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The Advent of a New 'Oil War' after Copenhagen

Critics of George Bush say he has led us into a quagmire in Iraq during the last decade from which we will never emerge. They say his way of doing business led to all the disagreements visible in the Copenhagen climate talks.

They're wrong. The world has been quagmired in Middle Eastern oil for at least the last 30 years. We have grown old on this one, not just the Americas. But the Copenhagen climate debates show us how and why we will get out of this petrochemical treadmill sooner than later. That's the surprise this month.

Since the first oil embargo in 1973, the American debate about oil had stalled between two extreme positions: Drill or find. Nothing changed in a generation; only the danger had increased.

But when the A-bomb of climate change arrived in our kitchens, all became different. In one rapid drop, this vast universe of consumer delight has given birth to a new louder child that is ranting: drill, find, conserve, innovate. Drill! Find! Conserve! Innovate!

We are at war, in a sense, but this global war now involves the rate of energy consumption in your car, your home, and your computer. Some still ask if it really possible to outsmart this fearful future? The answer is in your gas tank, and in the spin of your utility dial. The race to compete on carbon and capital constraints is the new grounds for hope.
 
A historic lesson: We shifted from steam and horses to cars and oil rapidly. We developed a habit of consumption of oil well before George Bush or President Obama. Back in 1901, Spindletop exploded gushers of oil and now, more than a hundred years later, we have Copenhagen.

My observation is that Americans are, in fact, conserving more gas and electricity. That is why a strange alliance of GE, Masco (the home products giant), Shaw Industries (a Warren Buffett giant), and LP and Owens-Corning are building hundreds of thousands of home that are still as big as we want, but have 20 percent less climate impact and 20 percent less of an electricity bill.

After Copenhagen, we have a new kind of oil war. It is the war for efficiency. We need Ben Franklin, that good old sense of Yankee frugality, all over again. That is the most patriotic and surprising answer. I say this for all nations, not just the world wide web.

Here in America we consume over 19 million barrels of crude oil daily. Our domestic production covers less than half of that amount. Dependence on foreign sources is increasing, not decreasing. Within the last two decades of Bush and his successor, oil imports have risen from 42 percent of supply to over 56 percent.

This is not an issue that can be solved by exploiting partisan differences or exasperating tensions between environmentalists and industrialists. The surprising solution I write about is innovation, that sweet spot where we learn, like a Thomas Edison, to do more with less.

The reliance upon imported oil amounts to over 10,000 tankers entering American ports annually. The more tankers go in and out of our ports, the greater the probability of spills and the likelihood of terror in those ports.   

Many in oil and transportation already know this. We are not heading towards Walden, or that great emergency down the road the alarmist recite. Instead, the threat of global climate change, an issue that strikes at the oil industry's core products, already has the attention of some of the world's largest and most powerful corporations.

"Oil companies as we know them will cease to exist," says a key director at DaimlerChrysler's environmental and energy planning unit. "No longer will there be a business in taking oil out of the ground in the Middle East, transporting it across the Atlantic, refining it in as and delivering that product to pumps. If they are to survive, the oil companies will have to become energy companies." Amen, to him.

After Copenhagen, it is time for us to open the kitchen cabinets and look at this new A-bomb with some honesty and tact.

Bruce Piasecki, Ph.D., is the president and founder of the
American Hazard Control Group, a management consulting firm specializing in energy, materials, and environmental corporate matters since 1981. His latest book, "The Surprising Solution: Creating Possibility in a Swift and Severe World," was published in November as a means to helping frame how best to compete in this carbon and capital constrained world. 

Image CC licensed by Flickr user L Gnome.
 

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