This is the good news, the silver lining, coming out of yesterday’s precipitous market drop. Oil prices fell by over $10. And, the dollar had its biggest gain against the British pound in something like 15 years (so Drudge tells me).
Considering that Americans consume roughly 20.73 bbl/day, a $10/bbl savings means [open “Calculator,” punch in a bunch of numbers, 20 mins. later …] that Americans will save $207 million per day. A few more days like yesterday will go a long way towards covering the cost of the Paulson Plan!
American Thinker has an article about the current state of the oil game here in the United States. Janet Levy’s section on “current supply estimates” is particularly instructive.
Although Congress has not authorized a thorough inventory of offshore resources for over 30 years, the American Petroleum Institute estimates recoverable U.S. oil resources at about 86 billion barrels offshore and 32 billion barrels onshore. This estimate doesn’t take into consideration technological advancements, unconventional sources and recent discoveries.Currently, the United States is the only industrialized country in the world not actively seeking to explore new offshore resources. In fact, offshore drilling is allowed in most of the Gulf of Mexico but prohibited on the East Coast, West Coast and Alaska. Only 17% of non-park, non-wilderness federal land is open to energy development and 85% of coastal waters are off limits. Further, since 1983, the amount of federal land available for development has decreased by more than 60%.Recent assessments of the extent of economically recoverable, conventional oil in two important locations — the Bakken Formation and the Arctic National Wildlife Refuge (ANWR) — could increase these estimates considerably.First discovered in 1953, the Bakken Formation covers part of Montana, North Dakota and Saskatchewan. In April of 2008, the U.S. Geological Survey (USGS) estimated that Bakken contains 3 to 4 billion barrels of technically recoverable oil, a 25-fold increase from the agency’s 1995 estimate. Market conditions and drilling and production advances could transform Bakken, the largest continuous oil accumulation in the lower 48 states, into one of the largest producing oil fields in the world.Meanwhile, petroleum experts have estimated that ANWR contains anywhere from 9 to 16 billion barrels of technically recoverable oil and could prove to be one of the largest oil fields yet in North America. Since current USGS estimates are based on the petroleum geology of adjacent lands, the true potential for oil recovery is uncertain.Environmental arguments about risks to wildlife and pristine forests have kept ANWR off limits to energy development, even though such risks are unfounded. Drilling in the region would cover a mere tenth of one percent of its 19 million acres. Plus, ANWR is a flat, treeless plain with temperatures inhospitable for most animal species. The area is already home to a village of Native Americans, who support its development. It currently contains an airstrip, power lines, an oil well and a military radar site. Two decades of drilling in the North Slope area has had no negative effects on the ecology of the area and, during that time, the caribou population actually increased sevenfold.
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