The Department of Energy Fails Us

Includes: DBO, OIL, USO
by: Michael Fitzsimmons

CNBC yesterday was recommending a new American bureaucracy: an "Energy Fed" - presumably for developing an energy policy to deal with the oil crisis. I contend we already HAVE a bureaucracy for that: the Department of Energy, which is a complete and unmitigated failure.

I contacted the DOE a couple years ago to discuss peak oil. I warned them of the consequences to the US economy and the threat it posed to our national security. I discussed production curves, depletion rates, the scarcity of cheap affordable oil, and all the rest. I mentioned the huge trade deficit and the effect it was going to have on the US dollar and the US equity markets. All I received back was a polite "thank you" and reference to a bunch of reports by themselves, the EIA and others about how the spike in oil (it as around $50/barrel at the time) was temporary and that new supply would be coming online and would bring the prices back down. Yet their long term demand estimates were upwards of 150 million barrels a day! They didn't specify exactly where all this supply was going to come from.

For a "Department of Energy" to be caught blind-sided by the realities of peak oil supply/demand fundamentals borders on criminal neglect. Secretary Bodman should be fired and the entire DOE dismantled. Perhaps we should bring em to court on treason charges.

Here is an energy policy.