Independence from Foreign Oil

Oil is the lifeline of any modern society. For years we have built our society on the false notion that Petroleum is an infinitely abundant resource. Some might argue that our dependence on oil has had a detrimental effect on everything from our foreign policy to the environment.

Having said that I came across an interesting story – while Detroit depleted their billions on developing trucks that would, in retrospect, achieve the ostentatious goal of building bigger engines for urban vehicles, Brazil spent its research on achieving 100% fuel independence. The secret to their miracle was E85, which is 85% percent alcohol distilled from corn or sugarcane and 15 percent gasoline.

Brazil announced that starting 2007, they would not need to import a single drop of petroleum. They will be able to meet a majority of their petroleum needs from renewable Bio Diesel, supplemented with a relatively small amount oil of that excavated locally. This is a great feat for a country the size of Brazil considering that it has a rapidly growing economy and the largest population of any South American country.

This has immense implications for Brazil’s economy. Its growth will no longer be tethered by OPEC regulated pricing. Oil prices are in a flux due to a number of reasons – Instability in the Middle East, the rising cost of excavation, an ever increasing demand for Petroleum from the newly industrialized world i.e. India and China.

Independence from Foreign Oil means that Brazil will be able to hedge against these rising concerns, insulating its economy against a sizeable risk, and in turn attracting foreign investors who see this as a potential haven.

Every socially responsible country must take positive steps in this direction to negate the influence of fluctuating foreign oil prices, secure a stable future, and chart a sustainable path forward.

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