It is not enough to "let the market sort it out". The petroleum market is no longer the province of private corporations such as Exxon or Conoco, but of government- controlled entities behind which stand the whole power and resources of the state. If we want a share of world oil production, we cannot leave it to the oil companies. Even the best and biggest of them cannot compete with the resources of the Chinese government, or force Russia to do their will. Our government has to take a hand as well.

This being said, one way we will not get more oil is through military action and occupation of oil-rich territory. Oil has become too valuable a resource for any population to let a foreign power appropriate it by force of arms. To that must be added that the oil industry is, by nature, the most vulnerable to asymmetrical warfare. The physical extent of oil fields and the length of pipelines make them impossible to secure by military means against a sustained insurgency aiming to deny this oil supply to an occupying power.

This leaves two alternatives (other than buying oil at ever rising world market prices): increase our domestic production, and/or obtain a secure supply from a major producing state through a preferential treaty or bilateral arrangement.

In the face of what will quickly become a national emergency, there is no reason not to begin exploiting domestic  oil-bearing areas now off limits the bulk of which is located off our coasts and in the Arctic. The primary reason for such drilling bans was the danger of oil spills and environmental damage, both of which have been very successfully addressed by the industry since the bans were put in place - witness the lack of spills in the Gulf following the recent series of strong hurricanes. However, while additional domestic production will certainly help, it is no panacea. The US, due to the gradual exhaustion of existing fields, is currently losing, roughly a quarter million barrels/day of production every year. Simply to compensate for that loss would require the discovery of a giant new field every three to four years, an unlikely prospect.

The other possibility would be to strike a bi-lateral deal with Russia, the country with the best potential for large new oil and gas discoveries. Such an arrangement would be mutually beneficial. Russia, still recovering from the collapse of the Soviet Union, lacks the exploration and exploitation know-how to locate and reach its new reserves, and to bring the oil to market across its immense territory. It is also, because of its huge budget needs, short of capital to finance such development. The US possesses both the technology and the capital, and it needs the oil. There is therefore a good possibility for a mutually satisfactory arrangement, under which a given portion of the new oil jointly developed would be reserved for US supply needs at a preferential price.

Such an arrangement might appear far-fetched, but in reality there is no fundamental reason why it would not work. There is currently no significant area where the legitimate interests of US and Russia clash. Their current hostility is mostly the result of the anti-Russian policies pursued by the current US administration, which are a continuation of Cold War attitudes now entirely meaningless. It is doubtful this state of affairs can be remedied before Mr. Bush leaves the White House, but the next administration should be able to shift policies. The opportunity is too good not to be pursued.  

Both policies, if given high priority and pursued decisively, will relieve the pressure on the US oil supply. Much more will be needed, however, if this supply is to become both stable and secure. This will be addressed next.