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  • How Higher Energy Prices Threaten U.S. Jobs

    America’s trucking industry is on pace to pay a whopping $138.7 billion for fuel in 2011 — an increase of $37.2 billion over last year due to higher energy prices. That’s a lot of money for gas. And unfortunately for consumers, they’re likely to pick up the tab.

    A new study from the Consumer Energy Alliance blames the lack of a national energy policy for America’s economic woes. Higher prices are costing jobs and putting a strain on families struggling to make ends meet.

    Higher costs for the transportation sector mean rising prices for everyday goods and services like groceries and airline tickets. But that’s not the only consequence. The report estimates upwards of 500,000 jobs could be in jeopardy because of restrictions on U.S. energy development.

    Industries such as manufacturing, agriculture and transportation are strained by endless red tape, including restricted access to domestic energy supplies. As a result, the higher costs for employers are being passed along through rising prices for consumer goods.

    CEA’s study indicates the offshore energy potential of the United States is conservatively estimated at 45 billion barrels of oil and 183 trillion cubic feet of natural gas. That would be enough oil to power 60 million vehicles for 25 years and enough natural gas to heat 60 million American homes for 57 years.

    ”Demand for oil and natural gas is increasing,” said National Ocean Industries Association President Randall Luthi. “Yet we only explore for oil and gas in about 15 percent of the nation’s offshore areas — the same areas that were available when Richard Nixon was president.”

    Apart from boosting job creation and steadying oil prices, offshore energy production would garner billions for the U.S. Treasury. Declining production in the Gulf of Mexico alone could cost the federal government more than $1 billion in revenue this year.

    Meanwhile, President Obama has opted for politically symbolic measures like last week’s release of 30 million barrels from the Strategic Petroleum Reserve rather than a comprehensive policy to increase American production. Heritage’s Nick Loris argued last week that the Obama administration is denying Americans access to domestic oil:

    Production in the western Gulf of Mexico dropped nearly one-third of a million barrels per day since last April, and the increased production in 2010 is a result of increased horizontal drilling in North Dakota. We can’t drill off the Pacific Coast, Atlantic Coast, or the eastern Gulf of Mexico. The U.S. Environmental Appeals Board withheld air quality permits preventing Shell from moving forward to develop 27 billion barrels of oil off the coasts of Alaska. The Environmental Protection Agency already issued two air permits, but Earth Justice filed a petition to review the permits, delaying the process.

    CEA’s report isn’t limited to oil and natural gas. It estimates the economic cost for other industries as well, including the benefits of new nuclear power plants. Click here for the full 52-page study.

    Posted in Scribe [slideshow_deploy]

    10 Responses to How Higher Energy Prices Threaten U.S. Jobs

    1. Nelson Rodriguez says:

      I'm confused. How does higher energy prices lead to jobs being jeopardized because of restrictions on U.S. energy development?

      • Cliff Garrison says:

        Higher energy prices lead to jobs being jeopardized because the consumer has less money to purchase other needed or wanted goods. When the people are not buying things they want or need, people are laid off from their jobs because no one is buying their goods and the companies they work for cannot stay in business if they are not buying. The economy relies on plentiful low cost energy supplies, among which are gasoline and diesel.

      • teacher says:

        really? restrictions on US Energy development lead to higher energy prices which in turn means people lose jobs. not really that hard to understand, just connect the dots.

    2. Lloyd Scallan says:

      What more does it take. In his own words Obama stated "under his plan energy prices will necessarily
      skyrocket. What more do we need to understand what Obama intends for this nation.

      • jim dougherty says:

        Total Destruction I believe! How' the hope & change working out for the people who voted for barry? Not well for anyone!

    3. Bobbie says:

      Really Nelson? Open your mind and your confusion will turn to understand. It's deliberate and unnecessary! AND COUNTERPRODUCTIVE!!! AND THAT'S ANTI-AMERICAN!!!!!

      drill here, drill now…baby! Don't mind the president, he doesn't own natural resources and environmentalists prove to be fraudulent and focused on revenue attached to their false claims the American government supports. Natural resources exist TO BE USED!!! We the people want energy independence, now! Provided by the private sector and no interference from government who continues to give false assumptions to an essential part of our lives!

    4. Keith says:

      What the heck are we getting for our taxpayer money supporting the US Dept. of Energy (DOE)? This cabinet department was setup during the 70’s to reduce dependence on foreign crude and increase domestic energy sources. Some 30 years later we are in the same boat that we were during the Carter Administration. This is typical of government efficiency – create a department to address an issue, study it to death or declare war on it and long term nothing gets fixed.

    5. Strategory says:

      Re higher energy prices being passed-through to the consumer: Unless the end product is on the completely inelastic portion of its demand curve, the higher prices will be shared by the supplier and the consumer.

    6. Slightly Altered says:

      What I've heard leads me to believe that speculation on the commodities market is having a huge impact on oil prices. As a conservative I hate to say it, but regulation of energy speculation may be the single most effective thing the government could do to stabilize energy prices, at least in the short term. Allowing more domestic exploration and production would help, but only in the long term.

    7. RTG says:

      It's basic economics, the cost of fuel effects every single business. I have to pay for fuel that my trucks use to deliver all the products you purchase. I also have to pay an increase on parts costs too because these had fuel involved in their delivery to me. I have to pay an increase in the fuel used to heat my store front so that you will come and shop at my business. These are all business expenses that I and EVERY single other employer pass on to our customers. Because you now have less surplus cash, our profits are down. Due to increased costs caused by new taxes and Obamacare, our profits are even lower. Added this all together, I have to let employees go instead of hiring more employees. Are you Liberals, beginning to see how your demand for an unread medical law and lack of an energy policy are effecting your pocket books yet? Replace Obamacare with something that will work and drill now in our own territories or watch mor businesses go under and the economy get worse. Your choice, THIS IS THE CHANGE YOU VOTED for.

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