By Robert Bradley, CEO and founder of the Institute for Energy Research
The recent events in Crimea give President Obama yet another reason to approve Keystone XL. Russia''s military incursion highlights the need for improved transportation of oil and natural gas from North America for energy-market stability.
Immediately after Putin''s forces entered the Crimean Peninsula, the price of crude oil jumped to a sustained six-month high of nearly $105 a barrel. Every dollar increase adds cents-per-gallon at the pump and to heating-oil bills.
In fact, average gas prices across the United States just broke $3.50 per gallon for the first time in six months. This comes as many households face skyrocketing heating bills with the harsh winter. Increased usage strains our supply of natural gas -- causing many utilities companies to switch to fuel oil.
Enter Keystone XL, the final leg of four segments of a project linking oil from Canada and North Dakota to Gulf Coast refineries for world distribution. Keystone XL''s 830,000 daily barrels would displace oil now imported by the same refineries, creating a more integrated, supply-rich international oil market.
In times of international incident, that can mean real savings for energy consumers at home and abroad.
There's much to like about Keystone XL, both economically and environmentally. And now Obama is out of excuses for its delay.
Indeed, anti-Keystone environmentalists fell on their own sword with a recent State Department analysis showing that the project was likely to decrease greenhouse gas emissions.
How so? Because the Canadian shale will get developed regardless of whether Keystone XL is built. In the report''s words, "approval or denial of any one crude oil transport project, including the proposed Project [Keystone], is unlikely to significantly impact the rate of extraction in the oil sands."
That oil and gas is just too valuable. Instead of being stranded, oil awaiting Keystone XL is currently carried by less environmentally friendly rail,barge, and truck).
Indeed, several construction projects to deliver Canadian crude oil to U.S. refineries have recently sprung up. Three large terminals are being constructed in Canada where oil can be loaded onto U.S.-bound trains.
A dock on Lake Superior is upgrading so Canadian crude can be put on barges travelling through the Great Lakes to U.S. ports. And at the Port of Vancouver, the Tesoro refining company and oil service company Savage are seeking permits to build an oil-loading facility.
These projects only make Obama's Keystone XL stall more confounding. The pipeline is more environmentally friendly than these alternatives and would grow our economy. In addition to creating 13,000 new jobs during its construction, Keystone would support 42,000 jobs domestically. Plus, by 2035, its estimated that the pipeline will contribute $172 billion to America''s gross domestic product.
That's a hefty return on investment for the $5.3 billion infrastructure project. And no taxpayer subsidies are involved!
Plus, the pipeline will increase our country''s energy security. We currently rely on imported oil from unstable regions across the globe, including the Middle East and Venezuela. Building Keystone would cut our imports from these less amiable countries by 40 percent.
It's little wonder that former President Bill Clinton has urged opponents to "embrace it" and move on.
Unfortunately, the issue remains partisan and controversial.
All the facts have been laid out. It is time for action, as the President would say. The American people support the construction of Keystone by a 3 to 1 margin. The Obama administration should provide final approval once and for all -- and avoid future repeats of politicized policy without a purpose.
Robert L. Bradley Jr. is CEO and founder of the Institute for Energy Research and the author of seven books on energy history and public policy.