To Conserve Gas, President calls for less driving
Dal New York Times 27.09.2005
27 September, 2005
By DAVID LEONHARDT, JAD MOUAWAD and DAVID E. SANGER
With fears mounting that high energy costs will crimp economic growth, President Bush called on Americans yesterday to conserve gasoline by driving less. He also issued a directive for all federal agencies to cut their own energy use and to encourage employees to use public transportation.
President Bush said Monday that the government is prepared to again tap into the Strategic Petroleum Reserve.
"We can all pitch in," Mr. Bush said. "People just need to recognize that the storms have caused disruption," he added, and that if Americans are able to avoid going "on a trip that's not essential, that would be helpful."
Mr. Bush promised to dip further into the government's petroleum reserve, if necessary, and to continue relaxing environmental and transportation rules in an effort to get more gasoline flowing.
On Capitol Hill, senior Republicans called for new legislation that they said would lower energy costs by increasing supply and expanding oil refining capacity over the long run.
Even though Hurricane Rita caused much less damage to the oil industry than feared, the two recent hurricanes have disrupted production in the Gulf of Mexico enough to ensure that Americans are facing a winter of sharply higher energy costs. The price of natural gas, which most families use to heat their homes, has climbed even more than the price of gasoline recently.
Households are on pace to spend an average of $4,500 on energy this year, up about $500 from last year and $900 more than in 2003, according to Global Insight, a research firm.
Mr. Bush's comments, while similar to remarks he made shortly after the disruption from Hurricane Katrina pushed gasoline prices sharply higher, were particularly notable because the administration has long emphasized new production over conservation. It has also opted not to impose higher mileage standards on automakers.
In 2001, Vice President Dick Cheney said, "Conservation may be a sign of personal virtue, but it cannot be the basis of a sound energy policy." Also that year, Ari Fleischer, then Mr. Bush's press secretary, responded to a question about reducing American energy consumption by saying "that's a big no."
"The president believes that it's an American way of life," Mr. Fleischer said.
Mr. Bush, speaking yesterday after he was briefed at the Energy Department, did not use the dour tone or cardigan-wearing imagery that proved politically deadly for Jimmy Carter during the oil crisis of the 1970's. Nor did Mr. Bush propose new policies to encourage conservation. But he was more explicit than in the past that Americans should cut back.
Oil companies spent much of yesterday assessing the damage from Hurricane Rita, which seemed to spare many oil and gas facilities. Still, the gulf's entire oil output and about four-fifths of its natural gas production remained shut yesterday, less than a month after Katrina left the industry stretched thin.
The Gulf of Mexico produces about 7 percent of the oil consumed in the United States and provides 16 percent of the nation's natural gas.
About half of the 16 refineries that were forced to shut by Hurricane Rita have said they plan to restart production soon. But delays in refining pushed the average price of gasoline up again for the first time since Labor Day, to $2.80 a gallon for regular gasoline, according to AAA.
Crude oil prices also rose yesterday on the New York Mercantile Exchange, closing up 2.5 percent, to $65.82 a barrel. Natural gas futures rose 12 cents, to $12.44 a thousand cubic feet.
"We've been in a chronic situation here where supplies have not really caught up with demand," said Dave Costello, an analyst at the Energy Information Administration.
In response to higher energy costs, households are likely to spend less on restaurant meals, clothing and other items. That would slow economic growth in coming months, but economists predicted that other forces - like a continuing housing boom and rising corporate investments in factories and equipment - would keep the economy growing.
"I don't think we're talking about a recession or a near recession," said Joshua Shapiro, the chief United States economist at MFR, a research company in New York. "I think we're talking about growth that is slower than people expected."