At a press conference at the White House on Thursday, U.S. President Barack Obama moved to freeze new offshore oil activity in the Arctic. (Associated Press)

Facing backlash over a devastating oil spill in the Gulf of Mexico, U.S. President Barack Obama announced a moratorium on new drilling for oil below the Arctic Ocean.

"We will suspend planned exploration on two locations off Alaska … and suspend the issuance to drill new deep water wells for six months," Obama said at a press conference at the White House outlining the plan.

Although the moves fall short of an outright ban on offshore drilling, Obama laid out four new rule changes:

• Exploration in two sites off Alaska's coast have been suspended.
• Plans for leases off the coast of Virginia and in the Gulf of Mexico have been cancelled.
• Permits for new deep-water wells in the Gulf have been suspended for six months.
• Thirty-three current projects in the Gulf of Mexico have been suspended.

"For years the oil and gas industry has leveraged such power that they have been effectively able to regulate themselves," Obama said. "This oil spill is an unprecedented disaster."

Offshore watchdog resigns

Only hours before Obama spoke, Elizabeth Birnbaum, the head of the troubled agency that oversees offshore drilling, resigned from her post.

"I found out about her resignation today, so I don't know the circumstances," Obama said of the leadership change, disputing reports Birnbaum was fired. "But we have to make sure, if we are going forward with domestic oil production, that the federal agency charged with its safety and security is operating at the highest level."

There has been a lot of public outrage over the administration's handling of the devastating oil spill, which followed the sinking of the Deepwater Horizon oil platform on April 20. Although BP is managing the effort to plug the leak, Obama insisted that the U.S. government has ultimate control.

"Every action must be approved by us in advance," he said.

BP was making its latest attempt to plug the leak with a so-called "top kill" method of pumping dense mud and concrete into the hole on Thursday.

'We are going to stop it.'—U.S. President Barack Obama

"We will take ideas from anywhere, but we are going to stop it," Obama said.

The moratorium will include Shell Oil's plans to begin exploratory drilling this summer on Arctic leases as far as 225 kilometres off Alaska's shores. Now those wells will not be considered until 2011.

In March, Obama announced a new policy on offshore drilling, throwing open a huge swath of east coast waters and other protected areas in Alaska and the Gulf of Mexico to drilling.

The sinking of the Deepwater Horizon oil rig after a fire on April 21, 2010 led to an oil spill which has is estimated to thus far have spewed between 64 million and 148 million litres. (Associated Press)

That expansion now looks like it will be dramatically rolled back for some time to come, as Thursday's announcement is something of an about-face, Obama acknowledged. "Where I was wrong was in my belief that the oil companies had their act together in terms of worst case scenarios," he said.

Thursday will also be the first time the U.S. president has made himself available for a lengthy press since the platform sank more than five weeks ago.

View Offshore oil activity in Canada in a larger map

A map of all the off-shore oil drilling activity in Canada.