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America's Oil Weapon

April 06, 2006

By Max Schulz

President Bush has bemoaned what he calls the United States' addiction to oil. He has demonized America's oil use in speeches, and talked about the need to move beyond the petroleum-based economy.

The president is certainly correct to point out harmful side effects to our use of oil and the need for us to address them. But in using the expressly negative language of addiction, the President not only cast a dark cloud over the fuel that presently underpins a huge portion of our economy, he badly confused a set of issues that demand clear thinking and fair analysis.

It would be useful, then, to keep in mind the positive benefits our petroleum use has afforded. To start, oil was largely responsible for the right side winning the three epic wars of the 20th century. Call it the Oil Weapon, wielded by the United States and its allies with an expertise that should make OPEC blush.

In the run-up to the First World War, Lord of the Admiralty Winston Churchill made the daring decision to switch the British navy's ships from coal to oil, the better to outrun German predators. When fighting broke out, the major oil powers like Standard Oil and Royal Dutch Shell saw to it that the Allied powers' military forces were always supplied.

Meanwhile the Allies were able to deny the Kaiser's forces access to the oilfields in Romania and Baku at critical junctures in the war, ensuring victory. As the British statesman Lord Curzon noted, "The Allied cause had floated to victory upon a wave of oil."

The story was similar in World War II. The Nazi army was hindered by a lack of oil. It attempted to power its war machine (and ended up draining its treasury) on expensive synthetic fuels made from coal. "Shortage of petrol!" wrote Nazi General Erwin Rommel to his wife after his army was forced to retreat at the Second Battle of El Alamein for want of oil. "It's enough to make one weep."

In the Pacific theater, the Japanese faced the same problems. Cut off from supplies of oil, the Japanese second fleet was forced to withdraw from entering Leyte Gulf and delivering a knockout blow to Douglas MacArthur's invading forces in the Philippines. According to Daniel Yergin in his Pulitzer-prize winning book The Prize, by the end of the war "shortages of fuel were preventing [Japan's] planes from flying more than two hours a month." Atom bombs may have finally convinced the fight-to-the-death Japanese to surrender, but defeat was earned before that when American forces won the battle for oil in the Pacific.

America and the West won the Cold War in a different fashion, but one that employed oil as a chief weapon against the Soviet Union. In his book Victory: The Reagan Administration's Secret Strategy That Hastened the Collapse of the Soviet Union, Hoover Institution scholar Peter Schweizer revealed how President Reagan and CIA Director William Casey sought to undermine the Evil Empire with the novel strategy of manipulating world oil markets.

Moscow's intent had been to keep pace with the Reagan Administration's military buildup. To finance this effort, the Kremlin planned to acquire the hard currency it needed by ramping up production and international sales of oil. Here's where the Reagan administration saw opportunity. In a series of secret negotiations, Casey prevailed upon the late King Fahd of Saudi Arabia to open the kingdom's oil spigots. The Saudis flooded the world market, sending the price of oil plummeting and helping to bankrupt the Soviet Union. The Soviets no longer could buy the technology needed to keep pace with the United States in an arms race. The rest, as they say, is history.

In loose terms, one might say that the West owes its victories in those three conflicts to oil. The first two were won because we ensured our enemies had too little supply. The last was won by ensuring our enemies had too much.

What is clear is that in the event of a "hot" war, primacy of oil supplies is critical. For all the fear about rising American oil imports, we still have little to worry us in 21st century America. Though we import 60 percent of the oil our economy uses -- and that figure is expected to rise to nearly 70 percent in the next several decades -- the United States still produces more than 8 million barrels of oil domestically per day. Keep in mind the Department of Energy manages a Strategic Petroleum Reserve holding nearly 700 million barrels, and our country should have enough in the unlikely event a large-scale hot war erupts. Our country holds a great deal of security in the oil we produce at home.

None of this even touches on the immeasurable economic benefits our "addiction" to oil has produced. Oil has revolutionized transportation, mobility, and industrial productivity, transforming society (for the better) in a manner that would have seemed impossible to those on the scene when crude was first spotted in Pennsylvania in 1859. Nor does it touch on the myriad modern marvels that derive, in part, from a barrel of oil, from dentures and diapers to pacemakers and syringes. That is a topic for another column. But the mention of them -- along with a short history lesson about how the west defended civilization on three occasions throughout the previous century -- should serve as a reminder that simplistic claims denouncing our use of oil add little that's positive to the public discussions on energy.

Original Source: http://www.tcsdaily.com/article.aspx?id=040606F

 

 
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