America’s trucking industry is on pace to pay a whopping $138.7 billion for fuel in 2011 — an increase of $37.2 billion over last year due to higher energy prices. That’s a lot of money for gas. And unfortunately for consumers, they’re likely to pick up the tab.
A new study from the Consumer Energy Alliance blames the lack of a national energy policy for America’s economic woes. Higher prices are costing jobs and putting a strain on families struggling to make ends meet.
Higher costs for the transportation sector mean rising prices for everyday goods and services like groceries and airline tickets. But that’s not the only consequence. The report estimates upwards of 500,000 jobs could be in jeopardy because of restrictions on U.S. energy development.
Industries such as manufacturing, agriculture and transportation are strained by endless red tape, including restricted access to domestic energy supplies. As a result, the higher costs for employers are being passed along through rising prices for consumer goods.
CEA’s study indicates the offshore energy potential of the United States is conservatively estimated at 45 billion barrels of oil and 183 trillion cubic feet of natural gas. That would be enough oil to power 60 million vehicles for 25 years and enough natural gas to heat 60 million American homes for 57 years.
”Demand for oil and natural gas is increasing,” said National Ocean Industries Association President Randall Luthi. “Yet we only explore for oil and gas in about 15 percent of the nation’s offshore areas — the same areas that were available when Richard Nixon was president.”
Apart from boosting job creation and steadying oil prices, offshore energy production would garner billions for the U.S. Treasury. Declining production in the Gulf of Mexico alone could cost the federal government more than $1 billion in revenue this year.
Meanwhile, President Obama has opted for politically symbolic measures like last week’s release of 30 million barrels from the Strategic Petroleum Reserve rather than a comprehensive policy to increase American production. Heritage’s Nick Loris argued last week that the Obama administration is denying Americans access to domestic oil:
Production in the western Gulf of Mexico dropped nearly one-third of a million barrels per day since last April, and the increased production in 2010 is a result of increased horizontal drilling in North Dakota. We can’t drill off the Pacific Coast, Atlantic Coast, or the eastern Gulf of Mexico. The U.S. Environmental Appeals Board withheld air quality permits preventing Shell from moving forward to develop 27 billion barrels of oil off the coasts of Alaska. The Environmental Protection Agency already issued two air permits, but Earth Justice filed a petition to review the permits, delaying the process.
CEA’s report isn’t limited to oil and natural gas. It estimates the economic cost for other industries as well, including the benefits of new nuclear power plants. Click here for the full 52-page study.
