Obama-+US+will+seek+oil+in+Alaska+and+Gulf+of+Mexico

**Date:** May 14th, 2011
 * Article:** Obama: US will seek oil in Alaska and Gulf of Mexico
 * Source:** BBC News - []

The article states that "the US will seek to expand domestic oil production in an attempt to reduce dependence on imported oil and bring down fuel prices." In other words, the US is increasing its allowed supply of oil since it is using parts of its reserve in Alaska, as well as "oil and gas fields in the Atlantic Ocean [being] evaluated as a high priority." By getting access to more oil, the US will be increasing its supply of oil from Q1 to Q2 and ultimately dropping the price of oil from P1 to P2, making a final shift from E1 to E2 (see graph below). By making this decision, the US's opportunity cost is a lessened supply of reserve oil for its future. Oil is also a relatively inelastic product, meaning its PED is less than 1, because it is a necessity in everyday life and there are very few substitutes (and almost none) that are as efficient and simple to use as oil. The factor of production in this case is oil, a commodity or raw natural resource of land. The article also implies some sustainable development, as Obama is only going to use oil reserves in Alaska that are un-protected for the future.
 * Summary:**


 * Vocabulary**

Commodity-a raw material or primary agricultural product that can be bought and sold, such as copper or coffee. Factor of production (LAND)-Natural resources and land that can be used for the production of a product Inelastic Product- A product's whose price elasticity of demand is lower than 1, and therefore a necessity Demand-The need for a good or service Supply- The quantity of a good or supply offered Positive statement- A statement that is proved by the use of fact Normative statement- An opinionated statement Sustainable Development-A countries economic development that will ensure that future generations' resources will not be in jeopardy Opportunity cost - the value of that which must be given up to acquire or achieve something


 * Graph 1: Supply and Demand of the US's Oil**


 * Evaluation:**

One thing that can be interpreted both ways in the article is whether this decision is an act of sustainable development. "Mr Obama has previously called for a step-change in energy policy, saying the US must move towards getting 80% of its electricity from clean energy sources by 2035." Through this, it can be seen that Obama wants the US to use cleaner energy which benefits the future (lower pollution/climate change/waste). However, by making the decision to tap into the oil reserves of Alaska, Obama is also to some extent jeopardizing the future's generations dependence on oil. In other words, if the US urgently needed oil for some reason (war, sudden loss of energy sources), it would have less, as parts of its reserves were used in 2011 and the global supply of oil is dwindling down. Regardless, I agree with Obama's choice, as 2011 is still a post-recession period and by increasing supply, oil will be cheaper and the U.S.'s economy may recover faster as people can buy oil with more ease. The best solution, ultimately, is mass-investing in cleaner energy sources like Obama says. This sort of sustainable development is vital for the US: as the world market is shifting to Asia, the last thing the US wants is importing more oil in the future with an economy that is declining.