ENERGY PUZZLE

UZZLE

“Sweetheart?” “Yes, darling?” “Would you mind reading an article I just finished?” “I suppose I could. What’s it about?” “Oil.” “It sounds kind of boring.” “Well, maybe it is, but will you read it?” “Sure, but let me get a cup of coffee first, then I’ll read it.” “OK, thanks.”

(To readers – you’ve been warned.)

A large part of my employment at an electric utility involved energy conservation, energy-efficiency, staying abreast of energy issues of all kinds, and coffee pot sustainability. It was a good gig in a field where technology and political landscapes change often. I thought it would be interesting (my wife’s sentiments notwithstanding) to review an often- misunderstood piece of a large energy puzzle – oil. We’ll begin in 1939.

Nazi Germany crushed Poland in 1939 to start WWII and it continued west smashing country after country across Europe. At the same time, Imperial Japan ravaged China, southeast Asia and the islands of the east Pacific. It took a lot of oil to power such massive war machines and U.S. oil (produced by private oil companies – not the government) was a major supplier. The oil industry was ordered to stop selling to Germany, but history shows Nazis received “American” oil, albeit at a limited rate, by a complex system of loopholes throughout the war as our soldiers died fighting them.

Similarly, despite Imperial Japan’s grievous aggressions, it received a majority of its oil from the U.S. right up until the bombing of Pearl Harbor in 1941. Keeping with this theme still today, despite sanctions on oil trade by the U.S. and its allies against Russia for invading Ukraine, “shadow fleets” (transferring oil from tanker to tanker to disguise source of origin) and system loopholes indicate Russia continues to bankroll it’s war through oil sales to the U.S. and others.

It seems patriotism should have a place in this story, but it doesn’t or at least not much. Oil business is private business and is driven to wherever the best price takes them. Despite political cries and finger pointing over “who” is to blame for fluctuations in the price of gas at the pump, the world oil market rules the day and a president can do little more than try to lessen demand (through efficiency mandates) or increase supply (more drilling leases) to drop prices, but neither course can insure it and certainly not instantaneously. However, our government does one vital patriotic function relative to oil in that it maintains a large Strategic Oil Reserve to protect the economy and national security during times of supply disruptions. I take comfort in that but I, like most, wish gas was cheaper than it is.

The cost of gas at the pumps goes up and down for more reasons than we have time for here, but one rule usually applies – the law of supply and demand. But even this is manipulated when oil wells are purposely capped or restricted to create a supply side deficit in order to artificially raise prices. Yes, they do that.

The U.S. has been the leading producer of oil in the world for years with daily exports just over 10 million barrels/ day. We are second only to China in importing oil at about 9 million barrels/ day. Importing (purchasing) oil provides a necessary mix of oil quality (quality ranging from “sweet to sour” – not the description I would have used for oil, but nobody asked my opinion) for the refining process. Importing also takes advantage of cheap market prices.

The U.S. has known crude oil reserves of 36 billion barrels or about 277 years of supply at our current rate of use which means, barring a medical miracle, my graduating class of ’74 should be covered. The world’s largest oil reserves are found in Saudi Arabia with 267 billion barrels of known resources. I assume that’s enough oil (and natural gas associated with oil) even for my grandkids grandkids, grandkids, that is, if burning little sea creatures, algae, plankton and an occasional T-Rex that sank to the bottom of ancient seas continues to be a popular way to power industries and fuel vehicles, and heat homes.

Despite these reserves, my personal sentiments are still based in conservation. I think using less through efficiency is the right thing to do regardless if we have 300 or 3,000 years of oil left. But it’s difficult to build on conservation efforts when we are consuming oil like a bus load of sailors taking on a keg of root beer while on shore leave. A significant reason for our copious consumption of oil is that it’s relatively inexpensive. Yes, it is.

It may sound contrary to some, but gasoline has been a relatively good value (even with the dreaded gas tax) when compared to many expenses. The national average price for gas in 1975 was $.57/gallon or equivalent to $3.12/gal- lon in 2022 dollars. Gasoline is projected to average $3.05 for Minnesota in 2025. In today’s dollars, the price of an average home has doubled for the same period.

As a result of relatively cheap gas, U.S. car manufacturers are largely giving up on inexpensive, compact 40+ mpg gas-driven automobiles as the demand for them is poor. Consumers tend to prefer larger, higher-priced, lower-mileage vehicles which in essence says the price of gas is “worth it” in consumers’ minds whether we want to admit that or not. If a concern for the price of fuel were truly in the forefront of our minds, our parking lots would look more like that in Italy where fuel is currently $6/gallon. Italians (from what I observed when visiting there) drive super-compact, gas-sipping cars that would make my daughter’s little red Chevy Cobalt look like a school bus if it were parked on the crowded streets of Rome.

I’m not here to declare the oil industry or our personal buying tendencies are bad things. After all, lavish consumption girds a growing economy at least for some folks. But it’s important to remember that we are the products of our own decisions. Use more – pay more. And few would recall the 2020 Safer Affordable Fuel-Efficient Vehicle Rule which significantly rolled back pollution and efficiency standards set for autos sold in the U.S. between 2021 and 2026. Yes, we even voted against better gas mileage for cars.

In the end, it seems only right that we use energy of any kind wisely or at least, wiser. Purchasing a clean-running fourstroke outboard motor for my fishing boat won’t win me any awards for conservation, but was a start. It was the least I could do to respect the sacrifice some unlucky T-Rex made long ago.

Leo is retired and lives in rural Cook with his wife, Lindy. He is the author of three books, She Won’t Mow the Daisies, The Cabin Experience, and Life Over Easy. Leo can be contacted by email at llwilenius@gmail.com.