SAFE Energy Policy Analysis: Fundamental Change Needed

Issue Brief Examines Energy Use, Causes and Effects of Oil Shocks, Policies That Will and Will Not Help Protect the U.S. Economy

WASHINGTON, March 11, 2011 /PRNewswire-USNewswire/ -- In advance of President Obama's press conference on the ongoing unrest in the Middle East and rising oil and gasoline prices, Securing America's Future Energy (SAFE) today released "Oil Shock: Options for Policymakers," a paper examining the causes and effects of oil price spikes, along with a menu of possible short- and long-term options for dealing with energy security challenges.

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"In short, what this paper shows is that there are very few viable short-term policy options once an oil price spike is underway," SAFE President and CEO Robbie Diamond said.  "There is enormous pressure on policymakers to act, but virtually nothing they do now will have results in the near future.  What is far more important is to get serious about the long-term changes that we must undertake in order to protect ourselves from the next price spike, and the one after that."

No Viable Short-Term Solution

Specifically, the paper argues that many of the solutions most often offered by commentators—particularly accessing the Strategic Petroleum Reserve—would have little to no effect on current high prices.  The paper also examines other short-term measures—all of which have significant drawbacks—including reducing the use of heating oil and other non-transportation petroleum fuels, easing ethanol import tariffs, increasing exports of natural gas, and more.

Meaningful Energy Policies

Instead, SAFE recommends medium- and long-term fundamental changes to the nation's energy use, including the electrification of the short-haul ground transportation system.

"Ultimately, the growth in demand abroad has placed us in a position of relative weakness, in which our alternatives are more limited and more complex," the report states. "Therefore, as long as our economy remains dependent on oil, price spikes will continue to have a deleterious effect on the United States."

SAFE is a nonpartisan organization dedicated to reducing America's dependence on oil by educating policymakers and advocating for comprehensive energy reform. In 2006, SAFE's Energy Security Leadership Council—a group of business executives and national security leaders who believe that our dependence on oil poses an unacceptable economic and national security threat—released its Recommendations to the Nation on Reducing U.S. Oil Dependence, helping shape 2007's Energy Independence and Security Act. In 2008, the ESLC released A National Strategy for Energy Security, a new plan building on the accomplishments of 2007 by proposing the electrification of the short-haul transportation fleet along with all of the required infrastructural upgrades necessary for that effort, and measures—including increased domestic oil and natural gas production—to keep our nation secure in the interim.

For a complete copy of "Oil Shock: Options for Policymakers," go to www.secureenergy.org.

Available Topic Expert(s): For information on the listed expert(s), click appropriate link.

Robbie Diamond: http://www.profnetconnect.com/robbie_diamond

SOURCE Securing America's Future Energy