Drill, Baby, Drill?

Many of this week's biggest applause lines had to do with drilling for oil. I, like Tyler Cowen, tend to assume that anything that comes out of a politician's mouth that involves economics (particularly anything in that category that induces a stadium of delegates to cheer) is probably dumb. But wait! Wouldn't it be great if someone had actually done a study to quantify the potential benefits of drilling? Ta da!:

The best estimate of economically recoverable oil in the federal portion of ANWR is 7.06 billion barrels of oil, a quantity roughly equal to US consumption in 2005. The oil is worth $374 billion ($2005), but would cost $123 billion to extract and bring to market. The difference, $251 billion,would generate social benefits through industry rents of $90 billion as well as state and federal tax revenues of $37 billion and $124 billion, respectively.

These figures are from 2007 when oil was roughly half the price it is today. Cowen updates the numbers for a rough estimate of $600 billion in benefits (minus environmental costs). That's, give or take, the GDP of Brazil.