False Sense of (Energy) Security

Superficially, it would seem that the nation is successfully pursuing the Obama Administration’s stated energy goals of “increasing domestic oil production” and “reducing our dependence on foreign oil.” Domestic oil production has increased, but in spite of and not because of Administration policies. And while our overall oil import demand has declined, our imports from the Persian Gulf states, and Saudi Arabia in particular, have actually grown dramatically to make up for shortfalls from Mexico and elsewhere.

There are two separate issues with regard to the supply of petroleum and refined products: Price, and Security of Supply. When the President said, “We can’t just drill our way to lower gas prices”, the political pressure of $4.00 per gallon for gasoline was his primary concern. But in an international emergency (say, a protracted shutdown of the Straits of Hormuz), our Strategic Petroleum Reserve might be quickly exhausted. Gasoline at $4.00 per gallon might seem cheap. Security of supply should be our nation’s #1 strategic concern with respect to energy.

A recent article in the New York Times considers our current supply situation and its causes:

U.S. Reliance on Oil From Saudi Arabia Is Growing Again

The increase in Saudi oil exports to the United States began slowly last summer and has picked up pace this year. Until then, the United States had decreased its dependence on foreign oil and from the [Persian] Gulf in particular.

This reversal is driven in part by the battle over Iran’s nuclear program. The United States tightened sanctions that hampered Iran’s ability to sell crude, the lifeline of its troubled economy, and Saudi Arabia agreed to increase production to help guarantee that the price did not skyrocket. While prices have remained relatively stable, and Tehran’s treasury has been squeezed, the United States is left increasingly vulnerable to a region in turmoil. …

“At a time when there is a rising chance of either a nuclear Iran or an Israeli strike on Iran’s nuclear facilities, we should be trying to reduce our reliance on oil going through the Strait of Hormuz and not increasing it,” said Michael Makovsky, a former Defense Department official who worked on Middle East issues in the George W. Bush administration.

CONTINUED:  http://www.redstate.com/vladimir/2012/08/18/false-sense-of-energy-security/