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New Study Examines America’s Energy Security Options
- By Williams Ekanem
- Published July 19th, 2011
- Washington File
- Unrated
A new study from the Peterson Institute for International Economics in Washington D.C. has evaluated the ability of recent policy proposals, from offshore drilling to vehicle efficiency standards, to make America more energy secure and cut oil imports.
The authors find that a comprehensive approach, comprising eight to ten major components, is required to significantly alter the country’s energy future.
Such a strategy, according to BusinessWorld findings could cut US energy inputs in half over the next fifteen years but even then the United States will remain vulnerable to international oil market disruptions with all the attendant economic and national security consequences.
The study, entitled America’s Energy Security Options, was prepared by Visiting Fellow Trevor Houser and Shashank Mohan. It provides a detailed analysis of the ability of various measures proposed by President Obama and currently before Congress to curb US oil imports, reduce gasoline prices, increase American resilience to global oil market disruptions and improve US national security.
The authors find that there is no panacea for the energy security challenges facing the United States. Rather than debate whether expanded domestic production, improved efficiency, or development of oil alternatives is the right course to take, the United States needs to start moving down all three roads simultaneously.
The authors conclude, for example, that taken together the various individual proposals under examination would have a meaningful impact on US oil production and consumption. In addition to the near-term supply relief from increased Gulf of Mexico production, total domestic oil output would increase by roughly one million barrels per day (bpd), about 10 to 12 percent, between 2021 and 2035.
Oil demand would be reduced by 2.2 million to 2.8 million bpd during that period, or 12 to 15 percent. Together, increased domestic supply, efficiency, and fuel substitution would curb US oil imports by 3.1 million to 3.8 million bpd by 2035.
In an upper-bound (high) scenario, this would cut overall net US oil imports to 4 million bpd, reducing US dependence on imported oil (measured in physical terms) to its lowest point in the past 40 years. America’s annual bill for imported oil would fall by between $127 billion and $148 billion between 2021 and 2035, taking a significant bite out of the country’s trade deficit.
Because global oil prices would drop by $8 to $10 per barrel, foreign oil producer revenue could be reduced by up to half a trillion dollars per year in the long term.
Rising oil prices and instability in the Middle East and North Africa have forced energy security back into the forefront of the American political debate.
In recent months, the Obama administration and congressional leaders have proposed a range of remedies and on June 23, 2011 the Department of Energy announced that the United States would sell 30 million barrels of oil from the strategic petroleum reserve, as part of an internal effort coordinated with 27 other countries to double that amount, to offset the impact of Libyan supply disruptions on the global economic recovery.
The authors find that a comprehensive approach, comprising eight to ten major components, is required to significantly alter the country’s energy future.
Such a strategy, according to BusinessWorld findings could cut US energy inputs in half over the next fifteen years but even then the United States will remain vulnerable to international oil market disruptions with all the attendant economic and national security consequences.
The study, entitled America’s Energy Security Options, was prepared by Visiting Fellow Trevor Houser and Shashank Mohan. It provides a detailed analysis of the ability of various measures proposed by President Obama and currently before Congress to curb US oil imports, reduce gasoline prices, increase American resilience to global oil market disruptions and improve US national security.
The authors find that there is no panacea for the energy security challenges facing the United States. Rather than debate whether expanded domestic production, improved efficiency, or development of oil alternatives is the right course to take, the United States needs to start moving down all three roads simultaneously.
The authors conclude, for example, that taken together the various individual proposals under examination would have a meaningful impact on US oil production and consumption. In addition to the near-term supply relief from increased Gulf of Mexico production, total domestic oil output would increase by roughly one million barrels per day (bpd), about 10 to 12 percent, between 2021 and 2035.
Oil demand would be reduced by 2.2 million to 2.8 million bpd during that period, or 12 to 15 percent. Together, increased domestic supply, efficiency, and fuel substitution would curb US oil imports by 3.1 million to 3.8 million bpd by 2035.
In an upper-bound (high) scenario, this would cut overall net US oil imports to 4 million bpd, reducing US dependence on imported oil (measured in physical terms) to its lowest point in the past 40 years. America’s annual bill for imported oil would fall by between $127 billion and $148 billion between 2021 and 2035, taking a significant bite out of the country’s trade deficit.
Because global oil prices would drop by $8 to $10 per barrel, foreign oil producer revenue could be reduced by up to half a trillion dollars per year in the long term.
Rising oil prices and instability in the Middle East and North Africa have forced energy security back into the forefront of the American political debate.
In recent months, the Obama administration and congressional leaders have proposed a range of remedies and on June 23, 2011 the Department of Energy announced that the United States would sell 30 million barrels of oil from the strategic petroleum reserve, as part of an internal effort coordinated with 27 other countries to double that amount, to offset the impact of Libyan supply disruptions on the global economic recovery.
