GOP - The Gas & Oil Party

President Bush has done it once again. Not satisfied with the havoc wrecked in 8 years of one of the most forgettable presidency in the history, he has decided to take one last salvo at pandering to an oil addict country by proposing to raise the ban on offshore drilling. Worse, he is also debating the ban on the Artic National Wildlife Refuge(ANWR). Only a few months before the election, the GOP is trying to fool the common man by giving a false illusion of falling gas prices and a future with copious oil flow. However, one only needs to look past the veneer of this preposterous idea to realize that this move only mirrors the current government's denial of the inevitable.

After a long time, the United States was finally taking positive toddler steps towards energy conservation, as they drove 1.4 bn fewer miles in April, while SUV and truck sales plunged 36%. Ford and GM closed their truck manufacturing plants, while hybrid sales hit new highs. The sudden surge in prices had also inspired countries like India to increase its gas prices by 10%, and China - the second biggest consumer in the world - to increase its prices by 20% to curtail demand. But it would take only one foolish legislation to negate this hardwork, and I am hoping that sanity makes comeback before this idea gets a strong backing by the beltway boys.

Even if the ban on offshore drilling were to be lifted, it would take 5-6 years, if not more, for the first drop of oil to hit the pumping station. It would do nothing to alleviate the current supply of crude oil. Free market Capitalists argue that this would bring down the futures price of crude oil and subsequently drive the gas prices further down. But in todays politically charged atmosphere, it just takes one Nigerian militant blowing up an oil pipeline or a crazed Iranian president's jingoistic speech to drive the prices back to their inflated levels. In short, a potential for increased supply is no guarantee that the crude prices will continue to stay down. The demand will continue to outstrip the supply, and the only solution is to pursue a dedicated approach to lower the demand. Everything else is a mere hogwash!

Depending on whom you listen to, the estimates of crude from ANWR and most of continental offshore will only suffice to meet 2-3 years of US domestic gasoline requirement. A major assumption here is that India and China will not continue to grow their local demand and eat away into this share. So once we are done with this 2-3 year regime (which by the way would happen 10 years from now), the problem would only revisit us. In fact some reports cite that when this additional oil will be available (say 10 years from now), it would only drop the gas prices by about 3-4 cents. It would do absolutely nothing to wean the world of oil addiction, and would only prolong the inevitable by a couple of years.

Instead of giving summer gas tax breaks, the government needs to start investing that money in alternative energy and giving subsidies to those progressive minded individuals who make conscious attempts to reduce their non-renewable energy resource consumption. Don't mistake me to be a far left liberal activist, I am not against digging in the ANWR. A few moose dying to reduce my gas prices doesn't alarm me. Besides technology has advanced to a state where we can safely drill and consume gas without harming the immediate surroundings in the process. The best example was the almost negligible spillage caused by the hurrican Katrina. But the decision to increase current oil supply while not investing enough resources to find an alternative is like subsiding the price of cocaine to a cocaine addict. Instead of making it harder for him to buy cocaine, and curing his addiction, the decision would only please him today by providing a quick fix, while conveniently ignoring the real malaise. The only solution to lower gas prices, is to raise it!