Reuters reports that eight deepwater drilling rigs are expected in the Gulf of Mexico this year, which would bring the active deepwater contingent to 29 – just short of the number before the 2010 Macando accident. While that will be a positive step, here are some reasons to hold off popping the champagne corks:

• The eight rigs are not yet in the Gulf, not yet working.
• While permit applications to work on Gulf jobs have been submitted, the rigs will return there only if the permits are approved.
• Given “A” and “B” above, it’s still premature to talk about Gulf drilling being back to normal or “close to pre-moratorium levels.”
• The eight rigs would bring the Gulf rig count to “just short of the level” before the administration’s permit moratorium, not equal to levels of two y... more »

Back in February we ran the chart below. Then, at a congressional hearing last month, API President and CEO Jack Gerard referred to it in testimony urging lawmakers to consider the effects of increased U.S. oil production on global crude oil markets. We’ve written about the effects of increasing domestic supply here, here and here.

Last weekend the Washington Post took issue with the notion that the basic laws of supply and demand apply to crude oil like they do other globally traded commodities. The article noted Gerard’s congressional statements about supply and market expectations and dismissed them:

"As Gerard told it, 'the price of crude oil over three days dropped $15 a barrel and continued to move down.' The lesson, he said, was that 'markets are driven on a global basis... more »

One of the most important things to know about producing oil on federal lands is that it takes time. Lots of it. As this chart developed by API illustrates, it’s up to a decade from the time a lease is won at auction to the first actual production of oil. If you include pre-lease sale studies and evaluation, which have to be done before companies bid on federal leases, that’s a couple more years.

The point here is that the production gains the country is seeing now date to a process that started up to a decade or more ago. You don’t just flip a switch and suddenly oil starts flowing.

This timeline also has implications for future production, given current federal data that show leasing acreage on federal lands at its lowest point since 2001 – declining from 47 million acres in 200... more »

A couple of questions for the White House's scheduled 2 p.m. live chat on U.S. energy independence:

• While discussion of improved batteries for electric vehicles, liquid fuels from microorganisms and other new technologies is worthwhile, the Energy Information Administration (EIA) says oil and natural gas will provide 55 percent of the energy we consume in 2035 (just slightly less than today's 61 percent share). Isn't securing those resources the more important discussion to be had?

• Whatever the potential of batteries, algae and other innovations, EIA's forecast clearly shows that oil and natural gas are an important part of our energy future. Thus, if 92 percent of America's liquid fuel needs by 2030 can be supplied domestically and through partnership with Canada, where are... more »

Paging through some of the positive ways the oil and natural gas industry is helping the economy as well as individual lives across the country:

A story in the San Antonio Express- News notes that just two years ago Dimmit County in South Texas was ranked as the 19th-poorest county in the United States. Today it's part of a drilling boom in the 400-mile-long Eagle Ford shale formation that's home to thousands of new oil wells and creating thousands of jobs. Last year Eagle Ford generated 6,800 full-time jobs and paid $311 million in salaries in benefits, according to a study. The same report showed another 12,600 spinoff jobs paying $512 million in salaries. By 2020 Eagle Ford is projected to support almost 68,000 full-time jobs, account for almost $21.5 billion in total economic output a... more »