Changing Energy Market

While The Times is of course correct in its editorial (Nov. 11) about energy supplies for the future, “Energy Shambles,” I must disagree with the premise that the “market is, to a large extent, a shambles.” The energy market is behaving largely as expected by most energy experts. Because of this, it is all the more ironic that our nation has no systematic energy policy.

The current depressed oil price and world glut was a predictable result of the following set of circumstances:

--Oil prices soared, encouraging new production from a multitude of oil and non-oil sources, as well as conservation.

--A global economic recession depressed energy demand, exacerbating the glut exerting a downward pressure on price.

While these circumstances were different than what was expected in the 1960s, they were not (or should not have been) surprising in the late 1970s and early 1980s.

What has not changed, however, are some basic resource and economic facts. The resource realities, highlighted once again in a recent U.S. Geological Survey paper, are that the Middle East has most of the world’s oil and that no new dramatic supplies have been unearthed outside of that region nor are they expected. This fact, combined, with the continuing reality that global economic growth increases the demand for energy in general and oil in particular, leads one to conclude that, far from being a shambles, the market is behaving properly. It’s just that we aren’t preparing for it.

CHARLES K. EBINGER

Washington

Ebinger is director of the Energy & Strategic Resources Program at the Georgetown Center for Strategic and International Studies.