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Americas
Bush ends offshore drilling ban
US president hopes greater oil exploration will boost energy supplies.
Last Modified: 14 Jul 2008 18:36 GMT
Environmentalists have decried Bush's
decision as "terrible" [AP]

George Bush, the US president, has lifted an executive ban on oil drilling on the US outer-continental shelf, the White House has said, improving prospects for oil exploration projects to go ahead in the region.

Dana Perino, a White House spokeswoman, said earlier on Monday that Bush had lifted the executive order because the Democrat-led congress had failed to act on his recommendation in June that restrictions on offshore drilling be lifted.

Perino said Bush's order to drop the ban would not automatically clear the way for exploration because "congress has to act as well" to lift legislative restrictions on drilling activity.

The move towards exploiting regions off US shores is strongly opposed by environmentalists.

Call to congress

High petrol prices have shaken US consumers in a presidential election year where Bush's Republicans are trying to keep control of the White House.

"It has been nearly a month since the president urged the congress to act to expand environmentally friendly and responsible exploration for American energy," Perino said.

"Democratic leaders in congress have not shown a willingness to move forward ... So we are going to move forward and, hopefully, that will spur action by the congress.

"The ball is squarely in their court now," she said, adding that individual US states would be able to decide for themselves if they want oil exploration activities off their shores.

The camp of Barack Obama, the US Democratic presidential candidate, on Monday criticised Bush's plan, saying it was a part of a failed energy policy.

"If offshore drilling would provide short-term relief at the pump or a long-term strategy for energy independence, it would be worthy of our consideration, regardless of the risks," Obama campaign spokesman Bill Burton said in a statement.

"But most experts, even within the Bush administration, concede it would do neither."

"It would merely prolong the failed energy policies we have seen from Washington for thirty years," Burton said.

Short-term plan

Jim Ritterbusch, president of Ritterbusch, a US oil trading advisory firm, said the impact of Bush's announcement would be minimal.

"It's a long-term deal, it's not going to have any impact on today's market, per se," he said.

"In the short term, it's no solution to high gasoline prices. This is oil that we will not see for years."

Perino said both the legislative ban and congressional ban need to be lifted in order for the US to move forward to try to develop more sources in the US.

But Tim Evans, a US-based energy analyst, said that the areas Bush is opening up to exploration are not likely to be the cheapest source of oil.

"Any international oil company .... would still have to evaluate whether the costs of production are going to be lower somewhere else.

"We still have to be competitive on a cost basis with sources of oil from the former Soviet Union, the Persian Gulf, [and ] offshore Angola."

Oil market stability

Bush's order comes amid continued volatility on global oil markets.

Crude oil prices swung back on Monday towards last week's record highs as oil workers in Brazil began a five-day strike that further tightened global energy supplies, traders said.

New York's main oil contract, light sweet crude for August delivery, rose by $0.82, to $145.90 a barrel.

The contract had hit a peak of $147.27 on the New York Mercantile Exchange on Friday.

Athan Manuel, director of a US environmental organisation, said Bush's plan to open up the US to offshore oil exploration was "a terrible decision".

"We're not going to drill our way out of this mess. We could drill everywhere in the US and not reduce our dependence on oil or reduce the price of gas at the pump," he said.

"The solutions to this problem are not off our coasts. The US does not contain enough oil to influence the world market."

Source:
Al Jazeera and agencies
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