What domestic oil shortage? Shale, coal and tar sands at $50 a barrel is feasible today.

The case is made that we could get all the oil we need out of coal and that we have more oil potential in coal than there is in the entire oil reserves in the world. Coal is already being made into oil in South Africa for about $55 a barrel. I would think that it would take a number of years to gear up in the U.S. and government and the radical environmentalists would have to get out of the way. Yet, coal is not all we have.

We also have oil shale reserves with more oil in them than the entire Middle-East reserves. Oil shale will be even easier and more enviornmentally friendly to get out of the ground than coal. It is much the same as drilling for oil except the necessary extra steps done below ground will still make oil profitable at $50 a barrel. So both oil production methods could produce all the oil we need for hundreds of years and give us gasoline for about $2 a gallon. I have not even talked about the oil sands of Canada that are just as huge.

So don’t let anyone tell you that we do not have the capability to get off of foreign energy dependency. That might be the party line but those who say such things are either ignorant, they are lying or they want crazy environmental restrictions. The only thing that is stopping development of all these resources is politicians. It is Congress and their government regulations.

If it were announced today that the U.S. would develop these resources on a unlimited scale oil futures and oil prices would drop like a rock half the price today is speculation. Also OPEC would panic and try to gear up production to lower prices below the price that we could develop these new resources in order to retrain their monopoly on oil. In that case, we would have to set a floor price and put a tariff on imported oil to keep it up to a price where these new resources could be developed and not undercut by Middle-East oil producers that extract their easy oil at less than $4 a barrel.

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This in effect means that as long as the price of crude oil remains above $55 a barrel – and there is every reason to believe it will – America can enjoy fuel self-sufficiency for as long as the eye can see.

It is important to grasp the full import of this: Unlike all the other ideas and proposals for achieving oil independence, coal conversion represents no false hope or wishful thinking but an eminently feasible and realistic possibility.

No new inventions, no technological breakthroughs, no extensive infrastructure modifications, no lengthy testing, no public investment or government incentives are required to make it happen. Everything is already in place to bring it about

All that needs to be done is to remove any artificially imposed impediments that may stand in the way. Most of them are in the form of environmental rules and regulations which make energy production such a difficult and problematic enterprise in this country.

As far as the environment is concerned, coal conversion and its derivatives are cleaner than their crude oil counterparts. There is technology to capture the CO2 released during the liquefaction process and the resulting diesel and kerosene have lower sulfur content than those refined in the conventional way. As a result, during the combustion process they release fewer particulates and less nitrogen oxide then their petroleum cousins. Such, in fact, is their purity that they are often referred to as ultra-clean fuels. This should go a long way toward assuaging environmental concerns.

The rising energy prices have made it possible for America to commercially utilize its enormous coal reserves and to become fuel independent in the process. The only thing required at this point is for government not to interfere with market forces which inexorably incline toward this outcome.