“For the last month, the price of a barrel of oil has teetered on the $100 mark.  In July, typically a peak month for prices, it was $77 per barrel.  Ten years ago – oil cost $20 per barrel.

Until Americans get as angry about the price of a barrel of oil as we do about the price of a gallon of gas, we are going to have a hard time changing the bad national habit President Bush called our “addiction to oil.”  Obviously, the price of one commodity is directly linked to the price of the other.  Every penny of an increase in the price of a barrel of oil is amplified and passed along to the consumer.  We pay for that oil several times over.

So it stands to reason that, as world supplies of oil become unstable or depleted, the American consumer will ultimately be held to pay for policies which don’t embrace the future of alternative, renewable fuels.

In August and September, I spent quite a bit of time talking about the dangers of importing foreign oil and laying out the case for ethanol and other biofuels – technologies we must implement today so we can improve them tomorrow.

Now, with the price of oil rising on the global market, we can see many of the pitfalls of our reliance on oil in action.  The Organization of Petroleum-Exporting Countries (OPEC) has rejected U.S. requests to increase the world supply of oil.  Even more infuriating, the Secretary General of OPEC said that there is no need for increased oil production. 

The maddening thing to me is that, during price spikes at the pump at home, America is forced to go to OPEC and plead for more output.  We’re reduced to asking for more oil from a consortium of emirs that know they’ve got us right where they want us: over a barrel, so to speak, of oil.  They are even more encouraged by the lack of traction alternative fuels are getting in our national economy even as gas prices surge to record levels.  At OPEC, business is booming.
In fact, this shortage in the market is unlike any other major spike in the price of oil we have experienced before.  While shortages or interruptions in supply were responsible for past price spikes, this one is due to excess demand for oil.  Though it is the first time such a situation has arisen, it will surely not be the last.

China and India are heightening demand for oil, and the world market for oil is not expected to soften any time soon as a result.  That’s the bad news.

The good news is that, in a nation with the innovative, entrepreneurial, and can-do spirit of ours, the solution to our reliance on foreign oil should not evade us for long.

We are perhaps five years away from extremely efficient cellulosic ethanol technologies, but if market demand for ethanol does not substantially replace market demand for oil, we’ll never get there.  The thought of an America dedicated to renewable, alternative fuels makes OPEC extremely nervous – so nervous, in fact, that they would once occasionally glut the market with excess supply in order to stave off new American fuel technologies.

In the meantime, aggressive solutions are called for: opening up ANWR to domestic oil exploration, enhancing offshore drilling for oil and natural gas, using new coal technologies to make the most of that efficient U.S. resource, and renewing the American commitment to clean energy by adding nuclear power and exploring technologies that capture energy from the wind, water and sun.

Now that global competition for oil is heating up, OPEC doesn’t need to lower prices to discourage innovation.  This is shaping up to be a serious, long-term problem for our country that affects both our national security and our economic security.  We need solutions now to keep us out of the red.”