>> Personally, I want to bankrupt OPEC. Corn ethanol is an important tool.
The enterprising American petroleum industry has just proven that we don’t need a single drop of ethanol to bankrupt OPEC.
Ethanol is an engine-destroying boondoggle. Anyone who *wants* to burn ethanol for whatever reason should be free to do so. Supply and demand will regulate it properly. But mandating ethanol is horrible policy.
But mandating ethanol is horrible policy.
Gasoline prices January 6, 2015, Springfield, Missouri.
Regular gasoline 87 octane E-10 $1.729
E-85 Flex Fuel $1.999
If this 27 cents per gallon price differential continues demand for E-85 will drop.
Oil dropped as low as $12 a barrel in the wake of the first gulf war. From that point, it marched inexorably upwards and was approaching $150 a barrel just prior to the recession. While most commentators devote most of their attention to the housing bubble and the financial crisis, $150 oil has to recognized as a contributing factor, and perhaps a precipitant, to the recent and continuing unpleasantness.
During that period, in response to rising oil prices, we intensified the search for alternatives to oil. Looking across the sweep of the Bush 41, Clinton, Bush 43, and Obama administrations, I still think that Bush 43 had the soundest approach. He favored expanded drilling, unconventional drilling, and research across all sectors, including electrics, fuel cells, and biofuels. At some point, as oil reached the $60-80 range, corn ethanol became viable without subsidy, and that is the point at which the ethanol industry really took off. Ethanol continues to be fiercely resisted by the oil industry, however, because fuel economy has increased, gasoline consumption is flat or declining, and ethanol cuts into oil refiners' market share. Then came fracking.
At the moment, OPEC is back to its old tricks, dumping oil on the market in an effort to break the fracking and biofuels revolutions. OPEC has done this before, and I do not think we should fall for it again. I would keep the pressure on, on all fronts, until the Saudi princes have to trade in the gold plated limos for used camels, and the jihadis are reduced to fighting with sticks and stones.