Back in July, when oil was trading near $150 per barrel, President Bush used the opportunity to lift the Executive Ban on offshore drilling, commenting “To reduce pressure on prices…we need to increase the supply of oil, especially here at home.”
Americans bought in, chanting “Drill Baby, Drill!” but there was just one problem…the soaring cost of oil wasn’t being driven by supply – it was being driven by Wall Street speculators.
With the world markets now in freefall, the price of oil has followed suit, plummeting 40% to $83 a barrel on the New York Mercantile Exchange.
According to an article published this week on Time Online, “The big oil producers have good reason to be nervous. Many are still haunted by a disastrous error made at an Opec meeting in Jakarta in 1999, when the cartel — which produces more than a third of the world’s oil — opted to raise its production levels. Within weeks Asian stock markets tumbled, driving world oil prices down to $11 a barrel. Oil officials in Saudi Arabia and elsewhere have cited that price crash as the reason they’ve rebuffed pleas from President Bush to pump more oil. Countries have learned the lessons of the past.”
Sadly, even if this lesson is to be learned here in America, it may have come too late for our country’s coastlines.