The People of America's Oil and Natural Gas Indusry

Denying Access to Energy Denies Safety, Prosperity, Opportunity

Mark Green

Mark Green
Posted December 11, 2015

Then there’s this from Alaska: Falling oil revenues have the governor in that energy-rich state asking his legislature to plug a $3.5 billion hole in the state budget by imposing a small income tax (Alaska hasn’t had one for 35 years), other tax hikes, budget cuts and a reduction in the annual dividend Alaskans get from the state’s Permanent Fund.

Now, it might not bother you much that Alaskans soon could be paying higher taxes. But there’s another story playing out in Alaska and other places that should trouble all Americans: Access to U.S. energy is being restricted – by policy and regulation – in ways that could imperil America’s energy revolution and the generational opportunities that are being created by that revolution.

Alaska isn’t in a fix because it’s running out of oil. Federal officials estimate the National Petroleum Reserve-Alaska holds 896 million barrels of oil and that Area 1002 in the Arctic National Wildlife Refuge – an area identified by Congress for energy development – holds 4.3 billion barrels. What’s more, Alaskan waters may hold nearly 50 billion barrels. Yet, federal restrictions on oil and natural gas development in Alaska have negatively affected offshore development there, with two companies recently announcing withdrawal of their plans for Arctic drilling. U.S. Sen. Lisa Murkowski of Alaska said the companies pulled out because of “uncertainty surrounding our federal government’s support for Arctic development.” Murkowski:

“… the real project killer was this administration’s refusal to grant lease extensions; its imposition of a complicated, drawn-out, and ever-changing regulatory process; and its cancellation of future lease sales that have stifled energy production in Alaska. These actions threaten to undermine Alaska’s economy, our security, and our environment.”

Alaska is one example of how restricting access to energy impacts American energy security, because restricting or blocking access to energy ultimately becomes a decision not to develop energy. Unfortunately, there are other examples: the withdrawal of lease sales, politically motivated rejection of needed energy infrastructure like the Keystone XL pipeline, snarls of red tape that make energy development on federal lands an unpredictably slow process with declining returns and redundant and prescriptive rulemaking applied to offshore development.

At risk is an energy revolution that is very, very good for America.

Rising U.S. oil and natural gas production – thanks in large part to the ability of safe, modern hydraulic fracturing and horizontal drilling to unlock shale energy – has made the United States the No. 1 producer of oil and gas, reducing oil imports and making our country more energy self-sufficient, stronger and safer. Instead of needing to import natural gas, the U.S. could become a leading exporter.

Because the U.S. is importing less crude, global markets are well supplied and the world is more insulated from potential shocks. (Ending the ban on U.S. oil exports would add to this benefit while creating others here at home.) Falling imports also means an improved U.S. trading posture – more wealth coming into the country instead of going out.

Domestically, the energy revolution’s benefits are everywhere. Increased U.S. supply is putting downward pressure on global crude prices and, ultimately, gasoline prices at your filling station. Other costs, too.

This week the U.S. Energy Information Administration (EIA) said heating costs for U.S. households using natural gas as their primary space heating fuel would average 13 percent lower this winter than last. EIA:

Working natural gas inventories on November 20 reached their highest recorded level at 4,009 billion cubic feet (Bcf), according to EIA's Weekly Natural Gas Storage Report (WNGSR). … Looking to March 2016, EIA projects inventories will end the winter at 1,862 Bcf, which would be a smaller drawdown than typically seen during the winter. … Strong inventory builds, continuing production growth, and expectations for warmer-than-normal winter temperatures have all contributed to low natural gas prices.

EIA’s chart on natural gas prices:


Likewise, EIA says costs for home heating oil and propane are lower heading into winter:

In all of the states surveyed, propane and heating oil prices are lower than they were at this time last year, and EIA expects prices will remain at lower levels throughout the winter.

Another EIA chart:


These are some of the real-world benefits of American energy to Americans.

The biggest threat to all of the above comes not from a foreign power or events beyond America’s control. It comes from our own policies that could jeopardize the revolution itself. We mentioned restrictions in Alaska, but there also are the recent decisions by federal officials to withdraw lease sales in Arkansas, Michigan and Utah.  

Think of it this way: Every barrel of American oil not produced is another barrel of oil to be imported, with American becoming more dependent and less secure. And a less secure world, too.

Every barrel of U.S. oil not produced, every cubic foot of natural gas not collected, has the potential to affect household budgets, the same ones currently doing better because of abundant domestic output.

America has a choice on energy because we’re an energy-rich country, a choice energy-poor nations can’t make. And that is to safely, responsibly develop our energy while acknowledging that energy development, climate progress and environmental safety can occur together. It already is.

There should be more energy, not less. There should be more access to U.S. oil and natural gas, not grudging, overly restricted access. API President and CEO Jack Gerard:

“The fact is our nation has become a global leader in energy production and leading the way in climate change mitigation disproves the overheated rhetoric of anti-fossil fuel groups who continue to peddle the unrealistic notion that our modern society and way of life would be possible without a true all-of-the-above energy policy that is built upon a foundation of responsible fossil fuel use. The false choices some have suggested contradict our energy reality. We are producing more affordable and reliable energy. We are creating jobs, helping the economy and generating billions in revenue for the government. And, we are leading the world on carbon reductions. … The energy policy choices we make today will impact our nation’s consumers in the future. … There is a vocal minority who believe that instead of growing our economy to lift people out of poverty we should reduce our current standard of living and cap our potential. We reject this notion and encourage policy makers to continue down the path we have shown to work, supplying abundant, affordable, and reliable energy to consumers while lowering our impact on the environment.”


Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.