What If...

Jane Van Ryan
Posted July 27, 2010

What if Congress and the administration approve many of the deepwater drilling measures that are now being debated? And what if their actions result in unlimited liability for oil spills, additional regulations on well and rig designs, higher taxes and fees and an extended moratorium that cancelled drilling projects?

The economic impacts could be dire.

A new analysis by API economists shows that the moratorium, if continued indefinitely, or similar proposals which would make deepwater development unavailable or uneconomic would cost this country 175,000 jobs every year between now and 2035. Over the long term, it also would reduce U.S. oil production by 27 percent and would likely increase oil imports by 19 percent.

API President and CEO Jack Gerard told reporters today:

"Legislation that raised the cost of production to uneconomic levels; that renders deepwater oil and natural gas areas off limits to production; drives small-and mid-sized firms out of business; shuts down access to domestic energy resources; or singles out our industry for punitive tax increases--all of which have been part of various bills in the House and Senate--will have significant impacts on jobs and economic growth."

Today, too many American workers are in need of a steady paycheck, too many American families are worried about their futures and too many Gulf Coast residents are watching their livelihoods disappear.This is not the time to approve policies that destroy jobs, raise costs and reduce U.S. energy production.

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Update on July 27, 2010: For more information, read the full API analysis below.