Constantopoulos: A short-sighted energy policy
U.S. imports of foreign oil are now at a 44-year low. Energy security is stronger than it has been in decades. But if we’re not careful, backsliding will happen and we will wind up back on square one. Shortsighted energy policy — focused largely on Federal lands in the West — threatens our energy future.
For all of the good that comes with cheap gasoline — and its very cheap now — we tend to take our eye off the energy ball when prices fall. Oil prices may be less than $30 per barrel, down from $100 per barrel a year ago, but they won’t stay low forever. In fact, an oil price spike might be closer than many people care to admit.
Every day the world consumes 95 million barrels of oil. Currently, the marketplace is oversupplied by about 1.5 million barrels per day. That tiny oversupply, less than 2 percent, is what sent the price at the pump into a freefall. It’s now hard to find gasoline anywhere in the country over $2 per gallon. If small fluctuations in the oil market can cause such wild swings in price, we would be wise not to rest on our laurels. Some 30 percent of the world’s oil is still produced by OPEC nations, many of which are in unstable regions of the world or are simply unstable themselves.
ISIS remains a constant threat to oil production in Libya and Iraq, while Saudi Arabia and Iran — on their best days — are a misstep or two away from conflict that could lead to the closing of the vital Persian Gulf to tankers. And there is Venezuela, which might be the most unstable of the bunch, nearing economic collapse any day. This is all to say that a major oil supply disruption could come at any time. It would be naïve to think the current moment of oil oversupply and cheap gasoline can’t be reversed in the blink of an eye.
The world needs more oil production from stable regions of the world. Clearly, Americans needs more domestic oil production. But one Obama policy after another seems designed to make it more difficult and more expensive to drill in the U.S.
New rules on hydraulic fracturing, methane emissions and flaring just scratch the surface. Most troubling of all is the new moratorium on coal leases on federal lands. While the moratorium doesn’t affect oil or natural gas production, the writing is on the wall. The Obama administration, and likely any succeeding Democratic administration, is likely to pursue a strategy that would limit fossil fuel production on federal territory. The Far Left is getting its way. Not only is this dangerous for American energy consumers generally but it could be ruinous for Western states.
However one views the need to address rising greenhouse gas emissions, the policies we take must be balanced with our energy and economic needs. A reasonable, balanced climate approach would seem to encourage greater U.S. energy production, not less. We need — the world needs — more oil production, particularly from stable nations. Improvements in energy efficiency and increased use of clean energy options are worthwhile, but let’s not underestimate the importance of oil to our economy.
The next spike in oil prices could be just around the corner. Are we going to pursue an energy policy that allows the U.S. to provide a critical counterweight to OPEC and the instability of so many oil-exporting nations? Or are we going to tie one hand behind our back and limit access to our vast resources while making it increasingly difficult to produce the resources lying just below the ground? We need to make the right choice.
Jim Constantopoulos is the chairman of the Department of Physical Sciences and director of the Miles Mineral Museum at Eastern New Mexico University in Portales, N.M.