Conflicts Between Economy and Energy

Can Obama balance the budget between Economics and Energy? Will Obama make compromises between foreign policy and commitments to renewable resources?

When the oil prices were high, it made production more feasible in the US in places where drilling costs more. Since the cost of oil decreased several US drilling rigs were moved and crews were cut back.

This decrease in price also caused an economic pinch in the Middle East nations around the Persian Gulf. If the market is unbalanced, yes we will take measures to balance the market,OPEC’s Abdullah al-Badri said. “We will do anything we can to balance the market. After February 15-16 when we will have all the information, we will decide,” he said.



While there has been some talk of President Obama loosening restrictions on the filing of environmental impact statements in order to speed up the use of the $819 billion bailout money, there is no loosening in issuing permits for coal fired plants. Coal fired energy plants do keep down US use of petroleum, which President Obama vowed to decrease.

He claimed in a Lansing, Michigan campaign speech he would eliminate dependence on oil in the Middle East in ten years. In addition, he said he would create five million new jobs by that trategically investing of $150 billion over the next ten years to catalyze private efforts to build a clean energy future. Any increase in economic activity is going to require more energy.

If the US will spend less on oil or try to limit US dependence by taxing foreign oil, OPEC is going to increase the cost of oil until they get back to their original revenues for oil. Any savings with alternative energy will still be passed onto OPEC. OPEC's position is they are more than willing to charge the US more and send less oil.