WITH the average price of petrol in America once again threatening the politically sensitive level of $4 a gallon as tensions mount over Iran's threats to close the Strait of Hormuz, your correspondent has been puzzled by the deafening silence with which the current spike in pump prices has been greeted. Usually, when oil crosses the $100-a-barrel threshold and petrol prices soar, demands for drastic action fill the headlines. Given that this is election year, presidential candidates might have been expected to exploit the situation. There have been few such murmurings.



For sure, there have been the usual calls for the White House to dip into the country's strategic oil reserves to slow rising prices at the pump—as happened last summer when more than 30m barrels were released to meet shortages caused by the Libyan uprising. The strategic reserve's storage caverns in Texas and Louisiana are currently filled to the brim. So, do not be surprised if the administration releases some of the 700m barrels in storage should petrol prices remain stubbornly high during the summer months when people take to the roads for vacation and President Obama campaigns warily for re-election.



But America's normally vociferous corn growers and ethanol producers have remained remarkably muted. At the least, one would have expected them to be clamoring for their precious E85 brew (85% ethanol and 15% petrol) to be re-instated in the government's package of tax credits for alternative motor fuels. Since the expiration in January of their $6 billion-a-year subsidy, ethanol blenders have lost their 38 cents-a-gallon credit on E85, causing its price to rise to an average of $3.20 (compared with petrol's $3.79). In California, where refineries have to use the highest grade of oil to meet the state's stringent environmental standards, the average price of a gallon of regular petrol is currently $4.36.



Clearly, the ethanol lobby has been lying low since the outcry over the way subsidies for corn-based ethanol have pushed up food prices disastrously. Bioethanol—which was supposed to be a home-grown fuel that was cleaner than petrol—has also been heavily criticised for causing more, not less, environmental damage than even fossil fuels.



Ethanol producers are worried, too, about losing the additional tax credit they get for making ethanol from non-food biomass, such as switchgrass, corn stalks, wood chips and other cellulosic materials. Yet, even with a dollar-a-gallon subsidy, cellulosic ethanol remains wholly uncompetitive. Producers live in hope of a breakthrough that will one day make it commercially viable.



Such hopes are beginning to look increasingly forlorn. The alternative fuel that ethanol producers fear most, clean-burning methanol, is enjoying an unexpected resurgence—thanks to the vast supplies of natural gas discovered in shale deposits beneath West Virginia, Pennsylvania, New York, Texas and Oklahoma. Even if the reserves turn out to be only half as extensive as initially thought, many liken the handful of states where shale-based natural gas is currently being tapped by hydraulic fracturing (“fracking”) and horizontal drilling to Saudi Arabia. Already, natural gas has fallen to its lowest price in a decade, and is expected to stay there for decades to come.



The usual way of making methanol is first to react methane, the main component of natural gas, with high-temperature steam in the presence of a nickel catalyst, to produce a mixture of hydrogen and carbon monoxide known as “syngas”. A second catalyst—usually a blend of copper, zinc oxide and alumina—is then used to turn the syngas into methanol.



Because the process involves stripping off one of the methane molecule's four hydrogen atoms that are tightly bonded to a central carbon atom, the process requires a good deal of energy. Even so, methanol has long been made commercially this way—without any taxpayer subsidies—for around a dollar a gallon. It can be bought on the spot market today for $1.13 a gallon. Modern catalysts, which eliminate the intermediate syngas stage, promise to make methanol even cheaper.

Methanol, the simplest of all alcohols, has a long history as a fuel for motor cars. It lost out to petrol in the early days of motoring because it packed only half the energy per unit volume (56,800 BTUs per gallon versus 114,100). All other things being equal, a car that gets 25mpg on petrol would get only 12.5mpg on methanol.



But all other things are not equal. Alcohols like methanol have higher octane ratings than petrol—typically 99 versus 87 for regular petrol. That means they can tolerate higher compression ratios without causing the air-fuel mixture in the cylinders to explode prematurely (“knock”) rather than burn smoothly. And the higher the compression ratio, the more energy stored in the fuel can be converted into useful work. In short, engines designed to take advantage of methanol's octane rating produce more power from the same cubic capacity, and can be more efficient in fuel-economy terms.



For years, lead was used to raise the octane rating of petrol and prevent high-compression engines from knocking. For health reasons, lead was replaced in the 1970s by MTBE, an anti-knock additive made from methanol and butane. When this smelly liquid was subsequently found to be contaminating ground water, it was replaced with ethanol. Today, petrol in most parts of America contains up to 10% ethanol in order to raise its anti-knock index.



For its part, methanol has long been used in motor racing, mainly because of its ability to boost horsepower. It also achieved a measure of popularity among motorists following the twin oil shocks of the 1970s—thanks to its ready availability, cheapness and environmental benefits. By the mid-1990s, some 20,000 “Flex-Fuel” vehicles capable of running on methanol as well as petrol were in use in America. Carmakers only stopped producing them when oil prices fell and the farming lobby won political support for corn-based ethanol.



If truth be told, motorists at the time were a little leery of methanol anyway. It may have been fine for “top fuel” dragsters developing 10,000 horsepower from an 8.2-litre V-8 to use a mixture of methanol and nitromethane. But to the average motorist, methanol seemed a bit unnerving to have around cars of the day. For one thing, methanol burns with an invisible flame, making it hard to see when a fire breaks out. For another, it is more corrosive than ethanol, attacking aluminium, rubber and many of the synthetic polymers found in older vehicles.

And unlike ethanol—the basis of all drinkable alcohols—methanol causes blindness in those who consume it habitually (“meth drinkers”). Not that motorists are prone to taking swigs from the fuel tank, but anyone who has syphoned fuel from one car to another will know the taste of petrol all too well. You would not want to do that with methanol in the tank.



Fortunately, the fuel systems of modern motor cars have been upgraded over the past few decades to cope with the demands of ethanol and methanol in anti-knock additives. Meanwhile, the cost of converting a petrol-powered vehicle to run equally on methanol has fallen to around $100. After allowing for methanol's lower energy content, and including fuel taxes and the cost of all the necessary infrastructure, methanol producers reckon they can deliver the same quantity of energy found in a gallon of petrol for $3.



Two things must happen to make methanol a serious alternative to petrol. One is that oil prices become less volatile. Instead of yo-yoing as they have in the past—for instance, from $147 a barrel in 2008 to $35 in 2009 and back to $90 in 2010—nothing would benefit motorists more than if oil remained stable for at least the next five years at over $100 a barrel. That could well be on the cards. John Hofmeister, a former chief executive of Shell, predicts that the recent run up in demand for oil—primarily from China and India—will require output to be raised by an extra 10m barrels a day, pushing prices in the process to more than $200 a barrel.



The other requirement is a change in the law. The Flex-Fuel vehicles on the American market today are warranted to operate only on ethanol or petrol. “If Congress were to enact an open-fuels standard that required new cars to be warranted to run on all-alcohol fuels, including methanol, natural gas could compete with oil in the liquid-fuels market,” Tom Ridge, the first secretary of homeland security, and Mary Peters, a former secretary of transportation, wrote in the New York Times recently. Bills pending in both houses of Congress could make that happen.



On cue, both Chrysler and General Motors disclosed plans earlier this week to build fleets of pick-up trucks capable of running on both compressed natural gas (CNG) and petrol. With refueling stations few and far between, and needing $10,000 worth of conversion gear, CNG works best in taxis, buses and lorries that have long service lives (to recoup the conversion cost) and return to a central garage at the end of each working day (to refuel).



While natural gas, compressed or liquefied, is hardly the fuel for ordinary motorists, encouraging lorry drivers to adopt it could help spur the development of a methanol supply chain across the country. As T. Boone Pickens, a Texan billionaire with diverse energy interests, has pointed out, “Domestic natural gas is cleaner than diesel or gasolene. It is cheaper. It is abundant. And it is ours.”

True, but the last thing methanol needs—despite what Mr Pickens would like to see as a potential methanol supplier—is the kind of subsidies that have been heaped on corn-based ethanol, which remains as uncompetitive today as it was 30 years ago, despite the $40 billion of taxpayer support it has absorbed. Methanol, by contrast, has already proved itself to be a commercially viable fuel capable of providing cheaper and cleaner motoring while substituting for imported oil.