First off, there is no energy “conspiracy” (I feel the irresistible impulse to throw that out there, to run off or infuriate those who skipped macroeconomics in college). The market is working as every model says it should. The problem is that it is not a free market - it is an oligopoly. Suppliers are not free to enter and leave the market as it is currently situated. Suppliers are fixed, and consequently control supply like you control the flow of water in your hose.

There are two alternatives. One is more suppliers, and more supply. This is accomplished by opening up more of our domestic reserves, to include oil rigs six miles and more off the Gulf coast, and permitting access to the Arctic wasteland we call ANWR for exploration. Neither will fully solve our reliance on external oil production, but both are common sense steps in the right direction. It would take years to get both online - a prudent people would have started yesterday, but we might as well start today.

There is a better way to increase the supply, however, which would put the United States, Israel, and Jordan at the forefront of the global oil market. Announced in 2006, Israeli company A.F.S.K. Hom Tov has developed a process that uses bituminous, the chief byproduct of oil, to more efficiently extract petroleum from shale rock, and to do so in an environmentally friendly way. Unlike with “conventional” extraction technology, otherwise noxious gases are absorbed by the bituminous coating the shale rock. The resultant product costs approximately $25.00 / barrel to produce. This cuts the costs associated with extracting petroleum from shale by about 2/3.

A nice secondary byproduct of the process is the production of natural gas.

Colorado, Wyoming and Utah are rich with shale suitable for extraction. Canada and parts of Latin America are as well. Of the estimated 2.7 trillion barrels of shale oil in existence worldwide, 2.0 trillion of it rests within the borders of the United States, the bulk in the Green River basin in Colorado. In short, a focus on shale not only addresses our energy problem long term, but it would be a seismic shift in geopolitical politics. Consider it the equivalent of an economic SDI - the mere threat and development could have positive near-term effects, and when fully developed, would permanently change the economic and global landscape.

Unfortunately, the religious fervor surrounding the belief in man made global warming has put the focus on conservation, the second, more inferior option. And that is a fool’s errand - we cannot conserve enough to make a dent in the market when the chief suppliers are out of our control. If you were in control of the Saudi oil supply, and your economic analysts told you that conservation in the West would reduce demand by 5% (an astonishingly large amount, actually), what would you do?

If you answered anything other than “Reduce production by the amount conserved” (and OPEC would certainly follow suit), you really need to take another look into the sheik’s soul. And Hugo Chavez’s too, for that matter.

Shale fields would take about ten years to get online. The question is: Who do you trust more to supply the world’s oil: Saudi Arabia, Venezuela, and Russia - or Colorado, Wyoming, Canada and Israel?