Senator Mary Landrieu (D-LA) agrees with me, and even credits me with drill, drill, drill. She’s on the right side of this issue with retail gas rising at the pump to $2.62 today. That’s up from $1.60 at the beginning of the year.
The Conrad amendment will open up the Eastern Gulf for drilling. It’s a good start. But the White House and Congressional Democrats will stand in the way. I give a lot of credit to Sen. Landrieu for hanging in there on this issue.
- Oil Near $71 After Large Drop In Crude Supplies
Here's the transcript of our interview on last night's Kudlow Report.
LARRY KUDLOW: Senator Landrieu, welcome back.
SENATOR MARY LANDRIEU: Thank you Larry, happy to be back.
KUDLOW: All right, we appreciate your time. Now as you know, though gasoline prices are way down from last year’s $4 dollars at retail, today according to AAA, they’re $2.60. They were $1.60 at the end of the year. Some folks are saying this could hurt recovery, that it’s a tax hike. It could raise inflation. What is Congress going to do about this? And isn’t it time to drill, drill, drill?
LANDRIEU: Larry, it absolutely is. These prices are going north, and pretty quickly, and alarmingly because we’re trying to recover. And one thing we could do is drill more here in the United States. Not just for oil and gas, that’s important, and also reach for alternative fuels. But on the drilling issue, you’ve been right on this for a long time. And today we had a very important vote on the energy committee. We opened up a large section of the Gulf which is good, but we did not include revenue sharing which in the long run will not encourage states to drill offshore. And there are lots of resources there.
KUDLOW: How much is this revenue sharing [issue] going to be a sticking point to possible legislation? I mean, I think opening up the Gulf, or the Eastern Gulf, is a terrific idea, at least as a partial solution. How much of the revenue sharing is going to stand alone as a problem?
LANDRIEU: Well actually, it could be a help Larry, in the long run. Because as you know part of the reason that we don’t have a lot of offshore drilling right now in America, although we have a lot of gas, and a lot of oil off our coast we believe, is because there’s really no reason for the states, the coastal states to engage in drilling. They don’t get any direct benefit. They get indirect benefit, it helps the nation. But they don’t get any direct benefit, unlike the interior states that keep 50 percent of their revenues. So I think it’s an important partnership for production.
We hope to open up drilling on the eastern seaboard in some places. We hope to open up the Eastern Gulf. But you know Larry, what we did today will open up the Destin Dome, which has 3 trillion cubic feet of gas at $10 a cubic foot. That is not small change. It’s $30 billion of value. So it’s important that the companies get a share of that, that drill. The state of Florida and the Gulf Coast states should share. And then the Treasury for deficit reduction. It makes a lot of sense to me.
KUDLOW: What are you going to do—the ban on drilling expired last September 30th if my memory serves me. Where does that stand now? Is that ban still banned and does that open the door for the kind of offshore drilling you’re talking about?