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Gas Prices Will Affect U.S. Military Operations Eventually

by: Matthew Potter
March 18, 2011

Category: Business Line, Companies, Congress, Contract Additions, Contract Awards, Department of Defense, DLA, Events, Federal Budget Process, logistics, Military Aviation, production program, S&T, Services | RSS 2.0

The U.S. military is currently involved in Iraq, Afghanistan and now what looks to be like Libya. They are also deployed in the Pacific and Europe which includes ships and aircraft on patrol. They also conduct large amounts of training in the U.S. and elsewhere. As such they are one of the biggest consumers of petroleum products (POL) in the world. This fuel is managed and provided through the Defense Logistics Agency’s (DLA) Energy Support Center (DESC) group.

As the price of oil and gasoline increases as it has over the last six months it will eventually begin to affect the ability of the U.S. to pay for and conduct its missions. DLA is able to lock in at certain prices as they award long term contracts but as these expire and new ones are issued the price effect will slowly appear. This means that more funds must be expended on fuel then originally planned and budgeted for at the beginning of the Fiscal Year. In the current budget structure where the Department is operating under Continuing Resolution and without a 2011 budget it also limits funding to 2010 levels which also may reduce the amount of money available to buy fuel.

The DLA issues hundreds of contracts each year for fuel. An example is one that was signed last week with the South Alabama Regional Airport Authority to provide fuel to support Army helicopter training at FT Rucker. This is worth about $11 million. If there end up being limits on how much funding may be spent on these types of contracts then it may affect training hours and flight time which slows the ability of the Army to produce new aviators who fill a critical need on the battlefield.

The U.S. military has also begun investing heavily in research to develop non-oil based fuel. These include the use of biofuels for aircraft power generated from plants or algae. The Air Force and Navy have both flown aircraft powered by such fuel even though there are some who feel the investment is not cost effective right now.

DoD is also investing in solar power and fuel cell technology to provide battlefield power beyond gasoline powered generators or from vehicles.

Even if in the short term it is more expensive it makes sense not only from an economic point-of-view but also logistically to try and reduce the amount of POL that is moved around via truck and aircraft.

Right now the price of oil seems to be going up due to pressures from unrest in the Middle East and North Africa. Eventually most likely sooner then later these increases will begin to affect the U.S. military. Either operational will need to be curtailed or money will have to be moved to buy POL at the cost of other programs or budget priorities.

Photo from roger4336 flicker photostream.

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