How low will gas prices go if we allow offshore oil drilling? And how long will it take?

Question

Has there been any actual studies of what the price of gas would be in the US if we ramp up offshore drilling? Will it go down by .10 cents, or will it go down by $1 or more. In other words, is it worth it? Should we spend the start up cost on just transitioning to alternate energy?

Answer 1

It is worth it as responder #1 explained.  It is also long-overdue, but it is not the ultimate solution because oil that is usable is finite, like coal.  It took millions of years for the Earth to create, so once we use it up, it's gone.

Transitioning to "alternative energy" is also necessary, and the US should be following the examples of Germany and France.  Reopen closed nuclear power plants and build new ones NOW!

Hopefully the US will come to its senses about Ethanol in gasoline, it is a hoax that it is better and we already have seen that it's not cheaper - thanks to Ethanol, our food prices are higher and it costs more to make than it saves!

We're starting to see the Domino Effect here, I hope Congress will step up and help the country fix all of the mistakes we've allowed to be made over the years!

Answer 2

As long as the Commodities Futures Modernization Act goes unchanged nothing anyone does will matter. You can drill your little hearts out and completely destroy the environment, but nothing will change as long as speculators are allowed to run amok.

Simply adding the words "and energy" to the Commodities Futures Modernization Act would bring gas prices down overnight.

80% of all known oil off the continental shelf of the United States have already been granted permits to drill, but those that would do the drilling are sitting on those permits.  Ask yourself why.

Answer 3

It will go down about a nickel over the next decade at the best. It's not going to have huge longterm effects except on the environment. Even if the US drilled all over the country we'd only have 2-3% of the needed national supply.

Answer 4

We probably won't see an immediate change, because they would have to set up the drills, etc.

CNN said if Saudi increased production by 1 mil barrels, it would lower our prices by like 25 cents.

I would say, if we drill, then we could lower our own prices, and be done with it. reduce the taxes on oil companies, so they can use that money to do research.

In the end, if they have to do whatever to save me a dime, then so be it, but don't leave it there. Do whatever to keep saving money.

Answer 5

I just watched CNN’s  international Channel(3pm EST), breaking  the news that oil price spikes again.  But the anchor and the reporter assert it is China’s diesel demand contributed to the hike.

Waited a sec !  It is already THIRD time I am hearing CNN’s assertion of China’s diesel demand. The first time was about two weeks ago. What’s going on?

Then, Israel’s-Iran-attack-drill news flashing back-------Which Was Just Happened This Morning !  That “unmistakable signal”  is surely an act to have a consequence of  oil supply disruption !  Why is it not reported as a oil spiking cause ? !

Time to scapegoat China again before a major offensive ? To verify, I went to CNN web site , there it is :

China hikes fuel prices http://money.cnn.com/2008/06/20/news/int...  

China to raise energy prices

http://money.cnn.com/2008/06/19/news/int...

But  nowhere saying that Israel’s-Iran-attack-drill  will unstablize the oil supply region, causing the oil  price up.

For Israelis Iran Strike Drill see

http://www.jpost.com/servlet/Satellite?c...

Answer 6

Depends on how much oil we pull out of the ground.  The World consumes 85/million barrels per day. The world produces 83/million barrels per day. Demand exceeds supply and as such, prices rise.

If we could pump out 12/million barrels per day, the United States would become oil independent. Meaning that we would no longer have to import our 12/million barrel shortfall, it would be domestic. Not only that, it would reduce our trade deficit and cause the US Dollar to strengthen.

Drilling is good for America.

Answer 7

Commenting on above

"I would say, if we drill, then we could lower our own prices, and be done with it."

We are in a global economy. We can't just "lower our own prices." If we lower importation by a say 3%, that gas will end up elsewhere around the world, which will lower the price a few cents over there. It will be just a few drops in the bucket.

Answer 8

One question is, if there is offshore drilling, WHO will get the oil?  

Will the oil actually go to the United States?  Or will the big oil companies get it?

If the oil goes to the big oil bucket of the world,  ie, Exxon and the big oil companies, it will hardly be a drop.  

Even if all of it went to the US, it would be, at most, 4% of the US oil supply.

We need to be thinking about conservation and alternative energies in order to get out from under the dependence we have on Middle East oil.

There is no easy answer.  Anything will involve some pain and  compromise.  Coal, nuclear energy, ethanol, solar energy, and conservation are all necessary.