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South Bend Tribune - America in Need of a Strong Energy Plan

Op-Ed

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By Senator Richard Lugar

Foreign oil is a source of American economic instability when gasoline prices approach $4 per gallon, but also when prices are low. Wars are fought over oil. Our national security policies are twisted to accommodate our foreign oil thirst. We spend billions to keep sea lanes open and to counter terrorists targeting vital infrastructure. Oil imports are a major component of our trade imbalance. Every day, Americans send about a billion dollars overseas to pay for oil imports, rather than investing that money here at home.

Oil is priced on global markets. Whether it is more gas going into the tanks of Chinese cars or less oil coming out of Nigerian fields, Hoosiers feel the pinch from events far away. Markets are tight and likely to stay that way as economic growth in Asia absorbs new supplies. With little spare capacity worldwide, we face a growing danger of sudden price spikes.

For all those reasons, my primary focus for energy policy is to reduce dramatically our oil dependence from unreliable and hostile foreign sources. Doing so will help protect us from price hikes and give our military and diplomats more options overseas.

The Obama administration has utterly failed by making a bad situation worse. Its poorly considered EPA regulations on oil refineries and roadblocks to responsible oil exploration are putting unnecessary strain on domestic supplies.

The Obama Administration should immediately halt new EPA restrictions that would provide only modest environmental benefit but would increase gasoline costs. The EPA should also ease seasonal fuel requirements to bolster gas supplies.

The Obama administration points to the good news that domestic oil production is up. But these gains are primarily on private lands or on federal lands made available by President George W. Bush. In fact, the Obama administration cut leasing availability by 50 percent compared to the previous five-year plan, and issuance of new permits is down nearly as much. President Barack Obama's rejection of the Keystone XL pipeline prevents new oil supplies in North Dakota and Montana from easily reaching U.S. markets.

And, the president should clearly warn unfriendly oil suppliers -- particularly Venezuela -- against supply manipulation.

We should not be holding anything back. I've championed expanding all viable American solutions including more oil exploration, more alternative fuels and improved fuel efficiency. Strong policies demonstrating U.S. resolve can help calm oil markets. That is why my energy plan and legislation would:

* Increase supplies of affordable and reliable oil. Leases should be offered and permits granted for safe oil production at home. Hoosiers can be put to work producing oil through enhanced oil recovery. Imports of reliable supplies from Canada should be bolstered -- including immediate approval of the Keystone XL pipeline.

* Bolster alternatives to oil. Commercial ethanol is already a fuel good enough for the Indy Racing League. Research and development into next-generation fuels should be supported, and cost competitiveness encouraged -- not just more subsidy. Fixing outdated federal rules can jumpstart Indiana's coal for use as liquid fuels.

* Encourage innovation. Transparent and flexible goals for auto fuel efficiency and options beyond oil will unleash innovation being pioneered by Hoosier companies, putting American consumers in the driver's seat, not government or oil companies.

Pursuing these three main goals, my legislation would reduce the need for foreign oil from unreliable nations by more than 6.3 million barrels per day -- more than two-thirds of what we presently import.

Action today will give us more control over our energy future and help control prices at the pump. It also will give great economic opportunity for Hoosiers. Commitment to a truly comprehensive energy solution should not wait for this price shock to pass or the next to come.


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