Drill more now, pay less at the pump? Not so fast

With high gasoline prices jolting summer travel and the economy, many members of Congress are pushing to open up an Alaskan wildlife refuge, the nation's deep-sea reserves and oil-shale fields for exploration, drilling and mining.

Few proponents have been more vocal than Rep. Michele Bachmann, R-Minn., who says expanded drilling and mining could provide "immediate and lasting" relief and slash gas prices to $2 a gallon.

Yet even as public opinion shifts in favor of more energy production, public and private analysts doubt that it would significantly reduce prices, at least any time soon.

The Alaskan National Wildlife Refuge (ANWR) holds too little oil to reduce gas prices more than a few cents per gallon, and new sources of oil could take decades to develop, according to government analysts.

Oil shale in Western states might be significant enough to one day exceed imports from Saudi Arabia, but it faces tough technological hurdles to become reality.

"It [oil shale] is sort of meaningless in the sense that it's such a large resource base and we're so far from producing it," said Philip Budzik, an oil and gas analyst at the U.S. Energy Information Administration. "It's not going to be tomorrow, and it's not going to be in 10 years."

Even an advocate of expanded drilling and mining says it should be done in tandem with an aggressive government effort to lower consumption, which he says is the quickest route to lower gas prices.

West also favors government action to require greater fuel efficiency than a 35 miles-per-gallon target recently approved by Congress, and more spending on mass transit.

Drilling in the restricted areas, West says, is a long-run strategy.

"Long term it could have a lot of impact," he said. "Near term it will have very little impact. But by that logic, you shouldn't ... save for your retirement." He added that alternative energy sources, which opponents of drilling often promote, also could be years away from having a major impact.

Shifting opinion

The push for more drilling has intensified in an election year amid evidence that more Americans support the idea. A Pew Research Center poll released this month showed that 47 percent now rate energy exploration as a more important priority than conservation, up from 35 percent in February. The proportion saying it is more important to increase energy conservation and regulation has declined from 55 to 45 percent.

"We ought to be doing more to develop American energy," Kline said, adding that technological advances have greatly reduced environmental hazards offshore and in Alaska.

Rep. Collin Peterson, D-Minn., joined Kline and Bachmann in supporting a measure allowing drilling in ANWR on condition that some of the revenue from the new oil leases be invested in alternative energy.

Generally, however, Democrats are more inclined to emphasize conservation over drilling in restricted areas and argue that oil companies have failed to drill where it's already permitted.

U.S. Senate candidate Al Franken, a DFLer, makes that argument in opposing drilling or mining in any of the restricted areas. Sen. Norm Coleman, a Republican, opposes drilling in ANWR but favors doing so in offshore areas and opening new lands to oil shale mining.

Both favor more stringent fuel efficiency standards. Coleman says he'd consider lower speed limits while Franken opposes it.

"We are not going to be able to manage the energy crisis from an oil-only solution," said Tinklenberg, who emphasizes alternative energy and conservation.

Long-run potential

Bachmann, like Kline, sees production as the answer. She opposes both lowering the speed limit and raising fuel efficiency standards to conserve. "We can conserve and conserve and conserve, but that won't get us out of the situation we're in without expanding energy supplies," she said.

By opening restricted areas and fast-tracking drilling permits, "very quickly, we can see this energy coming on line so we can get Americans back to $2 a gallon gas," she said.

Bachmann was expected to visit ANWR today to underscore her desire to drill there. But opening the refuge to drilling "is not projected to have a large impact on world oil prices" or the price of gasoline, said Budzik of the Energy Information Administration (EIA). Tapping the refuge could cut the cost of a barrel of oil by perhaps 2 percent and shave 1 cent to 3 cents off the pump price of a gallon of gas, he said.

Referring to oil shale, Bachmann wrote recently that there is "enough energy locked away in Colorado, Utah and Wyoming to offset all of our imports from Saudi Arabia." The Argonne National Laboratory confirms that the theoretical potential is great.

But the EIA said there are major technical hurdles to extracting oil shale. "It is not clear that the lifting [federal restrictions] would have a significant impact on projected oil shale production" for the next two decades.

The role of speculation

Bachmann contends that enacting a comprehensive drilling plan would immediately drive down prices because oil futures traders would anticipate greater supplies in later years. Others doubt this because futures contracts will expire before the new oil becomes available.

Futures traders "do a terrible job pricing ... how much is available 10 years from now," said Nate Hagens, who edits the Oil Drum, an online energy forum.

U.S. Deputy Treasury Secretary Robert Kimmitt was quoted recently by Dow Jones Newswires as saying: "We just don't see speculation having a major impact."

Yet others in the industry see speculation by pension funds and other institutions as influencing as much as 30 percent of current oil prices.

Congressional Democrats are pushing for a law to curb speculators and Republicans propose a milder version that also allows expanded drilling. Both Franken and Coleman said they would support restrictions on speculators.

Washington bureau correspondent Emily Kaiser contributed to this report.