WITH THE LATEST surge in oil prices, the case for a large-scale effort to make oil and gas out of coal has become overwhelming. Nobody knows exactly what it would cost to make gasoline from coal. But the country needs to find - and quickly. It's obvious that the only real limit on the price of oil the cost of substitute fuels. The only plausible substitute is synthetic oil manufactured from coal.

The country's most readily available defenses against steadily rising oil prices are conservation, of course, and solar energy. But it is evident that they cannot reduce the need for oil fast enough to avoid the need for synthetics. That will be true even if all the oil-exporting nations continue their present production. But the Iranian revolution is a warning not to count on stability, peace and harmony in the Persian Gulf.

The technology is already available to make oil and gas from coal. One argument against proceeding with it is the cost. The plants would be extremely expensive. The Carter administration is reluctant to speed up federal spending at a time when it's trying to balance the budget. Private industry thinks that the risks are too great. But past experience with joint public-private enterprises suggests many possible solutions. The most promising would require private investment, with federal price guarantees.

As for the environmental dangers, they are real but no greater than those incurred by any large mining or industrial operation. These plants would contribute to public health protection by removing from coal the pollutants that make its smoke toxic.

The Carter administration has several coal-oil and coal-gas projects in one stage or another of development. It is now imperative to force the pace, make decisions and greatly expand the plans for construction. Even with the greatest pressure for speed, it takes four or five years to move a plant from blueprint into operation.

The risks in the present slow progress are not entirely economic. The indecision at the White House on energy policy, and the incessant wrangling with Congress, are fueling the presidential campaigns of candidates who promise the opposite extreme - the most dramatic of whom is John B. Connally. It is easy to imagine the possibility next winter of a severe recession caused by high oil prices, plus continuing lines at the filing stations, plus more quarreling and uncertainty over energy policy, all adding up to victories for Mr. Connally in one party's primaries and defeats for Mr. Carter in the other's.

What are Mr. Carter and his administration to do? They are going to have to respond, and show that they are responding, to a deepening oil shortage. One endeavor on which they can embark immediately, visibly and most usefully, is to demonstrate the promise of coal technology.