Documente Academic
Documente Profesional
Documente Cultură
Index 1
Venezuela 9-10
Nigeria 11-12
Canada/Mexico 13-14
Link Turns
Impact Defense
No Link
1
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Russia Module
A) Uniqueness: The United States is highly dependent and currently
imports over $300 billion of oil from foreign nations and the number
is not going down any time soon
With the run-up in oil prices over the past four years, the United States is paying dearly
for its dependence on imported oil, Petroleum Intelligence Weekly (PIW) reports in its
latest issue. The US oil import bill last year came to some US$327 billion, and should easily
top US$400 billion this year. That's an increase of some 300% since 2002, according to PIW.
Last year, PIW reckons that the US paid out a record US$245 billion for about 10 million
barrels per day of crude oil imports, and another US$82 billion for about 3.5 million bpd
of imported oil products. This year it looks like paying out even more, with domestic
crude production continuing to fall, demand for imports of high-priced transport
fuels remaining strong, and oil prices around 30% higher year-on-year so far in
2008.
The increase to an estimated US$440 billion for 2008 is based on an average US$90
per barrel crude oil price for the year. In 2002, before the current bull market for oil
began, US oil imports cost less than US$103 billion. With oil prices this year as strong
or stronger than in 2007, any moderation in the US import bill must come from reduced
volumes. While oil demand growth has slowed in recent years due to both high prices
and greater fuel efficiency, the higher quality of crude oil imports that US refiners
require and the emphasis on high-quality transport fuels in the product import mix
are likely to keep upward pressure on import costs even if volumes are stable,
according to PIW. Although "energy security" and "dependency on the Middle
East" get the attention in the American national debate over oil imports, huge and
rapidly rising costs are of greater immediate economic significance, PIW says.
Relatively secure supplies from Canada and Mexico account for about one third of
crude imports.
2
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
3
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
AT NO TIME since the civil war of 1918 -- 20 has Russia been closer to bloody
conflict than it is today. The fledgling government confronts a vast array of
problems without the power to take effective action. For 70 years, the Soviet Union
operated a strong state apparatus, anchored by the KGB and the Communist Party.
Now its disintegration has created a power vacuum that has yet to be filled. Unable
to rely on popular ideology or coercion to establish control, the government must
prove itself to the people and establish its authority on the basis of its performance.
But the Yeltsin administration has abjectly failed to do so, and it cannot meet the
most basic needs of the Russian people. Russians know they can no longer look to
the state for personal security, law enforcement, education, sanitation, health care,
or even electrical power. In the place of government authority, criminal groups --
the Russian Mafia -- increasingly hold sway. Expectations raised by the collapse
of communism have been bitterly disappointed, and Moscow's inability to govern
coherently raises the specter of civil unrest.
A future conflict would quickly draw in Russia's military. In the Soviet days
civilian rule kept the powerful armed forces in check. But with the Communist Party
out of office, what little civilian control remains relies on an exceedingly fragile
foundation -- personal friendships between government leaders and military
commanders. Meanwhile, the morale of Russian soldiers has fallen to a dangerous
low. Drastic cuts in spending mean inadequate pay, housing, and medical
care. A new emphasis on domestic missions has created an ideological split
between the old and new guard in the military leadership, increasing the risk
that disgruntled generals may enter the political fray and feeding the resentment of
soldiers who dislike being used as a national police force. Newly enhanced ties
between military units and local authorities pose another danger. Soldiers grow
4
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
ever more dependent on local governments for housing, food, and wages.
Draftees serve closer to home, and new laws have increased local control over the
armed forces. Were a conflict to emerge between a regional power and
Moscow, it is not at all clear which side the military would support.
Divining the military's allegiance is crucial, however, since the structure of the
Russian Federation makes it virtually certain that regional conflicts will continue to
erupt. Russia's 89 republics, krais, and oblasts grow ever more independent in a
system that does little to keep them together. As the central government finds itself
unable to force its will beyond Moscow (if even that far), power devolves to the
periphery. With the economy collapsing, republics feel less and less incentive
to pay taxes to Moscow when they receive so little in return. Three-quarters of
them already have their own constitutions, nearly all of which make some claim to
sovereignty. Strong ethnic bonds promoted by shortsighted Soviet policies may
motivate non-Russians to secede from the Federation. Chechnya's successful revolt
against Russian control inspired similar movements for autonomy and independence
throughout the country. If these rebellions spread and Moscow responds with
force, civil war is likely.
Should Russia succumb to internal war, the consequences for the United
States and Europe will be severe. A major power like Russia -- even though
in decline -- does not suffer civil war quietly or alone. An embattled Russian
Federation might provoke opportunistic attacks from enemies such as China.
Massive flows of refugees would pour into central and western Europe. Armed
struggles in Russia could easily spill into its neighbors. Damage from the
fighting, particularly attacks on nuclear plants, would poison the environment
of much of Europe and Asia. Within Russia, the consequences would be even
worse. Just as the sheer brutality of the last Russian civil war laid the basis for the
privations of Soviet communism, a second civil war might produce another
horrific regime.
Most alarming is the real possibility that the violent disintegration of Russia
could lead to loss of control over its nuclear arsenal. No nuclear state has
ever fallen victim to civil war, but even without a clear precedent the grim
consequences can be foreseen. Russia retains some 20,000 nuclear weapons
and the raw material for tens of thousands more, in scores of sites scattered
throughout the country. So far, the government has managed to prevent the loss of
any weapons or much material. If war erupts, however, Moscow's already weak
grip on nuclear sites will slacken, making weapons and supplies available to a
wide range of anti-American groups and states. Such dispersal of nuclear
weapons represents the greatest physical threat America now faces. And it is
hard to think of anything that would increase this threat more than the chaos that
would follow a Russian civil war
5
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
With the run-up in oil prices over the past four years, the United States is paying dearly for its
dependence on imported oil, Petroleum Intelligence Weekly (PIW) reports in its latest
issue. The US oil import bill last year came to some US$327 billion, and should easily top US$400
billion this year. That's an increase of some 300% since 2002, according to PIW. Last year, PIW
reckons that the US paid out a record US$245 billion for about 10 million barrels per day of crude oil
imports, and another US$82 billion for about 3.5 million bpd of imported oil products.
This year it looks like paying out even more, with domestic crude production continuing
to fall, demand for imports of high-priced transport fuels remaining strong, and oil prices
around 30% higher year-on-year so far in 2008.
The increase to an estimated US$440 billion for 2008 is based on an average US$90 per
barrel crude oil price for the year. In 2002, before the current bull market for oil began,
US oil imports cost less than US$103 billion. With oil prices this year as strong or stronger
than in 2007, any moderation in the US import bill must come from reduced volumes. While oil
demand growth has slowed in recent years due to both high prices and greater fuel
efficiency, the higher quality of crude oil imports that US refiners require and the
emphasis on high-quality transport fuels in the product import mix are likely to keep
upward pressure on import costs even if volumes are stable, according to PIW. Although
"energy security" and "dependency on the Middle East" get the attention in the American
national debate over oil imports, huge and rapidly rising costs are of greater immediate
economic significance, PIW says. Relatively secure supplies from Canada and Mexico
account for about one third of crude imports.
6
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
GAL LUFT October 20, 2005 (EXECUTIVE DIRECTORINSTITUTE FOR THE ANALYSIS OF GLOBAL SECURITY (IAGS)CO-CHAIRSET
AMERICA FREE COALITIONPresented beforeSENATE FOREIGN RELATIONS SUBCOMMITTEE ON NEAR EASTERN AND SOUTHASIAN
AFFAIRS <http://www.senate.gov/~foreign/testimony/2005/LuftTestimony051020.pdf>)
The Middle East is gradually shifting from being a unipolar region in which the U.S. enjoys uncontested hegemony to
a multipolar region. The U.S. will face more competition from China and India over access to Middle East oil. Throughout its history, the Middle East
has been the center of an imperial tug of war with major implications for the region’s inhabitants. This was the case during the Cold War years. In the
decade after the fall of the Soviet Union the U.S. enjoyed uncontested hegemony in a unipolar Middle East. The
rise of China and
India is driving the Middle East back to multipolarity. In thecoming years the Middle East will turn increasingly to
Asia to market its oil and gas. By 2015 it will provide 70% of Asia’s oil. By far the most important growth market for countries
like Iran and Saudi Arabia is China. With 1.3 billion people and an economy growing at a phenomenal rate, China is today the world’s second largest
oil consumer and is becoming heavily dependent on imported oil. By
2030 China is expected to import as much oil
as America does today. To fuel its growing economy China is following America’s footsteps, subjugating its foreign policy to its energy
needs. China attempts to gain a foothold in the Middle East and build up long-term strategic
links with countries with which the U.S. is at odds like Iran, Saudi Arabia and Sudan. Though some optimists think
that China’s pursuit of energy could present an opportunity to enhance cooperation, integration and interdependence with the U.S., there are ample
signs that China and the U.S. are already on a collision course over oil. This will have profound implications for the
future and stability of the Middle East and for America’s posture in the region. For China the biggest prize in the Middle East is Saudi Arabia, home of
a quarter of the world’s reserves. Since 9/11, a deep tension in U.S.-Saudi relations has provided the Chinese with an opportunity to win the heart of
the House of Saud. The Saudis fear that if their citizens again perpetrate a terror attack in the U.S., there would be no
alternative for the U.S. but to terminate its long-standing commitment to the monarchy — and perhaps
even use military force against it. The Saudis realize that to forestall such a scenario they can no longer rely solely on the U.S. to
defend the regime and must diversify their security portfolio. In their search for a new patron, they might find China
the most fitting and willing candidate. China has also set its sights on Iran. Last year China and Iran entered a $70 billion
natural gasdeal that Beijing sees as critical to continued economic expansion. China has already announced that it will block any effort to impose
sanctions against Iran in the UN Security Council. No doubt that as China’s oil demand grows so will its involvement in Middle East politics. China
is likely to provide not only a diplomatic support but also weapons, including assistance in the development of WMD. In sum, the
prospect of a region, scarred by decades of rivalries, turning once again into an arena of competition between two or more of the major powers could
well be one of the most important geo-strategic developments of the 21-Century, with profound implications for U.S. national security
7
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
C) Impact:
1) The Middle East will use WMD’s for terrorism
Gilmore in 2003 (Gerry J. [Air Force Gen. Richard B. Myers, the chairman of the Joint Chiefs of Staff,
addresses National Defense University Class of 2003 graduates at a June 10 ceremony at Fort
McNair, Washington, D.C. Photo by Sgt. Linda Tsang, USA]. American Forces Press Service
“War on Terrorism Is 'Toughest Challenge' Yet, Myers Says”,
http://www.defenselink.mil/news/newsarticle.aspx?id=28884)
The war against global terrorism continues, Myers pointed out, noting, "there are still terrorists out
there who want to do us harm."
Terrorists, the general emphasized, "will use violence against the innocent." In recent weeks, he
pointed out, more than 50 people, including Muslims, Christians and Jews were killed in terror
attacks against civilians in Saudi Arabia, Morocco and Israel.
U.S. and coalition forces have achieved significant victories in Afghanistan and Iraq. Yet it is
paramount, Myers emphasized, "that we don't let our successes lull us into a sense of
complacency." He emphasized that "the war on terrorism is far from over."
Another modern-day threat to global security involves the proliferation of weapons of mass
destruction, the general remarked, noting that some countries with WMD programs "would let these
weapons fall into the hands of terrorists."
Civilized nations of the world "simply cannot afford to let this happen," the JCS chairman said.
Enemies of peace, he continued, would likely use WMDs to kill innocent civilians, destabilize the
global economy, or simply for blackmail.
Last week's brutal suicide bombings in Baghdad and Jerusalem have once again illustrated dramatically
that the international community failed, thus far at least, to understand the magnitude and
implications of the terrorist threats to the very survival of civilization itself. Even the United
States and Israel have for decades tended to regard terrorism as a mere tactical nuisance or irritant rather
than a critical strategic challenge to their national security concerns. It is not surprising, therefore, that on
September 11, 2001, Americans were stunned by the unprecedented tragedy of 19 al Qaeda terrorists
striking a devastating blow at the center of the nation's commercial and military powers. Likewise, Israel
and its citizens, despite the collapse of the Oslo Agreements of 1993 and numerous acts of terrorism
triggered by the second intifada that began almost three years ago, are still "shocked" by each suicide attack
at a time of intensive diplomatic efforts to revive the moribund peace process through the now revoked
cease-fire arrangements [hudna]. Why are the United States and Israel, as well as scores of other countries
affected by the universal nightmare of modern terrorism surprised by new terrorist "surprises"? There are
many reasons, including misunderstanding of the manifold specific factors that contribute to terrorism's
expansion, such as lack of a universal definition of terrorism, the religionization of politics, double
standards of morality, weak punishment of terrorists, and the exploitation of the media by terrorist
propaganda and psychological warfare. Unlike their historical counterparts, contemporary terrorists have
introduced a new scale of violence in terms of conventional and unconventional threats and impact. The
internationalization and brutalization of current and future terrorism make it clear we
8
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
have entered an Age of Super Terrorism [e.g. biological, chemical, radiological, nuclear and
cyber] with its serious implications concerning national, regional and global security concerns.
9
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Venezuela Module
A) Uniqueness: The United States is highly dependent and currently
imports over $300 billion of oil from foreign nations and the number
is not going down any time soon
With the run-up in oil prices over the past four years, the United States is paying dearly
for its dependence on imported oil, Petroleum Intelligence Weekly (PIW) reports in its
latest issue. The US oil import bill last year came to some US$327 billion, and should easily
top US$400 billion this year. That's an increase of some 300% since 2002, according to PIW.
Last year, PIW reckons that the US paid out a record US$245 billion for about 10 million
barrels per day of crude oil imports, and another US$82 billion for about 3.5 million bpd
of imported oil products. This year it looks like paying out even more, with domestic
crude production continuing to fall, demand for imports of high-priced transport
fuels remaining strong, and oil prices around 30% higher year-on-year so far in
2008.
The increase to an estimated US$440 billion for 2008 is based on an average US$90
per barrel crude oil price for the year. In 2002, before the current bull market for oil
began, US oil imports cost less than US$103 billion. With oil prices this year as strong
or stronger than in 2007, any moderation in the US import bill must come from reduced
volumes. While oil demand growth has slowed in recent years due to both high prices
and greater fuel efficiency, the higher quality of crude oil imports that US refiners
require and the emphasis on high-quality transport fuels in the product import mix
are likely to keep upward pressure on import costs even if volumes are stable,
according to PIW. Although "energy security" and "dependency on the Middle
East" get the attention in the American national debate over oil imports, huge and
rapidly rising costs are of greater immediate economic significance, PIW says.
Relatively secure supplies from Canada and Mexico account for about one third of
crude imports.
B) Link: Cross-supply the aff evidence that means they would decrease U.S. oil
dependence
10
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
The oil industry is a very capital intensive one, involving big projects with heavy
investment in fixed assets. The profitability of any oil project is highly dependent on the
market price. Oil prices have proved to be very volatile and subject not only to market forces but also to political, climatic and
environmental factors, among other. As a consequence, companies find themselves in the need to protect against the risk of fluctuating
oil prices. One way of achieving this objective is by means of integration, where risks are spread over several sectors of the industry,
and the potential losses in one stage of the chain can be overlapped by gains in the others. This is a risk management decision known
as diversification.
Bearden 00 T.E., LTC U.S. Army (Retired), ["The Unnecessary Energy Crisis: How to Solve It Quickly,"
http://www.freerepublic.com/forum/a3aaf97f22e23.htm, June 24]
History bears out that desperate nations take desperate actions. Prior to the final
economic collapse, the stress on nations will have increased the intensity and
number of their conflicts, to the point where the arsenals of weapons of mass destruction
(WMD) now possessed by some 25 nations, are almost certain to be
released. As an example, suppose a starving North Korea launches nuclear weapons upon Japan and South Korea, including U.S. forces there, in a spasmodic
suicidal response. Or suppose a desperate China-whose long-range nuclear missiles (some) can reach the United States-attacks Taiwan. In addition to immediate
responses, the mutual treaties involved in such scenarios will quickly draw other nations into the conflict, escalating it significantly. Strategic nuclear studies have shown
for decades that, under such extreme stress conditions, once a few nukes are launched, adversaries and potential adversaries are then compelled to launch on perception
The real legacy of the MAD concept is this side of the MAD
of preparations by one's adversary.
coin that is almost never discussed. Without effective defense, the only
chance a nation has to survive at all is to launch immediate full-bore pre-
emptive strikes and try to take out its perceived foes as rapidly and massively as possible. As the studies showed, rapid escalation to full WMD
exchange occurs. Today, a great percent of the WMD arsenals that will be unleashed, are
already on site within the United States itself. The resulting great
Armageddon will destroy civilization as we know it, and perhaps most of the
biosphere, at least for many decades.
11
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Nigeria Module
A) Uniqueness: The United States is highly dependent and currently
imports over $300 billion of oil from foreign nations and the number
is not going down any time soon
With the run-up in oil prices over the past four years, the United States is paying dearly
for its dependence on imported oil, Petroleum Intelligence Weekly (PIW) reports in its
latest issue. The US oil import bill last year came to some US$327 billion, and should easily
top US$400 billion this year. That's an increase of some 300% since 2002, according to PIW.
Last year, PIW reckons that the US paid out a record US$245 billion for about 10 million
barrels per day of crude oil imports, and another US$82 billion for about 3.5 million bpd
of imported oil products. This year it looks like paying out even more, with domestic
crude production continuing to fall, demand for imports of high-priced transport
fuels remaining strong, and oil prices around 30% higher year-on-year so far in
2008.
The increase to an estimated US$440 billion for 2008 is based on an average US$90
per barrel crude oil price for the year. In 2002, before the current bull market for oil
began, US oil imports cost less than US$103 billion. With oil prices this year as strong
or stronger than in 2007, any moderation in the US import bill must come from reduced
volumes. While oil demand growth has slowed in recent years due to both high prices
and greater fuel efficiency, the higher quality of crude oil imports that US refiners
require and the emphasis on high-quality transport fuels in the product import mix
are likely to keep upward pressure on import costs even if volumes are stable,
according to PIW. Although "energy security" and "dependency on the Middle
East" get the attention in the American national debate over oil imports, huge and
rapidly rising costs are of greater immediate economic significance, PIW says.
Relatively secure supplies from Canada and Mexico account for about one third of
crude imports.
12
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Fawole, William 2006 (The Politics of Oil, Plunder and Poverty in Nigeria, http://www.cpsa-
acsp.ca/pdfs/2006%20Abstracts.pdf)
Oil has generated great national wealth for the Nigeria state. Petro-dollars assured
Nigeria’s global prominence as Africa’s largest – and the world’s eleventh largest –
oil-producer. The Nigerian economy is heavily-dependent on oil exports and foreign
personnel and technology for oil extraction. Oil accounts for some 80% of all
government revenues. Despite its enormous oil-wealth, some 70% of the population live in poverty. Since 9/11 the
United States has characterized African oil as of ‘national security interest’. It is
estimated that by 2015 some 25 percent of US oil will come from Africa, primarily from Nigeria and
Angola, followed by Gabon, Equatorial Guinea and Congo-Brazzaville. Instead of creating national social well being, the petro-dollar
windfalls have sealed Nigeria’s fate as a ‘conquered state’, subjugated by civilian and military elites, and administered to satisfy the
prebendal obsessions of its domestic conquerors, as well as the interests of the world’s largest multinational oil companies including
Exxon Mobil, ChevronTexaco, Shell, Elf, Agip and ConocoPhillips. Post-colonial elites, both civilian and military, have plundered the
national wealth for personal aggrandizement. Corruption and impunity became hallmarks of politics and governance dominated by
these elites and their trans-national oil alliances. This paper will do three interrelated things: first, it will interrogate the political
economy of oil in Nigeria; second it will examine the unholy alliance between national civilian-military elites and trans-national actors
in pillaging Nigeria’s oil-wealth; and, third, it will examine the implications of these dynamics for social well being in Nigeria’s oil-
communities.
Bearden 00 T.E., LTC U.S. Army (Retired), ["The Unnecessary Energy Crisis: How to Solve It Quickly,"
http://www.freerepublic.com/forum/a3aaf97f22e23.htm, June 24]
economic collapse, the stress on nations will have increased the intensity and
number of their conflicts, to the point where the arsenals of weapons of mass destruction
(WMD) now possessed by some 25 nations, are almost certain to be
released. As an example, suppose a starving North Korea launches nuclear weapons upon Japan and South Korea, including U.S. forces there, in a spasmodic
suicidal response. Or suppose a desperate China-whose long-range nuclear missiles (some) can reach the United States-attacks Taiwan. In addition to immediate
responses, the mutual treaties involved in such scenarios will quickly draw other nations into the conflict, escalating it significantly. Strategic nuclear studies have shown
for decades that, under such extreme stress conditions, once a few nukes are launched, adversaries and potential adversaries are then compelled to launch on perception
The real legacy of the MAD concept is this side of the MAD
of preparations by one's adversary.
coin that is almost never discussed. Without effective defense, the only
chance a nation has to survive at all is to launch immediate full-bore pre-
emptive strikes and try to take out its perceived foes as rapidly and massively as possible. As the studies showed, rapid escalation to full WMD
exchange occurs. Today, a great percent of the WMD arsenals that will be unleashed, are
already on site within the United States itself. The resulting great
Armageddon will destroy civilization as we know it, and perhaps most of the
biosphere, at least for many decades.
13
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Canada/Mexico Module
A) Uniqueness and Link: The United States is highly dependent and
currently imports over $300 billion of oil from foreign nations and the
number is not going down any time soon
With the run-up in oil prices over the past four years, the United States is paying dearly
for its dependence on imported oil, Petroleum Intelligence Weekly (PIW) reports in its
latest issue. The US oil import bill last year came to some US$327 billion, and should easily
top US$400 billion this year. That's an increase of some 300% since 2002, according to PIW.
Last year, PIW reckons that the US paid out a record US$245 billion for about 10 million
barrels per day of crude oil imports, and another US$82 billion for about 3.5 million bpd
of imported oil products. This year it looks like paying out even more, with domestic
crude production continuing to fall, demand for imports of high-priced transport
fuels remaining strong, and oil prices around 30% higher year-on-year so far in
2008.
The increase to an estimated US$440 billion for 2008 is based on an average US$90
per barrel crude oil price for the year. In 2002, before the current bull market for oil
began, US oil imports cost less than US$103 billion. With oil prices this year as strong
or stronger than in 2007, any moderation in the US import bill must come from reduced
volumes. While oil demand growth has slowed in recent years due to both high prices
and greater fuel efficiency, the higher quality of crude oil imports that US refiners
require and the emphasis on high-quality transport fuels in the product import mix
are likely to keep upward pressure on import costs even if volumes are stable,
according to PIW. Although "energy security" and "dependency on the Middle
East" get the attention in the American national debate over oil imports, huge and
rapidly rising costs are of greater immediate economic significance, PIW says.
Relatively secure supplies from Canada and Mexico account for about one third
of crude imports.
14
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Bearden 00 T.E., LTC U.S. Army (Retired), ["The Unnecessary Energy Crisis: How to Solve It Quickly,"
http://www.freerepublic.com/forum/a3aaf97f22e23.htm, June 24]
History bears out that desperate nations take desperate actions. Prior to the final
economic collapse, the stress on nations will have increased the intensity and
number of their conflicts, to the point where the arsenals of weapons of mass destruction
(WMD) now possessed by some 25 nations, are almost certain to be
released. As an example, suppose a starving North Korea launches nuclear weapons upon Japan and South Korea, including U.S. forces there, in a spasmodic
suicidal response. Or suppose a desperate China-whose long-range nuclear missiles (some) can reach the United States-attacks Taiwan. In addition to immediate
responses, the mutual treaties involved in such scenarios will quickly draw other nations into the conflict, escalating it significantly. Strategic nuclear studies have shown
for decades that, under such extreme stress conditions, once a few nukes are launched, adversaries and potential adversaries are then compelled to launch on perception
The real legacy of the MAD concept is this side of the MAD
of preparations by one's adversary.
coin that is almost never discussed. Without effective defense, the only
chance a nation has to survive at all is to launch immediate full-bore pre-
emptive strikes and try to take out its perceived foes as rapidly and massively as possible. As the studies showed, rapid escalation to full WMD
exchange occurs. Today, a great percent of the WMD arsenals that will be unleashed, are
already on site within the United States itself. The resulting great
Armageddon will destroy civilization as we know it, and perhaps most of the
biosphere, at least for many decades.
15
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Uniqueness Extensions
Burnett in 2006 (H. Sterling, Ph.D., is a senior fellow with the National Center for
Policy Analysis. In the Public Interest: Tapping the Outer Continental Shelf, No. 563,
July 14, 2006)
The United States needs oil and natural gas. Oil is fuel and a feedstock for plastics,
pharmaceuticals, fertilizers and lubricants. Natural gas is used for cooking, heating homes
and water, and is also critical to chemical manufacturing. The best estimates indicate that
by 2025 U.S. oil consumption will grow by one-third — even with the rise of renewable
biofuels — and electricity demand will increase by more than 45 percent, with natural
gas fueling much of the new electric power generation. Where will Americans find the
additional oil and gas they need? Much of it lies under the deep waters of the U.S. Outer
Continental Shelf (OCS). Only politics prevents the development of decades’ worth of oil and
gas supplies. The Problem of Oil. Since the Arab oil embargo of the 1970s, the United
States has become dependent upon foreign nations for a majority of its oil. Many of these oil-rich
countries are either politically unstable, have governments hostile to U.S. interests or have
economies that are mostly unfree, meaning political calculations rather than market demand
dictate the pace of exploration and development.
16
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Evans-Pritchard 08
(Ambrose, Intl Business Editor of The Daily Telegraph. Also wrote for The Economist and Spectator. May 19.
http://www.telegraph.co.uk/money/main.jhtml? view=DETAILS&grid=&xml=/money/2008/05/15/bcnoil115.xml )
When President George Bush went to see Saudi Arabia's King Abdullah in January to
plead for higher oil output, he was politely rebuffed.
If the Saudis deny help once again, they risk incalculable damage to their strategic alliance with
Washington. The price of crude has rocketed by over $30 a barrel since that last fruitless meeting, briefly
touching the once unthinkable level of $127.
Asked what he would tell King Abdullah this time, Mr Bush said caustically: "the price is even higher."
The US-Saudi tango has been on thin ice ever since the terrorist attacks of 9/11. Sixteen of the hijackers
were Saudi nationals. The Bush family has cleaved closely to the Saudi monarchy, but strong
factions in Washington see Riyadh's Wahabi monarchy as part of the Mid-East problem--
not the solution.
Saudi Arabia's one saving grace -- in the eyes of US critics -- is that it has over the years been
willing to cap extreme surges in the price of oil, deploying its power as the world's swing
producer. This time Riyadh is giving no ground.
Oil minister Ali al-Naimi insists that there is plenty of oil about, blaming the latest spike on "the internal
logic of the financial markets", meaning hedge funds and speculators. The US Congress gave its riposte this
week.
17
LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Right now, the U.S. is desperately dependent on foreign oil. It creates various
problems, as far as foreign policy goes.
David L. Greene, Engineering Science and Technology Division, ORNL. 2005. “Oil Dependency High Now: U.S.
Oil Dpendence” http://www.ornl.gov/info/ornlreview/v38_1_05/article04.shtml
U.S. oil imports are at an all-time high, accounting for approximately 57% of domestic
consumption. Americans today import some 12 million barrels per day at a cost that in
2004 skyrocketed above $50 a barrel.
ORNL researchers have made important contributions to understanding and addressing the challenge of oil
dependence.
Imported crude oil as a percent of U.S. consumption.
Using a scientific approach to define the problem, the researchers have advised the Department of Energy on the
appropriate size of the Strategic Petroleum Reserve, contributed to National Academy of Sciences studies of the
potential to increase vehicle fuel economy, and produced comprehensive estimates of the costs of oil consumption.
America's growing dependence on foreign oil represents an interrelated combination of
factors that together create economic, political, and security problems of the highest
order. Oil supply is increasingly determined by a small number of nations that wield a near monopoly over world
production. An insatiable demand, driven in part by the robust growth of Asian economies,
makes American industry and consumers even more vulnerable to the recent shock of
higher oil prices. Whether America can remove this vulnerability will depend on substantially reducing the
volume of oil imported and consumed, an ambitious goal tied directly to making available affordable and practical
petroleum substitutes.
After oil prices fell from $40/bbl in 1985 to $20/bbl in 1986, many analysts predicted the end of the Organization of
Petroleum Exporting Countries (OPEC). By 1995, some were confident that the problem of oil dependence was a short-
term anomaly.
ORNL researchers disagreed. A three-parameter equation published in 1992 by Heinrich von Stackelberg cautioned
that a producer's ability to influence prices depends on: 1) market share, 2) the responsiveness of demand to price and,
3) other producers' ability to increase supply when prices rise.
The report suggested that the market's ability to respond to oil prices in the short run (1-2 years) is about one-tenth of a
long-run capability. OPEC could double, triple, even quadruple prices for 24 months but could not sustain such high
prices for an extended period. Absent events such as military conflict, OPEC's only recourse to sustaining historically
high oil prices is to cut production. Cutting production, however, would mean a loss of market share and thereby a loss
of market power.
From 1979 to 1985 OPEC's share of the world oil market shrank from 50% to 30% as members (especially Saudi
Arabia) continuously cut production to maintain high prices. But loss of market share did not alter the fact that OPEC
members held 75% of the world's proven reserves and approximately 55% of the ultimate resources of conventional oil.
Unless world oil demand could be curbed or economical substitutes to oil quickly developed, OPEC would inevitably
regain lost market share. In 1999-2000, with help from Russia, Norway, and Mexico, OPEC engineered a doubling of
world oil prices.
\In a 1995 ORNL report, "The Outlook for U.S. Oil Dependence," Don Jones, Paul Leiby, and I simulated the impact of
a two-year supply shock similar to those that occurred in 1973-74 and 1979-80, but starting in 2005 and ending in
2006. The model predicted that the shock would cause oil prices to jump from $20/bbl in 2004 to $50/bbl in 2005,
costing the U.S. economy an estimated half a trillion dollars.
If the U.S. thirst for oil continues unabated, Americans increasingly will be forced to
extract petroleum from unconventional sources. Oil sands and heavy oils are already in the early stages of
exploitation in Canada and Venezuela. Continued demand will lead to oil shale, coal, or methane for liquid fuels. Such
a path might allow OPEC to remain the lowest cost producer of oil and to sustain for several decades the capacity to
supply a third or more of the world market.
The world could, of course, pursue a different path leading to low-carbon energy sources or even hydrogen fuel.
Unfortunately, we do not yet know how to direct future energy transitions on the scale required for a global economy.
Developing the right technologies is a critical but probably insufficient solution. These technologies would need to be
accompanied by a fundamental rethinking, on an international level, of how we acquire, distribute, and use our planet's
energy resources.—David L. Greene, Engineering Science and Technology Division, ORNL.
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Link Extensions
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2005 Energy Bill Gave Billions in Subsidies to Fossil Fuel Industry. "On the eve of
the 35th anniversary of the first Earth Day, the House of Representatives has passed
a grossly porkified energy bill that doles out billions in subsidies to fossil-fuel
industries, shortchanges alternative energy and efficiency initiatives, and indemnifies makers of the gasoline additive
MTBE against liability for groundwater contamination. And this time the bill may actually have a chance of passing in the
Senate, perhaps as early as next month, after years of stalemate." [Salon.com, 4/22/05]
*IPCC Report Warned All Countries Would Be Affected, Producing Drought, Cyclones and Sea Levels That Could Cause
rainstorms, drought, tropical cyclones and surges
Flooding, Hunger and Water Shortages. "Heatwaves,
in sea level are among the events expected to become more frequent, more
widespread and/or more intense this century. As a result, water shortages, hunger,
flooding and damage to homes will be a heightened threat. 'All cuntries' will be affected, says
the IPCC. Those bearing the brunt, though, will be poor countries which incidentally bear the least responsibility for creating
the problem." [Agence France-Presse, 11/16/07]
Military Experts Predict Climate Change Will Act as Multiplier for Instability in
Most Volatile Regions of the World. "Climate change acts as a threat multiplier for
instability in some of the most volatile regions of the world. Projected climate change will
seriously exacerbate already marginal living standards in many Asian, African, and Middle Eastern nations, causing
widespread political instability and the likelihood of failed states. Economic and environmental conditions in already fragile
areas will further erode as food production declines, diseases increase, clean water becomes increasingly scarce, and large
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populations move in search of resources." [Military Advisory Board, "National Security and the Threat of Climate Change,"
4/07]
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Business Wire, March 5, 2008, Remarks by the President to the Washington International Renewable Energy Conference
2008, Remarks by the President to the Washington International Renewable Energy Conference 2008
My job, as the President of the country, is to put pro-growth policies in place. But we're
dependent upon oil, and
so as our economy grows, it's going to create more demand for oil -- same with China,
same with India, same with other growing countries. It should be obvious to you all that the demand is
outstripping supply, which causes prices to go up. And it's making it harder here in America for working families to save, and for
farmers to be prosperous, and for small businesses to grow.
Copley News Service May 23, 2008 ( Friday 2:45 PM EST BYLINE: Malcolm Berko,
SECTION: TAKING STOCK,LENGTH: 906 words, Grain for oil? Chew it over)
Dear W.C.: In the 1960s, Big Oil had accumulated mountains of debt, earnings were generally
weak and the future looked barren with oil trading at $5 and $6 a barrel. So the Energy Crisis of 1971-72
was a warning shot across the bow that Congress, for reasons that may be criminally suspect, blithely chose to ignore.
As the U.S. trudged through a painful recession, the price of crude tripled while Big
Oil raped the consumer and produced record profits. Then in 1981, we had our Second
Energy Crisis. The cover of National Geographic portrayed an oil derrick beneath a
headline that screamed: "Oil at $100 a Barrel Possible." Oil tripled again to $50-$60 a
barrel and while Congress twiddled its thumbs, Exxon, BP, Shell, etc. ransomed their oil to Americans,
reported obscene profits and the economy tanked into the great recession of 1981-1982.
The Third Energy Crisis began in 1991 as a result of the Persian Gulf War. Big Oil cozened
record profits from the crisis while our representatives sat in their Congressional
"snivel" chairs and the economy writhed through another recession.
And it happened again in 2007: oil at $125 a barrel, gas at $4 a gallon, Big Oil's enormous
profits sucked the consumer dry and the economy may be sinking into its most
severe recession since the Great Depression.
Four major energy crises and Congress has done nothing in the last 37 years to reduce our oil dependency. It's enough to convince
Rep. Edward Markey,
folks that most members of Congress and Big Oil are joined at the lips and hips. And when
chairman of the House Select Committee on Energy Independence, was forced to admit
that "Exxon-Mobile is resisting the renewable energy revolution,"
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Seven years of Bush Republican policy failures have weakened America's energy
security. America's dependence on oil undermines our national security interests by
funding terrorism and hostile nations, as well as limiting America's strategic options. America's
economy is so dependent on oil - and our energy infrastructure is so vulnerable to
natural disasters and attacks - that high prices and other crises can cripple our nation.
But the biggest threat to America's energy security is our continued reliance on fossil
fuels, which contributes overwhelmingly to man-made global warming. President
Bush
and his allies in Congress have had seven years to strengthen America's energy
security, but have done just the opposite. Democrats believe we must invest in alternative energy in order
to end our dependence on oil, stem the tide of global warming and strengthen America's energy security.
In this document:
3.America's oil supply is not secure - vulnerable to natural disasters and terrorist
attacks.
's energy policies have continued America's reliance on fossil fuels, worsening global warming.
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U.S. Oil Dependence Finances Terror. American oil dependence enriches countries
such as Saudi Arabia which harbor charities, nongovernmental organizations,
mosques, and banks that have funded terrorist groups around the world. Former CIA
director James Woolsey described the Saudi-sponsored Wahhabism and Islamist
extremism as "the soil in which Al-Qaeda and its sister terrorist organizations are
flourishing." [Institute for the Analysis of Global Security]
Hostile Nations Are Enriched by Flood of Oil Revenue from Sales to America. "The
control over enormous oil revenues gives exporting countries the flexibility to adopt policies that oppose U.S. interests and
values.Iran proceeds with a program that appears to be headed toward acquiring a
nuclear weapons capability. Russia is able to ignore Western attitudes as it has
moved to authoritarian policies in part because huge revenues from oil and gas
exports are available to finance that style of government. Venezuela has the
resources from its oil exports to invite realignment in Latin American political
relationships and to fund changes such as Argentina's exit from its International
Monetary Fund (IMF) standby agreement and Bolivia's recent decision to nationalize
its oil and gas resources. Because of their oil wealth, these and other producer
countries are free to ignore U.S. policies and to pursue interests inimical to our
national security." [National Security Consequences of U.S. Oil Dependency, 10/12/06]Revenue from Oil Sales to
America Has Been Used to Undermine Local Governance and Promote Instability. "Revenues from oil and gas exports can
undermine local governance. The United States has an interest in promoting good governance both for its own sake and
because it encourages investment that can increase the level and security of supply. States that are politically unstable and
poorly governed often struggle with the task of responsibly managing the large revenues that come from their oil and gas
exports. The elements of good governance include democratic accountability, low corruption, and fiscal transparency.
Production in fragile democracies, such as in Nigeria, can be undermined when
politicians or local warlords focus on ways to seize oil and gas rents rather than on
the longer-term task of governance. Totalitarian governments that have control over
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those revenue flows can entrench their rule." [National Security Consequences of U.S. Oil Dependency,
10/12/06]
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Impact Extensions
Impacts
Oil Exports Three-Fourths of the Venezuelan Economy.
Advameg. 2007 (http://www.nationsencyclopedia.com/Americas/Venezuela-ECONOMY.html)
During the colonial era and until the development of petroleum resources, the export of coffee and cocoa and the raising
of cattle and goats provided the main supports for the economy. However, agriculture now accounts for only about 5% of
the GDP.
For over 40 years the economy has been completely dominated by the
petroleum industry; in the mid-1980s, oil exports accounted for 90% of all export
value, and in 2002 petroleum accounted for over one-third of the GDP, three-
fourths of export revenues and half of government revenues. The Venezuelan
economy is therefore greatly influenced by petroleum market conditions and
Venezuela through its membership in OPEC has exercised influence on the rest of the world. The
Venezuelan oil minister is reputed to be one of the principle architects of the first oil shock in 1973, and in 1999,
Venezuela's decision to cut production to halt the continuing slide in oil prices led the way to their recovery in 2000 and
after. The second most important mineral product is iron, and Venezuela's mineral wealth is augmented by frequent
discoveries of additional reserves. Industrial development is fostered by government policy.
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Latin America’s oil economy and volatile oil prices have varying
impacts on the region’s economies. High oil prices help large producers
like Venezuela and Ecuador that rely on exports for fiscal revenue and
foreign exchange. For the net oil-importing countries of Brazil, Peru and Chile, the price of oil is a
key determinant of inflation, the cost of production, the trade balance and the strength of the currency.
Oil prices today are extremely volatile, and sharp fluctuations in oil prices contribute to macroeconomic
volatility in the region. Over the past 20 years, oil prices have been more volatile than the prices of other
commodities like raw agricultural products, ores and metals. The impact of this volatility varies according
to a country’s relative dependence on oil production and exports.
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input for processing, and produce more carbon emissions). As time goes on, societies will
tend first to exhaust substitutes that are superior and easy to get at, then those that are
equivalent, and increasingly will have to rely on ever more inferior substitutes to replace
depleting resources—unless rates of consumption are held in check (see Axioms 2–4).
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Surging oil revenues have led to a massive accumulation of capital in the Gulf of
arab in a very short time. To put this in context, GCC countries will provide about 18
percent of global capital exports in 2008 -- more than double their share just five
years ago.
The upside of this oil wealth is that the Gulf countries have an historic opportunity to
shore up their economic fundamentals, diversify their economies and make needed
investments in human capital -- steps that should help avoid the boom and bust
cycles of the past and support broad based growth. Many of the region's leaders are
embracing this opportunity by paying down debt, setting aside wealth for future
generations, increasing health and education spending, and improving the
environment for foreign and domestic private investment.
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Sino-Saudi relations extend beyond the energy sphere. Both countries maintain close relations with Pakistan, and China has sold Saudi Arabia CSS-2
"East Wind" intermediate range ballistic missiles. Saudi Arabia has also emerged as China's leading trade partner in the region with Sino-Saudi trade
amounting to US$14bn in 2005.
A similar deepening of relations can be seen in the case of Sino-Iranian relations. While China abstained in the vote to refer Iran's nuclear
ambitions to the United Nations Security Council at the meeting of the International Atomic Energy Agency (I.A.E.A.) in January 2006, it still
maintains strong relations with Iran. When the Iran issue will be discussed at the U.N. Security Council, China could employ a
similar tactic to what it employed over the issue of Sudan, which is also a significant oil supplier to China; in 2004, the U.N. Security
Council was forced to water down a resolution condemning atrocities in the Darfur region
to avoid a Chinese veto.
China's relations with Iran, while rooted in centuries of history from the "Silk Road" and the voyages of Zheng He, have recently blossomed as a result
of China's growing energy needs. China has signed a US$100bn deal with Iran to import 10 million tons of liquefied natural gas over a 25-year period
in exchange for a Chinese stake of 50 percent in the development of the Yadavaran oil field in Iran. China has also expressed a desire in direct
pipeline access to Iran via Kazakhstan.
Relations in the economic sphere have also continued to blossom as bilateral trade reached US$9.5bn in 2005, fueled by growing Chinese investment
in Iran's infrastructure. Iran has also been drawn into China's sphere of influence by its observer status at the Shanghai Cooperation Organization.
Given the ongoing frictions between Iran and the West, Sino-Iranian relations are also a source of potential friction for Sino-U.S. relations. For
example, while China has voiced its commitment to the non-proliferation regime, Chinese companies have been the subject of numerous sanctions for
the transfer of ballistic missile technologies to Iran. Since the mid-1980s, China has sold Iran anti-ship cruise missiles such as the Silkworm (HY-2),
the C-801, and the C-802.
While gaining access to the region's vast energy resources is China's primary motivation for deepening relations with the region, there are a number
of other factors driving China's Middle East policy. Since the Middle East is the ideological center of the Islamic world, China has attempted to
maintain good relations with the Arab world in order to get their support on the Uighur insurgency in Xinjiang Province and maintain amicable relations
with the 55 million Muslims residing in China.
While China's main efforts in preventing external actors from fueling the Uighur insurgency have focused on Central and South Asian states, countries
in the Middle East, most notably Saudi Arabia and Iran, have also had an important role to play in quelling the insurgency given their moral and
material support. Most notably, Wahabbi Islam, which is an export from Saudi Arabia, has played a significant role in the rise of extremist,
fundamentalist Islam in Pakistan, Afghanistan and the Central Asian republics on China's western borders.
In order to garner the goodwill of the region, Beijing has made numerous symbolic gestures. For example, in September 2002 Beijing appointed its
first Middle East peace envoy. While this has had little significance for the Israeli-Palestinian peace process, it has, nevertheless, demonstrated
China's increasing attention to the region.
Similarly, while China has maintained a low-profile in the U.S. intervention in Iraq, in May 2004 China submitted a document to the U.N. Security
Council proposing that U.S.-led forces withdraw from Iraq. China has also consistently called for a larger U.N. role in Iraq. China is deepening its
economic cooperation with the region through the China-Arab Cooperation Forum and the Framework Agreement between China and the Gulf
Cooperation Council, which includes negotiations for a free trade zone.
While China has maintained a historically close relationship with the Arab world, including sympathizing with the Palestinian cause, it has nevertheless
also pursued an increasingly close relationship with Israel in recent years. Israel is one of only a handful of countries that has never granted diplomatic
recognition to Taiwan. In recent years, Sino-Israeli relations have been fueled by China's growing dependence on Israel for arms imports and
upgrades, particularly hard-to-find U.S.-made weapons platforms. Israel is now China's second largest supplier of weaponry after Russia. Most
notably, Israel has sold China "Harpy" anti-radar drones and Python-3 air-to-air missiles.
Nevertheless, there are limits to Sino-Israeli relations given the close relationship between Israel and the United States as evinced by Israel's decision
(under U.S. pressure) to cancel the sale of the Phalcon airborne early-warning radar system to China in July 2000 and its decision not to upgrade
harpy drones for China in 2004. [See: "Return of the Red Card: Israel-China-U.S. Triangle"]
Potential for China-U.S. Rivalry
While China and the United States are not engaged in an overt competition in the
Middle East, it is not difficult to envision that the region
could emerge as the stage for future Sino-U.S. rivalry. Not only are the United States and China dependent on
energy resources from the Middle East, but both states offer competing models for international conduct,
with the Chinese model becoming increasingly popular in the region.
While the United States has become more willing to engage in humanitarian intervention,
preemptive action and regime change, with the Middle East emerging as the most likely
candidate for the U.S. to practice these policies, China retains a preference for a traditional
Westphalian-style of conducting international relations with emphasis on non-intervention, state sovereignty and
territorial integrity.
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Shikha Dalmia May 5, 2006 (Senior Analyst with Reason Foundation, http://www.reason.org/commentaries/dalmia_20060505.shtml)
As the nuclear stand-off with Iran helped push oil prices to near-record levels, President Bush once again declared, "Dependency on oil creates an
economic problem for us, and it creates a national security problem for us."
But if Iran's behavior makes the case for anything at all, it is that America
should become more – not less – "dependent"
on foreign oil. In fact, the best way for America to defuse the so-called Middle Eastern oil weapon is by purchasing even more oil from the
region.
The economic case for energy independence has always been nonsensical. It
is not possible to shield American consumers
from rising prices at the pump simply by replacing foreign oil with domestic oil. Why? Because regardless of where the oil
is produced – Oman or Oklahoma – its prices are set by the global market.
The global demand for oil and its ease of transportation have synchronized oil prices everywhere. Therefore, unless compelled by draconian
government mandates, no American company that can command $3 a gallon in Oman would sell it for much less in Oklahoma. If war prevents Middle
Eastern oil from reaching its global customers, the incentive for American companies to sell U.S. oil overseas would be even greater given the higher
prices that it would fetch. War or peace, no amount of domestic production will give us "independence" from the law of supply and demand.
But if domestic production won't ensure access to cheap oil, some believe that it will at least shield us from the kind of geo-political manipulation that
Arab countries attempted during the 1973 oil embargo. That, however, is also a myth.
For starters, OPEC -- the Arab-dominated cartel of oil producing nations – did not succeed in its manipulation even then. It
lifted the embargo in less than two months, once it became clear that while its members were giving up oil revenues, its
oil was still reaching the United States because of diverted shipments from Europe. There
was some diminution of oil supply in the United States, but not nearly enough to do any serious damage to the American
economy.
The long lines outside gas stations that Americans associate with the embargo resulted more from panic buying and domestic oil price controls rather
than lost Arab oil, notes M.A. Adelman, a professor of economics at the Massachusetts Institute of Technology.
But if
all OPEC countries together couldn't pull off their political blackmail, a rogue regime
acting alone will surely not succeed.
Saudi Arabia's experience in 1980 demonstrates why. The country elected to play the role of OPEC's "swing producer," unilaterally limiting its oil
production in order to boost world oil prices. It expected that higher oil prices would compensate it for lower oil sales.
But Saudi Arabia was forced to abandon its policy in a few years as other OPEC members bumped up their production on the sly and pushed its
exports to nearly zero. Since then, Saudi Arabia has repeatedly said that it would never again unilaterally cut output.
The lesson of Saudi Arabia's experience – oil
sales that one producer foregoes will quickly be captured by
others – is not lost even on regimes such as Iran, especially now when there are more oil suppliers than ever before.
Given Iran's defiant mood and tension with the U.S. and Europe over its nuclear program, one would have thought that this would be a perfect
moment for its hot-headed president to further escalate – if not act on – his threat to cut off Iran's oil exports to the West and shut down oil shipments
through the Straits of Hormuz.
But beneath all of Iran's saber-rattling and its threat to retaliate against Israel in the event of a U.S. attack, it realizes
how suicidal
such a move would be. During a recent OPEC meeting, Karem Vaziri Hamaneh, Iran's oil minister, went out of his way to reassure the
world that Iran had no intention of disrupting the oil market. "The need of the world for energy is soaring and, if Iran is taken out of the equation, prices
will shoot up," he told the Wall Street Journal. "But we don't want to cause hardship for any consumers around the world."
Vaziri's concern is not so much for the world's oil consumers, of course, as for the economic consequences for his own country. The Iranian
government depends on oil exports for nearly half of its total revenues. If it cuts these exports, buyers could go to other suppliers. But there is not
much else that Iran could sell to other countries to replace its lost oil revenues.
Our dependence on Middle Eastern oil is only the flip side of their dependence on our purchases. But given the narrow base of Middle Eastern
economies, the
power in the relationship is firmly on the side of the oil buyers. If that
relationship were to end because of "energy independence," we would give up crucial
leverage to control the worst behavior of some of the world's worst regimes. Of course, this
leverage is no magic wand that would protect us from a totally irrational regime willing to absorb the economic cost of using the oil weapon. But the
more oil we get from such a regime, the higher the price it would have to pay.
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Aff Answers
Non Unique: Addiction going down
On its front page, the Financial Times (5/20, Hoyos) reports, "The US is starting to
break its 'addiction' to foreign oil as high prices, more efficient cars, and the use of
ethanol significantly cut the share of its oil imports for the first time since 1977. The
country's foreign oil dependency is expected to fall from 60 per cent to 50 per cent in
2015, before rising again slightly to 54 per cent in 2030, according to the head of the
Department of Energy's statistical arm." US net imports "are expected to fall
between now and 2030, ending what has been an almost relentless 30-year climb in
the use of foreign oil and a fall in domestic production. In 2006, George W. Bush
said in his State of the Union speech that America was 'addicted to oil' ? often
imported from unstable parts of the world ? and said he would work to address the
issue. ... The US decline in foreign oil dependency is already becoming more visible,
with imports making up 57.9 per cent in the first three months of this year, down
from 58.2 last year."
Business Wire, March 5, 2008, Remarks by the President to the Washington International Renewable Energy Conference
2008, Remarks by the President to the Washington International Renewable Energy Conference 2008
The dependency upon oil also puts us at the mercy of terrorists. If there's tight supply and
demand, all it requires is one terrorist disruption of oil and that price goes even higher. It's in
our interests to end our dependency on oil because it -- that dependency presents a challenge
to our national security. In 1985, 20 percent of America's oil came from abroad. Today
that number is nearly 60 percent.
Now, all the countries we import from are friendly, stable countries; but some countries we get oil from don't particularly like us.
They don't like the form of government that we embrace. They don't believe in the same freedoms we believe in, and that's a
problem from a national security perspective, for the United
States and any other nation that values its
economic sovereignty and national sovereignty.
And finally,
our dependence on fossil fuels like oil presents a challenge to our
environment. When we burn fossil fuels we release greenhouse gases. The concentration of greenhouse gases has increased
substantially. We recognize all three of these challenges, and we're doing something about it.
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A $5 tax on every oil barrel would enhance our security by reducing our dependency
on our enemies and adversaries. It would reduce the shiploads of scores upon scores of
billions of dollars the U.S. is now sending each month to Putin's Russia, to Ahmadinejad's Iran, to the mother of all 9/11
terrorists Saudi Arabia, and other such good friends. These nations, in turn, use the oil funds to counter U.S.
policies overseas, to shore up their regimes at home, to purchase arms, and -- in Iran's case -- to finance terrorists
groups. . . . What is particularly distressing about the across-the-board failure of our politicians to tell the truth to voters -- to
explain why a tax on oil is essential and overdue -- is that it does not take nearly as much courage as it at first seems.
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Matt Nauman, May 2, 2008 Friday, San Jose Mercury News, Calif.
With gasprices near $4 a gallon, and sales of GM's big trucks and SUVs falling, the automaker announced
3,500 layoffs at the factories making those vehicles earlier this week. On Wednesday, it
announced a first-quarter net loss of $3.25 billion.
So going green has become vital to the automaker's survival, GM Chairman and Chief Executive Rick Wagoner
"One fact stands above all others," Wagoner said at a Commonwealth Club speech at the Fairmont Hotel. "The
auto industry can no longer rely almost exclusively on oil to supply the world's
automotive energy requirements."
Adding to that urgency, he said, is that the auto industry has become increasingly global. GM, which
celebrates its 100th birthday later this year, sold 59 percent of its vehicles outside the United States in 2007. It emerged as the
leading foreign automaker in China, Russia and South America.
"Energy supply, sustainable growth, CO2 emissions, fuel economy -- these are top concerns around the world," Wagoner said.
Wagoner's remarks -- interrupted briefly by protesters who say GM isn't doing enough to fight climate change -- touched on what
many thought the company considered another foreign country: California.
But, he said, the Golden State remains "an important market" for the seller of the Chevy, Buick, GMC, Saturn, Pontiac, Buick,
Cadillac, Hummer and Saab brands. In fact, it was at the Los Angeles Auto Show in 2006 that GM revealed its plan to build a
plug-in hybrid, once the battery technology is ready.
He praised a state program that awards $120 million a year for alternative fuel and
vehicle research. But GM and other automakers continue to fight California's attempts to
regulate greenhouse-gas emissions as pollution.
There's no denying, though, that the company is making a huge investment in green technology: It will sell eight hybrids by the
end of the year. It is testing its experimental hydrogen fuel-cell vehicles in California with consumers. It promises to bring out the
Volt by the end of 2010. And it continues to develop plug-in hybrid technology.
Wagoner,
a member of the basketball team while a student at Duke University, said
newer, greener technologies will cost more.
Consumers "must be willing to pay more for greater value and better fuel economy," he
said.
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The nuclear industry has announced it can cure global warming and make America
energy independent. The problem is the numbers don't add up and our cars don't run on
uranium pellets. Don't be fooled again by the same people who brought you electricity
"too cheap to meter."
Eastern Europe's growth will slow because of the economic downturn in the United States but the
region will not slip into recession, the prime minister of Hungary said Wednesday.
Prime Minister Ferenc Gyurcsany also expressed concern about Europe's growing gas and
oil dependency on Russia, telling The Associated Press that Europe needed to replace its
fragmented energy policies with coordinated action.
Speaking on the sidelines of the World Economic Forum, Gyurcsany said his country's economic growth could shrink below 1
The 2008 growth target was 2.8
percent this year as U.S. economic turmoil ripples out to Eastern Europe.
percent before U.S. sub-prime problems led to fears of a worldwide credit crisis that in
turn sparked global stock market free-falls early this week.
He also expressed concern about the "very high portion" of European energy dependence on
Russia following the Kremlin's latest energy deals with Bulgaria and Serbia.
Under a deal tentatively agreed to on Tuesday, a majority stake of the Serbian oil
monopoly NIS will be sold to Russian energy giant Gazprom, and Russia will route part of
the gas pipeline through Serbia in a deal that Serbian officials said was worth at least
€1.5 billion ($2US.2 billion.) Just days earlier, Russian President Vladimir Putin won Bulgaria's
support for the project, known as the South Stream pipeline, further denting EU hopes of reducing its
reliance on Russian energy.
"Our duty is to decrease the level of this dependence," Gyurcsany said. Within Europe, "markets now are
very fragmented and sometimes are competing with each other," he said, calling for "more integration among
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buyers," so as to present a common front when dealing with Russia.Still, he resisted suggestions
that attempts by Austrian oil and gas company OMV to buy out MOL, its Hungarian counterpart, would create leverage against
Russia by creating a major European player. Hungary late last year passed a law essentially designed to prevent such a
takeover."Integration has to be paced not by takeovers but by mutually shared long-term visions between two companies," he said.
He also invoked Hungarian fears that OMV was too close to Gazprom, as "one more cause to be very very cautious" about OMV's
overtures to MOL.
January 23, 2008 is a senior research scientist working for a start-up company in the
area of wireless broadband Internet access. He lives in Leominster.)
The final issue that confounds America is our foreign oil dependence.
Foreign oil funds Middle Eastern sheiks who support Al Qaeda. Foreign oil flows into
the coffers of Hugo Chavez whose Marxist anti-American rhetoric and friendship with
the 'axis of evil' states should cause alarm.
Foreign oil is also funding a resurgence of Russia's military and has made them much
bolder in their opposition to American interests.
Even worse, the scarcity of oil (or so we are told) has caused prices to skyrocket.
So naturally, given this dire situation, our government has launched a Manhattan project to achieve energy independence, right?
Actually the opposite is true. It appears the status quo is defended by force if necessary, if United Nuclear's attempt to sell
hydrogen conversion kits for automobiles is any example.
Their equipment was confiscated and their business was shut down by force of arms.
The U.S. actually has some of the largest coal reserves, the largest shale oil reserves in the
world, and significant untapped oil reserves in Alaska's North Slope. Yet none of these sources are being
tapped and no significant new energy technology is coming on line to end our oil
dependency.
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Last 07
The most pernicious effect of our Middle Eastern oil addiction is that it retards
the region's political development, keeping it mired in destitution and
instability. Oil revenues in Gulf states make taxation there largely unnecessary.
Policy observers long have recognized our oil problem. Nearly every U.S.
president since Richard Nixon has made noise about achieving oil independence;
none has gotten far. But we may finally have reached a point where there's enough
consensus - and concern - to build toward real action. If so, then what is to be done?
Last 07
But when it comes to oil, there are externalities that markets cannot easily process.
Environmental impact is a classic one. Even more immediate, more obvious, are the
national-security implications of the oil trade. The market cannot assign the costs of,
say, positioning an aircraft carrier group in the Persian Gulf - or fighting a war - to
American petroleum companies. Eventually, citizens and taxpayers, not oil companies,
pay those costs. By the same token, the market cannot establish the cost of funding
Wahhabi radicalism or weakening Middle Eastern liberalism, both of which occur
as a result of our oil consumption
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The likelihood that the U.S. is in a recession appeared to increase Friday, following weeks of
hopes that the country might be skirting one.
Unemployment rose sharply and payrolls shrank for the fifth consecutive month. The
economy news came on a day that oil surged to record prices, the dollar weakened and the Dow
Jones Industrial Average plunged nearly 400 points. The deteriorating job numbers led markets
to scale back the odds that the Federal Reserve will boost short-term interest rates this fall to ward off
inflation.
The jobless rate posted its largest one-month gain in two decades, rising to 5.5% in May
from 5.0% in April, the Labor Department reported Friday. Payrolls, measured by a separate survey,
fell by 49,000 jobs last month, bringing the tally of job losses so far this year to 324,000. (Read more about
the report.)
The rise in unemployment has been accompanied by higher food and energy prices,
pushing up the "misery index" -- the sum of the unemployment and inflation rates -- to
around 9.4, the highest level since the recession of the early 1990s apart from a one-month blip in 2005.
The U.S.’s dependence on oil from Saudi Arabia leads to the funding of
terrorist organizations, such as al-Qaeda.
Bandow 02
(Doug, Former Fellow at the Cato Institute as well as a former columnist with Copley News Service, advisor to President Regan, etc.
December 2, 2002. http://www.cato.org/ pub_display.php?pub_id=4124 )
In short, an unfriendly Saudi Arabia might hurt America's pocketbook; it would not
threaten America's survival. (In contrast, control of the Gulf by a hegemonic rival -- notably the
Soviet Union -- would pose a significantly different, and greater, security threat, but that prospect
disappeared with the end of the Cold War.) Thus, it is worth risking Saudi displeasure in order to
try to starve al Qaeda of funds.
Anyway, Riyadh isn't likely to turn hostile. It needs the money from selling oil as much as America
needs the oil. Moreover, it will be as brutal as necessary to defend itself from internal foes and the
withdrawal of U.S. forces would remove a prime source of potential instability.
Nor need Washington treat the Saudis as enemies. Rather, the U.S.
simply should reorder its
priorities, accepting a cooling of the relationship if that is the only way to halt terrorist
funding.
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America's most important foreign-policy objective is defeating terrorism, and the most
important contribution that Saudi Arabia can make is to cut off funding for al Qaeda or related networks.
That's worth achieving even at the cost of lost bear hugs in the White House, princely
visits to the ranch, and Cabinet-level jaunts to Riyadh.
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Venezuela is ready to cut off oil supplies to the U.S., and it’s going to
happen soon.
AP in 08
(The Associated Press issued this statement on February 12, 2008; http://www.kval.com/ news /national/15543787.html )
Venezuela's oil minister said today the nation's ready to cut off oil supplies to the United
States if necessary.
Chavez first made the threat Sunday in response to a drive by Irving, Texas-based Exxon
Mobil to seize Venezuelan assets through U.S. and European courts. Ramirez accuses Exxon Mobil of
having political motives and being "very closely linked" to the U.S. State Department.
The cases center on the Chavez government's nationalization of lucrative oil ventures in
Venezuela's Orinoco (oh-rih-NOH'-koh) River basin. A British court issued an injunction last
month temporarily freezing up to $12 billion in assets of Venezuela's state oil company.
Bush Has Failed to Reduce the Nation's Oil Dependency. "America's oil addiction has
worsened. Since 2001, America's dependency on foreign oil has steadily increased
even as the cost of oil has more than doubled. The Bush administration's approach to
this challenge has been to concede that there is a crisis while opposing new policies or
strategies that would change the status quo. In his 2006 State of the Union address,
President Bush declared that America is addicted to oil, but in the days and weeks that followed his administration failed to adopt a
new energy policy or support adequate funding for new initiatives that would significantly reduce the country's oil dependency."
[Center for American Progress, 8/06]
High Oil Prices Can Cripple the American Economy "America now faces a crisis of historic
proportion: a liquid transportation fuels crisis. Oil, the lifeblood of our economy, is in increasingly short supply and oil and
derivative product prices have recently soared to record levels." [Southern States Energy Board, Building a Bridge to Energy
Independence and to a Sustainable Energy Future, 7/06]
U.S. Oil Dependence Allows OPEC to Set and Sustain High Oil Prices. "Global oil
reserves are concentrated in a volatile region of the world, with 60% of reserves in the Persian Gulf region. Partly as a
OPEC producers are able to exercise market
consequence of this concentration of low cost reserves,
power, functioning as an imperfect ("clumsy") cartel and at times maintaining oil
price well above estimated competitive levels. The strength and influence of this cartel grows and
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Nonetheless,
declines, largely in relation to cycles of growth in global import demand and OPEC market share.
OPEC's production or pricing decisions can impose sustained economic costs over
many years and can exacerbate, or ameliorate, short-run supply shocks." [U.S. Department
of Energy, Estimating the Energy Security Benefits of Reduced U.S. Oil Imports, 2/28/07]
Much of World's Oil Passes Through Vulnerable "Choke Points" That Could be and Have
Been a Target for Terrorism. "A large fraction of the world's traded oil already passes through a handful of
strategic choke points, such as the Strait of Hormuz. The infrastructure for delivering oil has several potential
weak links, including major oil processing facilities that are vital yet vulnerable to attack and difficult to repair." [National
Security Consequences of U.S. Oil Dependency, 10/12/06]
Global Energy Infrastructure Remains Dangerously Vulnerable. "The global energy infrastructure and distribution channels
have not been adequately protected or modernized. The global energy infrastructure and the distribution channels used by the
United States and the entire international community remain dangerously vulnerable; yet, no comprehensive strategy for
protecting and modernizing them has been implemented.Terrorist attacks, in particular, pose a grave threat. In a videotape
released last December, deputy al Qaeda leader Ayman al-Zawahiri singled out energy infrastructure as a key strategic target
for his followers. Just two months later, suicide bombers in Saudi Arabia attacked the Abqaiq oil processing facility, where
two-thirds of the country's output - 6.8 million barrels per day - is refined." [Center for American Progress, 8/06]
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President Joseph P. Kennedy II is not all wrong in his Monday letter, "Chavez's generosity," and his motivation is pure: to aid
low-income Americans with their winter energy needs. The main thrust of his argument, however, is faulty.
In seeking to defend his push for energy assistance to Americans through aid from Venezuela and its dictator, President Hugo
Chavez,
the United States has made other deals with the devil to satisfy our
Mr. Kennedy notes that
energy needs, citing Saudi Arabia as a case in point. This point is correct: We shamefully deal
with Middle Eastern dictators whose countries gleefully take our money while
engaging in human rights abuses and denigrating the United States. Our Middle
Eastern oil dependency, which, remarkably, is greater today than it was at the time
of the 1970s oil embargo, skews and perverts U.S. foreign policy. By praising "our
good friends" in Venezuela in his organization's television commercials, Mr.
Kennedy glorifies Mr. Chavez and permits him the means to humiliate us and to
make us dependent on him.
Mr. Chavez has used the United Nations to engage in a vicious attack on our
president, referring to him as "the devil." I am a relentless critic of President Bush on
a host of issues, but the broadside attack on him by Mr. Chavez has transformed Mr.
Bush into a sympathetic figure. The democracy Mr. Chavez promised his people has
devolved into autocratic rule rife with threats and takeovers of private industry.
Would Mr. Kennedy accept oil from North Korea's Kim Jong-il if he had any to
give? Would he have accepted it from Adolf Hitler? Is there any leader whose record
of ruthlessness is sufficiently deplorable for Mr. Kennedy to say "no, thanks" to a
handout?
If Mr. Kennedy wishes to pursue the noble goal of helping the purported 200,000 low-income Americans with their energy
needs, he is welcome to use some of the Kennedy fortune to do so and to raise money from like-minded generous Americans
rather than making a hero out of the loathsome Mr. Chavez.
Let us finally work feverishly toward energy independence, but in the meantime,
may no patriotic American welcome handouts from an oppressor.
Business Wire, March 5, 2008, Remarks by the President to the Washington International Renewable Energy Conference
2008, Remarks by the President to the Washington International Renewable Energy Conference 2008
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I welcome the ambassadors who are here. I welcome -- listen, let me start first by telling you that America has got to change its
habits. We've got to get off oil. And the reason why is, first, oil is -- dependency on oil
presents a real challenge to our economy. As economies grow -- and we want all our economies to grow; we
want people to be prosperous, we want people who are living in poverty to be able to grow out of poverty. We want there
to be general prosperity, but as economies grow, until we change our habits, there is
going to be more dependency on oil.
Business Wire, March 5, 2008, Remarks by the President to the Washington International Renewable Energy Conference
2008, Remarks by the President to the Washington International Renewable Energy Conference 2008
Now, look, I understand stereotypes are hard to defeat. People get an image planted in their head, and sometimes it causes them
not to listen to the facts. But America is in the lead when it comes to energy independence; we're in the lead when it comes to new
technologies; we're in the lead when it comes to global climate change -- and we'll stay that way. (Applause.)
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Business Wire, March 5, 2008, Remarks by the President to the Washington International Renewable Energy Conference
2008, Remarks by the President to the Washington International Renewable Energy Conference 2008
We're also working with our friends overseas for the Global Nuclear Energy Partnership. I believe
developing nations ought to be encouraged to use nuclear power. I believe it's in our interests, I believe it will help take
pressure off the price of oil, and I know it's going to help protect the environment. And so
we're working with other nations, like Japan and France and Great Britain and Russia
and China, to form this energy partnership, the purpose of which is to help developing
nations secure cost-effective and proliferation-resistant nuclear power, and at the same
time to conduct joint research on how to deal with the nuclear waste issue, through
positive, productive reprocessing.
And so the United States of America has got a strategy to help change our electricity mix
here at home. And part of that strategy is on nuclear power. Another part of that
strategy is based upon wind power. Now, since 2001, America has increased wind
energy production by more than 300 percent. This is a new industry for us, and it's
beginning to grow. More than 20 percent of new electrical generating capacity added in
America came from wind last year. I met some of the wind boys. They're excited about the opportunities in the
U.S. market, and they should be, because this new technology is taking hold. Last year, America installed more wind power
capacity than any other country in the world.
I don't know if you know this or not: When I was the governor of Texas, I signed a electric deregulation bill that encouraged and
mandated the use of renewable energy. Today, Texas produces more wind energy than any other state in the Union. If an oil state
can produce wind energy, other states in America can produce wind energy. (Applause.) I remember when I signed the bill, I said,
there's a new day coming for wind. And they said, well, you're leaving the state, and a lot of hot air is going with it. (Laughter.)
In addition to wind power, we have spent, since I've been the President, a billion dollars on harnessing the power of the sun. The
solar technology folks who are here will tell you there's some amazing changes have taken place in a quick period of time. I mean,
I really see a day in which each house can be a little electric generator of their own, and feeding back excess power into the grid
through the use of solar power. (Applause.)
Business Wire, March 5, 2008, Remarks by the President to the Washington International Renewable Energy Conference
2008, Remarks by the President to the Washington International Renewable Energy Conference 2008
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agreement. I think we ought to be results oriented people, not process people. It's one thing to have a nice conference, but out
of those conferences we should expect results. We want a strategy that works, not sounds good.
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The United States has only 3 percent of the world's known petroleum reserves, but it
consumes 25 percent of the world's production. If we further tap America's reserves
now, they will soon run out -- and we will be even more reliant on foreign oil.
Rather than trying to drain our limited reserves, our nation's leaders should increase
funding for the research and development of alternative energy sources, impose
stricter fuel-economy standards on cars and trucks and provide new financial
incentives for energy conservation.
The United States can't drill its way out of its dependence on oil. The sooner our
leaders acknowledge that, the closer our nation will be to true energy security
Summer is coming, gas prices are up and -- just as sure as the changing of the
seasons -- oil drilling proponents in Congress are back with another bogus energy
plan.The latest version is an expansion of a proposal last summer that would have let
Virginia opt out of the federal ban on new oil and gas drilling off the U.S. coast.
That proposal was rejected by Congress.
But, undaunted and fueled by $3 million in campaign contributions from the oil and
gas industry, Republican drilling proponents now offer a plan that would let any
state on the Atlantic or Pacific coast seek an exemption from the ban, as reported
Monday by Kirsten B. Mitchell of the Herald-Tribune's Washington bureau. The
plan would also open Alaska's Arctic National Wildlife Refuge to oil and gas
leasing.
This so-called energy plan, scheduled for a vote in the Senate today, deserves to be
defeated like last year's proposal -- and for the same reasons:
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"When we talk about energy independence we are more often than not talking about
energy security. Our national security, for better or for worse, is tied to our energy
resources. Dependence on oil from unfriendly nations threatens our strategic
interests. It burdens our military which has to power a vast array of military
equipment using oil. And, rising energy prices put a strain on our vital transportation
sector and on American businesses which directly undermines our economic
competitiveness in a growing global market place.
Today the cost of driving kids to soccer practice, of putting food on the table because
of soaring transportation costs and of commuting to school and work is crippling the
economies of middle-class Americans.
I've lived in Ventura County for 40 years. My wife, Janice, and I raised four children
here, all of whom are now grown, married and have children of their own. They're
among those struggling to meet daily expenses as the cost of our dependence on
foreign oil has skyrocketed. Like most Ventura County families, they must balance
the costs of everyday life with dreams of a three-day weekend in the desert or on the
Colorado River, which was an easy reality not too long ago.
When OPEC cut production to force up prices in 2000, President Bill Clinton's then-
Secretary of Energy Bill Richardson said, "It is obvious that the federal government
was not prepared. We were caught napping."
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Congress did pass a comprehensive energy bill that was signed into law in 2005"the
first comprehensive energy bill passed in about 20 years. But the compromises that
had to be made to get it through Congress meant that any meaningful expansion of
domestic supply or refinery capacity was taken out first.
Perhaps today's wakeup call, with Republican, Democratic and independent families
alike having to prioritize among Girl Scout outings, vacations, getting to and from
work and dinner, will finally spur real action.
While it's possible to change it in the long term, changing it overnight isn't possible.
Congress also needs to pass laws and provide incentives to expand our refinery
capabilities.
The last U.S. oil refinery was built in 1976 while overall demand and demand for
special blends"such as that required by California"has soared. New technology has
expanded what each refinery can produce, but even so, current refineries are running
at nearly 100 percent capacity all year, leaving little downtime for maintenance and
repair.
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"When we talk about energy independence we are more often than not talking about
energy security. Our national security, for better or for worse, is tied to our energy
resources. Dependence on oil from unfriendly nations threatens our strategic
interests. It burdens our military which has to power a vast array of military
equipment using oil. And, rising energy prices put a strain on our vital transportation
sector and on American businesses which directly undermines our economic
competitiveness in a growing global market place.
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on Monday signed a bill that forces his administration to temporarily stop acquiring
oil for its emergency stockpile, even though an aide said the president considers it a
bad idea that won't lower fuel costs. ... In a bipartisan rebuke, the Senate last week
voted 97-1 and the House 385-25 for the legislation, margins suggesting that a veto
could be easily overridden." Bush "and White House officials had spoken out
strongly against the measure, although there wasn't a specific threat to veto it. 'He
remains against it,' [deputy press secretary Scott] Stanzel said. So why is he signing
it? 'I think he saw the overwhelming numbers of members of Congress who want to
attempt to have an impact on prices by stopping the fill of the Strategic Petroleum
Reserve.'"
ABC World News (5/19, lead story, 3:00, Gibson, 8.78M) reported, "Another week,
another record price for gas. The average price of a gallon went up seven cents in
just the past week. The average price of a gallon, $3.79." ABC (Harris) added, "You
can blame this latest gas price record in the rise in oil prices. In fact oil hit another
record today, $127 a barrel. This situation may get worse before it gets better.
According to today's numbers, gas is now officially over four dollars gallon in
Chicago and it's pretty darn close in Los Angeles, Miami, San Francisco, Seattle,
Cleveland and New York City. The angst and anger over these prices has the
politicians in Washington on high alert, hauling big oil executives before the
Judiciary Committee this Wednesday. ... Also today, the White House criticized
Congress for not doing enough to ease the pain." Scott Stanzel, White House Deputy
Press Secretary was show saying: "Going from band aid to band aid, that they think
will have an impact but really won't." The AP (5/20, Schreck) also reports on the rise
in gasoline and oil prices.
1. It would break the federal ban and open the door to further expansion of oil and
gas drilling -- including in the Gulf of Mexico. Offshore drilling poses a potentially
disastrous threat to marine and tourist economies and the fragile coastal
environment.
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2. It would have no effect on current gas prices or ease present U.S. dependence on
foreign oil. If new drilling were approved today, it would take a decade to bring any
of that oil to market.
3. It proposes to deplete our nation's few untapped reserves of oil and gas, while
distracting us from any serious efforts to reduce U.S. oil consumption and invest in
the development of alternative energy sources.
The oil industry has long hoped to weaken the federal ban. Many of its efforts in the
past have focused on expanding drilling in the Gulf, though this proposal currently
excludes the Gulf Coast.
Yet, like other plans in recent years, it seeks to shift drilling decisions out of
Congress and into state legislatures, which would be tempted by potential revenues
from royalties paid by energy companies.
These decisions should remain in Congress' hands, because any new oil and gas
drilling would impact the economies and environments of nearby coastal states and
affect national interests as well.
The United States can't drill its way out of its dependence on oil. The sooner our
leaders acknowledge that, the closer our nation will be to true energy security
Surging oil revenues have led to a massive accumulation of capital in the Gulf of
arab in a very short time. To put this in context, GCC countries will provide about 18
percent of global capital exports in 2008 -- more than double their share just five
years ago.
The upside of this oil wealth is that the Gulf countries have an historic opportunity to
shore up their economic fundamentals, diversify their economies and make needed
investments in human capital -- steps that should help avoid the boom and bust
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cycles of the past and support broad based growth. Many of the region's leaders are
embracing this opportunity by paying down debt, setting aside wealth for future
generations, increasing health and education spending, and improving the
environment for foreign and domestic private investment.
The downside of increased oil revenues is that the Gulf is experiencing new
challenges - such as inflation -- that are, in some instances, being addressed with
measures like price controls and wage hikes that are likely to exacerbate the
problem. And beyond this region, record high oil prices are putting a large burden on
the world economy and creating hardships for families, households and industries
everywhere. This threatens to exacerbate economic volatility in the Gulf and abroad.
There are no simple or quick remedies for this, and let me be clear in stating that the
Gulf region alone cannot alleviate the pressures in global oil markets. High oil prices
are the result of supply and demand factors that are likely to persist for some time.
Supplies have been affected by low capacity expansion and declining yields, while
demand has surged largely due to growth in emerging markets. Speculation and the
depreciation of the dollar are likely only small factors behind oil price increases.
I was driving a former member of Congress and U.S. senator from Cortland to
Syracuse when he mentioned the crisis that could be caused by our addiction to
fossil fuels, and proposed a tax on the purchase of the more gas-guzzling
automobiles as one step toward averting or ameliorating the crisis.
I have heard it said that we shouldn't worry about the supply of oil decreasing over
time, since it just means that the price will increase commensurately.
However, any undergraduate economics course, or good high school textbook for
that matter, will explain that when the demand is inelastic (as when the buyers are
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addicted to something), prices can rise drastically with only small decreases in
supply.
The Post-Standard June 6, 2008 (staff, editorial, “It's time to tackle our oil
dependency head-on” The Post-Standard (Syracuse, New York), lexis)
It doesn't matter what the commodity is that buyers are addicted to, whether gasoline
or heroin. The answer is to break -- or at least lessen -- the addiction.
A succession of Congresses and administrations has avoided tackling this issue of oil
dependency over the past 35 or more years, and it has led to increased instability in
the Middle East, including a disastrous war, and economic decline at home, in
addition to the climate change that perhaps wasn't understood until more recently.
To the government “You and your party have been the energy problem: "no" to
nuclear power, new oil refineries, drilling in ANWR that would decrease our oil
dependency; "no" to reasonable alternatives to foreign oil -- all equal "no" to growth
and lower energy costs.”
Wind turbines are inefficient and expensive to build, and are only a Band-Aid for a
failed energy policy. People will certainly leave the state due to credible information
available on the harmful effects of the wind industry.
Our Congress, with a disapproval rating of 78 percent, hurts the country and boosts
energy costs. We need responsible people with vision, not a quick-fix political solution.
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The last thing we need is more of the same -- dependence on a foreign wind energy
company.
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. The U.S.' dependence on oil has had a negative impact on the U.S. trade
deficit. In September 2006, the San Francisco Federal Reserve issued a paper titled Oil Prices
and the U.S. Trade Deficit. It concluded:
Oil prices have almost quadrupled since the beginning of 2002. For an oil-
importing country like the U.S., this has substantially increased the cost of
petroleum imports. International trade data suggest that this increase has exacerbated the
deterioration of the U.S. trade deficit, especially since the second half of 2004. One factor can
explain this evolution: The real volume of U.S. petroleum imports has remained
essentially constant. One explanation for why the demand for petroleum imports has not
declined in response to higher prices comes from a model in which firms are fairly limited in their
ability to adjust their use of energy sources, such as oil, in the short term.
Oil as a Weapon. Many Arab leaders understand the dynamic of the world's oil
dependence. For example, as early as 1990, the late Yassir Arafat said:
When the North Sea oil dries up in 1991, the United States will want to buy Arab
petroleum. And when the American oil fields themselves run dry and oil
consumption in the United States increases, the American need for the Arabs will
grow greater and greater.[7]
This observation has not been lost on the current generation of politicians and terrorist leaders.
However, bin Laden and Zawahiri are not satisfied with the unwieldy weapons of
oil boycotts and buying political influence in the West. Instead, they are clearly zeroing in
on the oil-rich kingdoms of Saudi Arabia and the Persian Gulf as their principal
targets. They also appear increasingly interested in attacking the entire global oil industry, from
wells to wheels.
Some analysts have warned that a carefully targeted terrorist attack on oil
facilities in Saudi Arabia could reduce Saudi oil production to 4 million barrels per
day or less for up to three months, which would have disastrous results for the
global economy.
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In 1973, OPEC’s actions in response to U.S. support for Israel, which was
attacked in the Yom Kippur War, resulted in a worldwide economic recession that
lasted from 1974 to 1980.
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• Alternatively, expecting a decline in demand for their oil, producing countries might
decide to reduce planned investments in production capacity expansion and maintenance
and mothball some planned projects, which would quickly lead to declining oil supplies. If
new technologies do not come on-line by the time oil production starts
declining, the world will face a serious energy crisis, probably unparalleled
in history. Reversing such a trend of declining investments would take
years, despite a massive increase in oil prices. This alternative is not a mere
possibility: several major projects have been mothballed in the past when the oil
producing governments deemed these as not needed, given perceived future demand
and prices.
Western posturing over reducing the demand for oil could cause major oil
exporters to react in a variety of ways, most of which would exacerbate rather
than help the global energy situation. Even in a scenario where Western countries
successfully replaced their demand for oil from alternative indigenous energy sources, they would
still have to live on the same planet as former major oil-exporting countries whose fragile
societies would then be faced with the additional economic strain of the loss of their main current
source of revenue. Energy independence for current oil-importers may carry a high moral price. If
a sharp decline in oil revenues leads to instability in the oil producing areas, the West will not be
able to turn a blind eye to such conflicts. In the age of globalization, these countries are economic
and political partners of the West. Political instability that results from declining oil
revenues must be added as a potential cost of oil independence. In
addition, it is unclear what will happen to the world monetary system without the
trade in oil and the associated recycling of petrodollars. A change to a world where
most industrial countries depend on their own domestic energy resources would require a major
change in the world’s financial and monetary system. Such a change will bring its own
challenges and difficulties to all, including the industrial countries.
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LMDIT 2008 Oil DA __of__
Team Sparta Stacy
Economists tell us that higher oil prices will stimulate investment in energy alternatives. However,
the prospects for a painless market-driven transition away from fossil fuels are hardly
encouraging. Globally, trillions of dollars will have to be spent on research and on new
infrastructureÑtens or hundreds of billions per year, starting immediately. We are not seeing
anything like that level of investment now; we have to assume that it will begin after the global oil
peak (that is, after an obvious price signal making alternatives more attractive). But then, with
less energy available to fuel the economy, we will have trouble simply maintaining basic
services. There won’t be any surplus to jumpstart the new energy infrastructure, which will take
decades to build.
High energy prices will cause recessions, destroying demand. Then, reduced demand will lead to
partial relaxations of energy prices. Temporarily lowered prices will stimulate economic recovery
and hence renewed demand, which will again be constrained by declining rates of oil extraction,
leading to more recessions, and so on. In other words, as demand begins to exceed supply,
expect increasing price volatility, with a general upward and steepening underlying price trend.
The ultimate consequence will be a global depression worse than that of the 1930s. No
government in the world is even remotely prepared. Even though we were warned by the “Limits
to Growth” report of the 1970s that resource shortages would arise in this century, politicians
have assured us that all will be well. None dare suggest that our fossil-fueled way of life cannot
be sustained. This is humanly understandable: voters respond well to optimistic messages. But
the result is that, in the decades since the oil shocks of the 1970s, we have become ever more
dependent on oil and gas.
The U.S. dependence on oil has a negative impact on the U.S. trade deficit.
Oil Prices and the U.S. Trade Deficit, September, 2006
http://www.frbsf.org/publications/economics/letter/2006/el2006-24.html
Oil prices have almost quadrupled since the beginning of 2002. For an oil-importing country like
the U.S., this has substantially increased the cost of petroleum imports. International trade data
suggest that this increase has exacerbated the deterioration of the U.S. trade deficit, especially
since the second half of 2004. One factor can explain this evolution: The real volume of U.S.
petroleum imports has remained essentially constant. One explanation for why the demand for
petroleum imports has not declined in response to higher prices comes from a model in which
firms are fairly limited in their ability to adjust their use of energy sources, such as oil, in the short
term.
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