Radio Moscow seas jubilant. The Arabs had at long last taken Soviet advice and unsheathed the political weapon of oil. How much is it going to hurt?
Not s ery much, said Washington nonchalantly, unless w e have a cold winter. Oil imports from the Middle East amount only to l0% of consumption, said President Nixon in his October 26 news conference.
That is the truth, but not the whole truth. The 10% take no account of the indirect disruption of oil supplies, which is likely to be considerable, and may well raise that fraction to as much as 25%. For example, Canada is the biggest source of US oil imports. But these imports come mostly from A1berta; Canada's eastern provinces rely on Arab oil. The Canadian government has already taken some steps to divert Albertan oil to the East (Oct. AtE); suppose it needs all of Alberta's oil to make up for the lost Arab oil then the US deficit could almost double.
That is admittedly pessimistic speculation. But turning to Europe, one faces some stark facts. The US imports not only crude directly from the MIddle East, but also refined products from Europe; particularly utilities and homeowners on the east coast depend on them. Since Europe gets some 605fo Of its oil from the Middle East, and its inventories are now rapidly decreasing it is likely to keep all it can get for itself. Austria has already introduced gasoline rationing. In Britain, ration books are printed and ready, but not yet in use. In France, the price of gasoline has risen to $1.35 a gallon. France and Spain have banned all product exports by refineries, and as wee go to press, Britain, West Germany, Holland, Belgium and Italy are considering similar steps. Chances are that all of the Common Market will ban exports by refineries.
It is not yet too late to take some steps for the coming winter
¾apart from buying warm sweaters. Instead of squandering money on "there's a good boy" advertisements appealing for conservation, the government could let the price of petroleum products rise to their unfettered market levels; that would work wonders for conservation, and in the long run, it could encourage exploration of oil and gas deposits as well as construction of refineries. The clean air act cripple could be amended now instead of next year, and pollution standards could be relaxed for this A inter to enable coal to be used in furnaces that have not yet been converted to oil or gas. Daylight saving time could be extended through the winter (a trick used by the British in the last war, and by the USSR permanently).The biggest danger now are the appeasers, apologists and neo Munichites who think that by playing footsie with the Arabs and the Soviets they can get their 30 quarts of oil. Yet the choice is simple: either no Arab oil, or submit to blackmail and no Arab oil again.
Perhaps the Arabs will succeed in stimng public opinion to do something about America drifting into energetic servitude, If so, it is a good thing that the crunch comes now, and not in S years, when it might already be too late.
|
Vol. 1, No. 3
Newsletter: Access to Energy Newsletter Archive Volume: Volume 1 Issue/No.: Vol. 1, No. 3 Date: November 01, 1973 11:32 AM Title: Arab Oil: The Big Fallacy
Copyright © 2004 - Access to Energy Newsletter Archive
|