What with unrest in the Middle East and record gas prices across Colorado, we hardly needed another reminder that this country remains dangerously dependent on uncertain oil supplies to fuel our economy.
The global system of oil refineries has been running so close to capacity that any interruption brings volatility to the market. Into this difficult scenario enters BP and an almost unbelievable setback in domestic oil delivery.
BP, formerly known as British Petroleum, revealed recently it must shut down America’s largest oil production field, Alaska’s Prudhoe Bay, while it repairs and inspects corroding pipelines. Analysts said the setback was predictable and preventable.
BP provides 8 percent of America’s domestic crude oil supply – about 400,000 barrels a day. (The U.S. overall consumes about 21 million barrels a day). With supplies already tight and demand high, the shutdown, which is likely to last several months, can mean only one thing for consumers – a bigger crimp in the wallets.
Gasoline prices in Colorado have jumped 6 cents a gallon in the past week, with regular unleaded hitting an average $3.07 on Wednesday.
BP had record profits of $7.3 billion last quarter, and could have paid for proper pipeline maintenance out of petty cash.
In Alaska, BP’s three pipelines are almost 30 years old and one has been shut down for repairs since March after a 267,000-gallon spill led federal officials to order extensive tests of other pipes. That led to the discovery last Sunday of a leak and the 16 miles of severely corroded pipe.
The Associated Press reported that the pipelines hadn’t been cleaned since at least 1992. That’s simple negligence.
BP advertises that it’s nickname is “Beyond Petroleum,” and for good reason. Now is a good time to take a serious look at the nation’s frail energy supply. Detroit and its competitors should be looking to manufacture more energy-efficient vehicles. The nation’s energy producers should get serious about developing alternative sources to power our cars, our homes, offices and industries.
Lawmakers plan to call hearings when Congress returns next month from its summer recess. Among the questions that need to be asked is whether federal regulators gave a free pass to BP’s Alaska operations. If so, the immediate burden would be to require inspections elsewhere in the oil delivery system.
