Reviving ‘Drill, Baby, Drill’
The White House is clearly getting concerned about rising gasoline prices and is said to be considering dipping into the Strategic Petroleum Reserve. This is a bad idea, and might even backfire, causing oil markets to price in an additional increment of political risk. But above all, the SPR is not meant to be used as a price stabilizer. Even the loss of all Libyan oil for an extended period will not significantly constrain the global market, but if trouble spreads in six months to Saudi Arabia and we’ve used up a bunch of SPR oil, then what?
Here’s a suggestion for Hill Republicans: If the Obama Administration opens up the SPR in a vain attempt to hold down gasoline prices, offer up a bill requiring that the SPR be refilled with domestic oil from new fields (like ANWR or new offshore fields), rather than purchased from overseas as has been our practice. How will Democrats oppose creating jobs to refill our reserves from our own sources rather than foreign suppliers? Republican might go further and suggest establishing a second SPR somewhere to be filled only with domestic oil from new fields.