Drill Baby Drill

Gas prices will get the attention of any hockey mom. But will off-shore drilling help lower prices at the pump?

MSNBC Senior Producer John Schoen: With oil prices showing no signs of easing, the White House has proposed increased oil drilling in the U.S. Increasing oil production is a great idea. Unfortunately, it won’t provide any relief at the pump for millions of Americans trying to stretch their budgets so they can top off their gas tanks. There’s little evidence that there’s enough untapped oil within U.S. federal waters to make much of a difference in oil prices. Even if the oil is there, it would take a decade or longer until it can be tapped — offering little relief from the recent surge in oil prices.

The biggest known, untapped reserves are in the Arctic National Wildlife Refuge in Alaska. Even if Congress approved drilling in ANWR today, production would not begin for at least a decade, according to Energy Department estimates.

The eventual impact on prices depends on exactly how much oil is under ANWR. Answering that question is an inexact science — you can’t stick a dipstick in the ground and determine how many barrels you’re dealing with.

But even in the best case, the price impact — decades from now — would amount to about 1 percent of current market prices. If work started today, production would peak in 2027 — when increased production would have the biggest impact on prices. According to Department of Energy projections, that impact would cut the prices of light sweet crude (in 2006 dollars) by 41 cents per barrel in 2026 for the low estimate, 75 cents per barrel in 2025 for the mean oil resource case, and $1.44 per barrel in 2027 for the high estimate --MSNBC Answer Desk June 22, 2008