Expect more pain at the pump in second Obama term

{mosads}If the past is any indication of the future, then the president’s first term provides an abundance of clues. Former White House climate adviser Carol Browner revealed as much on a recent conference call: “We know there’s more work to do to defend the progress we’ve made. We’ve achieved a remarkable amount in 50 years…But the decisions we make in the next four will have a lasting impact on generations to come.”
 
Overall, U.S. energy production has increased under the president’s watch; a fact he has frequently touted. But that’s akin to the rooster crowing to take credit for the sunrise. The facts are clear: he didn’t build that. True enough, production increased on private and state lands. What the Administration can take credit for is record low production on federal lands. The federal government’s own Energy Information Agency (EIA) found in its 2011 Annual Energy Review that from just 2010 to 2011, oil and gas production on federal lands dropped to a 30.3 percent share of total U.S. production, an 18.5 percent drop from FY2003.
 
Another example of the Administration’s ongoing hostility to affordable energy is the “waiver credits” that EPA forces refiners to buy if they don’t blend gasoline and diesel with a mandated amount of cellulosic biofuel. The problem is that according to the EIA’s most recent data, it’s doubtful that even a drop of cellulosic ethanol has been produced outside of a research laboratory. Refiners are having to cough up fines for failing to use a fuel that doesn’t even exist on the commercial market. It’s also another example of how the administration is needlessly driving up the cost of gasoline. Gas cost just $1.85 per gallon when Obama was sworn into office, according to the U.S. EIA.
 
Once the pressures of the reelection campaign are behind him, Obama’s Environmental Protection Agency is expected to demand further cuts in sulfur levels in gasoline, despite little evidence the action would produce significant health or environmental benefits. This directive also ignores the fact that U.S. refineries have reduced sulfur levels by 90 percent just since 2004. The price tag for refiners will be $9.8 billion initially and $2 billion annually thereafter, while motorists can expect to pay as much as an additional nine cents per gallon, by the American Petroleum Institute’s calculations.
 
The president’s Interior Department, meanwhile, is signaling that it will issue new regulations on the oil and gas drilling technology known as hydraulic fracturing. Not only will the rule cost the industry – and ultimately consumers – an estimated $1.5 billion dollars, it will also hand the agency unprecedented regulatory authority. Hydraulic fracturing has been responsibly regulated by the states for more than 60 years without a single case of groundwater contamination. That’s a fact acknowledged by 20 state regulators and associations, and confirmed by none other than EPA administrator Lisa Jackson.
 
On the campaign trail, Obama has retained his zealous devotion to renewable energy companies that without a steady diet of taxpayer dollars would likely go belly-up. This is a product of Obama’s abundance of hope over experience, given the Solyndra scandal and the fact that wind and solar are some of the most expensive forms of energy to produce. To fund them, he proposes the mammoth new taxes on the oil and gas industry. In addition to killing jobs in one of the economy’s few bright spots, a study by consulting firm Wood MacKenzie estimates that a tax increase of $5 billion per year would reduce domestic oil production by 400,000 barrels per day by 2025..
 
In a second Obama term, Americans should brace themselves for more pain at the pump, escalating transport costs, and higher prices for food and virtually all basic consumer necessities.
 
Pyle is president of the American Energy Alliance.