Bringing Solution to the Oil Crisis
Staff Writer, August 23, 2008
Oil is the principle source of energy. Every day 85 million barrels of oil are produced around the world. The U.S is the world's largest consumer of oil; about 21 million barrels a day and spends about $700 billion per year for oil import.
What are we doing with all this oil? 69% - Transportation, 24% - Industry, 5% - Residential and commercial use and 2% - Electrical power.
Why is the price of oil rising so fast? This time, it is raising demand, mainly because of American gas guzzlers, but also China and India, which are the growing economies. It appears some of the current spike is a result of a speculative bubble as well.
We have two interesting Presidential debates going on in this country where one camp talks about increasing the supply whereas the other argues about reducing the demand in order to bring down the oil prices. Both the camps are converging to end dependence on foreign oil and cut carbon emissions although they promise different plans.
Expanding offshore drilling could be a part of larger strategy to lower energy costs. However, it is going to take another seven years to get the first drop of the oil.
We have a 100-year supply of a resource, say oil? that is, the oil would last 100 years if it were consumed at its current rate. But the oil is consumed at a rate that grows by 5 percent each year. How long would it last under these circumstances? This is an easy calculation; the answer is about 36 years.
More oil procured from under U.S. soil means more oil on the global market, not more oil just for us. Also, more oil is going to clog our beaches with ugly rigs causing environmental hazards.
Offshore drilling is entirely clear that it is not going to have any immediate effect on gas or oil prices. These are long-term solutions. Again, think about the 5% increase in consumption rate.
On the other hand, reduction in oil consumption can bring immediate "Energy fix" and help reduce carbon emission into the atmosphere.
According to Joel Stein, columnist for the Los Angeles Times, a country is not stronger if it produces everything itself. Econ 101 teaches you that everyone benefits when people who are good at one thing, such as having oil, can exchange it with people who are good at something else, such as sitting in offices and surfing the Web. When Hurricane Katrina and Rita hit in 2005, for instance, we got oil to the ravaged Gulf Coast by buying extra from Venezuela and the Netherlands. "When they say, 'energy independence,' they mean, 'Vote for me.' It's all it means."
The government should come up with coherent national energy policy that is bipartisan that deals with economic, political and climate change by increasing the fuel efficiency of the cars such as hybrid vehicles and invest in other energy options that are non-petroleum based such as natural gas for transportation fuel.
We need an extraordinary leadership to work with oil importing nations to reduce demand especially the largest new consumers, China and India and encourage them to move to alternative fuels.
And since about 70 percent of all the oil consumed in the United States is in the form of gasoline and diesel fuel, the simplest and most effective way is to get off the road. American Automobile Association (AAA) says, for every pound of pressure your tires are under inflated, you may be losing 2 percent of your mileage. Hence the individuals can keep their car tires inflated properly; take public transportation, carpool to work and telecommute from home. This would be the only solution at this time until the government makes the decision.