Has BP's luck finally changed?

BP Plc, which reported a 53 percent drop in quarterly profit in July, announced much happier news Wednesday -- a gigantic oil discovery in the Gulf of Mexico.

Europe's second-largest oil company said the Tiber Prospect near Houston may contain more than 3 billion barrels. Shares of the UK company, down more than 6 percent over the past year, have jumped almost 4 percent in early morning trading.

"The latest discovery will help BP, already the biggest producer in the Gulf of Mexico, boost output in the region by 50 percent to 600,000 barrels of oil equivalent a day beyond 2020," according to Bloomberg News.

While the discovery is gigantic, people should not rev up their gas guzzlers quite yet. Alaska's Prudhoe Bay oil field, where BP also is a major player, has a total capacity of 25 billion barrels. The production quota for OPEC member states is about 25 million barrels per day. As oil prices rise, OPEC member states have reportedly been increasing production.

BP's discovery may ratchet up pressure on the Obama administration to allow more drilling for oil in areas such as the Arctic National Wildlife Refuge and in more areas offshore. Last month, President Obama pledged $2.4 billion to create green jobs, based on the argument that oil is a finite resource. That argument will be tougher to make if companies keep finding more of the stuff.

That's a pity because lessening U.S. dependence on foreign sources of oil is a worthy goal. Petroleum-based energy, though, will continue to be important for a long time.
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