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Oil Truths

Authors Name Withheld

Preface: The following was written as a response to a letter blindly denouncing the Bush administration and its alleged ties to oil companies.
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Thank you for your comments regarding the current oil crisis. It's great to hear the various ideas on what is happening and what needs to happen with our energy policies. That being said, I feel it's important to address a couple of misconceptions within the preceding comments.

You are absolutely correct that we can not drill our way out of our current predicament. However, it is not accurate to say that further drilling is not necessary. Let's look at a breakdown of the facts. We'll start with a point-to-point of your claims.

While America may only have 3% of the worlds known oil, did you also know that we only import 15% of our oil from all of the Persian Gulf countries combined? In fact, we get most of our oil from the world second largest oil reserves - Canada!

While it's inaccurate to state that President Bush or anyone in Congress believes that simply drilling will make our gas price problems go away, it is true by the very law of supply and demand on an open world market that an increase in supply will help reduce prices.

The assertion that we plan to drill up and down the beautiful coastlines for a few weeks worth of oil is an emotional prod to stir up false images. Drilling rigs wouldn't line up the coastline and in fact are located numerous miles off-shore and out of site. The proposed drilling location in ANWAR is a mere 2,000 acres out of 19,000,000. It also happens to be in an uninhabited area of flatland tundra - not a coastal region. The few animals that may cross those 2,000 acres will still have the other 18,998,000 acres to roam freely.

It is a bit na´ve to suggest that the "only" way to solve our energy problems is to remove our dependence on oil. We are still dependent upon energy to function as a society, so if we remove oil from the equation there will always be a "source" for which we are dependent. All such sources will be susceptible to various problems which will affect both our environment and our pocket book. The fact is, oil and gas are much more efficient than any of the other solutions that are suggested. (See further evidence below).

Vehicles that get 40+ MPG have existed for decades. The mid 1990's Geo Metro Hatchback had a rated 53 MPG city and 58 MPG highway. This was not a hybrid vehicle. Ironically it was government regulation for safety that ended up reducing this mileage in later years (though they still averaged in the high 40 MPG range).

Millions of plug-in hybrids would still use plenty of oil and gas. But in addition, they would now be sucking down much more electricity, requiring more power plants. Further more, what will we do with millions of vehicle sized batteries that die every few years? Yes, it will be a greater inconvenience, one that some are willing to endure. But it will also be a greater cost to purchase them every three years, as well as to have them recycled. Batteries are also encased in plastic, a highly toxic substance to produce. Don't electric hybrids really stand a chance of becoming more harmful than simply running gasoline? What will we do with all the waste? These hybrid cars will create their own nightmare of bi-products just as the mercury in CFL light bulbs. Did you know a single CFL bulb has enough mercury in it to contaminate 625 gallons of water?

Renewable wind sounds great, but at the current cost of wind turbines it takes years to just break even - and that's in the areas with a high concentration of constant wind. Then there is the increasing stories of wind farms killing hundreds of thousands of birds. No, this isn't an exaggeration. One particular wind farm in CA has killed over 130,000 birds just at its location. That includes 100's of golden eagles each year. The massive land usage that is necessary and the harm to the animal kingdom is far greater from wind farms than from drilling rigs.

Solar power is also very expensive and not very efficient. A 4 foot by 2 foot panel can power a single 100 watt light bulb. For the average home if their entire roof was covered with solar panels they wouldn't be able to even light the entire house, let alone run a single appliance.

Bio-fuels produce water vapor, and while that's not a pollutant, it is the single greatest cause of the "greenhouse" effect in our atmosphere. They also use up a portion of limited world food supply, driving up food prices, including feed for our livestock. This also adds to the growing inflation rate. It should also be noted that bio-fuels, such as ethanol, require more energy to be produced than regular gasoline, and they greatly reduces fuel mileage and horsepower in our vehicles.

I'm not against various forms of alternative energy. But it's not right to declare them our savior when they all harbor their own dark sides. Alternative energy can be used as a supplement - but it is a mere pipe dream to believe they can in any way sustain our energy needs. The proposed solutions are not being "sacrificed" with the deliberate intent of appeasing oil giants, as you have suggested. Instead, the alternatives simply do not offer real advantages when weighed on the premise of logic. They simply appeal to our emotion, often providing a false hope of utopia.

I find it ironic that so many are quick to degrade this current administrations energy policies considering the personal energy efficiencies of President Bush vs. Al Gore.

(http://www.snopes.com/politics/bush/house.asp) Every decent citizen is aware we need to conserve and do our best to reduce consumption. Frankly, despite the wishes of some, government was never given the authority to legislate the free market. Of course we've long ago crossed that bridge.

"Big Oil" is blamed for simply being money hungry and price gouging for the interest of the bottom line. Since the oil companies are publicly owned and oil prices are determined on an open world market, I have a hard time understanding who could really be pulling these strings. Allow me to close with a few hard facts.

1. The American Big oil companies control just 1.6% and manage just 2.5% of the global oil and gas resources.

2. Exxon Mobil, the largest American energy company, is not even among the top 10 largest global energy companies.

3. Return in investment: Oil/Gas trailed the S&P industrial avg. from 1976-2002, and only matched it through 2006.

4. Owners of Big Oil: 14% IRAs, 23% individual investors, 27% pension funds, and 29.5% mutual funds.

5. The components of the price of fuel at the pump is about 70% for the crude oil, 17% for refining and retailing and 13% for taxes (1st quarter of 2008).

6. Oil/Gas paid US tax of 40.7% while All Manufacturing paid tax of 22.1% in 2006.

7. Canada is the largest and Mexico is second largest exporter of oil/gas to the US.

8. IEA estimates if every acre of corn was dedicated for ethanol it would equal 12.3% of US gasoline consumption.


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