Egypt Crisis and Oil

Egypt Crisis and Oil
By Herman Cain on 2.1.11 @ 6:07AM

Egypt is in the midst of what can only be described as a political and social meltdown. While elected officials and diplomatic leaders from the U.S. determine our appropriate course of action, we are reminded that the stability enjoyed by Americans is simply not the norm in other parts of the world.

While our thoughts and hearts go out to the Egyptian people, we as a nation must examine how their affairs deeply affect the vital components of our economy and our way of life. One of the most apparent consequences of such turmoil is the impact on our energy supply and consumption.

With nearly 40 percent of the world's oil transported through Egypt's Suez Canal, government collapse and societal chaos could shut down the world's busiest oil pass-through. If such a catastrophe were to take place, the U.S. is hardly poised to stand on its own when it comes to energy.

After the BP oil spill, President Obama's overreaction spurred a ban on offshore drilling and, as a result, a 79 percent drop in domestic oil production. While he argued that it was necessary for regulators to ensure the safety of rigs, it's been nearly a year and there seems to be no sign of lifting this moratorium.

In addition to the loss of revenues and joblessness resulting from the moratorium and other drilling restrictions, the U.S. will inevitably rely even more heavily on foreign oil to satisfy America's growing energy needs. While OPEC claims it would be willing to send more fuel to the U.S. in the event of an Egyptian oil shutdown, this would only exacerbate the stranglehold foreign oil maintains on U.S. consumers and our government.

The greatest way America could eliminate this dependency and better insulate ourselves from unrest in other parts of the world would be to increase our own domestic energy production. According to Robert Bluey of the Heritage Foundation, allowing access to oil and natural gas resources currently off-limits would increase U.S. crude oil production by as much as 2 million barrels per day in 2030, offsetting nearly one-fifth of the nation's imports.

Further, the American Petroleum Institute conservatively estimates that if energy companies were allowed to drill in areas currently restricted by the federal government, they would find 116.4 billion barrels, enough oil to power more than 65 million cars for 60 years. Additionally, they project they would discover 650.9 trillion cubic feet of natural gas, enough to heat 60 million homes for 160 years.

It is disconcerting that President Obama did not make a single mention of domestic drilling or lifting the moratorium in his recent State of the Union address. While the free market should examine the options alternative energy sources provide, it is clear that significant domestic drilling is an unmistakable necessity in achieving American energy independence.

Although the outcome of the crisis in Egypt is uncertain, American lawmakers should remain uncomfortable with the notion that another nation's problems could so adversely affect our energy consumption at home. The U.S., while willing to endure occasional pitfalls in exchange for participation in the global economy, should never be willing to risk our autonomy for the whims of foreign producers.

It's time to lift the ban on offshore drilling. It's time for the federal government to begin issuing drilling leases to oil and gas companies. And it's time to get America on the road to real and lasting energy independence.