By year’s end, all U.S. military personnel will be out of Iraq, and the newly formed Iraqi security forces will be tasked with keeping the peace, protecting the oil fields and repelling attacks from enemies of the state.

This marks the conclusion of a U.S. military presence in Iraq since 2003. It also serves as a rather unpopular topic of political discussion, especially given the election year that’s fast approaching — then again, war never is a popular topic to stump on during an election year.

Should civil war or an incursion happen before Nov. 4, 2012, the blood spilled, the hundreds of billions of dollars spent and the forfeiture of oil reparations to pay for the war will paint this seemingly clever political maneuver as selfish and foolish.

This is the risk a president takes when he doesn’t listen to the military tactics of his generals. This type of political posturing is just one of the reasons why it behooves America to rapidly expand its domestic onshore energy policy.

The benefits of doing so are both numerous and blatantly clear: Thanks to the technological advances and new drilling techniques, such as horizontal drilling and hydraulic fracturing, U.S. oil production is at its highest level since 2002. The Energy Information Administration reported that production of crude oil rose by 3% last year alone, which is an average of roughly 7.5 million barrels per day.

Take Texas for instance: In 2008, production of crude reached a low of nearly 1 million barrels per day, but it has jumped 20% since then, to 1.2 million barrels per day, thanks to an industry-wide focus on the Permian Basin and the Eagle Ford Shale formations in west and south Texas, which are undergoing a renaissance.

Other vast domestic oil and natural gas deposits in the U.S., that were at one time too costly to pursue, include the Bakken Oil Shale in North Dakota, the Wattenberg Field in northeast Colorado and the Marcellus Shale Formation in Western Pennsylvania. Technological drilling developments have opened the flood gates for drilling there and are causing what only can be called an American oil boom.

These previously untapped areas represent modern-day buried treasure and are in the nascent stages of development. Can you smell that? It’s the smell of opportunity — and money.

So vast is the Bakken shale formation that a major play there, Continental Resources (NYSE:CLR), recently estimated that the company has drilled only about 15% of the wells that will be needed to develop the entire Bakken formation.

Lane Riggs, a senior VP at Valero Energy (NYSE:VLO), one of the nation’s largest refiners, said his company processed 37,000 barrels of oil per day from the Eagle Ford Shale in the second quarter of 2011 alone. And Anadarko Petroleum (NYSE:APC) announced it had discovered what it believes will be 1 billion to 2 billion barrels of oil in the Wattenberg Field, which would make it the largest oil discovery in more than 40 years.

Suffice to say that, collectively, America’s oil production will double over the next decade. The world markets have recognized America’s new oil boom as well.

Take the two types of crude oil that are used as benchmarks in oil pricing: First is North Sea Brent crude (NSB), which, as the name implies, is sourced from the North Sea. It is used to price European, African and Middle Eastern oil that is exported to the West.

Next is West Texas Intermediate (WTI), or “Texas light sweet,” which is the underlying commodity of the New York Mercantile Exchange’s oil-futures contracts.

Up until mid-2010, the two pricing indices traded within $3 of each other. But as of early 2011, WTI gradually has been trading at a widening discount to NSB — so much to where the disparity reached a 30% discount this past October.

The reason is a sizable and sustainable increase in the domestic onshore oil production.

And it doesn’t stop there. President Barack Obama recently shelved the Keystone XL pipeline — which was set to deliver oil from the tar sands in Alberta to Cushing, Okla., and many similar refineries along the Gulf of Mexico at an initial rate of 435,000 barrels per day — until after the election.

It is again another politically inexpedient move to delay this project, which already has three years of environmental impact studies supporting its construction. Not to mention the fact that tabling the project removes the creation of more than 20,000 high-paying U.S. jobs.

Again, Obama didn’t want to polarize his alternative energy-loving, rich voter base in what is shaping up to be a highly charged and close presidential election. So, labor gets thrown under the bus as a result of this political tradeoff.

As you can tell by now, I think the anti-fossil fuel policy embraced by the current administration is wrong on several fronts, especially in the wake of budget debacles like the Solyndra meltdown and 90% of all other solar companies getting priced out of the market by China.

As far as energy policy is concerned, as a nation, we need to develop both green-energy technologies as well as onshore oil and gas exploration. One day, fossil-fuel reserves will run dry — it’s just a fact — and it argues strongly for renewable energy. But if all the stars lined up for solar, wind, geothermal, hydro, algae and biomass, the capacity of all these renewable sources of energy wouldn’t replace 10% of America’s energy needs by 2025. This data is from the EIA, and it fully supports why we need to move full speed ahead with onshore oil and gas exploration.

Let’s put it into perspective:

• Domestic onshore oil and gas exploration and production creates tens of thousands of high-paying, high-quality jobs, and it’s the best catalyst for restoring GDP growth in America.
• Onshore E&P alleviates the risk of massive deepwater oil spills, like the BP (NYSE:BP) disaster in the Gulf of Mexico.
• It drastically reduces America’s dependence on foreign oil imports, which, in turn, leads to a large scale-down of military exposure in the Middle East, allows huge savings for the national budget and brings down the unemployment rate.

It all makes sense to me, and that’s why I’ve recommended the Cushing MLP Total Return Fund (NYSE:SRV), E-TRACS 2X Monthly Leveraged Long Alerian MLP Infrastructure Index (NYSE:MLPL), SandRidge Mississippian Trust (NYSE:SDT) and SandRidge Permian Trust (NYSE:PER) as high-income pure plays for a 2012 investment theme.

This article originally appeared on MoneyShow.com.