Energy Features in Mid-Terms

So its judgment day in the US mid-terms. Most pundits believe that the Democrats will makes gains but whether it will be enough to overturn the Republican majorities in both the House and Senate is anyone’s guess. It’s up to the voters now. There is no doubt that the Iraq war will be a major factor, so will scandals about sex and race that have played out across the airways.

But oil and energy have also featured in the last days of campaigning. Political candidates from both parties have stressed “energy independence” as a national security and economic need. It was promoted heavily in the tight Senate race in Missouri, a farming state where biofuels are popular. The House Democratic leadership’s “Six for ’06” theme also features “energy independence” among its key statements.

Climate Change is also creeping up the political consciousness of the American public. Americans now rank climate change as the country’s most pressing environmental problem–a dramatic shift from three years ago, when they ranked climate change sixth out of 10 environmental concerns. In a recent survey almost three-quarters of the respondents felt the government should do more to deal with global warming.

But the concept of “energy independence” is not going down well with the oil barons. “Unfortunately, a number of candidates still hold out the illusory idea that the United States can be energy independent or cut off its reliance on energy supplies from the Middle East,” said Peter Robertson, vice chairman of Chevron Corp. “That approach,” Robertson added, “is neither realistic nor, in my view, responsible.”

Energy independence is not just infeasible, added Stephen Pryor from Exxon, it’s also a lousy idea. Pryor said independence would not allow free flow of innovative technologies. “Energy innovation also flourishes through energy interdependence,” he said. “Through the free international exchange of ideas, new technologies are born and through free trade and investment, new technologies are applied on a worldwide basis. Policymakers who pursue the false promise of energy independence risk undermining the path towards technological progress,” Pryor said.

Shell Oil Co. President John Hofmeister also speaks of a “flaw of perception” and the need for more dialogue on the idea of interdependence. “As promising as the alternatives are … they do not meet today’s demands today,” Hofmeister says. “They represent future bets on future technologies, which may well become important in the next 25, 50 and 100 years. In the meantime we have a lot to do in the oil and gas infrastructure in which we operate.”

But what happens at the polls today could determine how much longer that infrastructure – from the gas pumps to the lobbying on Capitol Hill – remains unchallenged.