- The Washington Times - Wednesday, February 23, 2000

Truckers have a way of getting your attention. Here in the city, the cost of rising fuel prices was brought home by a convoy of several hundred truckers who descended on Capitol Hill and made a nightmare of the morning commute. Diesel and heating oil have been especially hard hit this winter. In the space of little more than a couple of weeks, the per gallon cost of diesel has risen from around $1 to nearly $2 while home heating oil has become so expensive, in part because of the recent cold snap, that many seniors have had to risk freezing to death or not eating because they can't afford both oil bills and groceries. Their plight has been brought on by the iron-fisted tactics of the Organization of Petroleum Exporting Countries (OPEC). This group last year decided that the world can make do with 4 million barrels of oil less every day, all in the name of inflating prices.

The truckers came to Washington to urge President Clinton to open the spigot of the Strategic Petroleum Reserve, which will lower prices. They are also asking for temporary relief from the 20 cents a gallon federal tax on diesel fuel and an end to tolls. Truckers who have normally spent $24,000 annually on fuel are facing costs as high as $40,000. Last week, crude oil hit $30 a barrel for the first time since the Gulf War. "It's cheaper to park a truck than to drive it," Douglas Sorantino told The Washington Times. Mr. Sorentino said he is now spending an additional $16,000 per month to operate his fleet of eight trucks. "I'm lucky if I make $20 net profit a day."

This is terrible for the truckers and will certainly mean higher food costs and other "ripple effects" throughout the economy. Relieving the trucking industry of the fuel tax is certainly a reasonable idea, which ought to be permanent. As for the Strategic Petroleum Reserve, established after the oil shocks of the 1970s, it was intended to provide for energy needs, particularly the needs of the military, in the event of another OPEC embargo. Several billion barrels of crude are currently in the Strategic Petroleum Reserve and would indeed help the truckers and others who are suffering from the dramatic change in the cost of a gallon of fuel.

Now, there are good reasons to be concerned about getting the government involved in regulating the cost and supply/demand equation of energy. The last time this happened, in the 1970s, the result was inflation and low growth. Opening up the Strategic Petroleum Reserve could encourage wider meddling with energy policy. And there is also the issue to be considered of the purpose for which the reserve was created, e.g., to provide the fuel and oil our military would need in time of emergency such as extreme political instability in the Middle East or another oil boycott while our armed forces are involved in a military crisis.

Even so, we are a long way from the world of the 1970s, when oil was thought to be a dwindling resource. Since then, new suppliers and new technologies have revealed a world awash in oil. If only our own government would let them, oil companies could extract vast amounts from offshore drilling along the West Coast of the United States and from deposits in Alaska. Furthermore, one reason the oil shocks have not yet rippled throughout the economy is that it is less vulnerable than it used to be. Today oil accounts for 3 percent of the U.S. gross national product, compared to 8 percent in the early 1980s.

The mere threat of opening the Strategic Petroleum Reserve helped keep oil prices down during the Gulf War, even when Saddam Hussein set Kuwait's oil refineries ablaze in a black inferno. A similar, serious threat today could be used to clobber the hard heads at OPEC with the fact that the United States isn't just going to sit there and let them blackmail honest Americans making a living and trying to stay warm. And there is this: While blackmail is what one would perhaps expect from Iran, shouldn't Saudi Arabia think twice about it?

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