Global Supply & Demand

Today's Washington Post included an article about India open for doing up to $80 billion in nuclear energy business. General Electric (GE) helped put up an early reactor in the 1960s and sees another $30 billion in potential alone. Another situations where the US Congress is involved though makes this rather curious. India has a demand? Who will be allowed to supply the demand is the question.

The Indians already know the answer to solving their problems. To directly quote the article, "'If a deal with Congress doesn't happen, we will have business with other countries. So simple,' said SK Malhotra, a spokesman for India's Department of Atomic Energy." Mr. Malhotra is wise and knows the options for his nation. India is going to demand electricity and energy for their population and nuclear energy would be a good solution. With advancements allowing better treatment of waste (yet something else that can be recycled!) and less impact on clear air, the Indians are thinking a nuclear solution could be good for a portion of their energy needs.

Which brings us to supply & demand -- India will have nuclear power, that's a given they have asserted will be true. With no agreement from the US Congress that would forbid US companies to get into a $30 billion (or maybe $80 billion?) market, the French and Russians will get the contracts. This is simple supply & demand. Worldwide demand will create supply from some part of the globe. If the USA doesn't supply, the Indians go shopping.

US oil demand of over 20 million barrels per day is big and conservation would be wise and efforts should be made to reduce that number when possible. But even starting today, oil consumption is going to continue. As the USA demands oil, the supply will be made available. If the USA chooses not to produce our own, we'll buy it. If we choose to produce it ourselves, the advantages are: 1) we control the import & export accordingly. 2) US workers earn a living in the production process. These workers pay taxes and help drive the economy. 3) Corporate taxes, leases and other gains to the US treasury exist. 4) We control the environmental regulations and restrictions -- strict enough to be clean and relaxed enough to allow production. 5) Top oil producing nations (Saudi Arabia, Russia, Iran, Venezuela) that might not always have a similar worldview will not benefit financially from our spending -- WE will benefit from buying from ourselves.

The demand will continue to exist in some way. The USA can be a leader to responsibly extract oil for ourselves -- or leave it to others who might not be good stewards of the environment or care about our workers or our national security. What's it going to be? Drilling in America is one option. If we say "no" to that, then some other country will drill and they will sell to us, and we will owe them. I recommend we bring more of our own energy policy into our own control.