In response to the recent CFR.org Daily Analysis Brief, The Oil Investment Dilemma, reader Barry Parker writes:

This is an excellent article- but I would like to see a link to policy challenges facing the new Administration. Irrespective of who got elected, this is a time for the new President to show vision on energy policy. Energy independence is intertwined with America’s national security, as the article points out. Instead of investing $100 Billion or far more in Iraq for a dubious investment in security, look at what’s needed to get us away from foreign oil. Note I am not against oil consumption per se (indeed I am in the maritime business and want my friends in the tanker business to prosper), but I do see it as a bridge towards home grown alternatives.

The $100+ / barrel oil will be back, it’s not a question of “if?” but rather “when?”. The vision will be to remind everyone that we need investment in energy, whether it be oil in the deep waters, or alternative
energy. And going beyond reminding and cheer-leading, crafting incentives for investment, including as part of bailouts (financial, automotive, whomever is next) under discussion. The below $60 oil we see now is effectively a big head-fake that benefits OPEC because it throws the US off the scent of either oil independence or alternative energy. This would be a terrific time to impose some big taxes, yes taxes on gasoline consumption, since it seems that people were OK up to $4.00/gallon before they stopped
driving. Right now, we are looking at prices around $2.00/gallon or slightly above so if I were advising policy makers, I would be beaming at all that potential money that could be raised. Yes, people need cash for other things, but….ah, that “vision thing” calls for tough choices.
The best policy path is one that looks past whatever the price for spot oil or nearby futures happens to be at the time.

Very truly yours,

Barry Parker
http://www.conconnect.com/writing.html