Oil's Silver Lining

In April 1980, oil prices went stratospheric, peaking at about $100 a barrel, adjusted for inflation. Some of the causes might sound familiar. Constantly rising demand. Political crises in Iran and Iraq. Uncertainty about the extent of future reserves. And, of course, the edgy enthusiasm of commodities buyers, whose fears drive up the price.

A generation later, we've returned to the grim neighborhood of $100 oil, having arrived down the same path. Demand is up more than 60% worldwide since the early 1980s, as China and India lead a wave of nations roaring into modernity. Iraq is a shambles, Iran a menace. Leading oil companies in the U.S. and Europe are gloomy about their ability to open up sufficient sources of oil to meet the demand. This cauldron of uncertainty is helping push the dollar down and energy prices up.

Humankind doesn't always get a second crack at answering a crisis, but perhaps this fresh encounter with $100 oil amounts to a global do-over. Most of the recommendations in a recent call to arms issued by the National Petroleum Council simply restate what we've known we should have been doing for almost 30 years--improve efficiency and conservation, develop clean and renewable sources of energy, make energy security a central element of national policy and global diplomacy.

Can we do it this time around? There may be hope. The price spike is likely to filter down to gas pumps and home heating-oil tanks just as voters begin choosing presidential nominees, which presents a rare chance to force this uncomfortable issue to the top of the political agenda. And in fact we may be better at tackling this problem than we tend to believe, as Daniel Yergin, chairman of Cambridge Energy Research Associates, points out.

"Since the last time we saw $100 oil, the U.S. economy has become twice as efficient in its use of energy," Yergin tells TIME. "The question now is, Can we become twice as efficient again?" And can we entice the Asian behemoths to adopt those efficiencies? "This is a test of consumers, of government policies and of the pace and breadth of our ability to innovate."