The year was 1973.
My father, a young school teacher with a wife, a kid, and a mortgage, worked nights and summers at the McCormick Spice Company, where he would load trucks and do inventory. My mother worked as a clerk for what was then the C&P Telephone Company.
We lived in the working class neighborhood of Middlesex, where generations had worked the steel mills and docks in Baltimore County. It wasn’t white picket fences and soccer clubs, but it was still a family community. Little league teams were sponsored by local crabhouses and electricians.
The nursery school I attended was a short drive towards the city, where the playground was not occupied by plastic sliding boards and rubber flooring…
We played cheerfully on metal monkey bars that would burn the hell out of your hands when the mercury rose above 85ºF. The seesaw was a bit worn, and had nasty habit of leaving small splinters on your legs. But it worked, and no one really complained.
All in all, it wasn’t a bad place to call home. Although there’s no doubt about it; while most folks in our neighborhood weren’t poor, they sure as heck weren’t rich, either.
So when OPEC decided to remind the world who controlled it by launching an oil embargo that resulted in a quadrupling of oil prices and, of course, gasoline rationing, people in my neighborhood were stung harder than most.
Energy Independence
This month marks the 40th anniversary of the 1973 oil crisis that forced the United States to take a long, hard look at its economic and national security vulnerabilities.
And while I still think as a nation we dragged our feet on this, today we are no longer completely vulnerable to the wills of OPEC.
There are a number of reasons for this, but the most important one is the domestic oil and gas boom that is currently underway in the United States.
It is because of this that we are no longer at the mercy of OPEC.
Sure, we still import some oil from that region, and we will continue to do so for some time to come. But with our neighbor to the north pumping out the majority of our imports, plus the wealth of new oil coming online throughout the United States, the days of OPEC embargoes are over.
In fact, to suggest that we can kick OPEC to the curb is not a pipe dream.
However, I would be careful about making grand claims like the one billionaire oilman Harold Hamm recently posted in Forbes, when he wrote the following:
[…] America as a whole has so much oil and natural gas that most experts agree energy independence is possible in less than a decade.
Complete independence from foreign oil is not only unlikely in less than a decade…
It’s unlikely for many decades to come.
You see, while there’s no doubt that increases in tight oil production in the United States will increase significantly over the next five to ten years, other onshore oil, offshore oil, and crude from Alaska continues to decline rapidly.
Take a look:
And this reality cannot be ignored just because we’re all giddy about new drilling technologies that allow us to tap more of our “home-grown” resources.
Blood and Treasure
Although I share Hamm’s enthusiasm regarding the boom in domestic oil and gas production, his recent piece in Forbes misses one important point.
While it’s true that we have a ton of oil and gas below our feet… and we’re going to use it, and it’s going to make us economically stronger… and no, we’ll never have to worry about OPEC screwing us again…
We’re still wading around in a world that has been raped and pillaged by our irresponsible demand for oil imports.
This, my friend, is the ultimate value of domestic oil and gas.
How much of our blood and treasure has been spilled in the Middle East over the past twenty years? Don’t think for a second that this is not connected to our reliance on oil.
How many people were murdered on 9/11? Don’t think for a second that the folks flying those planes weren’t funded by oil dollars. Money we paid out of our pockets to keep our cars and trucks running went right into the hands of the very people who killed our fellow citizens.
How much of our basic freedoms and rights have been stolen away in the name of Homeland Security? Would we even need Homeland Security if it wasn’t for oil-funded terrorists trying to hijack our planes and blow up our buildings?
The greatest gift that domestic oil and gas offers is that of peace.
Although we’ll never be completely energy independent, the oil and gas we’re pumping out of the ground today limits our reliance on oil-producing nations that wish to do us harm.
The next step, however, is to start to reduce our reliance on our oil and gas altogether…
Little by little, we can start to integrate things like electric cars, more walkable communities, and high-speed transit systems.
We can make our natural gas supplies last for another 300 years by complementing them with solar, wind, geothermal, and energy efficiency measures.
If we play this right, the wealth of oil and gas below our feet today can not only take us into the next century, but well into the next three centuries.
And that, dear reader, is an amazing gift we can leave to future generations.
It’s also one of the reasons I continue to invest in domestic oil and gas.
To a new way of life and a new generation of wealth…
Jeff Siegel
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Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.
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