Think gas prices are bad now?
Imagine another terrorist attack — especially one on Saudi Arabian oil refineries, former CIA Director R. James Woolsey said Monday during a visit to Pittsburgh.
If terrorists took out the sulfur-cleaning towers in northeastern Saudi Arabia, as described in the beginning of Robert Baer’s book, “Sleeping With the Devil,” crude oil prices could easily top $150 a barrel and stay there for more than a year, Woolsey said.
A barrel of oil sold for about $73 yesterday, with gas prices in the United States hovering around $3 a gallon.
Most Americans don’t want to think about paying double that.
They also don’t want to think about where some of the money goes when they buy gasoline — to groups that threaten the U.S., Woolsey said. And it’s not just terrorists, but established Middle Eastern regimes that restrict women’s rights, have poor education systems and fail to invest in their societies.
“If you want to see who’s paying for all that, next time you pull in to fill up, turn the rearview mirror a little bit so you can look at yourself for a minute as you get out with your credit card,” Woolsey said during a meeting with reporters and editors of the Pittsburgh Tribune-Review.
One way to beat that — and hit Islamic extremists in the pocketbook — is for Americans to start using renewable fuel, Woolsey said. That includes ethanol and biofuels as alternatives to gas and diesel.
In the U.S., ethanol is mostly made from corn and biodiesel from vegetable oil. Both are mixed with gasoline or diesel.
Neither is widely produced or used now, but could be in coming years — in part because of skyrocketing gas costs.
“We’re a few years off, but it’s on the horizon,” said Greg Boulos, of Steel City Biofuels, who sees alternative fuels as a way to bolster local economies while also curbing U.S. dependency on foreign oil. “At this point, though, alternative fuels are more expensive than gas.”
That will change.
By 2020, the National Commission on Energy Policy says it will cost less than 80 cents a gallon to produce cellulosic ethanol.
In addition to alternative fuels, Woolsey also advocates fuel-efficient vehicles and technological advances to build cars and trucks out of lighter carbon composites — all in an effort to use less oil.
Buying less foreign oil will make the United States more secure, Woolsey said, by providing less money to Middle Eastern groups — particularly radical Islamists.
Continued dependency on foreign oil could pose problems if future Middle Eastern regimes are not as cooperative, such as Osama bin Laden’s assertion that he would cut Saudi oil production if he were in charge. It’s possible other countries also could restrict the flow of oil to the U.S., Woolsey said.
That’s the tactic Woolsey said he would use against Iran, which is shrugging off international concerns about its nuclear ambitions.
Iran produces about 4 million barrels of oil a day, most of which it exports. The country imports nearly all of its refined petroleum products — such as gasoline and diesel fuel — from Europe and India.
“And I think the thing that would bring the Iranian government and economy to its knees, quite quickly, would not be a cut-off of their exports of unrefined petroleum (but to ban) their imports of refined petroleum products,” Woolsey said.
Short of sweeping technological and fuel changes, lawmakers in Washington, D.C., have become focused on more short-term answers to high gasoline prices.
Sen. Edward Kennedy, D-Mass., said President Bush should drill oil companies until “outrageous profits are returned to working Americans” and have the Federal Trade Commission report on price-fixing and gouging.
“They ought to be working seven days a week to make sure that we know exactly who is price-gouging,” Kennedy said. “Congress also needs to pass an excess profits tax that will return revenue to working families — this is not the time for greed.”
The U.S. oil industry has been peppered with bad press in recent weeks for posting huge first-quarter profits.
Bush has resisted any call for a windfall profits tax.
Senate Majority Leader Bill Frist, R-Tenn., has called for more homegrown oil.
“Consumers are feeling pain at the pump, and Republicans are moving aggressively to address their concerns,” he said. “We must reduce our dependence on foreign oil by increasing domestic exploration, improving our energy infrastructure and continuing to encourage conservation.”
Frist also supports giving taxpayers a gas refund check.
Woolsey said that isn’t enough. The country’s gas woes need long-range solutions, he said.
“Rather than mailing everyone $100, we ought to do something to fix it,” Woolsey said.