Oil expert says 3 countries control prices

Make no mistake.

There is an energy crisis. Three countries are to blame.

And ethanol is a scam.

So says Michael J. Economides, a provocative petroleum expert and professor of engineering at the University of Houston, who told a trade conference in Charleston on Thursday that he predicted three years ago that crude oil would hit $100 a barrel. When that threshold was breached in February, it also broke an important psychological barrier, Economides said.

"The toothpaste is out of the tube," he said.

Massive increases in oil usage since the turn of the century by China and other nations has played a significant role in pushing up the price, Economides said.

There never had been a country in history that increased oil consumption by 20 percent in a year until China saw its usage grow by one-fifth in three consecutive years recently.

"China has gone berserk," Economides said.

But according to Economides, a frequent contributor to conservative publications such as "Human Events" and a high-profile skeptic about human-induced climate change, it's the "energy militant nations" — Iran, Venezuela and Russia — that control oil prices, perhaps by as much as $50 a barrel.

Whenever the leader of Iran makes headlines because his country has enriched uranium, or when Venezuela throws political jabs at the U.S., the price of oil spikes, Economides noted.

Post-Soviet Russia, he said, controls oil prices and supplies across Europe. Vladimir Putin, Russia's prime minister and until recently its president, "has been able to do with oil and gas what communist leaders did with nuclear weapons," Economides said.

In other remarks at the 35th annual South Carolina International Trade Conference, Economides described ethanol, a much-touted alternative "green" fuel, as "the biggest scam in the energy business of the last 100 years."

It takes so much raw product — in this case, corn — to produce a gallon of ethanol that it takes more energy to produce the fuel than the product provides, he said.

If the U.S. converted all its corn supply to ethanol, it would provide for only 20 percent of the country's oil consumption, he said.

Further, if all soybeans in the U.S. were converted to biodiesel, 96 percent of diesel fuel in the U.S. still would come from traditional sources, he said.

By 2030, 87 percent of energy still will come from oil, gas and coal, Economides said. There are no alternatives to traditional fuels in the foreseeable future, he said.

Reach Peter Hull at 937-5594 or phull@postandcourier.com.