Bush lifts offshore drilling ban in symbolic move

By Jeremy Pelofsky and Tom Doggett

WASHINGTON (Reuters) - President George W. Bush on Monday lifted a White House ban on offshore drilling to try to drive down soaring energy prices, a largely symbolic bid unlikely to have any short-term impact on high gasoline costs.

With prices at the pump over $4 a gallon, Bush pushed the Democratic-controlled Congress to expand offshore oil and natural gas drilling in the Outer Continental Shelf and give oil companies access to the Arctic Wildlife National Refuge.

High gasoline prices and soaring food prices have irked American consumers in a presidential election year, when Bush's Republicans are trying to keep the White House and wrest control of Congress back from Democrats.

"Today, I've taken every step within my power to allow offshore exploration," Bush told reporters. "This means the only thing standing between the American people and these vast oil resources is action from the U.S. Congress."

Congress too has a ban on offshore drilling and while it expires on September 30, it could be renewed. Plus, federal officials say it would take years for any oil to be produced in those areas, together making Bush's move largely symbolic.

"Now the ball is squarely in Congress' court," Bush said after signing a memorandum reversing a presidential ban that was instituted by his father, then-President George Bush, almost two decades ago. "The time for action is now."

With an eye to the November election, Bush accused Democrats of having "done nothing" as gas prices have gone up and urged them to pass a law for "responsible offshore exploration" and to give states a say in the decisions.

House Democratic Speaker Nancy Pelosi called Bush's plan a "hoax," joining a chorus of condemnations from environmental groups. The business-friendly U.S. Chamber of Commerce hailed the move as a step toward alleviating high gasoline prices.

Democratic White House hopeful Sen. Barack Obama's campaign also criticized Bush's move. "It would merely prolong the failed energy policies we have seen from Washington for 30 years," spokesman Bill Burton said.

Even if more Democrats in Congress backed lifting the legislative ban, it would be unlikely that they would buck their presidential candidate ahead of the November election.

Republican White House contender Sen. John McCain, who reversed his previous opposition to offshore drilling, told reporters that he thought the decision was a "very important signal" and that "states should continue to decide."

NO SHORT-TERM RELIEF IN SIGHT

Despite the hurdles, stocks of offshore drilling companies rose, including Noble Corp. up 1.8 percent and Hercules Offshore Inc. up more than 4 percent. August light crude oil was up slightly to $145.20 a barrel in afternoon trading on the New York Mercantile Exchange.

"Sooner or later, the American public will get so tired of high prices, that they will put pressure on politicians to make changes," Larry Nichols, chief executive officer of Devon Energy Corp, an independent U.S. producer, told Reuters.

The U.S. Energy Department's forecasting arm has said opening the Pacific, Atlantic and eastern Gulf of Mexico regions to drilling "would not have a significant impact on domestic crude oil and natural gas production or prices before 2030."