- The Washington Times - Friday, October 6, 2000

It is unfortunate the current oil crisis has been caught up in election politics. The decision to release 30 million barrels of oil from the Strategic Petroleum Reserve (SPR) was the right one, but it was so orchestrated for political effect that its credibility as a policy has been undermined. Vice President Al Gore's public call on President Clinton to release the oil for the benefit of the Northeastern states was stage-managed not only to aid Mr. Gore's campaign, but also Hillary Clinton's bid for the New York Senate seat.

Texas Gov. George W. Bush was put on the defensive and took the equally political stance of denouncing the release as imprudent and a misuse of the SPR. The Bush alternative, to open new domestic oil wells to reduce foreign dependence was, in turn, denounced by Mr. Gore as endangering the allegedly fragile ecology of Alaska's frozen wastes.

As is often the case in campaign-driven policy debates, both Mr. Bush and Mr. Gore are partly right and partly wrong.

Mr. Bush was wrong to claim that the SPR is only for use during a wartime emergency when foreign supplies are cut off. The Republican Congress directed the SPR to sell 28 million barrels of oil in 1996 and 1997 to help reduce the budget deficit. It was only in February of this year that plans were announced to replace that oil. Ironically, this meant the SPR sold oil when prices were relatively low only to have to refill the tanks when prices were rising.

An absolute cutoff of oil is not the problem, as oil is available from a variety of sources. Even during the Arab oil embargo that accompanied the Yom Kippur War in 1973, the United States was always able to get oil if it was willing to pay the price. During the Gulf war in 1991, 33 million barrels were earmarked for release not because oil shipments were cut off, but in order to stabilize world markets.

It is always about price. Intervention by the SPR is justified when oil prices are cartel-dictated by the Organization of Petroleum Exporting Countries. Rep. James Saxton, New Jersey Republican, co-chairman of the Joint Economic Committee of the Congress, had it right when he said, "An SPR release counteracts OPEC's anti-market policies, at least in the short run."

Use of the SPR does not mean that the Clinton administration has an energy strategy. If the SPR had been envisioned as a price balancing device, there would be more oil in the tanks today than there is. The current inventory of 571 million barrels is well below the SPR's 700 million barrel capacity. A 1 billion barrel SPR was authorized by statute in 1990, but never pursued. The U.S. thus missed the chance to fill the SPR when oil prices were abnormally low during the 1997-99 period. The Clinton administration exhibited the most basic of human failings; the belief that good times will last forever and no provision needs to be made against the re-emergence of problems.

Since 1992, American oil consumption has gone up more than 14 percent. Imports of foreign oil have increased by more than a third to meet this demand as domestic production has declined. Today imports provide 56 percent of the nation's oil, a trend that has made the U.S. again vulnerable to OPEC.

Demand has also gone up in other parts of the world, and will accelerate as China, India and other major nations continue to develop modern economies. New sources of energy must be developed to avoid not only price wars, but real wars to control limited supplies. There is already growing discussion about how American military forces might have to defend oil fields in Central Asia. It would be far better for America to find its energy closer to home.

Mr. Bush is more convincing in his desire to find domestic alternatives to foreign oil than Mr. Gore. Though the vice president said in the first debate "we have to give new incentives for the development of domestic resources like deep gas in the Western Gulf, like stripper wells for oil, but also renewable sources of energy" he spent most of his time talking about reducing consumption. Mr. Gore is long associated with the environmental movement that has opposed all forms of domestic energy development; protesting nuclear power plants, blocking oil drilling, locking up coal fields and even calling for the breaching of hydroelectric dams. This is ultimately a policy of lower economic growth and stagnant living standards, the antithesis of the Clinton-Gore claim to have found the secret of perpetual economic expansion.

Yet, Mr. Bush left out of his list of domestic energy sources any mention of nuclear power, which already provides one-fifth of America's electricity. Mr. Bush's profound emphasis on electricity as the key to high-tech civilization should draw him to nuclear power, which is much cleaner than the coal-fired plants he has been championing. From Sweden to Japan, South Korea to France, Hungary to Canada, nuclear power has been the choice for meeting higher energy demands.

It is Mr. Gore's "green" friends who have halted nuclear plant construction in the United States. Unfortunately, Mr. Bush seems to have conceded this point to Mr. Gore, again letting political calculations stifle a reasoned approach to a long-term national energy strategy.

William R. Hawkins, senior fellow for national security studies, U.S. Business and Industry Council.

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