GO
Loading...

US Must Break OPEC Monopoly to Be Secure: Ex-CIA Head

The killing of Osama bin Laden was a fine CIA and Navy SEAL operation but the U.S. and its allies are still far from secure, warned former Central Intelligence Director James Woolsey.

AP

He told CNBC Friday that to be really secure, the U.S. has to "break oil’s monopoly over transportation and to break OPEC's monopoly over oil. If we can get a handle on transporting ourselves using other substances—electricity, natural gas, methanol, ethanol, whatever—we can begin to turn the corner on the ideology and the amount of resources they have to pour into terrorism against us."

Woolsey, now with the Goodwin Procter law firm in Washington, discounted talk that OPEC members are in disarray because they couldn't come to an agreement on increasing production during this week's meeting.

It may be squabbling but OPEC, he said, is still a cartel.

"We’re paying $100 or so a barrel of oil because OPEC is a conspiracy in restraint of trade," he said. "It was pumping about 28, 29 million barrels a day 30 years ago in 1971 when the world economy was five times smaller than it is today. It’s still pumping 28 to 29 million barrels a day."

Right now, he asserted, "we’re paying for both sides in this war on terror. That’s idiotic. We’re not going to solve the overall problem until we break oil’s power."

There are many ways to do that: he agrees with T. Boone Pickens' plan to have fleet vehicles, trucks and busses running on natural gas.

Woolsey also thinks the U.S. should follow the lead of Brazil, which is requiring auto makers to "make their fuel lines out of a slightly different kind of plastic so it costs less than $100 a car in the manufacturing process … and the vehicle can burn alcohol fuels as well as gasoline."

Finally, there's electricity. Woolsey practices what he preaches, driving a plug-in Toyota Prius and GM's Chevrolet Volt.

"I drive for about 2 cents a mile until I need liquid fuel," he said, calling electricity "part of the hope."

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    › Learn More*

Don't Miss

U.S. Video