Cliff May

Brazil provides an example: Over the past 30 years, Brazilian farmers have greatly increased the amount of sugarcane they produce and the amount of alcohol fuel they derive from it. They now have more than enough sugar for the table, and they also are on track to displace half the country's gasoline demand with ethanol -- at $70 per barrel, according to Florida International University scholar George Philippidis. As you well know, oil today is about twice that expensive.

Brazil has gone from 80 percent foreign oil dependence to zero per cent dependence. Over the same period, the U.S. has gone from 30 percent dependence to over 60 percent. In addition, Brazil should soon derive 15% of its electricity by burning sugarcane waste.

A more plausible rap against ethanol: In the U.S., it receives government subsidies. But the research being done thanks to these subsidies is already giving rise to technologies that will allow fuel in the not-too-distant future to be made from crop residues, grasses, weeds, algae and perhaps plants bioengineered specifically for this purpose – and able to be grown on land unsuitable for food crops.

What’s more, do you really think oil is not subsidized?  Former CIA director James Woolsey estimates that U.S. oil companies receive preferential tax treatment worth more than $250 billion a year – and that doesn’t include the military costs necessary to keep oil supplies flowing around the world. We do that because oil is a strategic commodity: Western economies can not function without it. That will be true until the day oil is forced to compete with a variety of alternative fuels.

But that day will be long in coming if OPEC has anything to say about it. And OPEC has a lot to say about it, including Chakib Khelil’s claim that the mere prospect of competition is driving the cost of oil up, rather than providing us with the only weapon that can drive it down. It’s a lie – a big, bold, and obvious lie. But OPEC figures we’re stupid enough to believe it.


Cliff May

Clifford D. May is the President of the Foundation for the Defense of Democracies.