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Itís been 40 years this month since the oil embargo of October 1973. What have we learned as a nation and what has changed? Unfortunately, not much.
Four decades later we are still exposed to oil shocks, disruption and price hikes ó because even after 40 years, we still overwhelmingly rely on one source of fuel: oil. During that time weíve experienced price shock after price shock due to unrest and instability in the Middle East. Egypt, Libya, Saudi Arabia, Kuwait, Iraq, Iran and now Syria ó all unstable oil-producing nations in a region where even the slightest disruptions can have a drastic ripple effect on the supply and price of oil. Ultimately the American consumer is stuck footing the bill for an antiquated energy policy that is reliant on others.
Wars have been fought, trillions of dollars have been spent to protect the flow of oil, and trillions more of our wealth has been transferred to foreign nations. But most important is the number of precious lives of American soldiers lost because of our addiction to foreign oil.
In reflecting on this anniversary, we should recognize that itís futile to put all of our eggs in one basket ó what we need is a diverse policy that helps shield us from the price hikes, supply shortages, shocks and whims of foreign governments.
Currently there is a massive gap in what Americans consume compared to what we produce domestically. This leaves us no choice but to continue to throw ourselves and our nationís security interests at the mercy of those who are frequently at odds with the policy interests and values of western society.
The most recent data shows total U.S. oil consumption at a whopping 18.5 million barrels per day and domestic production at 6.48 million barrels per day. So, even during what has been described as a renaissance of domestic energy production at home with new techniques, we are only producing slightly more than one-third of what we consume each day. This is simply not sustainable.
The price of oil continues to rise and, whatís more, oil is a global market, so regardless of our domestic production there is nothing we can do to control the price domestically. At the end of the day OPEC is still setting the price. Oil still costs more than $100 per barrel and America still spends $1 billion per day for oil imports. As a result, gas prices remain high and so do the profits of oil companies.
There is a better way, one that allows us to achieve energy independence while continuing to produce energy domestically: renewable fuels.
However, just as we have found a way to produce renewable fuel at home, now making up 10 percent of our gasoline supply, oil companies are doing everything in their power to roll back any progress and repeal the renewable-fuel standard. Their goal is to reduce the use of renewables and maintain the status quo of our dependence on fossil fuels.
We must not let the special interests of oil continue to hold our nationís energy needs hostage to the most unstable and hostile regions in the world. That is why Congress passed the RFS in 2005 ó an energy policy designed to reduce our dependence on foreign oil. And itís doing just that.