more than meets the eye
Has anyone considered what will happen when peak oil meets the Decepticon Energon Cube Panic of 2007? Well? Well?!
Sixteen gallons of oil. That's how much the average American soldier in Iraq and Afghanistan consumes on a daily basis -- either directly, through the use of Humvees, tanks, trucks, and helicopters, or indirectly, by calling in air strikes. Multiply this figure by 162,000 soldiers in Iraq, 24,000 in Afghanistan, and 30,000 in the surrounding region (including sailors aboard U.S. warships in the Persian Gulf) and you arrive at approximately 3.5 million gallons of oil: the daily petroleum tab for U.S. combat operations in the Middle East war zone.
Multiply that daily tab by 365 and you get 1.3 billion gallons: the estimated annual oil expenditure for U.S. combat operations in Southwest Asia. That's greater than the total annual oil usage of Bangladesh, population 150 million -- and yet it's a gross underestimate of the Pentagon's wartime consumption.
For anyone who drives a motor vehicle these days, this has ominous implications. With the price of gasoline now 75 cents to a dollar more than it was just six months ago, it's obvious that the Pentagon is facing a potentially serious budgetary crunch. Just like any ordinary American family, the DoD has to make some hard choices: It can use its normal amount of petroleum and pay more at the Pentagon's equivalent of the pump, while cutting back on other basic expenses; or it can cut back on its gas use in order to protect favored weapons systems under development. Of course, the DoD has a third option: It can go before Congress and plead for yet another supplemental budget hike, but this is sure to provoke renewed calls for a timetable for an American troop withdrawal from Iraq, and so is an unlikely prospect at this time.
Nor is this destined to prove a temporary issue. As recently as two years ago, the U.S. Department of Energy (DoE) was confidently predicting that the price of crude oil would hover in the $30 per barrel range for another quarter century or so, leading to gasoline prices of about $2 per gallon. But then came Hurricane Katrina, the crisis in Iran, the insurgency in southern Nigeria, and a host of other problems that tightened the oil market, prompting the DoE to raise its long-range price projection into the $50 per barrel range. This is the amount that figures in many current governmental budgetary forecasts -- including, presumably, those of the Department of Defense. But just how realistic is this? The price of a barrel of crude oil today is hovering in the $66 range. Many energy analysts now say that a price range of $70-$80 per barrel (or possibly even significantly more) is far more likely to be our fate for the foreseeable future.
A price rise of this magnitude, when translated into the cost of gasoline, aviation fuel, diesel fuel, home-heating oil, and petrochemicals will play havoc with the budgets of families, farms, businesses, and local governments. Sooner or later, it will force people to make profound changes in their daily lives -- as benign as purchasing a hybrid vehicle in place of an SUV or as painful as cutting back on home heating or health care simply to make an unavoidable drive to work. It will have an equally severe affect on the Pentagon budget. As the world's number one consumer of petroleum products, the DoD will obviously be disproportionately affected by a doubling in the price of crude oil. If it can't turn to Congress for redress, it will have to reduce its profligate consumption of oil and/or cut back on other expenses, including weapons purchases.
The rising price of oil is producing what Pentagon contractor LMI calls a "fiscal disconnect" between the military's long-range objectives and the realities of the energy marketplace. "The need to recapitalize obsolete and damaged equipment [from the wars in Iraq and Afghanistan] and to develop high-technology systems to implement future operational concepts is growing," it explained in an April 2007 report. However, an inability "to control increased energy costs from fuel and supporting infrastructure diverts resources that would otherwise be available to procure new capabilities."
But the genius of the free market, embodied by the transnational corporation, loosened from the physical and lawful bonds of statehood to pursue the best means at the best prices for the savvy consumer, is already showing the way.