The truth is that oil is in low supply, and in high demand; thus reflected in its price. If the supply was of comforting amounts, 8% threats would be of little concern. Too much of the world is dependent on the Middle East for its oil imports, and too many in the west fail to realize the impacts of continued demand for the stuff. Does it not seem odd that most of our foreign relations and wars are focused in the very region that fuels our economy? We need a comprehensive energy plan - an all of the above approach. This is one sector of trade in which some degree protectionism works. Energy production for domestic consumption trumps the status quo. America is abundant in natural gas, solar and wind corridors, and more.
We can leverage this opportunity even more by utilizing NAFTA to operate what I call a strategic North American Energy Alliance (NAEA): tapping into onshore and offshore drilling areas, contributing to our strategic oil reserves, natural gas exploration and development, incentives for cleaner and sustainable drilling innovation, expanding the wind and solar corridors to power grids that connect the North American continent. Canada is already skilled in extracting oil from tar sands, most of which exported to the US. Mexico's control of most of the Gulf region contributes to their comparative advantage in oil, exporting to the US. Our contribution needs to be significant. We need to produce enough for domestic use, and then some for the export advantage to China and India. If anything, we need to act fast on a plan like 'NAEA' before China does.
There are many ideas on the table. Bowing down to the Saudis should not be one of them. James Cramer, the energetic host of Mad Money on CNBC made this statement:
First, Cramer said the government needs to sell oil futures contracts against our strategic reserves to stop the jump in oil prices. Second, the U.S. government must be vocal about its support for Bahrain and Saudi Arabia, which will help prevent unrest from spilling over into these regions. Finally, Cramer said Congress must pass the natural gas act to subsidize 18-wheelers converting from oil to natural gas.
Here's a video of former Vice Presidential candidate Sarah Palin. Her remarks on the need for energy independence are spot on. Our abundance in resources are clear, and its about time we use this.
I'm also a strong supporter in an all of the above approach. T Boone Pickens also has a plan that will reduce our reliance on foreign oil.
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