Take Their Leverage Away.

Saudi Arabia.  Fuel Prices. Oil Dependency. Alternative Sources of Energy.

My feelings have nothing to do with politics or religion.  I just don’t like the way the Kingdom of Saudi Arabia does business.  Oil is their poison pill and their leverage.  If they did not have this leverage could they behave badly with their Middle East neighbors and the rest of the world? Could they hide behind the fact that they licensed the murder of a journalist at their consulate in Istanbul?  We can complain all we want but the only answer is to take that leverage away and lower our dependency on foreign oil, especially with Saudi Arabia.

Here is some background information starting with facts and questions from S², who was born and raised in the Middle East:

  • In 2018 the USA surpassed Russia and Saudi Arabia as the leading producer of crude oil.  
  • The USA consumes over 20 million barrels of petroleum products per day.
  •  Most of the oil consumed in the USA is used in cars.  So why not reward owners of high mileage vehicles?  
  • Electric – make it’s use affordable. I cannot buy the argument that we put a man on the moon in 1969 and we cannot create a battery that yields 500 miles of range on one charge.
  • Solar usage. Israel forces every new home to have solar panels. Why not create incentives for home and commercial builders to design solar into their construction plans?
  • Why should we continue to import oil from Saudi Arabia.  Why not increase our buy from Canada and Russia?

Realities:  As a transport-intensive society, and though the USA’s production is up year-over-year, it is not nearly enough to satisfy our thirst for oil.  While we produce close to 12 million barrels daily, our consumption is close to 21 million barrels per day.   Can the USA produce more oil?  Not exponentially as we can only extract a certain amount of oil at reasonable or competitive prices.  Extracting oil from U.S. soil is difficult and expensive to obtain – not a viable option with overseas oil prices remaining relatively low.

Creating alternative fuel sources used for transportation seems like a good way to deal with the problem. Bringing domestically produced alternative fuels — like ethanol, natural gas, electricity, and hydrogen into the transportation fuel mix will reduce our oil consumption and decrease the amount of foreign oil we import.  Reducing our imports, especially from Saudi Arabia, will mean that the USA is less susceptible to price hikes which for the most part are caused by international events and political discord.  For example, ten of the last eleven recessions have been preceded by a spike in oil prices – along with the U.S. government spending billions of dollars defending oil trade routes.  Alternative sources of fuel, at a basic benefit, give people the opportunity to select their fuel source and mitigate the cost implications of a spike in oil prices.

An associate of mine, T.A., works within the energy sector.  Her view:  “I agree with the comments regarding electric vehicles to lessen our dependency on foreign oil.  We are seeing public transportation fleets convert to electric or compressed natural gas in California based on mandates from the state. 
More and more states are putting in renewable energy targets as well to maximize use of solar and wind. Storing that energy for future use is essential. EV may play a part in that but not sure how right now.
Adoption will be the key. Whether it’s making the cars more attractive, states putting mandates in place or people like you helping people connect the dots may motivate people to make their next car an EV.”

An alternative fuel like E85 may not be the long term answer but at a minimum it seems to be another path of least resistance to slow down the USA’s dependency on foreign oil.  E85 is made up of 85% ethanol and 15% gasoline.  There are attributes and some downside to E85 but it does seem that the pluses outweigh the minuses:  it is domestically produced and for the most part made of corn starch.  It supports the efforts of our farmers.  E85 can reduce greenhouse emissions and is biodegradable.  On the downside, it does cost a bit more than regular gasoline and yields less MPG’s based on fuel volume.  One big reason that E85 has not caught on in the USA is the lack of fueling stations. This issue also affects owners of electric cars, who continuously complain about the lack of plugin infrastructure across America.

I offered up the energy issue to W.P., who summed up what many must be thinking:  “….I was struck by how relatively uninformed I am on this subject, and how I take the availability of inexpensive sources of energy for granted.  Maybe this observation is my message, i.e. too many of us have become complacent with the energy status quo (cheap, virtually limitless) so we don’t think much about it, and we have no sense of urgency to develop alternative sources. To build on your thoughts, I think the USA needs a bipartisan strategy to gradually wean ourselves off of fossil fuels in a manner that minimizes economic repercussions over the next 10-20 years. Unfortunately, I don’t see that happening. Therefore, I believe we will be poorly prepared for the next energy shock — and it will happen sooner rather than later.”

The bottom line:  it is essential that the USA, once and for all, reduce their dependency on foreign oil.  It is time to marginalize Saudi Arabia and the rest of the Middle East.  It is time to take some risks with creating viable and alternative sources of domestically produced energy.  It is really bad business for bad-behaving countries to have leverage with crude oil.  Very bad business.

I would like your take on this subject. Comments are welcome – use the “Leave a Comment” section of the blog. I stay away from politics but if you have a position on this issue you can email Rick Perry, our Secretary of Energy, at:  The.Secretary@hq.doe.gov

 Thoughts and prayers to all who were affected by yesterday’s incident in Pittsburgh.

Adios and have a Funday Sunday!

One thought on “Take Their Leverage Away.”

  1. I know you are staying away from politics. The point I like to make is that in addition to giving these countries leverage, our money is going to support who knows who in the middle east. most of these countries finance terrorism to keep it away from their borders. Affordable and decent range EVs will help.

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