Saving American Oil: Beknighted States of Hysteria
On December 10th, former Vice President, Al Gore said in his acceptance speech for his Nobel Peace Prize, “So today, we dumped another 70 million tons of global-warming pollution into the thin shell of atmosphere surrounding our planet, as if it were an open sewer.” In The United States, we can certainly better use and conserve our oil. Each year we use hundreds of billion gallons of the world’s petroleum supplies. Yearly, Americans use over 7 billion barrels of oil products. Since the USA constitutes 4% of the world’s population, uses over 25 % of the world’s oil, and produces 22% of climate-altering CO2, surely we must assume responsibility for the use and conservation of this precious, and finite, resource.
Just five days earlier, the Senate Environment and Public Works Committee passed a bill (S.2191) to address climate change establishing a national cap-and-trade system to limit the amount of greenhouse gas (GHG) emissions to 70 percent of 2005 levels by 2050, thanks to the leadership of one lone Republican, Senator, JohnWarner who is retiring from my home state. He commented, “The United States simply has to lead on this issue. We are the superpower in the world, and we've got to use our status.”
Now in this same week, you would hope the Democrats, who have a majority in Congress, would pass better fuel efficiency standards: knowing Corporate Average Fuel Economy standards (called CAFÉ) is a no-brainer. There are many reasons why CAFÉ standards have failed in the past. Both auto manufacturers and unions have opposed attempts to impose higher fuel-efficiency standards because they insist that this conservation measure would cut manufacturing jobs. Do we know today how many American jobs serve to conserve oil instead of wasting it?
The powerful Washington lobby currently offset their low mileage trucks and SUVs with cars that sell for far less but get better mileage. So automakers do not want a provision to separate cars and trucks from this 35-mpg requirement and changing their present fleet-wide average, a practice that the Senate bill would stop. Carmakers also have an advocate, Chairman John Dingell of the House Energy and Commerce Committee. His district is home to Ford Motors. Dingell advocates that trucks and cars must continue to be treated differently when considering fuel efficiency for economic reasons.
We can do better. A recent report released by Citi's Equity & Debt Research group1 explored the five-year earnings impacts of changes to the CAFE program. This report found that stricter fuel efficiency standards would result in most automakers' earnings largely unaffected by the CAFE standards in the 2012 time horizon. Also some companies, like GM, could gain as much as $0.25 per share. Finally such CAFÉ standards can be implemented "with modest additions of existing technologies" and will likely be "most beneficial to GM and least beneficial to Chrysler."
I am ashamed at how we in the USA continue wasting our black gold. Remember the oil crisis in the late 70’s? Back, in 1981 I helped build a used oil recycling plant that now has recycled over a hundred million gallons of old crankcase oil into new oil. Back then I bought my first new car--a Toyota Starlet that got 42 miles per gallon on the highway. It seemed the right thing to do.
Yes I am upset! On average, every man, woman and child in the United States uses three gallons of oil every day. As a nation, we daily consume 20 million barrels of oil or 840 million gallons. One trillion gallons of oilfield waste we inject into deep wells, in addition to the 3 billion tons of oil and gas wastes we generate yearly by our oil and gas exploration and production in the USA. One-sixth of the world's oil production is used for transportation purposes in the United States. Transportation accounts for two out of three of those gallons. Almost 300 million barrels of oil could be saved each year by raising U.S. auto-efficiency standards by 2.75 miles per gallon. If the tires of all cars on U.S. roads were properly inflated, it would save an estimated 2 billion gallons of gas each year. [2]
Just look at a simple thing like traffic congestion that wastes over 2 billion gallons of fuel each year. Just in Northern Virginia, we collectively drive 42 million miles each day. In 1980, 64.4 percent of us drove to work alone; in 2000 it was 75.7 percent. Carpooling dipped from 19.7 percent to 12.2 percent in the same years. Transit use went from 6.2 percent to 4.6 percent, while walking dropped from 5.6 percent to 2.9 percent. Today over 60 percent our oil is imported from OPEC, while in 1980, it was 37 percent showing another alarming trend [3].
We may face another 100 million American residents in the next 35 years. Such growth is frightening. Now let’s see what becomes of Senate and House CAFE legislation. Can we boost vehicle mileage standards by 40 percent to 35 miles per gallon by 2020 or maybe earlier? CAFÉ also calls for the standards to be progressively implemented starting with the 2011 model year. How much oil Americans can conserve depends only on when enough citizens become outraged and demand action, or we run dry. If India and China follow our example then watch out.
Senator Dirksen, whom one of the senate buildings is named after, once said, “The oil can is mightier than the sword.” Now we Americans face a deadly world neighborhood. We have to play a game of kick the can, but now with an oil drum. Yes, we are red, white and blue petro-addicts. We need serious treatment with “Oil Anonymous” meetings everywhere to work on our denial, inventory and salvation. We certainly need help from a higher power. I pray we recover and do better than we did since our first oil crisis 30 years ago. It took 125 years to consume the first trillion barrels of oil. It's estimated that the next trillion will be used up in just 30 years. Isn’t it healthy if we became honest with ourselves and discover what economy truly means?
Just five days earlier, the Senate Environment and Public Works Committee passed a bill (S.2191) to address climate change establishing a national cap-and-trade system to limit the amount of greenhouse gas (GHG) emissions to 70 percent of 2005 levels by 2050, thanks to the leadership of one lone Republican, Senator, JohnWarner who is retiring from my home state. He commented, “The United States simply has to lead on this issue. We are the superpower in the world, and we've got to use our status.”
Now in this same week, you would hope the Democrats, who have a majority in Congress, would pass better fuel efficiency standards: knowing Corporate Average Fuel Economy standards (called CAFÉ) is a no-brainer. There are many reasons why CAFÉ standards have failed in the past. Both auto manufacturers and unions have opposed attempts to impose higher fuel-efficiency standards because they insist that this conservation measure would cut manufacturing jobs. Do we know today how many American jobs serve to conserve oil instead of wasting it?
The powerful Washington lobby currently offset their low mileage trucks and SUVs with cars that sell for far less but get better mileage. So automakers do not want a provision to separate cars and trucks from this 35-mpg requirement and changing their present fleet-wide average, a practice that the Senate bill would stop. Carmakers also have an advocate, Chairman John Dingell of the House Energy and Commerce Committee. His district is home to Ford Motors. Dingell advocates that trucks and cars must continue to be treated differently when considering fuel efficiency for economic reasons.
We can do better. A recent report released by Citi's Equity & Debt Research group1 explored the five-year earnings impacts of changes to the CAFE program. This report found that stricter fuel efficiency standards would result in most automakers' earnings largely unaffected by the CAFE standards in the 2012 time horizon. Also some companies, like GM, could gain as much as $0.25 per share. Finally such CAFÉ standards can be implemented "with modest additions of existing technologies" and will likely be "most beneficial to GM and least beneficial to Chrysler."
I am ashamed at how we in the USA continue wasting our black gold. Remember the oil crisis in the late 70’s? Back, in 1981 I helped build a used oil recycling plant that now has recycled over a hundred million gallons of old crankcase oil into new oil. Back then I bought my first new car--a Toyota Starlet that got 42 miles per gallon on the highway. It seemed the right thing to do.
Yes I am upset! On average, every man, woman and child in the United States uses three gallons of oil every day. As a nation, we daily consume 20 million barrels of oil or 840 million gallons. One trillion gallons of oilfield waste we inject into deep wells, in addition to the 3 billion tons of oil and gas wastes we generate yearly by our oil and gas exploration and production in the USA. One-sixth of the world's oil production is used for transportation purposes in the United States. Transportation accounts for two out of three of those gallons. Almost 300 million barrels of oil could be saved each year by raising U.S. auto-efficiency standards by 2.75 miles per gallon. If the tires of all cars on U.S. roads were properly inflated, it would save an estimated 2 billion gallons of gas each year. [2]
Just look at a simple thing like traffic congestion that wastes over 2 billion gallons of fuel each year. Just in Northern Virginia, we collectively drive 42 million miles each day. In 1980, 64.4 percent of us drove to work alone; in 2000 it was 75.7 percent. Carpooling dipped from 19.7 percent to 12.2 percent in the same years. Transit use went from 6.2 percent to 4.6 percent, while walking dropped from 5.6 percent to 2.9 percent. Today over 60 percent our oil is imported from OPEC, while in 1980, it was 37 percent showing another alarming trend [3].
We may face another 100 million American residents in the next 35 years. Such growth is frightening. Now let’s see what becomes of Senate and House CAFE legislation. Can we boost vehicle mileage standards by 40 percent to 35 miles per gallon by 2020 or maybe earlier? CAFÉ also calls for the standards to be progressively implemented starting with the 2011 model year. How much oil Americans can conserve depends only on when enough citizens become outraged and demand action, or we run dry. If India and China follow our example then watch out.
Senator Dirksen, whom one of the senate buildings is named after, once said, “The oil can is mightier than the sword.” Now we Americans face a deadly world neighborhood. We have to play a game of kick the can, but now with an oil drum. Yes, we are red, white and blue petro-addicts. We need serious treatment with “Oil Anonymous” meetings everywhere to work on our denial, inventory and salvation. We certainly need help from a higher power. I pray we recover and do better than we did since our first oil crisis 30 years ago. It took 125 years to consume the first trillion barrels of oil. It's estimated that the next trillion will be used up in just 30 years. Isn’t it healthy if we became honest with ourselves and discover what economy truly means?
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