Eight days, seven broken records

Beginning on March 6, the price of crude oil has broken its own record seven out of eight days, reaching a high of $110.05 per barrel the morning of March 13. The price is changing momentarily upward on the TV screeen.
Between Jan. 4, 2007, and March 13, 2008, the price of crude oil increased by nearly 120 percent with no end in sight.
Predictions are floating around that the price may go to $200 per barrel by year’s end.
Gasoline prices nationally are averaging $3.25 per gallon, with Energy Information Administration predictions of $3.50 per gallon by spring.
Interestingly, the general public seems little concerned.
And still the greatest threat to the U.S. economy and the very survival of the nation apparently goes unnoticed. It is the fact that the United States has now reached a level of 75 percent importation of America’s vital petroleum requirements.
The United States consumes some 20 million-plus barrels of oil per day. It provides less than 5 million barrels of that need from its own resources. Fifteen million-plus barrels have to be imported, creating an additional imbalance of some $547 billion in the U.S. balance of payments.
OPEC — the 13 oil-producing export countries — with the help of the geopolitical unrest in the world, controls the price of oil today. The market forces of supply and demand have been cast aside. Political help here at home is non-existent.
The President and the Congress remain silent on the issue. In this election year, both political parties are avoiding discussion of energy independence policies themselves.
While both candidates of the Democratic Party slide back and forth between demagoguery and self-obsession, the Republican party has already selected a candidate who busies himself working through a minefield of challenges to prove his conservative identity.
All this political activity most certainly makes this year a lot more interesting, but it does nothing for America’s energy problem.
Meanwhile, America drifts ever closer to a probable crisis that must be addressed sooner rather than later; the solution to such a critical issue is energy independence.
America’s major energy problem can be solved by one method only.
The solution is at the end of an oil rig drill bit: Drilling in our own reserves in continental North America, particularly in Alaska and offshore on the Atlantic and Pacific coasts, plus the Gulf of Mexico.
Millions of barrels of domestic oil will replace the $100-plus cost per barrel of imported oil.
Several highly promoted national energy bills have been passed in recent years. These energy acts have dealt mainly with fuel efficiency of automobiles extending out to the year 2020 and with biofuels produced from grain.
Remarkably, these energy acts do not provide for any drilling for petroleum.
Major problems are beginning to surface as a result of directing agricultural resources to energy.
Biofuels convert both human and animal food resources into energy in the forms of ethanol and biodiesel.
This diversion of food to energy has disrupted both the food and grain markets to the extent that some grains have more than doubled in price, particularly corn and soybeans.
Pitting energy against food is tantamount to a form of economic cannibalism where energy must win, in as much as the billions in infrastructure for biofuels must be paid off to investors.
Ethanol has yet to prove economical as a fuel in as much as a 50-cent-per-gallon U.S. government subsidy is hidden in the final cost.
While it’s nice to look for ethanol rainbows and biodiesel sugar plums, the vehicular traffic of America operates on petroleum fuels.
Envirocrat naysayers point to the fact that petroleum should be reserved for future generations.
This is nonsense.
The U.S. Geological Society, according to a major U.S. energy producer’s ad in the Wall Street Journal on March 13, “estimates the amount of conventional oil that ultimately will be recovered from the Earth at more than 3 trillion barrels.”
Additionally, “only about one trillion barrels of that oil has been recovered so far.”
There’s plenty left.
It’s time for America to take its share.
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Mr. Hostetter welcomes your comments at admin@americanfarm.com.