right now by big oil and opec and we are not doing anything about it. >> the time is expired. the gentleman from georgia, dr. brown is recognized. >> thank you. i believe very firmly the nation cannot he did so for close itself, it is not energy independent it's not a secure nation. we are not a secure nation because we are not energy independent. the department of energy was founded during the carter administration as we all know to make us energy independent. it's been a an abysmal failure in that charge. the nationwide the gil troy gasoline is about $3.55 a gallon. this is the highest price ever in the month of march and is over 40 cents higher than just a month ago. the skyrocketing gas prices in a risky dependence on tools supplied by volatile for

innovations such as libya for the american energy policy that emphasizes production and decreases our reliance upon foreign oil. the united states is the only nation on earth that bids development of its own god-given natural resources. we've been blessed by our creator with abundant natural resources and we shouldn't be hesitant to tap into it. especially of the time when the energy cost is so high. however, since taking office the obama administration has done everything in its power to block of our energy resources even more with the defect code moratoriums. the production of the gulf of mexico alone has declined by 400 barrels -- 300,000 barrels of oil per day just due to the obama administration's actions. energy is the lifeblood of american economy. our nation's economic prosperity is closely tied to the availability of the reliable and affordable sources of energy.

unfortunately u.s. energy production has grown by only about 13% while energy consumption has grown by 30% since 1973. at a time when 9% of our citizens are unemployed in the district we had 17% unemployment. food prices are giving high with a still struggling economy we must do everything in our power to allow the responsible use of our known american supply of energy. now doctor, it's been proposed by the obama administration of tapping the possibility of tapping the strategic petroleum reserve. does this make sense at all or should we develop the known resources that we have here in the united states? >> i think the psychology of the marketplace would be much more significantly impacted by the

decisions that affect us long term rather than now. i don't think -- this is my own opinion. i don't think that the release right now would matter much because i don't think we have an inventory problem, we have if your problem about the future. we have expectations about the future, uncertainty about how events will unfold in the critical producing region and uncertainty about policies here and investment actions here, and i think that symbolic steps, meaningful steps that indicate we are willing to make sure we have a robust industry here would have much more impact on the treaters and treaters ecology and market psychology than using the spr. >> thank you, dr. foster to devotee tapping into strategic reserves is not sound policy and i think that it is an aim to even consider doing so. there are other things we can do. i take the first time a drill hits the ground and starts

drilling in anwr you will see the prices come down worldwide. but what can we do, doctor, here in the u.s. to lower the gasoline prices? >> i think some good points came up in the panel today both on the supply side ensuring that the moving portfolio of resource reserve production conversion is able to continue to function the right way. so that means looking how the industry operates and ensuring that appropriately given 000 for site is there but that it's done the right way. streamlined, sprint, everybody can understand it. the public industry and the government agencies that are involved. the industry has to be able to maintain portfolios of the prospects.

and people have to understand what that entails in terms of both public and private mineral leasing access to resources and the investment cycles that are needed and then on the demand side i think some key points were made considering how malleable the hydrocarbons are because of their energy content we should use them wisely and i think by now we have the reams of research show how much we can gain by affecting things like combustion engines, performance in vehicle technology that allow us to get basically more bank for the buck for every gallon of gasoline we use and that's what we ought to focus on. >> my time is expired. >> thank you. i now recognize the gentleman from louisiana. you don't have a witness here that speaks the same language like you do yesterday but you are recognized for five minutes. >> i'm going to try. i have a lot to ask. i never have enough time.

[laughter] i want to make one quick comment that i'm certainly glad that mankind didn't calculate the perils or perilous circumstances of the voyage by 400 years ago so that they could find the great country. i guess that is why my colleagues on the other side of the ogle are mad. they didn't do the calculation. i guess if they would it wouldn't have come over here and they could have been born in europe. but just common sense over here. i wanted to ask, and i don't know if they ask you this i had to step out a couple of different times but last week the president had a precious conference. he made some statements and did the white house call you and ask you to give any statistics on that? >> i'm sorry, what specific are you referring to? >> he had a press conference he

talked about production increases and how he was doing a fabulous job of increasing oil production in the country and i just wondered were you in that meeting -- did a brief you and call you and ask you to send them some statistics? no, no, that is a yes or no. did they call you last week to ask you to send them some data? >> there is data that comes, yes. >> sent specifically to the white house on the request of last week? speenine i wasn't involved in providing the data. it's very routine -- >> do you know if you send them the data that says in the first quarter of 2011 your agency said the production in the gulf would decrease from 1.59 million barrels to 1.4 million barrels a day. >> are you asking me if the number in the short-term energy all?

>> no, no. i know that's your number. did you send that to the president? did you send that to the administrator? because he never mentioned that in his press conference. he just said production was the highest. he's a fellow who gave us our all. did you send that to the white house? i'm trying to figure out did you or did you not send these statistics to the white house if they asked you last week was this statistic in there? >> my recollection of what is on the fact sheet was kind of history, historical as opposed to the forecast -- >> don't you think -- >> you don't just send facts, but he evidently tried to influence policy but in forecasts or you wouldn't have run these numbers. don't you think it was your responsibility to send it to the president and say i think you're fixing to make a tignes statement? >> we certainly do not to our

forecast to influence the policy. quite the contrary. we do it to inform people about the current state of affairs and the link the state of affairs in the future given what we see in the market and regulatory outlook. >> that didn't answer the question, but do you or don't you agree under the current policy the production of the gulf of mexico will continue to decline? >> [inaudible] spec no, no, it's yes or no. pretty simple. it's just is the number going down or is it going up? >> over the next two years which is where the short-term outlook goes there is a decline in the gulf of mexico in terms of offshore oil production. >> and so the gulf of mexico production in fact is in the entire domestic production, correct? so that means if that goes down, in domestic production goes down; is that correct? >> other things tend to lower the rate of change of the domestic production. >> other things equal.

>> there is also offsetting effects -- >> such as? >> increased production of the liquid natural gas and increase productions in the lower -- >> i'm glad you brought that up because you see he's taking credit for the increased production but yet there is one project in the gulf one in deep water project started under ronald reagan and bush or clinton, and then i think started drilling in bush from a neck to win 99 and the platform set in 2005, 250 barrels a day. to hundred 50 -- to you think there is anything on sure that can produce that much oil onshore? no, no, that's yes or no. that's pretty easy. you know the facts. do you think that there is a project on shore we can get 250,000 barrels a day out a well

know. >> thank you. i yield. >> mr. johnson of ohio is recognized. >> thank you, mr. chairman, and think the panel for being here with us today. not long ago we had an opportunity to question secretary salazar in a hearing here. it became very clear to several of the questions, and the secretary made a comment that oil prices are determined on an international markets, and therefore america has no influence, little to no influence on the price of oil thereby little control over the price of gas at the pumps. do you agree with secretary salazar, dr. foss when he says

the u.s. cannot impact the price of oil and therefore the price of gas at the pumps? >> i disagree. >> would you explain why you disagree? >> we are both a large producer, the largest producer, and a large consumer, and i still think we are the largest consumer. it hasn't been passed up yet. that gives us i think market clout we don't use to our advantage and i think there's a lot of ways of exercising that that came up this morning i think through the international relationships for our own actions and our own country through our industry activities how we signal to the will of our intentions going forward. all of those things, how we manage our energy consumption and things we do to put in place to use our energy resources wisely. all of that has impact. estimate it encourages me that

you think so, because i certainly think so as well, and as i commented to secretary salazar, it greatly concerns me that our leaders and the administration and in the cabinet seem to have felt their hands are tied behind their back and that is a further indication to me as i mentioned them that we have a field energy policy. you are in america and that should be alarming to the american taxpayers. it's certainly alarming to me. another question, he brought forth a budget and one of his justifications for his increase in the budget was so that they could put in a robust permitting approval process in place. i don't have these numbers exactly right, but you will get the intent of my meaning. three years ago, two years ago, 300 some permits approved. a year ago, 100 some permits

approved. this year, 30 some permits approved, and we are on the study downhill curve. why do you think it is that the department the interior needs more money in 2012 to go back to producing and authorizing permits at a level for which they were doing it for less money three years ago? does my question make sense? we were authorizing 300 plus permits just a couple of years ago. we are down to the 30's in the deepwater area we are now almost none, one or two. but yet they want more money to the robust process in place. they were doing it for a lot less. three years ago. why do you think they need the additional money and increase in the budget, dr. foss, to put a

permitting process in place -- help me out. >> sure. thanks for clarifying you were addressing the question to me. >> i'm sorry. >> that's all right. i think that there is a certain amount of public funding that probably needs to be used. i'm not a budget expert. there are other people who are federal budget experts and i'm not. happiness the process happens we that it should. but not commission report and around other discussions, there are also additional avenues of making sure that federal areas are managed and administered in a way that doesn't put as much pressure on the federal budget as perhaps some might think. and that includes a range of things. how they function themselves, giving the industry to participate the right way. there are options. >> i just want to rap up with

one final question, sort of a yes or no as well. do you agree that we have a small permitting process? >> i can give implementation problems. >> are we proposing the number of permits that we should be producing to tap into america's resources? >> i think we need to think about how to implement a permitting -- >> that is a yes or no question. >> yes. >> okay. thank you. i yield back, mr. chairman. >> thank you. i recognize the gentleman from california. >> thank you, mr. sherman. i actually had a number of questions on the permitting today which i will submit and look for an answer in writing because i think that it's the most pressing issue right now actually has to do with the door right. i'm surprised to see mr. marchi's crafts, and i would agree the burn rate -- we don't want to approach was all so we are in jeopardy birding for all

of our natural resources. but i think that the chart suggests norway -- if you believe norway and mexico are larger than the united states, that would actually be a factor. or if we only had 2% of the world's oil reserves. is that is actually what i wanted to ask a number of questions on and first of all, mr. whitney specifically let me start with the president's statement last week was even if we tap every single resource available to us we can't the state the facts according to the president we only control 2% of the leal but we consume over a quarter. some people are talking about kunkel versus actually what are the reserves. so i want to clarify that the crs did come out with a report and the 2% figure is 19 billion barrels of oil; correct? >> [inaudible] about 21 or 22 billion barrels

-- >> and the number that i shall hear from the crs report actually is 140 -- 145.5 billion barrels? >> again, that number has been updated. i don't know the latest number is that it's near that, yes. >> i mean, there's a difference. we are saying that 2% is less than 20 billion but we actually believe there's over 145 billion -- >> welcome this is -- >> it would obviously affect the right. ..

>> if you understand all of our energy reserves we can obviously balance those different reserves and make sure that we are self-sufficient. we want to be self-sufficient and not in danger of war markets. >> right in their other issues we can address. for example the consumption of oil types or transportation system so if the transportation system in the future is converted to an electric system or more reliant on electricity than natural gas, coal and nuclear are fuels for generating electricity, and that could help move us away from consumption of oil. >> mr. marquis's charge of how we compare the rest of the world. 1.3 trillion, how does that compare to the rest of the world? >> it is the largest number in the world but i want to caveat

that very carefully because as i put in the report there are some caveats and disclaimers within the u.s.. we have very good numbers for proved reserves and for technically recoverable resources thanks to usgs and iea. once you get outside the united states, united states, that data is much, much harder. >> how do we define recoverable? the recoverable is defined by what current technology. >> is killing rich in californid recoverable? >> i'm not familiar with that feel. >> mr. newell, killing rich. the biggest project in california one of our largest states. >> it is existing technology can get resources at some price then yes that would the. >> are we assuming we don't have the technology?

i would hope we are stemming we have the technology. >> i was agreeing. as long as you have the technology it would be so yes that would be included. >> that would be included in the 19.1 billion barrels that the 2% the president is referring to? >> i'm not sure because that is proven reserve so i don't know specifically whether those have been looked by a company which has an additional set of requirements for it to be considered a reserve. i just don't know. >> what i'm trying to get down to and i have a number permitting question so what i'm trying to understand is when mr. marquis shows a chart 2% and throws off these burden rate numbers and the president talks about 2% are we talking about oil that we know of, oil that is permitted and we are pulling out of the ground or somewhere there in between? >> 2% number is referring to a reserve number which is it proven reserve. technically recoverable resources is a much bigger

number. >> the time of the gentleman has expired. >> thank you mr. chairman. >> the gentleman from south carolina. >> thank you mr. chairman and american energy independence is what we are talking about. in 2007 and 2008 i served under the previous administration department of interior mms five year planning ocs five year planning subcommittee which dealt with oil and natural gas on the outer continental shelf and talked about the next five-year plan in where those leases would go. and i was amazed during that process how convoluted it really was, because we are very limited on what we can talk about. we were limited to certain grid section in the western gom in one small spot of the coast of alaska and they were both an ultradeep water. in 2005 i went out, probably 2006 i went out to louisiana and

it was post-katrina, and we flew out to a deep water production platform and a deepwater drilling platform. the platform i went to us the devils tower floating and 5600 feet of water. we also went to a drilling platform which was a pontoon drilling platform for natural gas about 4 miles away and so i've seen it for myself. and, congressman landry has been very clear about the impact of the de facto moratorium on the gulf coast states. the fact that it is not just the energy companies, the petroleum companies that are drilling. it is a trickle-down effect all the way to the smallest welder. it is a trickle-down effect to the states that are hit by this recession that are losing the royalty revenues is a double whammy to an art impact of economy that was impacted not

only by this bill which was unfortunate, but understanding from talking with folks is that the companies that do expert -- exploration and drilling have met every requirement of this administration that was put out there in order to get that to work, in order for the permits to be issued but yet to this day we'll may see that to permits have been issued. the american people want to see us to deal with american energy independence and they understand it is a national security issue. let me be clear, i am for all, all resources that we have in this country to meet our energy needs. i am very pro-nuclear energy. i am pro-on drilling. ocs in here on the mainland. we have had thanks to the direction of our chairman, we have had ahead of the l. n. and the committee and we have talked about the wildlands act and the fact that secretary salazar fired the secretary of order in december to basically accelerate

the designation of wilderness areas. a sickly usurping the power of this congress which has the only statutory authority to designate wilderness areas usurping the authority so now we are saying the federal lands are being taken off the table for energy exploration and energy production to meet our energy needs in this country. i think that is abysmal. this administration spoke recently about, and i applaud them for this, about the necessity of increasing domestic production, but actions speak louder than words. so i asked this administration to accelerate the permitting process. let's get the people back in the gulf of mexico that have leases. let's extend the current leases that are expiring because those folks that do to the plate and they bought the rights to explore for energy sources and produce energy sources on those leases. having been on that five year planning subcommittee i know the process that it takes to

recommend to the ocs committee the next five-year plan of where those leases should be. it is a long process. and if we started today we are five, six, seven years out for the next release so we have got leases expiring and we don't have another lease sale. in fact i don't know when that is going to happen. anwr should be back on the table mr. chairman. it is the size of the great state that i come from but as we talk about the impacted area in anwr we are talking about the size of the columbia airport in colombia or maybe the size of the city of charleston. if i stuck a postage stamp on that wall that is what we are talking about. is time for us to be serious about energy production meeting the needs of this country with american resources for american energy production. that is deep water, onshore and that is offshore. fracking, hydraulic fracturing. james lankford from oklahoma mentioned they have been fracking in the houma for 50

years without an incident. he said come and drink our water. come and drink our water. we are proud of it. we have got the ability to do that mr. chairman. let's not remove this federal land from access for exploration and see what is out there and and than we can produce it. georgetown i saw a sign $4.69 a gallon. i think that is the highest in the nation but still it is alarming. $3.95 is alarming. i know what $4.95 of diesel fuel meant to my small business in 2000 i know with the rising cost of fuel means to large and small businesses in this country and it is time for us to be serious about that. >> the time of the gentleman has expired. the gentleman from florida. >> thank you very much mr. chairman. i want to give you an indication of perhaps what is going on with some of the residents in my state in the state of florida where on average the price of a gallon of gasoline in florida is

currently about $3.56 which is higher than the national average just a month ago, just one month ago the average in florida was $3.13 and at this time just in one year ago, in my state, the average was $2.82 of this is a 74 cents or 26% increase over the past year in my state's fuel costs. initially i thought to ask the panel whether they were aware in certain states like florida what the average household income was and whether that household income in florida was keeping pace with the rise in fuel prices and that of course was going to be a rhetorical question. i presume what he may not know the exact amount you would probably all know the answer is absolutely not, that household incomes have not kept pace. so the fact of the matter is

according to the latest american community survey put out by the u.s. census bureau the average median income in my state in florida has been declining. people's incomes are going down. so florida families and across the nation are having a harder and harder time paying their bills, having a harder and harder time providing for their families. and this administration's policies or perhaps the lack thereof in certain areas are making it even more difficult to provide for their families. and the economic resources are diminishing rapidly. with political unrest in the middle east and north africa the summer travel season picking up in the coming months, and the additional rising fuel costs that accompany it, americans i believe are anxiously awaiting for the administration's plan,

for the plan to increase our fuel supply and try to suppress price spikes for foreign supply disruption, whatever the cause is. the american people need to see the way out. what is the plan? >> i have a question for mr. newell if you would. according to your agency, production in the gulf has declined by nearly 300,000 barrels a day since last april. berrigan project declines of 200,000 barrels a day or will be for the next two years continuing declines. have you calculated how much in revenue by royalties the federal government and the producing gulf states have lost? >> we have not done that compilation. that would be the kind of calculation the department of interior would do. we have not done that. >> let me ask perhaps dr. foss if you would.

this year, the president's fiscal year 2012 budget, the proposed budget includes over $60 billion in new taxes and new fees for american energy production. if you couple that with the lag in getting permits approved in the gulf where we have been discussing during this hearing, can you tell us what you believe this will do to fuel prices and whether these actions will encourage or discourage companies to invest in american energy production? >> anything that affects the cost of doing business that breakeven finding and development cost that i mentioned in my testimony will make the resources that are recovered more expensive and the

only way to offset that is to streamline other things, for example the cost of obtaining permits or the cost of dealing with regulatory oversight or other actions and increase production volume so that the cause cost could be spread over more arrows for more gas. >> anyone else like to elaborate? perhaps mr. caruso? >> no, i think the thing that in that budget that is likely to have a significant effect is the increased cost by reducing or eliminating the intangible drilling, the ability to expense intangible drilling cost. i am told from the smaller independent oil and gas producers that is going to have a significant negative effect on

their ability to drill as much as their expert patients were. so i think that in the longer term will reduce the u.s. production. >> thank you mr. chairman. >> the time of the gentleman has expired. the gentleman from utah, mr. bush of. >> thank you mr. chairman. i thank the panel for staying as long. ms. pierce i appreciate the conversation you had with mr. tipton about oil shale and i appreciate you saying we are billions of euros actually the energy department believe there are 800 billion of arrows that could be recovered and that is which -- which much bigger than what saudi arabia house. the state share would do a great job in funding our state's education system. as we can tell when the secretary of the interior told by leading his process 77 oil

leases have a direct impact on the funding of education in my state as well so i appreciate that comment. i do want to hit up dr. foss if i could with some questions. dealing with what we have talked about so far because it is very clear when gas prices go up and heating prices go up that becomes part of the collateral damage oftentimes of administration decisions especially lately so i want to follow-up with what mr. rove there was talking about. in your opinion which americans are really the most impacted by rising gasoline prices? >> the americans has been the most money on gasoline relative to their disposable household income so people who have a larger sale of their household budget. spivak becomes a lower economic strata of our society than? i am assuming that is lower. okay. so i mean it would be safe to say that americans would be the ones who stand to benefit the most from an increase in american-made oil and natural

gas production. vis-à-vis the ones who we would be helping the most i am assuming? >> yes, that is correct. >> let me stick with you dr. foss. we currently lease less than 4% of the 2.5 billion a curse of the federal mineral estate. if we were to allow access to more bad federal mineral estate is not logical we could increase our domestic reserve days? >> yes, we would. >> we are used to bigger answers but thank you for the direction. what advantages does the united states have compared to other countries or maybe even hindrances do we have two other countries that we might and congress address that would encourage more domestic development? >> i think the one that we just talked about, which is budget and taxes and there are two things to think about there. one is a direct effect on the

producers themselves, the producing community itself. so the tax structures they face, the cost structures they face but then the other one is the health of the overall economy because just like any other industry that companies will do better if the overall u.s. economy and budget are in better shape. >> i appreciate that. just one last one of view them. because we heard yesterday a great deal of comparisons between the united states in other countries that i think somewhat were skewed in the response of doing that at how does the domestic oil and gas industry compared here, compared to the industry and other countries in terms of science or technological development? >> it is the norm ashley different. for one thing we have thousands and thousands of producers of all sizes and shapes and specialties anywhere from nine to 10,000, 9000 to 10,000 is the

roof estimate of the total number of active producers in the united states large and small. they are motivated to deploy and develop the best technologies that they can and they tried to do that. and they do that freely in an open open market and competitive industry activities. and they have access to private owned minerals and not just the public owned minerals. we are the only country that is organized organized outweigh. >> i appreciate that very much. i also appreciate the fact we have talked a lot about offshore development that i come from an inland state that has a great deal of potential development of the were allowed to be there and if somebody is on a schoolteachers retirement my retirement is the future of my retirement is based on ability of economy and my state to fund that as well as my kids education system so i'm very sensitive than remake of arbitrary decisions it takes that potential development off the table when we could be benefiting from that.

mr. chairman of five a few minutes left and i yield to the gentleman from louisiana if i have a few seconds left? >> the gentleman has 19 seconds left. >> do you want 19 seth -- seconds jeff? >> i would like to just for the record talk about their rig count real quickly, the rigs that are out there that are claiming in the gulf of mexico, those rigs may not be drilling. is that correct? so it doesn't do us any good to to -- drilling. >> correct. rigs could certainly be there not drilling. i can speak to the longer-term issue of how fast it could recover. >> the time of the gentleman has expired and there is a desire for second round so i will certainly recognize the gentleman. the gentleman from utah's time has expired. there is a desire for second round. i have one question of mr. holt and then finish up with mr. landry. dr. foss, there have been records that have been --

between that price differential of the world crude in the west texas and the suggestion is because this has been the rise or the impact of north dakota. and i understand that new production probably would have an impact on the world prices but is this difference in price an indication that more domestic production could provide a price base for american consumers in that regard as well as the national security aspect that i have been talking about for some time, dr. foss? >> yes. >> boy that is very definitive. do you want to elaborate? that is the only question i have so i'm not going to ask you another one. explain briefly. >> i understand what you are asking which is the impact of our crude production in our own markets? >> right, exactly. >> course it is a huge impact

and i mentioned an idea the suggestion that we need to think about which is the bottlenecking to make sure we can benefit from it, because and we have this problem, we have had this problem before. we have a, natural gas sides periodically and we have new areas that grow and start flourishing. we have pipeline bottlenecks and storage bottlenecks and we can't get it out to the markets that we have an accumulation of inventory and one in one part of the country right now and it is contributing to the disparity between our domestic price and internationally traded price of crude, so to the extent that provides an indication to investors that perhaps there is money to be made by building additional oil pipeline and storage terminals and other capacity, they will get there as long as they can get it permitted and enter the market in a way that they feel will work timing wise.

>> and all that would be based on the assumption that would be less than the world market prices and therefore benefiting american consumers. is that correct? >> well, they would take advantage of arbitrage to make the investment work. so when you have a disparity in a price signal like this, a low price in a producing area relative to higher prices and markets, that allows you to actually finance the structure. that basis differential as we call it that allows people to move forward with projects like new pipeline capacity and other the bottlenecking strategies. benefits consumers. >> which goes back to your original short answer yes it it helps bennett that the american consumer. now i will yield back my time and recognize the gentleman from new jersey, mr. holt. >> i thank the chair and i thank him for his courtesy and allowing further questioning.

several of our colleagues raised the point of the cost of gasoline at the pump today. $3.50 am more compared to months ago or a year ago. but i think it has come out quite clearly in the testimony today that oil prices are much more a function of what opec does then a function of the rate of issuing oil drilling permits, and gasoline prices are even less correlated with that. gasoline price fluctuations are much more a function of speculation and even what i would call couching. gouging. wishing and hoping and dreaming won't change reality. when we talked about reserves -- that is reality.

what resources can be estimated with reasonable certainty to visit -- at exist under reasonable economic conditions. i think we have to face the fact that we must have a broader balance of energy portfolio. simplistic solutions won't do. drill baby, drill is simplistic. it does not capture what we have. we do not dominate the production of oil in the world. we never will again dominate the world oil production. the burn rate actually has some meaning. we can quibble about exactly where we are relative to norway and others but what it means is that our leverage in oil prices will be less and less and less

and it is already not great. so my question has to do with oil reserves and not cool by the way. in talking about how many barrels equivalent we have of coal, is not really relevant here today. in trying to explain that the burn rate doesn't mean anything, dr. foss says well but we are continuing to expand our knowledge of our reserves. my question is, when was the last time that more oil was discovered then was actually produced? in other words, when did this view of reserves around the world stopped keeping up with our use of oil?

yes, do you know what you are that was dr. foss? >> we always have more reserves than we have production. reproduce some reserve's. >> let me pretend we are playing jeopardy here. that has been something -- the last year that more oil was discovered than was actually produced, what is 1984? more than a quarter of a century ago. we can hope and dream and wish, but we have got to face facts. we can't look for simplistic solutions. we have to have a broader energy portfolio and of course oil is important to louisiana. of course oil is important to texas. of course oil is important to all of their country for all sorts of reasons. but we can't change reality, and we have got to face facts as mr. markey said early on.

we have ridden this horse and we have ridden this horse and the legs are giving out. i yield back my time. thank you. >> the gentleman yields back his time. i will recognize mr. landry to close. >> i think we have a few more horses in oil. we have got natural gas. i think this horse is a pretty solid horse. we should put her in the gate. we have got a lot of coal. put colin the gate and nuclear certainly does a good job here in this country if we could get back to building refineries and i'm confused to know i know it is hard to say right and there is a lot of confusion on the other side of the aisle, because they talk about opec having a stranglehold and another member comes up and says that exxon has a stranglehold. that is kind of confusing. as to who exact we has the

stranglehold. anyway, how long do you think that this trade of speculation has been around in this world? come on, you are all smarter than me. someone knows. do you want to guess? 100 years? 200 years? century so speculation of commodities has been around for centuries. so it evidently we have been able to grow this country -- this country has been able to grow and prosper all the way through the speculators for centuries and centuries ago. they didn't hang them back then or anything. do you know? if they did or not? was at a punishment for speculation? >> i don't believe so. >> okay, all right. what bothers me is we always want everybody else to increase their production capacity for our gain but we don't want to

take responsibility for what we could do ourselves. the interim safety rule issued by the interior department in october 142,010 said that there is sufficient spare capacity in opec to upset the decreases in the gulf of mexico's deep water production. do you all believe that is true? i mean if that is the case then prices shouldn't be continuing to go up. wow. [laughter] that may ask you this question. are any of you all familiar with water cuts? any of you familiar with the mideast reserves out there? does anyone want to comment? i'm going to give you off the floor. i've got some time here.

>> i'm not sure what the question is. >> if you are familiar with the problems, we always want to turn to the middle east but is it true that the middle east really has a problem with that spare capacity? every time the united states asks the middle east for saudi arabia in particular to increase its spare capacity, doesn't that put drescher on saudi's reserves such that it actually damages the research rather than allowing for longevity of these reserves? >> my experiences they manage their reserves pretty efficiently, but i don't have any evidence. >> ms. foss? >> i think and i think many other people would agree including all of our colleagues at eia, that one of the more difficult estimates to put

together is that estimate of spare capacity along oil-producing countries and that is one of the things that contribute to great deal to uncertainty in the oil markets themselves. >> what potential does the united states have to create spare capacity here at home domestically? >> we have a great deal of capacity to do that because again it is about portfolios. portfolios of opportunities that are available to companies on both public and private lands and to the extent that those portfolios of opportunities are robust. that is our spare capacity. >> will the gentleman yields? on the issue of speculation i don't know the gentleman does grocery shopping and his family are not, but i would guess that your wife from time to time will buy a two for the price of one. would you consider that

speculating? >> know, that is more shopping. >> right, but it makes the point. i would guess that your wife is making that purchase because you are speculating the next time she buys that product the price would go up and she speculating on keeping it down. when one talks about speculation, if you put it in that terms like that we do that every day in our lives. you buy a jumbo instead of the other because they are speculating that price is different, the differentials so that is why apparently you don't do the shopping. >> she does smart shopping. she buys two for one. >> the time of the gentleman has expired. the gentleman from california is recognized. we get the courtesy to him. certainly if the gentleman wants to have the time he is certainly recognize. >> thank you very much mr. chairman and i do appreciate that. i noticed than a long hearing and that it has been an important hearing and i thank you for putting it together.

it has been six years since i've been on this committee and we have obviously had this discussion and debate throughout the six years, and i find it interesting that we all use the same facts more or less but obviously using those facts come to different conclusions. and it is interesting we come to different conclusions even though we want in essence the same goals, the same goals that they want, a cleaner more reliable sources -- i say sources of energy for a nation that will be economically viable that will reduce over the years our dependency on foreign sources of energy but the same goals. and it seems with lacking to me me -- what is lacking to me is how we can agree in a bipartisan fashion on how we obtain that goal. and it is not that we are

lacking for plans. since 1973, i remember clearly when president nick's and, we experience the first energy gas lines where people had even and odd days to get your gas, and announced a plan then that was called energy independence. i'm not so sure that we ever truly are going to be independent but certainly everybody believes we ought to reduce our dependency on foreign sources. at that time we were importing 30% of our energy as foreign sources and since that time every president and numerous congresses have all had energy proposals on plants that in some fashion have been implemented. and of course we have gone from 30% of our energy sources being imported to now almost 60% or more of our energy sources. so you have to set -- step back for a moment and say since we want the same goals, and we have all had a lot of plans out there

what has been lacking and i will tell you what i think has been lacking is the ability for any congress or any administration to reach a consensus on a short-term interim and long-term energy policy that in fact will fulfill those goals of dealing with the the new technologies reducing our dependency on foreign sources of energy and sticking with a plan. we can't stick with any plan. our plans, you know the planned issuer, the plan for the day. with a plan for this year, two years, three years. we change it and energy prices go up. make certain alternatives are viable and energy prices go down. it makes less energy alternatives viable and we have this kind of circular browbeating up one another that at the end of the day doesn't help the american public nor a

long-term energy plan. mr. caruso, what do you think in using all the energy tools in our energy toolbox because i don't think there is a silver bullet out there. i think we have got to use all of them. i have always maintained that for the six years i've been there. how do we do a transition and adopt a plan in the near term with more reliant on our fossil fuels and the interim as we transition to longer-term policy and i define longer-term twenty-year send out, to reach the sword of near-term and long-term goals that our country needs to i think the chief and we ought to be focusing on a bipartisan basis. i mean when do we do an inventory of what our current energy needs are? what they are going to be in the midterm and the longer-term, and how to use different energy tools in the energy toolbox you transition?

>> i think you are absolutely right about the timeframe. we need to be thinking decades long transition. fossil fuels are going to be with us for a long time to come, and the alternatives for a variety of reasons, technology, economics, scalability are going to take a long time to develop but that doesn't mean we shouldn't start as you are alluding to and on that side, the focus should be on technological development and innovation through research and development. and that is the long-term. >> but under short-term part of the conservation is low-hanging fruit. we are 20% trying to get to 30% by the year 2020. >> in the short-term as i mentioned in my opening statement that the vehicle efficiency, improvements in efficiency and homes, the use of code generated electricity.

there are a lot of things that can be done to reduce demand so i think we need to do it all and not think it is going to happen overnight. so i think there has been an unrealistic expectation created by all of us including us energy experts. >> thank you mr. chairman for the time and allowing this and to sum things up. i look forward to working with you on these important issues. >> i thank the gentleman very much and i want to thank this panel. it has been over three hours that we have convened this and especially i really mean that, especially appreciate the brevity and in fact we have been kicking around some ideas able we are going to call it. it could be as time goes by ward, the once upon a time award or the good time award. whatever it is, i will say that this panel here today on st. patrick's day is the recipient of of the award so

thank you during much and the committee will stand adjourned. [inaudible conversations] [inaudible conversations] >> next, live, your calls and comments to the "washington journal."

then, news makers with jegry jzczko. >> if you recall in the 60's and 7 o's -- >> katherine wylde, working to keep the city the center of the business world. >> new york city was really pulled into the global economy, became america's gateway to that economy and has really prospered ever since. >> watch the rest of the interview tonight on c-span's "ququ & a."