Some analysts see little relief for rising costs, smaller supply
WASHINGTON -- Three years ago, President Bush and Vice President Dick Cheney, both former oil executives, were seen as the US oil industry's dream team and the most capable of tackling America's energy problems.
With nationwide gasoline prices expected this month to top a record $1.75 per gallon, however, government energy data show many problems still exist. Energy costs -- and smaller supplies -- have pinched the pocketbooks of consumers and pushed up business expenses.
Some Wall Street analysts see little relief in sight.
"It looks like another two years of high crude and petroleum prices," Jay Saunders, energy analyst at DeutscheBank, said during a Senate hearing Thursday.
Shortly after taking office, Bush, a former Texas oilman, created a White House task force to overhaul energy policy and boost oil and natural gas production. Cheney, the former chief of oilfield services firm Halliburton, headed the panel.
The results have been mixed.
While various government agencies have adopted most of the task force's recommendations, the White House did not persuade Congress to pass a broad energy bill that would have opened the Arctic National Wildlife Refuge to drilling.
The House of Representatives easily approved drilling in the refuge, which was a key part of Bush's national energy plan. But John F. Kerry of Massachusetts, the presumptive Democratic nominee, joined other Senate Democrats and moderate Republicans to block the government from opening the refuge.
Even if the refuge was opened for drilling, however, oil industry specialists say it would take about 10 years for the area to reach full production.
When asked whether the failure to pass energy legislation was a political liability for Bush, Energy Secretary Spencer Abraham said Thursday, "I think the question should be whether the Congress is prepared to go into the election season having once again -- if it does -- fail to pass an energy bill."
"This administration has done everything we can," he said.
When Bush was sworn into office in January 2001, the national weekly price for gasoline averaged $1.47 a gallon. This week, the pump price stood at $1.72, just 3 cents below the record set in August.
Gasoline costs are forecast to remain high through the busy spring and summer driving months, according to the Energy Information Administration, a statistical agency.
Abraham said the Bush administration was "extremely concerned" about rising gasoline prices, but did not say what the White House was doing about the problem.
Guy Caruso, EIA administrator, said the ministers of the Organization of Petroleum Exporting Countries are to blame for high prices and US oil inventories that slid recently to the lowest level since the mid-1970s. "They played a role by restraining supply," he said of OPEC.
Although the Bush team has succeeded in granting more permits for natural-gas drilling on federal lands in Western states, the US crude oil output has continued a steady decline. The oil output fell from 5.8 million barrels per day in 2001 to 5.74 million last year. It is expected to drop to 5.63 million this year, the EIA said.
