I have to change a previous position. I DO think that development and drilling now would change the prices somewhat immediately. Here's why: oil prices are partially driven by futures markets. Long term futures prices would likely decrease, causing a slowing demand in the bidding for crude. This would create excess supply in the long term, meaning more than one year. It would convince speculators that we are serious about increasing long term supply, which would lower the demand curve to meet at a lower clearing point, resulting in lower prices for processed crude. Secondly, it would put us in a much better bargaining position with OPEC, which would either build more capacity themselves to meet our demand, or start lowering prices to keep us happy in the long term. So, there are two basically sound theories that would predict a modest drop in the price if congress authorized drilling today.
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