While the never-ending debate about ethanol goes on and on, a renowned energy economist who served as an adviser on energy issues in both the Ford and Carter administrations noted the impact of renewable fuels beyond the environmental benefits.

Philip K. Verleger said the renewable fuels legislation supported by then-President George W. Bush and Congress has successfully driven down crude oil prices.

Those prices today are between $15 and $40 per barrel lower than they would be had Congress not endorsed the president’s proposals to boost ethanol production and blending with gasoline, according to Verleger.

“Today, the Bush measures add the equivalent of Ecuador’s crude oil output to the world market at a time of extreme tightness,” he wrote.

In 2007, Congress passed the Energy Independence and Security Act, which amended the renewable fuels program to raise the use of ethanol and other renewables as alternatives to petroleum.

“These fuels have replaced a significant volume of petroleum consumed in the U.S. EISA increased the required renewable fuel amount by 400,000 barrels per day in 2010 and 2011, 500,000 barrels per day in 2012 and nearly 700,000 barrels per day in 2013. The total amount blended into the petroleum mix from 2008 to 2012 was 700 million barrels,” Verleger said.

“Had Congress not raised the renewable fuels requirement, commercial crude oil inventories at the end of August would have dropped to 5.2 million barrels, a level 200 million barrels lower than at any time since 1990.

“The lower stocks would almost certainly have pushed prices higher. Crude oil today might easily sell at prices as high as or higher than in 2008. Preliminary econometric tests suggest the price at the end of August would have been $150 per barrel.

“According to the August 2013 issue of Petroleum Economic Monthly, the U.S. renewable fuels program has cut annual consumer expenditures in 20132 between $700 billion and $2.6 trillion. This translates to consumer paying between 50 cents and $1.50 per gallon less for gasoline.”

This is good news for U.S. consumers, but the global trend differs. The Energy Information Administration recently reported that global consumption of petroleum products reached a record high of 88.9 million barrels per day in 2012.

Consumption did decline in North America and Europe, but whatever drop was realized on those two continents in the use of gasoline, diesel fuel, jet fuel, heating oil and others was more than outpaced by growth in Asia and other regions of the world, according to the 25x’25 Alliance.

“To look beyond our own backyard shows an upward consumption trend that has run virtually unabated, and with that increase in fossil fuels comes with it an inherent inelasticity in the oil market,” the alliance said.

“Demand may be down here in the U.S., but prices remain high because overall demand remains high across the world. The EIA analysis shows U.S. consumers remain vulnerable to the global oil market shocks that push prices up at the gas pump, whether they come from conflict in the Middle East or natural catastrophes that shut down oil production.

“The EIA report underscores the longstanding need to pursue renewable alternatives and to continue building on a biofuel sector that has widely demonstrated over the past decade a number of economic and environmental benefits.”