Text of the API Speech.Rising demand for oil worldwide and congressional inaction on comprehensive energy legislation have combined to create acute problems for American business and consumers, Red Cavaney, President and CEO of the American Petroleum Institute, said today.
"The sad fact is that the current policy framework does not deliver as promised," Cavaney said. Addressing a forum sponsored by the U.S. Energy Association, Cavaney called for major changes in U.S. energy policy, including broader access to oil and natural gas supplies in the United States and abroad. Overseas, he said, demand for crude oil in nations like China and India is increasing at an enormous pace. Cavaney said typically the annual increase in worldwide demand for oil is approximately 1 million barrels a day; last year the daily increase was 2.7 million barrels.
"A comprehensive U.S. energy policy must recognize the growing impact of these new major competitors for energy supply in the world," the API President said.
"For the U.S. to secure energy for its economy, " he said, "government policies must create a level playing field for U.S. companies to insure international supply competitiveness."
The current implementation of policies, Cavaney said, has created the contradictory effect of decreasing U.S. oil and gas production while increasing reliance on foreign imports.
Increased competition in foreign oil markets is vital, he said. "In fact, it is a matter of national security," Cavaney said.
In the U.S., he said, the failure by Congress to enact comprehensive energy legislation is already harming U.S. economic growth.
"What is so difficult to understand is how we could have had four years of inaction on energy at a time when the nation has been beset by energy problems," Cavaney said.
Among the consequences, he said, have been losses of between a half and one percent in growth of the Gross Domestic Product (GDP), declining production of natural gas, sharp spikes in gasoline and diesel prices nationwide, tight fuel supplies in the Midwest and New England and electric power blackouts in the Northeast and parts of California.
The time has come, he said, for Congress to enact an energy bill that will ensure diversity of supply, increase access to oil and natural gas on non-park federal lands and offshore, encourage greater imports of liquefied natural gas (LNG), increase energy efficiency and conservation, expand refinery capacity and reduce the growth of boutique fuels across the country.
"One would think legislators would recognize that inaction has a direct and harmful impact on all U.S. energy users…," Cavaney said. "Failing to pass national energy legislation hurts real people—those who rely on energy to heat their homes, fuel their vehicles and power their small businesses."
"All of these energy issues and concerns…" he said, "add up to a need for action. America's energy problems are becoming acute."
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