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Elliott Negin

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Playing the Blame Game on Gas Prices Won't Solve the Problem

Posted: 03/16/2012 11:19 am

2012-03-16-081008pumpgashmed10a.grid6x2.jpgPhoto: Mike Derer, AP

A recent front-page story in the Washington Post announced the results of a new Post-ABC News poll that found nearly two-thirds of Americans disapprove of the way President Obama is handling gasoline prices.

Too bad presidents have no control over them.

But that doesn't stop politicians -- or journalists, pundits and the general public, for that matter -- from calling out the president when it suits their agenda.

In 2006, for example, when gas prices doubled under President Bush, Rep. Nancy Pelosi slammed the "two oil men in the White House." "Today's record high gas prices," the California Democrat said, "are the price that the American people are paying for the Bush administration's failed energy policies." And that was when regular grade gasoline was averaging $2.91 a gallon. Two years later, it jumped to more than $4.

Now the tables have turned. A gallon of gas yesterday averaged $3.82, and Republican House Speaker John Boehner recently made the same baseless allegation. "The president's energy policies," he told Fox News' Greta Van Susteren on March 8, "have led to a more than doubling of gas prices over the three years of this presidency."

There are a number of reasons why gas prices are spiking -- turmoil in the Middle East and growing worldwide demand among them -- but there is no quick fix for presidents to lower them. That said, there are practical steps our political leaders can take to reduce the amount of oil we consume, which would save Americans billions of dollars for years to come.

Speaker Boehner's solution to drill, baby, drill is not on that list. He complained to Van Susteren that the Obama administration has "closed down most of the gulf" and "all the public lands in the inter-mountain West. And if we're going to bring gas prices down, we need to have all of the above."

In fact, the number of oil rigs in U.S. oilfields has quadrupled over the last three years, despite the temporary slowdown in the Gulf of Mexico after the BP oil disaster. And domestic crude oil production increased by nearly 17 percent between 2008 and 2011.

But even if we opened the entire country to rigs, the impact on gas prices would be inconsequential -- pennies at most, and not for decades. Americans consume more than 20 percent of the world's oil, but the United States holds only 2 percent of the world's proven reserves -- hardly enough to affect the price of a global commodity.

One need only cite the findings of the U.S. Energy Information Administration to prove the point. In 2007, the EIA analyzed the potential impact of increased offshore oil production. It concluded that "access to the Pacific, Atlantic, and eastern Gulf [moratorium] regions would not have a significant impact on domestic crude oil and natural gas production or prices before 2030. Leasing would begin no sooner than 2012, and production would not be expected to start before 2017." The effect on prices would be negligible: "Because oil prices are determined on the international market ... any impact on average wellhead prices is expected to be insignificant."

Conversely, if we boosted fuel efficiency, expanded our reliance on low-carbon fuels, and provided better transportation options, we would not only save Americans money at the pump, we would curb U.S. dependence on oil and combat climate change.

The Obama administration already has made significant strides in increasing fuel economy by establishing the first new standards in more than 30 years. In April 2010, it announced standards for new cars and light trucks that will increase average fuel economy to 34.1 miles per gallon by model year 2016 and cut new vehicle global warming pollution by about 25 percent compared with today's average. Then, in July 2011, the administration reached a second agreement with automakers that will nearly double the average fuel economy of new cars and light trucks by 2025.

The first round of the standards took effect this year, so new car buyers are already benefiting. Over time, the standards' benefits will grow dramatically, ultimately reducing U.S. oil consumption by as much as 3.5 million barrels a day -- more than 50 billion gallons of gas annually -- in 2030, according to the Union of Concerned Scientists (UCS). That's almost as much as the U.S. imports from Canada and Mexico combined, and it's more than we imported from the entire Middle East last year. Likewise, in 2030 the combined standards will cut some 640 million metric tons of global warming pollution -- the equivalent of shutting down nearly 140 average-size coal-fired power plants for a year -- and save Americans $150 billion after covering the cost of the fuel efficient technology.

And that's not all. Last August the administration finalized the first fuel efficiency and global warming pollution standards for new medium- and heavy-duty trucks. The standards--for trucks sold between 2014 and 2018--will reduce fuel consumption across a range of categories, from long-haul trailers to buses to cement mixers. They collectively represent only 4 percent of vehicles on our nation's roads but, according to UCS, account for 20 percent of U.S. fuel use.

These landmark fuel economy standards will go a long way to protect our pocketbooks, not to mention our health, our national security, and the future of the planet. But there is still much more to do to develop low-carbon fuels and electric vehicles, expand public transportation alternatives, and improve the energy efficiency of our planes, trains, ships, factories and homes. UCS has outlined a "National Oil Savings Plan" that would do just that, resulting in a 50 percent reduction in projected U.S. oil use over the next 20 years.

Instead of rehashing the same tired arguments every time gas prices jump, let's focus on real solutions to curb our oil addiction. Drilling more is definitely not one of them; cutting consumption in half is. So let's stop the blame game and get to work.

Elliott Negin is the director of news and commentary at the Union of Concerned Scientists.

 
 
 

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04:35 PM on 03/19/2012
It's infuriating to read all these posts and watch the blame go back and forth. For God's sake, people, are you so unwilling to admit the role your lives have played in this gas price drama? We have become the most obscenely lazy people on the planet in our unwillingness to make even the smallest effort to reduce our consumption of this precious resource. Can your kid get to school by walking or biking? Do you have to jump in the car just for that beer run? Did you really need that big-a$$ car? How about skipping the drive through and walking into Starbucks for that overpriced latte? Is it really just too hard to set up a car pool? C'mon folks, get a little creative, exercise your body and your mind and you can at least make a dent in the amount YOU spend on gas each month. As far as prices go, Big oil will always set whatever price they're going to set. They are the ones telling politicians what to do, not the other way around.
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Josh Crawford
Just the facts, man!
02:54 PM on 03/19/2012
This is how delusional Republicans are: they are so desperate for an issue to "hate on" Obama over that they are willing to pretend that he is causing gas prices to increase in the run up to this Fall's election. Not only would that be a ridiculous "strategy" from a President looking to get reelected, the underlying facts don't even support the GOP allegation. What's causing gas prices to go up are increased global demand and unrest/uncertainty in the Middle East. It's NOT due to the Obama administration energy policy...
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wmnorton
Moderate where moderate used to be
03:09 AM on 03/19/2012
The big difference between Bush and Obama is that Bush added as much as he could to the Strtegic Petroleum Reserve every month he was in office. Nancy Pelosi stopped him when oil was going for $140/barrel. Obama didn't do that. The funny thing about that is that when the Reserve was established all our ships ran on diesel, now most of them are nuclear, so the need for the reseve is much lower.But if you want to speculate on oil who can help you more than the Federal Government taking oil off the market.
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12:13 PM on 03/18/2012
Thank the Fed for a large part of gas $. They devalued making public pay 25-35 percent more for everything.
01:42 PM on 03/18/2012
That is a good point. There is massive inflation going on. The price of everything is going up because the value of the dollar is going down.

They used to publish the real numbers. Now they won't even admit it's happening.
Genders
Love, Tolerance, Enlightenment
04:41 PM on 03/18/2012
Oh, it's much worse than that. The FED gave the banksters who crashed the economy, and robbed the world a 26T$ credit line at .004% so they could speculate and gamble on the entire world, and oil is their Favorite. GS and fiends have been buying up gas, even tankers full and keeping them off the market to drive the prices up, using OUR MONEY!
10:19 AM on 03/18/2012
Let's get to work building the Keystone pipeline.
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lbsaltzman
Permaculture and Sustainability
04:00 PM on 03/18/2012
Why would we want to build the keystone pipeline. It won't lower the price of gas and it will worsen global warming. Instead let's get to work building solar and wind energy installations. And let's get to work building rapid transit and high speed rail to lessen our dependence on cars.
05:04 PM on 03/18/2012
Of course not! Increasing the future supply of oil in the United States will not reduce oil prices one bit.

So not building the Keystone pipeline will somehow prevent Canadian oil from being sold and burned somewhere else like China? How will that stop global warming?
08:12 PM on 03/18/2012
"...worsen global warming."

That's a laugh. Scam of the century. How many predictions that fail to come true until people finally wake up?
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Josh Crawford
Just the facts, man!
02:46 PM on 03/19/2012
Rebel: what do you really think that will do? You do realize that we are already importing that oil, right?
01:05 AM on 03/18/2012
"But even if we opened the entire country to rigs, the impact on gas prices would be inconsequential -- pennies at most, and not for decades."
True. We should have started twenty years ago and we'd be in much better shape today. It's never too late to start. But whether it's oil and gas drilling, or facing up to the impending disaster of an out of control national debt, Obama is unwilling to think ahead. Except for wind and solar of course; we can look forward to lots more Solyndras while gasoline heads for $5 a gallon.
BlackbirdHighway
Brawndo's got electrolites!
07:34 AM on 03/18/2012
Do you guys really believe that Solyndra is the entire solar industry? It was actually one small company that didn't make the cut, while there are plenty more that are doing just fine.
08:33 AM on 03/18/2012
Please name the successful ones. Also name the ones that went bankrupt.
08:16 AM on 03/18/2012
Twenty years ago, oil prices were around $20/barrel. The market was over supplied and new drilling was at a all time low. Oil exploration companies were folding up and the US government had to offer incentives to get industry going again.
08:34 AM on 03/18/2012
Yes, but wouldn't it have been a good idea to LOOK AHEAD AND PLAN FOR THE FUTURE? And ANWAR was a live issue even back then, was it not?
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ennis438
07:08 PM on 03/17/2012
The author misidentified the two main culprets of oil price increases. First is the trading of oil in markets. Fatcat friends of Republipunks are raking in the money while Americans suffer. Nothing new there, as this fits GOP policy perfect. Second is no major alternative energy options. Again the oil company criminals buy Congressional support to assure nothing gets in the way of these corporate mafia's profits. And the GOP , howling about high gas prices , are the ones who want to start another war in Iran which could sent barrel prices to $200. So before the GOP lie brigade starts lying about the reason for oil going up, they should look into their mirrors to see the real person to blame.
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05:44 PM on 03/17/2012
I've been keeping this a secret (until now)...the Swedish Chef controls gas prices.
09:21 AM on 03/18/2012
That is total BS, the Swedish Chef can barely control a oven and could never control the oil market.

Dr. Bunsen Honeydew has create a synthetic hydrocarbon which cost $4.59/gallon. Once gasoline hits $5.00/gallon, Dr. Honeydew will flood the market with "HoneyGas" which produces zero CO2 emissions.

And yes, Dr. Honeydew created the global warming hoax.

Sadly I must report, Beaker was incinerated during a cold fusion experiment.
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opus1dog
I'm anti-stupidity
04:23 PM on 03/17/2012
If a sitting POTUS has any influence over fuel prices whatsoever then why didnt Bush lower it from 3.87 per gallon in May, 2008 when the primaries were winding up and the GOP needed a front-runner and a platform? Fast forward to March, 2012 - if our POTUS has influence over fuel prices then why doenst he manipulate them down to 2.00 until November 7, the day after his re-election?
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den1953
The National Inquire of Politics the GOP!
12:56 PM on 03/17/2012
If this nation could get together with the law makers in Washington a do a bill that can start the country on a path of making fleets of large trucks incentives to convert to natural gas and set up fueling stations across the country, the use of foreign oil would drop dramatically and would reduce gas consumption to the general population until cars could be converted. Natural gas drilling still has it's bugs but at least it isn't coming from the countries that hate us and speculation will drop faster......
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05:42 PM on 03/17/2012
What kind of "incentives"? Money? Or cookies?
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den1953
The National Inquire of Politics the GOP!
03:27 PM on 03/18/2012
Tax cuts for alternative fuels i guess even conservatives aren't aware of alternative energy?
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ogis
powerdown baby powerdown
06:25 PM on 03/18/2012
How about we give Afghanistan the cookies & we keep the money.
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Josh Crawford
Just the facts, man!
04:02 PM on 03/19/2012
President Obama has been doing just that for a while, most recently on Jan 26, 2012 in Las Vegas.

"In his remarks, President Obama proposed several federal initiatives favoring the use of natural gas for transportation, including getting more natural gas vehicles on the road using federal fleets and helping local governments upgrade their fleets, offering new tax incentives to help companies buy more clean trucks, working with the private sector to help develop natural gas fueling stations between cities for more natural gas corridors along our highways, and launching a competition to encourage new breakthroughs for natural gas vehicles."

http://www.marketwatch.com/story/president-obamas-support-of-natural-gas-vehicles-and-lng-fueling-corridors-for-trucking-at-las-vegas-ups-depot-strengthens-prospects-for-broad-deployment-says-clean-energy-2012-01-27
02:30 PM on 03/20/2012
Josh, I am about to travel and probably won't be posting for the next couple of weeks.
Thanks for keeping our argument reasonably civil. :-)
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gutenmorgen
a.k.a. crowsnest
12:55 PM on 03/17/2012
We who live in Houston know exactly why the price of crude and gas have surged up. Why? When the path of a hurricane threatens Houston we go to stores to stock up on food, water, batteries, plywood, and fill the tanks of our cars to overflowing even though we cannot be absolutely sure that the hurricane will hit us. We therefore understand why the price of gas goes up ever time President Obama publicly utters the word "Iran". The CEO's of oil companies and the rulers of China and other dictatorships immediately send the word down: buy as much crude as you can for immediate or future delivery. All other explanations are nonsense.
10:36 AM on 03/17/2012
Gas prices spiked in 2005 and the Republicans wanted more drilling while lefties said it won't matter because it takes 5-7 years for new leases to turn into oil rigs and increased production.
Prices once again spiked in 2008 and the Conservatives wanted to open up more areas for production while Lefties cried out that it wouldn't help us because that oil production wouldn't be seen for 5-7 years.
Guess what? It's 5-7 years later.
So let me get this straight.
Increase production won't give us more oil. Okay.
I guess that increasing harvests won't give us more food. Lefty math is funny. More coal fired power plants means more C02 production but more oil production means.....um.....nothing.
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doctorkosan
PhD Chem E, HBS
01:45 PM on 03/17/2012
Increased production in the US will not lower prices. Production in the US has increased and prices went up. Got it?
Prices are not impacted by US production because it is a relatively small fraction of global production. And if a huge unexpected oil field was found under your state, do you think the global oil lobby intends for the price to decrease? Dream again.
02:30 PM on 03/17/2012
Production has increased as worldwide demand has increased.
Got it?
American production has not however kept up with increased demand in the US.
Let's talk about national security for a moment. Sooner or later Saudi Arabia will fall to fanatics and they will use oil as a weapon. The same could be said for the entire Middle East and no one honestly knows what Iran will do. Mexico is producing less oil today than they did in the 1990's and China is locking down oil contracts all over the globe as their demand increases.
Meanwhile we have a dumbshit President in the White House turning down oil from our closest and most reliable friend and neighbor.
And people wonder if he's competent or even likes this country.
Oil is a national security issue and anyone that can signicantly cut our supply can bring us to our knees. We can't be self sufficient but we can increase production enough to hopefully prevent a total economic collapse in the event of a significant disruption.
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ron ray
Justice: Big Bird has a job, Mitt's a 47%er.
12:32 PM on 03/19/2012
that would be true if this spike were due to supply shortages; they are not.

the fact is that there are millions of acrs open for leasing oil companies have not tapped, and thousands of capped well dotting texas and oklahoma. none of that will be tapped until prices are higher, ie, as long as oil from the middle east is cheaper. oil companies have no interest in glutting the market.

price are up because of unrest and war mongering in the middle east. tapping more expensive domestic reserves will not change this.
09:51 AM on 03/17/2012
So Obama is the reason we have high gas prices? I don't think so, if you want to blame anyone blame all the members of congress for the last 30 years, and the presidents too. No energy policy, no planning for the future. Now, knowing that oil is a finite resource, the remedy is "drill baby drill". I mean I can't wait for that oil well in my back yard, creaking and smelling its way into my senses. Let the speculators continue to drive up the price, any controls on that type of speculating were watered down or removed by congress.
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hk usp 45
Land of the free not freebie
09:14 AM on 03/17/2012
Blame game?

There is no need to play the blame game.

O promised high energy prices when he was campaigning in 08. One of the few campaign promises he has kept.
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gts31bumbee
a Warehouse of Information
01:21 PM on 03/17/2012
This was over another issue and falls within 'taken out of text'. Even Faux conceded this ! If it were true, did Bush make the same promises in 2005 and 2008 when gas also spiked ? Pure B.S. !
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kenhamlett
09:13 AM on 03/17/2012
We all should have figured this out by ourselves. The rising cost of gas is no one's fault. That was easy. The economic collapse was no one's fault, either -- at least no one is being held responsible or prosecuted for wrongdoing. Ignoring reality and holding no one responsible for anything can be cathartic.

Not.