Bud's Offshore Energy (BOE)

The very disappointing 68 page ruling on Lease Sale 257 boils down to the following:

1. BOEM had correctly determined that, from a GHG standpoint, US offshore production was preferable to more carbon intensive foreign production.
2. The plaintiffs, who are seemingly intent on stopping all oil and gas production regardless of the economic consequences, argued that BOEM failed to consider the “positive” effect that higher prices (the logical result of lower production) would have on reducing demand.
3. In particular, the plaintiffs asserted that BOEM failed to consider the effect that reduced production (and higher prices) would have on foreign consumption and the associated GHG emissions.
4. The judge not only decided in favor of the plaintiffs, but ruled that BOEM’s omission was so serious that the lease sale had to be vacated.
5. The judge reached this decision even though (1) the five year leasing plan expires in June leaving the timing of any future sale very much in doubt and (2) all of the sale 257 bids are now public information compromising the integrity of the leasing process at the next sale (if and when that occurs).

So, if BOEM has to consider the environmental benefits of higher oil and gas prices, shouldn’t they also have to consider the negative economic and environmental effects from the resulting price inflation and energy poverty? Are higher prices, which are most detrimental to the poor and to developing nations, “energy justice?”

If your only objective is the destruction of the US offshore oil and gas program, this was a great decision. For everyone else, this is yet another reason to be concerned about our energy future.