canceling all new leasing and phase out existing oil and gas development:
“To save imperiled marine life and protect coastal communities and our climate from pollution, we need to end new leasing and phase out existing drilling.”
- The Biden administration also canceled a pair of offshore leases in the Gulf of Mexico because of “conflicting court rulings that impacted work on these proposed lease sales.”
- Sen. Bill Cassidy (R-LA), who is a member of the Senate Energy and Natural Resources Committee, said of the move:
“President Biden’s administration is actively making high gas prices worse. When we need to unleash American energy production, the Biden administration kills opportunities at every turn. The administration’s actions over the past year and a half have been an all-out assault on American energy, Louisiana jobs, and families’ pocketbooks.”
- The decision to cancel the offshore drilling leases for Alaska and the Gulf of Mexico isn’t likely to have an immediate impact on energy prices given that it can take months or years to put in place the infrastructure needed to meaningfully develop a given tract. However, the policies can have a long-term impact on energy markets and play a role in calibrating future expectations about oil and gas supplies. If higher levels of energy supplies are expected in the future, that can help stabilize prices.
- Marty Durbin, president of the U.S. Chamber of Commerce’s energy arm, said in a statement:
“The lack of new lease sales will lower future supplies, which will keep energy prices high and drive inflation for years to come. While some in the Administration have called for more domestic production, this action sends exactly the wrong signal to producers and markets and is contrary to that goal.”
- The cancellations come as the Dept. of the Interior’s five-year schedule for offshore lease sales is set to expire at the end of June, creating additional uncertainty for energy markets. Interior Secretary Deb Haaland told lawmakers at a hearing last month that the administration is “working hard” on a new leasing plan but, “There is a significant amount of internal work that still needs to be done.”
RELATED READING
- Gas Prices Reach New All-Time Highs - Are You Feeling the Pain at the Pump? (5/14/22)
- Biden Announces Release of 180 Million Barrels of Oil From Strategic Petroleum Reserve Over Six Months (3/31/22)
- Biden Orders Release From Strategic Petroleum Reserve Amid Rising Energy Prices (11/23/21)
- Biden Admin Reiterates Call for OPEC to Increase Oil Production as Gas Prices Rise (8/12/21)
- Biden Admin Urging OPEC to Increase Oil Production After Constricting US Oil & Gas Development (7/9/21)
- Biden Admin Suspends Oil & Gas Leasing in Alaska’s Arctic National Wildlife Refuge (6/2/21)
- Manchin Urges Biden to Reverse Decision & Allow Further Construction of Keystone XL Pipeline (2/10/21)
- Biden Revokes Permit for Keystone XL Pipeline - Do You Agree With the Move? (1/20/21)
— Eric Revell
(Photo Credit: iStock.com / morkeman)
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If fossil fuel companies are not going to use the nearly 9000 oil drilling permits and leases they already have to increase oil supply and lower gas prices, then why should they be allowed to buy more leases? The Biden Administration is right to put its foot down on selling leases. They should enforce a "Use it or lose it" policy for all leases. The President can not unilaterally control gas prices. The fossil fuel companies control them, unfortunately. There needs to be pressure on the companies from below and above to lower prices.
Refining capacity is insufficient for the crude oil they currently have, and releasing crude from the national reserve only made the problem worse so how do more leases help especially since it will take a long time before they'd produce crude.
its beginning to look more like blackmail with oils companies demanding new leases on federal lands, offshore, etc and taking their sweet bippy time ramping up refining capacity after the pandemic shutdown. Having supply chain issues allows oil companies to maximize profits.
Crude prices are down 15% since the early-March peak are now the bottlenecked in refining as the energy market earns record profits in the meantime.
Crude is processed by oil refineries into gas, diesel, and jet-fuel used for travel in a process referred to as “Crack" and "spread" refers to the price difference between crude oil bought by refiners and the final products sold by them.
From 1985 to 2021 the crack spread averaged about $10.50 per barrel and only rose above $20 during high demand has now hit $55 per barrel of gasoline.
Current crack spreads are even higher for diesel and jet fuel that affects consumers pricing of plane tickets and products that are shipped by truck or air (especially multiple step global supply lines).
The release of national reserves was unrefined oil that now use be refined, and many refineries are still reopening from Covid lockdowns and is at its lowest since 2014 according to Energy Information Administration
Opening refining capacity is the only way to reduce cost at the pump now.
Congress needs to review this process now and if necessary the DPA should be invoked.
https://www.businessinsider.com/why-gas-prices-so-high-crude-oil-market-crack-spreads-2022-5
https://www.causes.com/comments/7729
Biden has lost his mind! He blames our gas prices on Putin and cancels the Keystone pipeline. Now, he cancels the leases for the oil companies to drill. This is madness! Not only will gas go up to $15 a gallon, he also is cutting thousands of jobs. He isn't helping the middle class, he's destroying it.
Drilling takes years to get to the gas pump, so this will not affect us directly at all; unless the greedy oil companies punish us for it with higher prices.
We need to stop expanding drilling and use the sites we already have to refine the gas we need. The oil companies are playing us for fools, especially those on the right who don't know how any of this works.
I'm a climate-first voter, and I'm happy to see more action from Biden to stop raping our environment to feed corporate greed.
I like some of the comments concerning this issue. It makes no difference if I agree or disagree with President Biden's actions concerning oil permits. It is not rocket science what the major oil companies are doing. They have a toe hold on not only the American people but the world as far as mass transportation goes. They are making more now than ever. And they know it. And they are loving it. They also see the end of a great business with EVs becoming more accessible by the day. We will still have gasoline and diesel vehicles, but they will be limited. The rest of us will be in an EV. Ever since 1973, we have had the opportunity to ween us off oil, but with big handouts to bought and paid for elected officials, it was not going to happen.
What the hell is this administration doing to America! It's disgraceful. They really need to complete the Keystone Pipeline and stop this craziness.
We have REAL PROBLEMS and no one is doing anything to help the American people! What's wrong with this world?
No more oil, no more spills, no more dead aquatic life, no more poisons, and no more garbage in our oceans!
Additional off shore drilling should be cancelled.
Deregulation is key to energy independence.
Gas prices are outrageous. We have energy resources here. It's irresponsible to not produce US energy! We can and should have diversified energy. Drill/frack here. Nuclear energy. Should be part of our energy plan.
We need to remember that oil and gas companies are still making record profits. There isn't a shortage, there IS a price gouge.
Please communcate the facts about the current oil prices. It's not a shortage of oil but gread by the oil companies. New oil leases will not solve the problem, openning the Key Stone pipeline will not solve the problem.
Please publicy stand up and demand the truth from members of the government.
A lease is not an assurance of drilling, extraction or production. As even some of the lefty loon respondents to this topic point out, these exploratory endeavors consume years off the calendar and frequently produce nothing while the oil companies are spending billions on the effort. Also, please stop with the false claims of 9000 unused leases. Clearly you rely on Jen Psaki for your information. Fortunately, her career is winding down. Although you shouldn't feel sorry for her as she's no doubt inked a book deal that will create additional unjust enrichment for yet another privileged elitist Dimocrat.
We should not be buying oil from countries like Venezuela. Politicians Republicans and Democrats you people need to work on reinstating the pipeline become independent again cell oil and gas to Europe. You're not in support of this come November the American people Republicans and Democrats will vote you out of office.
Biden shuts down the Keystone pipeline, cancels drilling permits and then blames high gas prices on the pandemic and the Russian invasion of Ukraine. I can't believe that anyone that stupid could have been elected. I guess we got what we deserved.
I believe the president's administration either has no knowledge of basic economics or they are deliberately wanting the citizens of this country to struggle financially. Approving this could have a great positive impact on our oil industry in the long term, in turn bringing down fuel prices for every day consumers. This is not a good trade off.
You guys realize our gas is through the roof?? Why are people supporting this idea while destroying our country and economy
WE need to protect our lives and the ocean animals as well.
I strongly oppose cancelling these leases. It is bad business. It is bad for energy security. We cannot just "zen" our way a green future or "manifest it" as some of these crystal carrying nut jobs suggest. It will take time and investment, and in the mean time we need energy. A balance, sane energy policy is what we have needed for decades and still need. This random walk stabbing approach hurts everyone.
Produce US energy!! Reduce inflation and helps all Americans.
Dear Representatives and Senators:
I’m urging you my representative to co-sponsor HR 7061, the Big Oil Windfall Profits Act, and H.R.7688, the Consumer Fuel Price Gouging Prevention Act, which will hold Big Oil accountable for their blatant price-gouging and profiteering.
Big Oil companies reported nearly $100 BILLION in profits in Q1 2022. Corporations are laughing all the way to the bank while many of your constituents, particularly those on fixed incomes, are having to decide between taking a necessary trip (for example to an oncologist or cardiologist) and buying food.
We have laws against price gouging in Florida (after hurricanes) and we need it nationally (post pandemic or any other crises).
Good Governance is not a football game - it is not supposed to be Republicans vs everyone else, especially Democrats. Good Governance is about doing what is right for your constituents and the nation.
WE NEED YOU TO ACT WITH GOOD GOVERNANCE.
The Destruction of America
Oil and gas Companies are fleecing American people, because that can. Republicans refuse to investigate or put a bill in to investigate because they say it socialism, no it is corruption and a monopoly!
Only republicans cry about gas prices and republicans are cool with supporting a terroist state so long as gas is a $1 less. It's funny cause I paid 3.50-$4 a gallon for the last 3 years of trump and then somehow it's bidens fault after Russia invades. And drives up my gas price by $1 I'm totally fine paying 7 a gallon as long as none of my money goes to Russia unlike most Americans who only see 3 feet in front of there face and have no feelings towards anything unless money is involved we all know in America $1 is worth more then a life but it's opposite for me I'll pay more to not support a terroist state where as most Americans will support a terroist state if there saving money where hypocrites in this country. Oh yeah and Fox News an tucker Carlson are full of shit peddling there agenda and propaganda to there millions of idiot followers. I know this you can't trust a American who supports Fox News tuckercarlson or trump remember tucker Carlson was praising Putin just 1 ur ago and continue to do so there not telling the news there peddling there agenda how can ppl not see right through these idiots the very first time I heard Donald trump speak I knew he was a pathological liar without knowing anything about him I knew he was a bullshiter on top of a liar by bullshitter I mean a guy who claims to have all the answers but when asked never answers the question he never says anything except it's gonna be great "how"? It's gonna be so great you can not even believe it. That's not a answer that's a bullshitter I guess it's true trump supports have a below average iQ I worked with 1 he was below average iQ for sure
What the Hell are you Democrates doing to Us? In the middle of an energy crisis you shut these things down! Are you doing this on purpose to destroy America? What is wrong with you?
The President needs to be held accountable for unilateral policies like this that run counter to the interests of the American people. This measure will only serve to reduce future supply of oil & gas, reducing opportunities to lower market costs.