Just drill, baby...

President Bush is going to announce that he is lifting an executive order that banned  offshore drilling in the United States.

This in and of itself won't start the drilling. Congress would have to specifically remove restritctions in several locations in order for the lifting of the ban to be effective. And at the moment, the Democrats seem perfectly willing to allow the issue to die since polls tell them it is Republicans who are being blamed for high fuel prices, not them.

Any move to alleviate the suffering of the American people due to high gas prices will not come until the Democrats are convinced doing something about the problem will benefit them in the November elections. That means that as long as they are successful in placing the blame for our current fuel crisis on the Republicans, they won't lift a finger to help.

The White House could probably assist Congressional Republicans by doing something that has been urged upon them since this crisis started; begin releasing our strategic petroleum reserves.

Even a partial release would help some by driving speculators out of the market. And with the threat of additional releases, we might succeed in stablizing the price at a much lower level than it is now.

But Bush also sees the downside; once that card is played, it invites the price to rocket up again. That, and replacing the reserve once the immediate crisis is over would be a very expensive proposition. There are currently around 700 million barrels of oil in the SPR worth $90 billion. This represents around a 30 day supply for the US.

Of course, selling it on the open market would cause the price to immediately come down. How much depends on how fast we would be releasing it. A small release of say 2 million barrels a day would more than cover the excess demand putting pressure on prices. As a price stabilizer and anti speculation tool, that might be one answer to the fuel problem.

But lifting the ban on offshore drilling is key. Now let's see if we can pressure congress to actually do their jobs and get things started.

Just drill, baby...