Even aggressive conservation efforts in the United States won’t balance out the growing demand for energy around the world. Increasing supply will remain paramount. Certainly, alternative fuels hold promise and hopefully will ultimately be able to contribute meaningfully to America’s energy mix, but it’s clear that in the near term increasing energy supply means increasing the supply of fossil fuel. Most Americans recognize this and support greater exploration: a recent Gallup poll found that 57 percent want to allow drilling in U.S. costal and wilderness areas that are currently off limits.
The Democratic Congress has been reluctant to acknowledge the need to allow an increase in energy supply. Their rhetoric and legislative initiatives seem designed more to confuse the voter about the root causes of the oil price spike than to actually solve the problem. For example, in an attempt to counter calls for more drilling, Democrats focused on how many acres are already available for exploration, suggesting that companies are letting vast supplies stay idle while prices surge. Yet surely the Democrats know that if oil was really readily available in these acres, the greedy corporations they complain so much about would be drawing supplies out now to take advantage of the record prices.
Democrats have also focused on the role of “speculators” in oil markets. But they misrepresent the role that speculators play. By buying commodities at low prices and selling when prices go up, speculators generally decrease price volatility. Moreover, if speculation was really the cause of high prices, there would be growing inventories of oil, and there’s no evidence of such stockpiling. Legislative attempts to quash “speculation” will do nothing to change the root cause of high prices, which remains our limited energy supply.
Americans know that it is passed time to begin allowing access to the vast reserves of oil in the U.S. that are currently off limits. Democrats lament that, even if drilling is allowed, it will take years for these new reserves to reach the supply chain (somehow that logic never holds when they are taking about federal giveaways to favored “alternative fuel” research). Yet even if it takes years to access, the marketplace will benefit from the knowledge that more energy is coming.
Democrats may try to obscure the simple fact that prices are driven by supply and demand. Voters aren’t being fooled.