SallyRand

The 6 Myths About Oil

By Alex Epstein

Published December 29, 2010 | FoxNews.com

Every American consumes an average of three gallons of oil a day. Republicans and Democrats call this reliance on oil an ?addiction??an irrational, self-destructive habit that must be broken as soon as possible. This year's BP oil spill disaster is only making the chorus to ?end our addiction to oil? louder. But if we examine the most common arguments for this idea, we see that they are myths. Oil is a vital, viable, and desirable part of our energy future.

Myth #1: America?s reliance on oil is an ?addiction??an irrational, self-destructive habit.

?America is addicted to oil.? ?George W. Bush, 2006

The Reality: America?s use of oil brings indispensible value to our lives.

?Addiction? implies an intense desire for something harmful, such as heroin. But we do not desire oil irrationally; we consume it because it is a beneficial, life-sustaining product. Oil is unmatched as a concentrated, safe, and affordable source of portable energy. And our lives depend on such a source of energy.

- Oil powers the industrial farm equipment that brings us abundant food; oil powers the mobile machinery that we need to extract the raw materials like iron, lumber, uranium, or natural gas from the earth.

- Oil powers the construction equipment we need to build new buildings, dams, levees, factories, and homes.

- Oil powers the hundreds of millions of vehicles that move people, materials, and products around the world to make possible the efficiency of our integrated, global economy.

- Oil is also the vital raw material for thousands of different petroleum products: from the carpet on your floor to the insulation inside your walls; from the synthetic rubber of your tires to the asphalt of the roads; from the pesticides and fertilizers that magnify crop yields and make food affordable to billions, to the pharmaceuticals that save millions of lives.

We are not "addicted" to oil any more than we are addicted to the myriad values it makes possible, like fresh food, imported electronics, going to work, or visiting loved ones.

Without oil, or something just as potent, abundant, and affordable, life as we know it would be impossible.

Myth #2: There are ?green? technologies that are just as good, or better, than oil.
?The way to bring gas prices down is to end our dependence on oil and use the renewable sources that can give us the equivalent of $1 per gallon gasoline.?
??we can start right now using solar power, wind power ??
? Al Gore, 2008

The Reality: There is zero evidence that any ?renewable? can replace oil in any foreseeable future.

For decades, the Al Gores of the world have claimed to know how to supplant oil. In 1977, Jimmy Carter proclaimed that in order to combat ?too much demand for fuel that keeps going up too quickly,? America would ?develop permanent and reliable new energy sources. The most promising, of course, is solar energy, for which most of the technology is already available.?

Since then, solar, wind, as well as biofuels?fuels derived from vegetable and animal sources?have received extravagant subsidies in America and throughout the world. And yet America uses more oil than ever, while Americans get less than 2% of their energy from solar solar and wind combined, and less than 4% of their energy, including transportation fuel, from biofuels and other plant and animal sources.

Why? Because solar, wind, and biofuels have proven utterly incapable of matching two of oil?s key virtues: low price and enormous abundance. They are expensive and nearly impossible to scale?largely because they all use highly diluted sources of energy that take far more land and equipment to process and transport than does oil (or other fossil fuels).

To attempt to implement these on a large scale would bankrupt Americans through home and business electricity costs alone?to attempt add a new generation of electric cars to the mix would make the costs and scarcity that much greater.

To make matters worse, solar and wind cannot even provide reliable, expensive electricity, because they use inherently intermittent sources of power--sunshine and wind gusts. Whereas coal, natural gas, and nuclear can generate the massive, precise, and reliable flows of power a modern economy require, wind and solar cannot?which is why they are always used as auxiliary, not primary, sources of power on electric grids. Think about it: Would you want your parent?s hospital room powered by the wind?

As for biofuels?fuels generated from crops or animal waste?they are generally very expensive because it costs a lot of money to extract diffuse energy from piles of manure or ears of corn, vs. the highly concentrated energy in a barrel of oil.

Biofuels typically require hundreds of gallons of water per gallon of output produced, while a gallon of oil requires five gallons of water. Further, they are very difficult to scale because they require massive amounts of expensive land, and the best ones require the best cropland. This is why Brazil, home of the most efficient and in-demand biofuel production (sugar-cane ethanol), produces the oil equivalent of less than 1.5% of the US?s consumption.

By far the most viable, large-scale non-CO2-emitting energy source is nuclear power, which environmentalists have set back decades and kept expensive through scare-mongering and a nearly insurmountable approval process. Thus, while dependence on nuclear power will likely grow in the coming decades?right now it supplies only 20% of U.S. electricity?it would take decades before it could economically replace a large percentage of the energy now supplied by coal and natural gas plants, let alone the 40% of U.S. energy supplied by oil.

Calls to cap 80% of oil (let alone all fossil fuels) and replace it with sunshine, wind gusts, vegetables, and manure piles are tantamount to economic suicide. This would drain the lifeblood of our civilization without offering a transfusion.

Myth #3: Because oil is finite, it will inevitably run out.

?The amazing exhibition of oil is a temporary and vanishing phenomenon, one which young men will live to see come to its natural end.? ?State Geologist of Pennsylvania, 1885.

Reality: There?s a lot more oil than you think?and if we have a free market in energy we will ensure that we find superior substitutes long before we run out.

Since the beginning of the oil industry, oil doomsayers, including prominent geologists, have been claiming that oil was running out, and would soon would run out or go scarce; in every case, oil supplies in general have increased.

A typical example: in 1939 the Department of the Interior forecast that U.S. oil supplies would be exhausted by 1952; 30 years later, not only had oil production not run out, it had tripled.

The year 2009 was one full of talk of ?peak oil,? and yet some of the most momentous, unexpected oil finds in history, especially in Brazil, followed each announcement.

Why are the ?experts,? so often wrong, and what can be expected for the future?

One reason is that the ?experts? routinely neglect or underestimate the capacity of the human mind to discover better methods of locating and extracting oil. In industry parlance, they falsely equate ?proven reserves??the amount of oil that is known to exist and be extractable in the present?with future production: the amount of oil that will be known and be extractable in the future.

This is a fallacious tactic. As a rule, in the future companies will have the knowledge and economic incentive to discover and harness oil that they do not have the knowledge and incentive to discover today. Oil companies locate new oil supplies as and when it makes sense to do so given their production projections and given market supply and demand. They have no way of knowing the total amount of oil that exists in the earth, and no need go to the expense of finding and validating any given new deposit until it is profitable to do so.

Over time, as demand increases and/or previous reservoirs becoming exhausted, the industry locates new oil and discovers new and better ways to extract it. For example, oil companies can now discover deposits thousands of feet below the ocean floor using 3-D magnetic imaging; they can extract many times the oil from a reservoir that they once could, using methods such as horizontal drilling or high-pressure gas and water injection; today?s ?easy oil? was yesterday?s ?impossible? oil.

End Part One.