There have been recent reports that drilling in the Gulf of Mexico is coming back strong, with exploration and development returning to 2009 levels. We wish. New analysis (PDF here) by Quest Offshore Resources suggests otherwise:

• As of the end of September, there were 21 floating rigs in the Gulf, of which only 18 were drilling wells. Before the 2010 drilling moratorium, there were 33 floating rigs with 29 engaged in drilling, about a 37 percent decrease.

• The decrease in activity translates to approximately 60 wells lost, based on the original contract terms for the rigs. Loss of the rigs amounts to lost spending of $6.3 billion and annual lost direct employment of 11,500 over two years.

• Since the moratorium 11 drilling rigs have left the Gulf with just one returning. 3 rigs are sitti... more »

The Interior Department isn't off the legal hook yet. Although it finally issued one deepwater drilling permit this week after months of delays, U.S. District Court Judge Martin Feldman has ordered it to act on two more permit applications, raising the total number to seven.

In a ruling last month, Judge Feldman gave the Bureau of Ocean Energy Management (BOEMRE) 30 days to take action on five deepwater applications. Yesterday he said two additional applications from Houston-based ATP Oil & Gas Corp. were included in his order.

API President and CEO Jack Gerard called the approval of the first application "welcome news," but warned that the slow pace of permitting could be dangerous to U.S. energy security and the economy:

"[T]ightening the screws on domestic oil and natural production du... more »

No matter where you live, the cost of filling up your car with gasoline has increased in recent months, which has some consumers asking: "What's causing this spike in gas prices?"

A number of factors help dictate the price of gasoline, but the cost of crude oil on the global marketplace is the main component, and crude oil prices have been steadily rising. With current economic conditions improving worldwide, global demand for oil is rising, leading to the higher prices we're seeing today.

Gasoline prices are also affected by other factors, including weather events, inventories, refining and distribution costs, marketing and taxes. For example, every time U.S. motorists pull up to the pump, they pay an average of 48 cents in state and federal taxes per gallon of gasoline.

One way to ad... more »

Gasoline prices rose to their highest level in the past two years yesterday. According to AAA, the average price of gasoline climbed one penny Dec. 29 to $3.071 per gallon. This is the highest level since October 15, 2008, when the average price of gasoline reached $3.084.

If you've been reading this blog, you're aware that the cost of crude oil is the largest factor in the price of gasoline. Between November 17 and December 28, crude oil prices increased 26 cents per gallon to $2.18 per gallon ($91.49 per barrel), which was the highest level in October 3, 2008, when the per-barrel price reached $93.88.

Demand for gasoline and diesel fuel also have climbed recently. Last month, according to API's Monthly Statistical Report, gasoline demand rose 3.2 percent over November 2009. Demand for Ul... more »

(Editor's Note: The following Op-Ed by API President and CEO Jack Gerard was published in The Hill today.)

The Interior Department's surprising decision to place the Atlantic, Pacific and the eastern Gulf of Mexico off-limits to oil and natural gas production for at least seven years takes U.S. energy policy in the wrong direction. Despite long-standing concerns about U.S. energy dependence on oil from other countries, the administration's decision is likely to result in increased imports and a lessening of U.S. energy security.

The decision couldn't have come at a worse time. With unemployment rising to 9.8 percent and an estimated 15 million Americans out of work, it makes no sense to shut the door on one of the nation's best prospects for job creation.

A study by ICF International proje... more »