CONGRESS IS BATTLING over whether to approve the Keystone XL oil pipeline, proposed for the heart of the country. The project has clear value to the United States. Yet, with all the amped-up rhetoric, it is important to remember what the project would not do. It would not endow the United States with “energy security” in the sense that most Americans understand the phrase and that many pipeline advocates wield it. It would not significantly lower oil prices. In fact, when it comes to oil, America will be affected by global events for decades, and that’s assuming the right policies are in place.
The Congressional Budget Office (CBO) underscored that point in a report it released last week. “The extensive network of pipelines, shipping and other options for transporting oil around the world means that a single world oil price prevails,” the CBO pointed out. “Disruptions related to oil production that occur anywhere in the world raise the price of oil for every consumer of oil, regardless of the amount of oil imported or exported by that consumer’s country.”