Citing rising demand in India, China, Bush seeks oil nearer home

June 19th, 2008 - 10:58 am ICT by IANS  

By Arun Kumar
Washington, June 19 (IANS) Citing increasing demand for oil from India, China and other emerging economies pushing up prices, the White House has asked US Congress to permit drilling for oil in deep water off America’s coasts. “There is no excuse for delay,” said President George Bush Wednesday in a White House Rose Garden speech seeking a reversal of a long-held executive position on offshore oil drilling.

The president proposed lifting a ban that he has signed annually and was strengthened by his father, former president George H.W. Bush, and extended by former president Bill Clinton until 2012.

Urging Congress to make the first move on the legislative ban, Bush said: “There’s also an executive prohibition on exploration in the OCS (Outer Continental Shelf). When Congress lifts the legislative ban, I will lift the executive prohibition.”

“The president has been focussed on the root of the problem, which is supply and demand,” said White House spokesman Tony Fratto explaining the policy reversal.

“We’ve done a lot on the demand side, in terms of conservation … We have done a great deal of investment in technologies for long term, for future automobiles and other forms of alternative fuels,” he said. “Now what we really need to do is something on the supply side.

“We have seen millions of consumers out there - in this country and in places like China and India and South Africa and Brazil and Russia and other emerging countries - that are putting millions of new cars out on the road and they’re increasing demand,” Fratto said.

“So we see demand increasing and we’re not seeing a corresponding increase in supply,” he said estimating that over the last three years or so, 85 million barrels of oil were being produced per day in the world.

“And we have supply here at home and we should use it,” Fratto said.

The White House estimates that there are 18 billion barrels of oil offshore that have not been exploited because of state bans, 10 billion to 12 billion in the Arctic National Wildlife Refuge and 800 billion barrels of recoverable oil in the Green River Basin.

The White House press office also told reporters that by proposing the policy reversal, Bush was not following John McCain, the likely Republican presidential nominee, who also changed his tune on offshore drilling earlier this week as petrol prices jumped above $4.00 a gallon ($1.06 a litre).

The president has held such views on reversing offshore drilling policy for some time, they said as Bush drilled the “Democratic-controlled Congress” for opposing his energy policies, which he said has resulted in the rise of “gas prices to record levels”.

“If Congressional leaders leave for the Fourth of July recess without taking action, they will need to explain why $4-a-gallon gasoline is not enough incentive for them to act.

“And Americans will rightly ask how high oil - how high gas prices have to rise before the Democratic-controlled Congress will do something about it,” Bush said.

“I believe it is time for the federal government to lift these restrictions and to put our own reserves to use,” McCain told a crowd Tuesday in Houston before the president made his announcement Wednesday.

McCain, who is engaged in a balancing act of distancing himself from the unpopular president, while trying not to alienate those Republicans loyal to the president, did not seem to welcome the White House energy symmetry, and resisted the “third-term Bush” claims from his Democratic opponent Barack Obama.

“When I announced this policy the other day, Senator Obama wasted no time in mischaracterizing it. He described my position as - you guessed it - another example of Bush’s third term,” McCain said Wednesday in Missouri.

“I guess the senator has changed his position since voting for the 2005 Bush energy bill - a grab-bag of corporate handouts that I opposed.”

However, Democrats were quick to pick up on the Bush-McCain energy embrace.

“After admitting he doesn’t understand the economy, Senator McCain is now trying to pass off failed Bush policies that have undermined America’s energy security, our national security and our economy as his ‘new’ approach to energy independence,” Democratic National Committee Communications Director Karen Finney said.

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