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Federal Judge Cancels 1.7 Million Acres of Drilling Leases
In late January, U.S. District Court Judge Rudolph Contreras invalidated the largest offshore oil and gas lease sale in the nation’s history, canceling 1.7 million acres of drilling leases.
One of President Biden’s first actions in office was to ban new oil and gas drilling on lands and waters owned by the federal government. But after a Louisiana judge struck down the moratorium last summer, administration officials said they were forced to go through with the sale in November.
“Judge Contreras’ decision to ‘throw out’ the last lease sale is disappointing for industry, but even a bigger blow to the American consumer,” Louisiana Oil & Gas Association President Mike Moncla said in a statement.
“This administration continues to make decisions that increase energy costs on Americans. In just one year in office, President Biden’s energy policies (or lack thereof) have more than doubled oil, natural gas and gasoline prices.”
“LOGA will continue to fight for actual policy that puts Americans to work while also providing affordable, reliable, and abundant energy to our nation.”
Oil prices forecast to hit $100 per barrel
According to Loren Scott, CEO of Loren C. Scott and Associates, oil prices could rise to nearly $100 per barrel later this year, though he warned they likely won’t stay there for long as production climbs globally toward pre-COVID-19 levels.
Market predictions from financial institutions like Morgan Stanley and Bank of America have stated oil could reach or surpass the $100 per barrel mark by this summer as demand inches its way back to its 2019 heights.
If you recall, at the beginning of the pandemic global oil demand plummeted from 100.9 million barrels per day in 2019 to 92.3 million barrels a day in 2020, a drop of 8.5%. Producers such as the United States and OPEC cut their output as prices cratered. Demand grew back to 96.3 million in 2021 and is expected around 99.7 million this year as countries continue to reopen their economies. As a result, oil prices were $86.30 per barrel as of Jan. 28, which is higher than pre-COVID levels.
So what exactly does that mean for the price of gas at the pump?
According to Scott, for about every $10 increase in the price of oil, the price of gasoline at the pump is going to go up somewhere in the neighborhood of 50 cents a gallon.
How is this good for Louisiana? Well, that’s the love/hate we all feel as we fill our tanks. When the oil prices are up, our people are working. But our working people have to pay more to fuel their vehicles to get to their jobs. Job openings are at an all time high here in our region. Here’s hoping the workers return to ride out this high time in the state
