THE OIL CRISIS SCENARIO

The threat of another energy crisis has attracted renewed interest since the collapse of oil prices in 1986. The lower prices have set in motion several trends, especially higher demand but lower production of oil in the United States. That has sharply increased the level of imported oil, which many say is making the nation more vulnerable to the use of foreign oil as a weapon.

The following is a fictional account of a politically motivated cutoff of oil from the Middle East in 1994-95 and the possible effects on Southern California. Some events used here resemble incidents that have already taken place at various times, superimposed on a world that has made some adjustments to withstand energy shocks since the oil cutoffs of 1973 and 1979.

This account is conservative in that it assumes no military crisis, natural disaster or other catastrophic events. It draws partly from findings of simulated energy “crises” or games conducted by the California Energy Commission and by Gama Corp. of Falls Church, Va., for the U.S. Department of Energy.

Throughout, factual material has been inserted in italics to explain actual developments of the past few years.

December, 1994

Prosperity has returned to Saudi Arabia, where the oil fields are busy once again. With fewer oil wells than exist in the city of Los Angeles, the Saudis are bringing 10 million barrels of crude oil to the surface every day--nearly one-fifth of the world’s needs.

It is like the old days. The Western economies must have the Arab crudes to run. With a growing appetite for imported oil in the United States, Europe and Japan, the oil fields of the Organization of Petroleum Exporting Countries are operating at 82% of their capacity.

As recently as 1988, so much oil was available that the Saudis and other members of OPEC were scrambling for customers and offering price discounts. Saudi Arabia was turning out a mere 4 million barrels a day, and the Kingdom was borrowing money.

This revival of the OPEC era has been especially satisfying to the Saudi royal family. It was King Fahd who long counseled patience and moderation in oil prices, which are a mere $24 per barrel as 1994 draws to a close--less than oil cost before the price collapse of 1986.

If prices are allowed to remain high, one-time Saudi oil minister Sheik Ahmed Zaki Yamani warned back in 1981, the Western nations will conserve energy and develop alternatives to oil:

“This would take no more than seven to 10 years, and would result in reducing dependence on oil as a source of energy to a point which will jeopardize Saudi Arabia’s interests. Saudi Arabia will then be unable to find markets to sell enough oil to meet its financial requirements.”

The Saudi-engineered collapse of oil prices from $30 in 1985 to an average $13 per barrel in 1988 has caused a resurgence in the West’s demand for oil products, especially gasoline for cars and trucks, and virtually halted the nation’s 12-year growth in energy efficiency. Spending on non-oil energy research has plummeted.

In Los Angeles, the chilly weather continues, absent only the blizzards and subzero temperatures that are paralyzing traffic in the East in the nation’s coldest winter in a decade.

There is no paralysis in Southern California. Except where snowdrifts obstruct mountain passes, the flow of traffic through Southern California--which in the past five years has outstripped all projections as driving became increasingly affordable--is heavier than it has ever been.

In the process, the state’s dwindling ranks of service stations are pumping more gasoline into more cars and trucks than ever before, a heightening of efficiency that occasions great pride and profitability in the oil industry.

On Dec. 9, a different kind of pump closes down: Arco disconnects its sole remaining methanol pump at a service station in Woodland Hills. Arco’s experiment, offering methanol at a dozen California sites to encourage alternative fuels for cars, flops because gasoline is so cheap and plentiful.

In Washington, the President reviews the latest Palestinian uprising and once again affirms the nation’s support of Israel. He acts despite Arab warnings of reprisals against nations that fail to back a homeland for the Palestinians.

White House advisers argue that the Arabs’ only possible weapon is oil. Shrugging off the nation’s dependence on imported oil for 53% of its consumption, the President declares that the 660 million barrels of crude oil in the U.S. Strategic Petroleum Reserve will enable the country to outlast any embargo.

After bottoming out at 32% in 1985, the import share of U.S. oil consumption has climbed to 41% in 1988. Saudi Arabia once again rivals Canada as the biggest foreign supplier. With U.S. oil fields in decline and today’s lower oil prices discouraging much domestic oil exploration, imports are forecast to soon exceed half of consumption. The peak was 47% in 1977.

But the Strategic Petroleum Reserve (SPR) is a weapon against oil imports that didn’t exist during the energy shocks of the 1970s. Currently totaling 550 million barrels of crude stored in caverns in Texas and Louisiana--enough to last the nation for 110 days in the unlikely case of a complete cutoff of imported oil--it is being filled at a rate of 57,000 barrels per day.

On Dec. 12, the oil ministers of OPEC convene in Vienna for their year-end meeting. Emboldened by strong world demand for the cartel’s oil while its Arab faction fumes at Western support for Israel, the ministers stun the world’s oil markets by slashing production 10% to 20 million barrels per day.

The announcement drives up oil prices by $4 per barrel in three days, the steepest, quickest rise since 1979. The $28-per-barrel price remains moderate by 1981 standards, but the inflationary spiral suggested by the spike in oil prices sends the Dow Jones industrials down more than 90 points for the week, led by auto, steel and airline stocks.

The week before Christmas, gasoline pump prices in Los Angeles tick upward 3 cents a gallon to an average $1.11, contrary to seasonal trends. Refiners are boosting prices to distributors to offset the higher price they expect to pay for crude oil.

The International Energy Agency, the Paris-based organization of 22 nations created in response to the 1973 Arab oil embargo, reports a sharp rise in world crude-oil inventories. Analysts blame it on hoarding by the Japanese and the big oil companies. The stockpiling suggests that they expect prices to keep rising. Taking oil off the market makes this a self-fulfilling prophecy.

A Middle East oil journal reports that Saudi Arabia and Kuwait are cutting production even more steeply than planned, dropping OPEC output to 19 million barrels per day.

But the cartel is promising full delivery to OPEC-controlled refineries in several European nations. That means Japan and the United States--whose Congress sharply limited foreign ownership of refineries after Saudi Arabia’s 1988 deal to buy into Texaco’s U.S. refinery system--will bear the brunt of the OPEC production cutback.

Kuwait, Saudi Arabia and Venezuela have led a move by OPEC nations to buy foreign refineries as assured outlets for their crude. Kuwait has refineries and a vast network of service stations in Europe; Venezuela owns one Gulf Coast refinery and half of another, and Saudi Arabia recently agreed to buy half of three Texaco refineries and up to 11,000 service stations here. Numerous other deals are in the works. A consumer group, independent oil producers and several U.S. senators have demanded an investigation.

January, 1995

Hit hard by the cold weather, Southern California Gas cuts off deliveries to electric utilities and other big customers because its reserves of natural gas are running low. It says record cold has caused demand for natural gas to skyrocket and admits letting underground reserves get too low at the onset of winter.

The cutoff to Southern California Edison and other utilities--intended to ensure plenty of natural gas for private homes--forces the utilities to burn low-sulfur oil from Indonesia. Indonesian crude is the only type that burns clean enough for local air quality standards. About 1,000 big industrial firms are also cut off, forcing them to activate standby oil-burning systems.

SoCal Gas did this last winter, and had to buy natural gas on an emergency basis from Pacific Gas & Electric in San Francisco. A warming trend in California and in the Midwest enabled the gas company to restore full service after two weeks.

In Sacramento, concerned over a potential double-whammy from the natural-gas shortage and the ominous oil news, the California Energy Commission dusts off its elaborate crisis contingency plans. The commission warns the governor that although the state gets nearly all its crude oil from fields in California and Alaska, a worldwide shortage will quickly be felt here.

U.S. participation in the emergency-sharing plan set up by the IEA could lead to the diversion of some Alaskan oil to Japan. In a military crisis, the Pentagon could seize output from the Elk Hills Naval Petroleum Reserve near Bakersfield, whose oil normally is a big component of the state’s private oil market.

But even without a cutoff of the state’s usual oil supplies, interruptions of the Middle East flow will cause oil prices to surge everywhere, triggering panic and hoarding that could severely disrupt life in California at heavy cost to the economy, the governor is told.

In Jerusalem, the endless dispute enters a new and dangerous phase as a gun battle on the West Bank leaves 29 Palestinians and 11 Israeli soldiers dead.

At an emergency OPEC session at its Vienna headquarters on Jan. 14, the group’s Arab members--threatened by militant factions in the Middle East who consider them apologists for the United States--denounces Israel and “its American conspirators” and unilaterally agrees to slash oil production by another 15%. On top of earlier cuts, the action would withhold some 6 million barrels per day of crude.

The six-month Arab oil embargo that began in October, 1973, removed up to 4 million barrels a day from world markets, averaging 1.5 million a day over six months. The U.S. “loss” averaged 915,000 barrels daily. The Iranian revolution in 1978-79 took up to 6 million barrels a day out of production, averaging 2.5 million barrels a day over six months. The U.S. share of the loss was 800,000 barrels a day.

OPEC’s non-Arab members refuse to go along, anticipating a windfall from the inevitable huge demand for their own oil in the United States and Japan.

Despite California’s almost total reliance on domestic oil, prices there are rising ahead of the rest of the country. The California Energy Commission detects massive fuel-oil and gasoline stockpiling by private industry because of the natural-gas curtailment and the news from the Middle East.

Post-mortems on the gasoline lines in California after the interruption of oil shipments from Iran in 1979 placed much of the blame on panic that led to hoarding.

In Pasadena, a small Unocal station is cut back on allocations by a Unocal zone manager dissatisfied with the station’s performance. Unexpectedly heavy traffic empties the under-supplied tanks.

Exasperated, the owner posts an “Out of Gas” sign and closes at noon. A local radio reporter reaches him at home that evening for an interview, then broadcasts a report of a gasoline shortage.

Anxiety over the OPEC cutbacks is deepest in Japan, which gets all its oil from abroad. Japanese oil companies dramatically bid up the price for crude from Far East producers, including OPEC member Indonesia. A bidding war among dozens of panicky buyers erupts in the Pacific Basin.

Among them is SoCal Edison, scrambling for sweet Indonesian crude to supplant the natural gas it can’t get to power its boilers. Edison manages to buy one cargo--at a 90% premium over the price that prevailed just a month ago.

In Sacramento on Jan. 21, the governor consults hastily with energy and environmental officials and orders the temporary relaxation of sulfur-emission standards. The move would let Edison and other utilities burn dirtier Alaska or California crude in its boilers.

But environmentalists block that in court. Edison calculates that without fresh sources of oil, its own crude reserves will last 38 days, well below the desired 60-day buffer. The utility initiates a Stage I alert, an appeal to its customers for voluntary conservation.

In the same fix as Edison, the Los Angeles Department of Water and Power wins approval by the mayor to slap a 50% surcharge on electric customers who fail to cut their power usage by 10%.

Southern California gas station dealers announce they have been cut to as little as 80% of their usual January gasoline allocations. The action is confirmed by refiners, who disclose they were asked in November by the Energy Department--pressured by congressional delegations from the Northeast--to produce more heating oil and less gasoline per barrel of crude due to the continued cold weather.

Refiners acted on a similar government request just before the Iranian revolution.

In Paris, the IEA meets to invoke its global oil-sharing plan. But a split emerges because West Germany, France, Spain and the Netherlands have large refineries owned or controlled by OPEC members Kuwait, Saudi Arabia and the United Arab Emirates.

The European refineries have been promised full shipments from the shrunken pool of Arab crude. Unless the Europeans agree to share, the United States and Japan in effect become victims of a daily embargo of six million barrels of crude.

Until now, the pressure that has been building on the New York Mercantile Exchange has been kept largely in check by traders’ belief that the Strategic Petroleum Reserve will prevent any serious shortages of oil.

But the President--reluctant to drain the SPR unnecessarily and afraid that declaring an emergency will itself cause panic--has yet to act. The market finally erupts on Jan. 28.

Frantic traders force crude oil prices up more than one-third over the next three days to a record $44 per barrel. Futures contracts for gasoline explode to levels that will mean pump prices of $1.80 per gallon for unleaded regular.

The Reagan Administration has refused to spell out in advance what events would justify the use of oil from the Strategic Petroleum Reserve “because of the wide range of unpredictable conditions.” But simulated energy crises or “games” conducted for the government by Gama Corp. of Falls Church, Va., suggest a strong tendency by participants to delay action too long. There is reluctance to interfere with free markets and fear that an over-reaction will bring political retribution.

To avoid this problem, some have urged that oil from the reserve be automatically released when oil prices reach a certain price level, perhaps through the sale of futures contracts on SPR oil. The government has rejected this idea.

February, 1995

Japan appeals for the emergency diversion of Alaskan crude oil to the Far East. But Congress long ago banned North Slope exports, and Alaska now supplies 40% of California’s oil and 25% of the nation’s. The United States would need assurance of crude from elsewhere.

In Van Nuys, two Arco stations--their distributor unable to deliver a full supply--run out of gasoline by mid-morning on Feb. 4. Cars begin to back up at other nearby stations. An area Chevron dealer whose morning price was $1.78 per gallon for regular unleaded becomes, by closing time, the first dealer in the nation’s history known to collect $2 for a gallon of gasoline.

He tells the ABC evening news that if he’d been greedy, he could have gotten $5.

In Sacramento, the governor declares an energy emergency, triggering a series of steps at the state and local level. It will lead to tougher enforcement of the speed limits, a mandatory alternate-day scheme for buying gasoline, a ban on frivolous uses of energy and an emergency fuel set-aside plan that commandeers 3% of private oil stocks for use by police, fire, agricultural, trucking and mass-transit vehicles.

Motorists are told to buy at least $5 worth of gasoline at a time. Big companies are ordered to activate van-pooling programs for employees. Gasoline stations are supposed to stay open at least half the weekend.

But the government is swimming upstream. The anxiety that led many private companies to hoard oil products has now infected the California motorist, who stockpiles by topping off his tank. By the millions, cars and trucks converge on the region’s 5,000 service stations.

Running low on gasoline, dealers by the hundreds begin to cut back on their hours or close down altogether. As the lines grow, prices in some areas test the $3 per gallon mark.

Police are called to scores of service stations when arguments and fistfights break out. In Culver City, a teen-ager is killed in an explosion as he tries to siphon gasoline from a neighbor’s car. In Anaheim, a driver shoots another who cuts ahead of him in line. A Venice dealer dresses up in a gorilla suit to cheer grumpy customers.

As the economists figured, the long delays and the relentless rise in prices deter many drivers, who cancel dentist’s appointments, put off errands or conduct business by phone instead of taking to the road. Blood donations fall, movie houses suffer, bus ridership soars. Thieves siphon gasoline from cars in Disneyland’s half-empty parking lot.

But the declining traffic doesn’t ease the gas lines. A retrenchment that has seen thousands of service stations bulldozed as cars and trucks multiplied makes for a logistical nightmare.

The bottom line, the head of a dealer group explains to the governor, is that there are almost twice as many cars for every gasoline nozzle in Southern California than there were during the first Arab oil embargo.

The swollen motor-vehicle fleet, its worried owners stopping for fuel almost daily, battles for pump space at the dwindling number of stations. There are more hoses per pump, but no more places for cars. And the stations, no longer spread throughout communities, are concentrated at freeway exits and intersections of big streets.

While each station has more pumps, the dominance of self-service means double lines--one to pump gas, one to pay. As if that wasn’t enough, the clean-air devices affixed to California’s nozzles take longer compared to the pumps of the 1970s to pump the same amount of fuel.

Since 1974, the number of cars and trucks in Greater Los Angeles has risen by 39% to 9.55 million, while the number of service stations dropped 41% to less than 5,300, according to a Lundberg Survey census. The drop in the actual number of nozzles emitting fuel is only 6%, but the big rise in vehicles means that the ratio of nozzles to gas tanks has already worsened, from 1 for every 105 cars and trucks in 1974 to 1 for every 155 this year.

The vapor-recovery nozzles used in most of the state’s metropolitan areas restrict the flow of gasoline to about 8 gallons a minute, at least two gallons a minute slower than uncontrolled nozzles. Most of the devices were installed after the 1979 gasoline lines.

Cars and trucks waiting for gasoline stack up on exit ramps and spill onto the freeways, snarling the normally overburdened network of highways. On the morning of Feb. 11 alone, the California Highway Patrol is summoned to more than 300 trouble spots on Southern California freeways.

The CHP advises the governor that its 96 underground fuel tanks around the state--installed after patrol cars had trouble getting gasoline from service stations during the 1973 oil embargo--are running low.

The freeways can no longer be characterized as a transportation system.

Though the crude-oil shortage hasn’t materialized in the United States, the rest of the nation is now hit by the same panic, hoarding and production imbalances that afflict California.

The enormous network of pipelines from Texas and Louisiana that converge in Chicago and East Coast cities brims with crude and refined oil. But the stuff commands the highest prices in U.S. history, and not enough of it is gasoline.

The Energy Department says the 60-day supply line from the Middle East to the United States shows that a shortage of 4 million barrels of oil per day--nearly one-fourth of the nation’s needs--will reach American shores in early March.

The President finally declares an energy emergency and orders the DOE to begin auctioning off the Strategic Petroleum Reserve oil. The oil auction is scheduled for two weeks hence, March 2.

Oil prices tumble on news that the U.S. oil stockpile will be tapped, ending the day down $1.42 per barrel at $58.01. But gasoline prices show no sign of easing. In Los Angeles, motorists are paying $2.40 a gallon.

Sale notices are mailed out from SPR headquarters in New Orleans to 700 oil refiners. Private oil companies will bid at auction to acquire the government oil stockpiles, which will move by pipeline out of the reservoirs and into the nation’s oil distribution network.

Rejecting the cumbersome allocation quotas that were blamed for worsening the energy shocks of the 1970s by creating unnecessary spot shortages, the government’s energy emergency plan calls for the marketplace to allocate the oil. On price, the sky is the limit. A higher price is supposed to curb demand.

The Reagan Administration policy for distributing and pricing SPR oil spells out a competitive sale to the highest bidder. The needs of the marketplace will then decide where the oil goes. Markets will dictate the price. Critics say the plan for selling and distributing the stockpiles is too slow and cumbersome.

During the 1973 and 1979 oil interruptions, the big price increases--from $4 to $12 a barrel in 1973-74 and from $13 to $37 in 1979-80--would have been even greater if there hadn’t been price controls on domestic oil. Today, such controls have been removed.

At International Falls, Minn., a long-overdue warm front boosts the temperature to 46 degrees, a Feb. 18 record and the third straight day of relief from the unusually frigid winter. The balmy weather drifts toward New England.

In Washington, the Labor Department blames energy prices for a record spurt in January’s consumer price index to an annual rate of 11%, the first hint of double-digit inflation in more than a decade. Economists revise their GNP forecasts downward and warn that the nation is moving rapidly toward a recession or is already in one. The Dow Jones industrial average tumbles by 70 more points, leaving it at barely two-thirds the early December level.

France, muttering about wasteful U.S. energy practices, says it won’t share any oil. The White House angrily quits the IEA and blasts France for undermining the energy alliance. The White House also tells Japan that it can’t have any Alaskan oil and criticizes the Japanese for hoarding and driving up prices.

The President issues a plea for accelerated oil production in Mexico, Venezuela and Colombia. But the energy potential of U.S. neighbors, once seen as a source of oil security, has languished.

Brazil’s supposed blockbuster oil discoveries of 1988 proved minor. Canada’s declining reserves have made it a net importer of crude. Years of terrorist attacks have crippled Colombia’s fledgling industry. Mexico hasn’t expanded and cannot produce any more oil.

OPEC member Venezuela earmarks half its “surge” capacity of 1 million barrels per day for its joint-venture refineries in Europe. But the United States can have the rest. It will cost $64 per barrel, Venezuela adds.

In Tokyo, the politically vulnerable prime minister--threatened with massive shortages of oil and severe economic dislocations--condemns Israel’s actions on the West Bank and calls for a homeland for the Palestinians.

The actions, combined with the commercial relationships that Japanese companies have established in the Gulf region since 1973, win favored-nation status for Japan. Several oil tankers already at sea are diverted to Tokyo.

During the 1973 oil embargo, Japan was exempted after agreeing, under Arab pressure, to urge Israel’s withdrawal from land it had occupied since the 1967 war. The Japanese still import 99% of their oil, 70% of it from the Middle East.

March, 1995

The SPR has already failed in its first mission, that of reassuring world markets by its mere existence. Now it is called on to solve the real problem. The salt domes must produce a flat-out 3.5 million barrels every 24 hours to meet the shortage.

The six Gulf Coast storage sites have conducted numerous test drawdowns, but only at nominal production levels. Huge diesel-powered pumps begin sucking crude out of the underground reservoirs and moving it to holding tanks.

At a rancorous meeting in Washington, nearly 1,000 state and local energy and civil-defense officials, oil producers and others meet with the vice president and the secretaries of energy and defense. A shouting match erupts between the Texas and Massachusetts delegations, and Californians are accused of wasting Alaskan crude to heat their spas and drive to the beach.

But the Administration wins support for a broad-based plan, drawn heavily from the steps already implemented in California, to slash the use of oil nationwide by 10%, or nearly 1.7 million barrels a day. The government also announces plans to escalate production from the nation’s existing oil fields, though it will probably damage reservoirs.

Desperate for feedstocks, oil companies oversubscribe the government’s auction for the first 40 million barrels of SPR crude oil and bid an average of $54 per barrel--well below the market price in the high $60s. The below-market bids are the first signal that oil markets now think prices have climbed too far, and are reassured by the infusion of SPR crude.

On March 4, valves open for nearly 800,000 barrels of crude to ooze into the pipelines hooking the SPR caverns to the nation’s commercial pipeline system. Weekly auctions are scheduled as the system builds toward output of 3.5 million barrels daily.

Coincidentally, the leading edge of the embargo arrives the same day. It is the day when a Panamanian-registered tanker would have reached Galveston, Tex., from the Saudi export terminal of Jubail if she had followed her original schedule.

But the tanker has already unloaded her 2.4 million barrels of Arab Light crude at Rotterdam, and is on her way back to the Persian Gulf.

Besieged by angry independent refiners, Congress begins a probe into the dominance of the SPR auction by Exxon, Mobil and eight other big multinational oil companies. Ashland Oil Co. tells a federal judge its U.S. refineries are going dry because it was outbid in New Orleans. Jewish groups protest the sale of 10,000 barrels of SPR crude to a small Texas refinery controlled by Saudi businessmen.

In Detroit, auto sales tumble 30% as domestic and imported models alike suffer from the dramatic increase in the price of gasoline. A General Motors executive proposes a revival of the fuel-stingy diesel engine for passenger cars.

With warmer weather, Southern California Gas resumes delivery of natural gas to all its customers. Southern California Edison and the region’s other electric utilities quit burning fuel oil and switch to natural gas.

Edison notifies the Public Utilities Commission that its fling with exorbitant fuel oil boosted its fuel costs by $180 million. The PUC warns that bills for electricity and natural gas will rise as much as 40% next year when the new energy prices are folded into utility rates.

A state lawmaker introduces a bill that would force industrial customers of utilities to pay more than their share of electricity and natural-gas usage, subsidizing the more vulnerable residential customers.

The California PUC is currently eliminating the residential subsidy that had been in place since energy prices began to skyrocket in the late 1970s, and will eventually require private residences to pay their full share of the cost of providing such services.

The delivery of the government’s stockpiled oil reaches the maximum rate of 3.5 million barrels a day, and auction prices stabilize around $50 per barrel. Refiners begin their seasonal conversion to make more gasoline. With gasoline increasingly available and panic subsided, gas lines around the nation subside.

The average price at the pump dips below $2 a gallon and settles in at about $1.90 for self-serve unleaded regular.

A Louisville, Ky., truck factory with 3,000 workers closes down because the trucks it makes don’t go as far on a gallon of gas as some other trucks. Ford says sales are so weak since the big jump in gasoline prices that it has enough of the trucks on hand to last a year.

USX Corp. says a falloff in steel orders from auto and appliance makers forced it to call off the modernization of a mill in West Virginia. The plant closes indefinitely, idling 800 in a town of 4,000 that was once home to 50,000 people.

In Riyadh, the Saudi capital, finance ministers from the Gulf nations warn that the steep cut in oil output has not been offset by the higher per-barrel price. And if prices continue to climb, Kuwait warns, the Western economies will use less oil and revive other energy forms.

The group, declaring that it has made its point, announces it will partially restore production.

But it now looks as if the sharply higher energy prices will remain, even as the threat of a shortage subsides. The President’s Council of Economic Advisers forecasts 12% inflation for the year, with major economic dislocations. Occidental Petroleum Chairman Armand Hammer, nearing his 98th birthday, predicts $100-a-barrel oil within three years.

From the Oval Office, the President addresses the nation on television. Wearing a sweater, he explains that the thermostat in the White House has been turned down to 62 degrees and urges all Americans to do the same.

He says the nation faces a long-term crisis unless something is done to reduce its need for oil and natural gas. He proposes a $100-billion crash program to develop alternative energy sources and calls for the emergency development of oil reserves beneath the Alaska National Wildlife Refuge.

“The energy crisis has not yet overwhelmed us, but it will if we do not act quickly. Our decision about energy will test the character of the American people and the ability of the President and the Congress to govern,” he says.

“This difficult effort will be the moral equivalent of war, except that we will be uniting our efforts to build and not destroy.”

DR, GARY TANHAUSER / for The Times

DR, ILLUSTRATIONS BY GARY TANHAUSER / for The Times DR, GARY TANHAUSER / for The Times