Saturday, June 21, 2008

Saudi Arabia Tries To Get OPEC To Pump More Oil

Over the past 30 days, leaders in Saudi Arabia have changed their attitude about pumping more crude oil in order to help stabilize gas prices. While there may be many reasons why Saudi Arabia had a change of heart on increasing oil production, more than likely long term survival of oil as the main source of energy in the world played a big part in that decision. While I am no fan of environmentalist, on one issue they are completely correct. When crude oil prices remain high for a prolonged period of time, better alternatives to fossil based fuels will be developed and become practical in an energy hungry world. Over the past 50 years, oil producing nations have manipulated the price of crude oil and for the most part they have been successful at this strategy because shortly after they artificially inflate the price of crude oil, they quickly allow it to go back down.

Over the past two years, something new has happened within the walls of OPEC. Rather than using their brains to manipulate the price of crude oil up and then back down, instead now they have become greedy and allowed oil prices to remain high for much too long. I believe Saudi Arabia understands very well that the world is working vigorously on energy alternatives to fossil fuels and they realize that long term crude oil prices of $100 per barrel will allow even more development of alternative sources of energy and at some future date, the price crude oil could plummet if a winning energy alternative to it's dominance is discover and made affordable to the general public. On one hand, the short term greed of members nations of OPEC is good news for the long term energy needs of the American people. However, just because OPEC is now trying to manipulate us again, does not mean that we should not spend money on energy alternatives to fossil fuels and it does not mean that we should not drill for more crude oil within the United States.

There are already some people that are writing words of praise for Saudi Arabia because of their decision to start pumping more crude oil without first getting approval from other OPEC members. While I am glad that Saudi Arabia is pumping more crude oil out of the ground and delivering it to world markets, I certainly am not ready to credit Saudi Arabia's decision to help lower crude oil prices on their desire to help out the American people or our struggling economy. For far too long, Members of Congress and yes most Americans have made the wrong choices when it comes to thinking long term about the future energy needs of our country. Most government leaders and regular citizens are so short sighted when it comes to the reasons why we are facing an energy crisis right now, that nothing short of a massive program to discovered more domestic oil and energy alternatives will succeed. This new program must be given enough government funding and time so as to be successful in making major breakthroughs in new energy technologies.

Major breakthroughs in new technology only happen when there is a desire and funding to see the project through to it's ultimate conclusion. During World War II there was a huge need to create a single weapon that would bring that war to a quick conclusion. In the end, the U.S. government, through a program called the 'Manhattan Project' invented, perfected and deployed the first atomic weapon. Right now what is needed the most in the United States when it comes to discovering a real alternative to the use of fossil fuel is a government financed program, with the same kind of determined goal as we used during World War II, instead this time this program should be focused on discovering and marketing a real energy alternative to fossil fuels. I believe that American scientist have the intelligence and ability to take this world to a new form of energy that has yet to be discovered. However, that will not happen if left to the free market system. Only the U.S. government has the financial resources to take all this talk about energy alternatives to a different level where real work is done and money is made available for a project that could take 10 years or more to become successful.

Title: Saudi Arabia Tries To Get OPEC To Pump More Oil
Written: June 21 2008
Related Gas Prices Content:
OPEC Against The World Over High Gas Prices
Using Corn For Fuel, A Smart Choice?
Prices Are Rising Fast, Wages Are Not
2005-2008 © Hutch Report