Obama's Moratorium Disaster: "Tens of Thousands" on Gulf Coast Will Lose Their Jobs
An a$$ to kick?
On May 27, President Obama instituted a six-month moratorium on all drilling in water depths greater than 500 feet and stopped work on 33 Gulf deepwater exploration rigs, except under special circumstances. The president’s decision will force tens of thousands of Gulf Coast employees to lose their jobs.
EnergyTomorrow Blog posted this information today:
Several organizations have offered estimates of the drilling moratorium’s impact on consumers, the U.S. oil and natural industry, and the nation’s energy security:
- Adam Sieminski of Deutsche Bank predicted that U.S. oil production could fall by 160,000 barrels of oil per day by next year. (Financial Times)
- Bernstein Research said delays from the moratorium and rising costs stemming from new safety regulations are likely to raise the marginal cost of deepwater production by about 10 percent. (Financial Times)
- Paul Cheng of Barclays Capital warned that the higher costs could eliminate small independent companies who compete for drilling projects against the majors. (Financial Times) He also predicted an 11 percent drop in deepwater oil production. (Houston Chronicle)
- The Houston Chronicle reports that two large oil-services companies are relocating workers from the Gulf of Mexico to onshore North America drill sites and Brazil.
- The National Ocean Industries Association (NOIA) predicts that relocation is just part of the pain to be suffered by energy workers. Burt Adams, NOIA’s chairman, said in a statement, “the [president’s] order will be felt by the families of tens of thousands of offshore workers who will be unemployed.”
API’s chief economist John Felmy discussing the potential short effects of Obama’s moratorium: