Alaska Crude: Just A Drop In the Global Barrel
StartFragment --> The average price of gasoline in America is $2.05 a gallon, according to the American Automobile Association and we know that in California the cost of gasoline is usually much higher.
Now the Bush administration wants to tap the pristine ground of the Arctic National Wildlife Refuge on Alaska's northern coast to reduce gasoline prices at the pump and lower the American dependency on foreign oil.
But drilling for oil in the Alaskan reserve is a poor choice for economic reasons.
While oil in ANWR could reduce gasoline prices at the pump it would represent only 1 percent of Americans daily consumption of gasoline at peak production. Officials from the National Resource Defense Fund said most of the oil would not reach consumers until 2027.
Oil from this area will not affect American gasoline prices.
A leading expert from the Cato Institute, a prominent Washington, D.C. conservative think tank agrees.
"Even if all the oil we consumed in this country came from Texas and Alaska, every drop of it, assume we didn't import any oil from the Persian Gulf, prices would still be just as high today. And the main reason is that domestic prices will rise to the world price," said Jerry Taylor, Cato's director of natural resource studies, in a Cato Institute press release.
Therefore, ANWR oil would not be enough to put a dent in our dependence on foreign oil.
Yet, the President says there are 16 billion barrels of oil under the grounds of the reserve. But the United States Geological Service's estimates the amount that could be recovered economically, or sold at a profit, represents 7.7 billion barrels.
America consumes about 8 billion barrels each year, which means the ANWR would provide less than a year's supply.
Once this oil is gone it is gone. Oil doesn't grow on trees, unless we can press olives into fuel to run our cars. Hmmm
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