How to Weaken the Power of Foreign Oil – NYTimes.com by R. James Woolsey and Robert C. McFarlane

How to Weaken the Power of Foreign Oil – NYTimes.com.

OUR country has just gone through a sober national retrospective on the 9/11 attacks. Apart from the heartfelt honoring of those lost — on that day and since — what seemed most striking is our seeming passivity and indifference toward the well from which our enemies draw their political strength and financial power: the strategic importance of oil, which provides the wherewithal for a generational war against us, as we mutter diplomatic niceties.

Oil’s strategic importance stems from its virtual monopoly as a transportation fuel. Today, 97 percent of all air, sea and land transportation systems in the United States have only one option: petroleum-based products. For more than 35 years we have engaged in self-delusion, saying either that we have reserves here at home large enough to meet our needs, or that the OPEC cartel will keep prices affordable out of self-interest. Neither assumption has proved valid. While the Western Hemisphere’s reserves are substantial and growing, they pale in the face of OPEC’s, which are substantial enough to effectively determine global supply and thus the global price.

Achieving $2 Gas – Robert Zubrin – National Review Online

Either we break the cartel, or the cartel breaks us. The Open Fuel Standard bill needs to be passed.

via Achieving $2 Gas – Robert Zubrin – National Review Online.

Republican presidential contender Michele Bachman has said that if she is elected, gas prices will fall to $2 per gallon. Such promises have understandably been greeted with considerable skepticism. But $2 gas is exactly what America needs. The question is, how can we get it?

We can’t do it just by expanded domestic drilling. In order for gasoline prices to fall to $2 per gallon, oil prices must be cut to $50 per barrel. And oil prices are set globally, with the dominating influence being the OPEC oil cartel. Since 1973, this cartel, which controls 80 percent of the earth’s commercially viable oil reserves, has refused to expand production, thus keeping petroleum prices artificially high. While, with a more pro-business government, the United States might conceivably be able to expand its production by a million or two barrels per day, OPEC could easily counter by cutting its production to match, or more likely, by simply continuing its non-expansion policy and letting increased Chinese demand take care of the slack.

Moving Beyond OPEC: Energizing the Economy with a Viable Energy Policy – Kellie Dunlap

During Spring, oil prices reached over $100 dollars per barrel­ ­̶  the highest price since 2008.  This summer, oil prices fell due to the global economic recession.  In direct correlation to the volatile oil market that followed the Spring price hikes, the U.S. domestic economy has floundered. With minimal job growth, rises in food prices and debilitating effects on the housing market, it becomes apparent just how much high oil prices  impact the U.S. economy.

Clemson University Professor David Bodde says, “What we are seeing in terms of the price [of oil] is more of a financial demand phenomenon more than a supply and demand phenomenon.”  Bodde further explains that in order for the economy to recover, oil prices need to be consistent. However, there is little the U.S.  government can do to influence the global price of oil since it is a fungible commodity and the U.S. only produces about 8% of the world’s total supply.

OPEC , the Organization of Petroleum Exporting Countries, sets the global price of oil since they are the largest petroleum producers; theoretically basing the price of oil on supply and demand.  However, history suggests that supply and demand is not the determining factor of oil prices. Gal Luft, executive director of the Institute for the Analysis of Global Security (IAGS) argues that, among other factors, the recent inter-organizational politics of OPEC may further exacerbate the unpredictability of oil prices in the near future.

In late July, Islamic Revolutionary Guards veteran Rostam Ghasemi was appointed the new petroleum minister of Iran.  Iranian President, Mahmoud Ahmadinejad explained that the nomination of Ghasemi will promote Iran’s objective to align the complex oil industry with its national interests. Iran currently holds OPEC’s  rotating presidential seat.  Therefore, Ghasemi will act as the de-facto president of OPEC in the coming months.

Ghasemi, a former Chief Commander of the Iranian Revolutionary Guard, will be sure to uphold Iranian national interests, which poses a threat to Saudi Arabia’s longstanding control of OPEC decision-making.  Luft contends that, while there is the obvious historical Sunni-Shia rift between Saudi Arabia and Iran, as well as the ideological dispute over regional hegemonic power, there is another contentious issue at hand; instead of the member states of OPEC falling in line with Saudi Arabia’s decisions as they have in the past, they are now attempting to raise the price of oil to cover their own economic needs. Both Iran and Saudi Arabia are largely dependent on oil revenues.  However, Iran would rather see the price of oil per barrel around $140 in order to balance its budget. Saudi Arabia, on the other hand, can maintain its budget with oil prices about $90 per barrel.

In June, OPEC members, for the first time in two decades, were unable to agree to an increase in output levels or establish the price of oil per barrel.  The widespread civil unrest in many Middle Eastern countries has weakened their economies, causing OPEC members to make decisions individually rather than as an organization.  These disparities, coupled with Iran and Venezuela’s insistence on higher oil prices, have divided OPEC’s members and reduced Saudi Arabia’s influence. With Rostem Ghasemi holding the reins of OPEC, the international community will likely see inflated oil prices for the remainder of the year.

2011 has illustrated that dependence on foreign oil makes the U.S. economy vulnerable- America can no longer afford to be at the whim of OPEC .  With Middle Eastern civil turmoil, revolutions, and power politics, America needs to end its dependence on foreign oil.  The government should be focusing on utilizing all available resources in order to become energy independent.  On shore and offshore drilling should be permitted; natural gas expansion should be encouraged; clean coal production for the purpose of creating fuel via methanol should also be pursued, as well as the continuing production of biomass fuel.  By acknowledging that capricious oil prices are the source of our economic problems, we can work to solve the problem by reducing our dependence on foreign oil, which will create long-term employment and help to balance the trade deficit.

As gas prices continue to range between $80-$100 dollars per barrel, Americans will pay $500 billion to OPEC and other foreign governments this year alone. While the President prepares to address Congress regarding job creation on Thursday, America should be demanding that he and Congress create an effective energy policy that will mobilize multiple sectors of the economy rather than simply promoting each party’s preferred energy sources.  Until this occurs, we can be sure to see further unemployment, a depressed economy and higher prices at the pump.

Guest Column: Energy policy should focus on becoming energy independent – Opinion – Heritage Newspapers

Guest Column: Energy policy should focus on becoming energy independent – Opinion – Heritage Newspapers.

Today, America is under tremendous financial pressure due to our continued federal policies to spend more money than our government brings in. We hear all about entitlement reform and “belt tightening” plans, but energy is mostly ignored.

But, do you realize that America sends one half a trillion dollars to other countries every year in the form of oil imports which contributes to our crisis?

Key to stronger economy is stabilizing gas prices, professor says » Anderson Independent Mail

Key to stronger economy is stabilizing gas prices, professor says » Anderson Independent Mail.

The economy needs consistency in gas prices to strengthen, Bodde said.

“The key danger in all this is volatility,” he said. “We can adjust to a high price and a low price, but the thing that really wreaks havoc on the economy is high prices then low prices and then high prices.”

Stephen Moore: ‘Green Jobs’ vs. Real Energy Jobs – WSJ.com

Stephen Moore: ‘Green Jobs’ vs. Real Energy Jobs – WSJ.com.

President Obama is expected to seek another $250 billion or so in new stimulus funds next week, with plenty of money for clean energy and the creation of so-called green jobs…

So we now have a national energy policy directing our resources away from cheap, efficient and increasingly abundant fuels like coal, oil and natural gas while we channel billions of tax dollars to 500-year-old energy technologies like wind power that can’t possibly scale up to power a modern-day industrial economy. That’s a shame.

Open Fuel Standard: The Answer is Multiple Choice – Lilly Sherman

Open Fuel Standard: The Answer is Multiple Choice.

We have to stop looking for a single fuel or a single way to become energy independent. Oil is one thing. The answer will be many things. People may argue methanol is better than ethanol, or only certain ways of making fuel are acceptable, or all cars should be electric or natural gas, or hydrogen is better.

But nobody can say any one thing can replace oil. We need all these ways. And we need cars that can handle all sorts of fuel and power: A flex-fuel plug-in hybrid, for example.

Ethanol: U.S.-produced fuel is leading oil alternative – baltimoresun.com – Stephanie Dreyer

Ethanol: U.S.-produced fuel is leading oil alternative – baltimoresun.com.

Karen Hosler’s recent opinion piece calling for an end to ethanol subsidies (“End the ethanol charade,” Aug. 30) uses sweeping generalizations that distort the truth about grain ethanol’s role in fostering America’s energy independence and producing food as well as fuel.

Domestic ethanol is the single-best alternative to foreign oil we have today. In 2010, ethanol reduced imports by 445 million barrels of oil — more oil than we import from Saudi Arabia. And America’s ethanol industry helped reduce farm subsidy payments by $10.1 billion, added $53.6 billion to the economy and reduced gas prices by $34.5 billion.

Open Fuel Standard: Defeating Al Qaeda: The Energy Offensive – Kellie Dunlap

Open Fuel Standard: Defeating Al Qaeda: The Energy Offensive.

In the aftermath of the siege and death of Osama bin Laden, counter-terrorism officials prepare for Al-Qaeda’s response. The home front is on alert with heightened awareness for both soft and hard target attacks. There have been numerous false alarms, including the foiled terrorist plot in New York City a couple weeks ago. Intelligence analysts assert that Al-Qaeda is seeking to conduct a large-scale attack, proving to their enemies the group’s resilience and adaptive modus operandi, while rallying support from affiliates.

In the last decade, however, the elimination of key individuals within the terrorist network has left Al Qaeda on the defensive, forcing the remaining operatives into hiding and reducing their effectiveness. Furthermore, intelligence gathering and dissemination has improved tremendously since 9/11. Law enforcement officials have thwarted numerous attacks by radical individuals such as the cases involving Bryant Neal Vinas and Najibullah Zazi, two men who, on separate occasions, traveled from the United States to Pakistan, and underwent weapons and explosives training in Al-Qaeda’s training camps, but were foiled by the FBI before they were able to carry out their missions.

Biofuels Make a Comeback Despite Tough Economy | Energy content from Corn and Soybean Digest

Biofuels Make a Comeback Despite Tough Economy | Energy content from Corn and Soybean Digest.

Global production of biofuels increased 17% in 2010 to reach an all-time high of 105 billion liters, up from 90 billion liters in 2009. High oil prices, a global economic rebound and new laws and mandates in Argentina, Brazil, Canada, China and the U.S., among other countries, are all factors behind the surge in production, according to research conducted by the Worldwatch Institute’s climate and energy program for the website Vital Signs Online.

The U.S. and Brazil remain the two largest producers of ethanol. In 2010, the U.S. generated 49 billion liters, or 57% of global output, and Brazil produced 28 billion liters, – 33% of the total. Corn is the primary feedstock for U.S. ethanol, and sugarcane is the dominant source of ethanol in Brazil.