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May 23, 2012

It’s a Fact: Domestic Drilling Doesn’t Affect Gas Prices

Two newly released reports shed some much-needed light onto a crucial question in Washington: Does domestic oil drilling affect gasoline prices?

That question lies at the heart of the debate over what we should do about high and volatile gasoline prices. Advocates for oil drilling call for broader and quicker access to our nation’s resources in order to provide relief at the pump – calls that the House has happily obliged by passing bills that would open up new areas to offshore drilling and undercut government oversight. Environmental groups and other opponents of domestic drilling, on the other hand, argue that this is the wrong approach, and that we should instead be investing in fuel efficient vehicles and alternate modes of transportation.

The two new reports provide much-needed objective and nonpartisan analyses of this crucial question, and come to the same, clear conclusion: providing relief at the pump to U.S. consumers can only be achieved through reducing our oil consumption, NOT through more domestic drilling.

The reports were issued by the Energy Security Leadership Council (ESLC), a nonpartisan project of Securing America’s Future Energy that’s composed of industry CEOs and retired four-star generals and admirals, and the Congressional Budget Office (CBO), which provides nonpartisan economic analysis to Congress.  They join a growing list of impartial publications that refute the notion that the United States can drill its way to energy independence and free ourselves from the myriad problems associated with our oil consumption and offshore drilling.

The ESLC report begins by laying a solid foundation for how to think about energy security. Energy security is not just about becoming independent from our foreign oil suppliers – it’s also about protecting ourselves as consumers from the impacts of high and volatile oil prices.

As both reports point out, the latter is simply not possible through increasing domestic oil production even if we were able to produce all of the oil we consume, which we are a long way from doing. The reason for this is simple: oil prices are determined in a global market, and producing more – or even 100% – of our oil domestically will not isolate our nation from the global market.

So what can protect us from volatile and high gasoline prices, if not increased domestic production? Both reports draw the same conclusion: decreased oil consumption. As the ELSC report puts it, “the long-term goal of energy security policy must be to break the petroleum’s stranglehold on the transportation sector.”

Doing so will not be easy by any means, but plenty of options exist that can reduce our nation’s dependence on oil. One powerful tool is continuing to strengthen the nation’s fuel economy standards, which the ELSC report calls the “most important energy security accomplishment in decades.” Both reports also highlight the promise of electric vehicles in reducing oil consumption by providing a transportation solution not fueled by liquids.

At a time of political frenzy over high gasoline prices, the CBO and ELSC reports provide a much-needed reminder of a very simple fact: the U.S. cannot drill its way to energy security. If we truly want to protect ourselves from volatile oil prices and high gasoline prices, we need to invest in alternatives like electric vehicles or more efficient vehicles – not in drilling for oil and gas.

Michael Craig is the Energy Analyst at Oceana.