22 August 2005

How oil dependence fuels US policies

Opinion -- From Iraq to China, from the Gaza Strip to Iran, the biggest foreign-policy problems of the summer all are setting off the same alarm: It is imperative for the US to become more energy independent. But that, of course, is precisely what Washington's policymakers have been unable, or unwilling, to accomplish. Instead, America's exposure to trouble in the world's volatile oil-producing regions actually is on the rise, even as the summer driving season heads toward its climax with oil near a once-unthinkable US$65 a barrel. In brief, while the 20th century was the century of oil, the 21st already is unfolding as the century of whatever follows oil, or the century of fighting over what's left of oil -- or both. The omnipresence of oil in America's foreign calculations will be underscored this week. The interim government in Iraq -- an oil-rich country that's actually pumping less now than it did before the US invaded -- will try again to write a new constitution that's supposed to start stabilizing the nation. At the same time, Israel will be trying to force out the final settlers in the Gaza Strip so it can be turned over to the Palestinians. There's no oil in the Gaza Strip, of course, but the whole episode is a wrenching reminder of how vulnerable the broader, oil-soaked Middle East remains to continuing upheaval. Meantime, President Bush will be getting ready for a September meeting with China's president, Hu Jintao. Overhanging that meeting will be a nasty midsummer episode in which Congress effectively stopped oil company Cnooc of China -- which has its own unquenchable thirst for oil -- from taking over an American oil firm, Unocal. Simultaneously, the US and Western Europe are cruising for a September confrontation at the United Nations with Iran, the world's fourth-largest oil producer, over the Iranian nuclear program.

If it seems that the odor of oil hangs over America's whole international agenda right now -- well, that's about right. "The overwhelming national-security issue is that we are becoming increasingly dependent for the lifeblood of an industrialized economy, oil, on the most unstable parts of the world," says Robert Hormats, vice chairman of Goldman Sachs International. "And there doesn't seem to be a sense of urgency about energy policy in this country." Yes, Congress did pass an energy bill earlier this summer, after four years of dithering. But even its champions found it a bit of a letdown. It does open the way to more nuclear power and better use of coal for power generation, but doesn't promise to make a big dent in America's gasoline consumption, at least immediately. There are, among other things, hefty subsidies for ethanol, which should decrease gasoline use gradually over the longer term, and modest incentives for buying hybrid cars that burn less gasoline, but nothing revolutionary. Meantime, oil imports as a share of total American oil consumption are more than 60%, up from about 50% a decade ago. Hormats suggests that when President Bush and Chinese President Hu meet next month, they set out to devise a plan for the two countries to become energy partners rather than energy competitors. That quest might well begin by paving the way for more US oil companies to take their oil-finding and energy-extracting expertise into China to help pump up production there. Imagine, Hormats muses, if oil could be a source of cooperation instead of tension, for once.
(Wall Street Journal 050822)

3 comments:

Jeff said...

Reid, would you like to know how crayons are made? Come by my blog and check it out!! Reid can we party again this weekend and actually get out to the bar? I saw SOO many cutie's in the +15's today and I need to see some men to hopefully "frolic" with. PREASE CRAN WEE GO? PREASE!!

Reid Dalgleish said...

I've been told I'm going to Kinky at Detour on Friday by my Master. Saturday is Doug's party! Woo-hoo!

Reid Dalgleish said...

I've been told I'm going to Kinky at Detour on Friday by my Master. Saturday is Doug's party! Woo-hoo!