Congressional Report: Obama Deliberately Causing Oil Prices To Spike

Yesterday, Congressman Issa's House Oversight and Government Reform Committee issued a scathing report about the nation's energy (embedded below) saying in part that the President has deliberately created policies which would cause energy prices to rise.

"The United States has the largest reserves in the world—resources that can provide good paying American jobs and fuel our economic expansion. But standing between that energy and U.S. consumers is an obstacle course of government red tape, regulation, delays and obfuscations," Chairman Darrell Issa (R-CA) said. He pointed to statements by President Obama and Energy Secretary Chu about intentionally raising energy costs for Americans and how these goals are being implemented throughout the government.

The committee's report found that U.S. domestic energy resources are currently the largest on earth—greater than Saudi Arabia, China and Canada combined. It also said that the recent EPA and Department of Interior regulatory actions, some in collaboration with environmental groups or outside normal scope, are having a detrimental impact on independent energy producers.

The report had eight basic findings:

1. Key Obama Administration figures have expressed a belief that Americans should pay more for energy – a pattern of actions shows the Administration is, in fact, pursuing an agenda to raise the price Americans pay for energy.

President Obama, Energy Secretary Chu and others have stated that American consumers should pay more for energy, including electricity and gasoline. From a political perspective, increasing the price of energy (by whatever means) helps them make the case for “green” energy. Even beyond the effort to raise energy prices through “cap and trade” legislation that Congress rejected, a pattern of increased enforcement, regulatory delay and new hurdles can be seen across numerous agencies and approval processes. The result of this government action is less production, higher costs for producers, and more expensive energy.

2. While the Administration touts nascent “green” energy technologies, U.S. domestic energy resources are currently the largest on earth—greater than Saudi Arabia, China and Canada combined. New developments in drilling and extraction technology have dramatically expanded the amount of total recoverable reserves of oil and natural gas. Much of this, however, may be put off-limits by the government.

3. Still trying to capitalize on domestic energy resources, U.S. firms are nevertheless investing billions of dollars to tap newly recoverable resources in California, Texas, Colorado and North Dakota, among others.

By 2015, fields in these areas could yield more daily oil than the Gulf of Mexico produces today, boosting domestic production by 20-40 percent and increasing our energy independence if government action does not severely restrict development and yields.

4. Recent Administration action has already led to significant cost and regulatory barriers that have limited domestic production of oil. 

Even before the Gulf oil spill, the Department of the Interior had undertaken significant steps to restrict access to much of the energy resources located in the outer continental shelf: Alaska, the Gulf of Mexico, and along the Atlantic and Pacific coasts.

5. Other agencies have stepped up their efforts to indirectly curtail energy production through environmental regulations.

The U.S. Fish and Wildlife Service has proposed placing the dunes sagebrush lizard that lives in New Mexico and Texas on the Endangered Species list—designation that would severely restrict production activity in a resource-rich part of Texas.

6. EPA has collaborated with environmental groups to target independent energy producers for environmental concerns not related to their operations.

In an email message reviewed by the Committee, environmental advocates and EPA’s Texas-based regional director exchanged celebratory accolades for efforts that create barriers to energy production. One exchange concluded: “Yee haw! Hats off to the new Sheriff and his deputies!”

7. President Obama’s proposal to increase taxes on the energy industry will cost American jobs and hamper economic recovery.

Independent operators are responsible for 95 percent of domestic oil and gas wells and they currently invest 150% of their domestic cash flow back into future projects development. Tax increases proposed by President Obama, some of which would be transferred to “green” energy producers, would cost energy producing firms a combined $12 billion in the first year.

8. Some green energy sources the Administration is promoting at the expense of expanded domestic oil, gas, and coal supplies create unintended environmental, security and economic consequences.

"Viewed in tandem with Obama Administration efforts to slow production from the Gulf of Mexico, block "fracking" a technology that would increase domestic oil production by 40 percent in only five years, and stifle production on public lands, this can be seen as nothing less than a concerted campaign to raise the price of energy as a means to force the issue of green alternatives," Issa added.

"Today's hearing exposed the many ways the government is limiting access to our vast natural resources. With this understanding, Congress can enact policies that support American businesses and consumers, rather than give more reasons to look overseas for economic opportunities and more favorable regulatory climates.

There is no big surprise in Issa's findings many of us in the blog world have been saying it for a long time.  But its nice to see congress get involved.  The report is very informative, and its worth giving it a read below.
REPORT - Rising Energy Costs an Intentional Result of Government Action