The U.S. gets its oil from two sources: either it pumps its own oil, called "Field Production" by the Department of Energy, or it imports oil from other countries around the world. In 2000, American commercial field production made up 38.69% of the total supply of crude oil, while imports made up 60.28%. In 2005, when I wrote the last post, those same percentages were 33.67% and 65.84%, respectively. (These numbers are different from what I wrote back in 2006 as adjustments have been made to the official statistics; these types of revisions are normal for economic statistics.) In 2007 (the most recent year), the percentages were 33.72% and 66.19%, respectively. While there has been an extremely slight increase in the amount of oil pumped domestically (0.05%), imports have also increased as well. (The reason why both numbers can increase is because a third number, "supply adjustments," fell.)
In 2007, the U.S. imported a total of 3,656,170 thousand barrels. Of those 3.66 billion barrles, the U.S. imported from a total of 46 different countries. The top 5 importing countries were: Canada (18.61%), Saudi Arabia (14.50%), Mexico (14.07%), Venezuela (11.48%), and Nigeria (10.80%), for a total of 69.47% of all American imports. In contrast, imports from countries six through ten (Angola, Iraq, Algeria, Ecuador, and Kuwait) made up only 17.95% of the total; countries 11 through 46 made up the remaining 12.58%.
Looking at petroleum imports in two other ways...
Conclusions/Predictions:
Two years ago, I made four points as to how I thought things would go with respect to American oil imports and consumption. We'll look at how good or bad those predictions were:
1. American field production will probably go below 25% of its total annual supply within the next five years.
I think we can write this prediction off; I don't foresee this happening within the next three years (or perhaps even the next ten).
2. In that same time frame, imports will probably be in the high 50s percentage (perhaps 58-59%).
On the other hand, I think this prediction is very much a lock at this time. In fact, I wouldn't be surprised if this number goes back up again, remaining in the 60-65% range.
3. America will continue to seek the majority of its oil from non-OPEC countries, such as Canada and Mexico, if only to avoid being as dependent on OPEC countries as they have been in the past. However, this will probably turn out to be a pipe dream in the long run unless Canadian oil reserve estimates turn out to be near the high end. (Estimates for Canada's proven oil reserves ranges from 4.7 billion barrels (World Oil) to 14.803 billion barrels (BP Statistical Review) to 178.792 billion barrels (Oil & Gas Journal). Obviously, this extremely wide range of guesses shows that no one truly knows how much oil Canada has.)
Since I wrote this, I've gotten a better understanding with respect to Canada's oil reserves. The problem with the Canadian oil sands is that it is made up of a very dense and viscous type of petroleum called bitumen. Bitumen is like molasses at room temperature, and needs heating just to flow. (The tar that we pave roads with is bitumen.) Oil refineries are set up to process certain types of crude oils, and bitumen is normally not one of them. So, while Canada has a lot of proved oil reserves, most of it is not in the form the refineries need to produce products like gasoline. In this respect, the lower reserve amount mentioned above is probably closer to the amount of crude oil Canada actually has. In time, more refineries may convert to take advantage of the Canadian oil sands, but that will probably be a gradual process.
4. Persian Gulf oil, which has ranged between 19.81% and 28.56% of all U.S. imports since 1996, will probably continue to hover in the high teens-low 20s, despite President Bush's goal to cut American consumption of Middle Eastern oil by 75% by 2025, per the latest State of the Union address.
I don't see this forecast changing at all. What President Bush said in 2006 about cutting the amount of Middle Eastern oil America consumes was complete and utter bullshit (and shame on you if you believed him). BTW, shame on you again if you believe either McCain or Cheney that drilling for oil offshore or up in Alaska will make a significant difference. Two reasons: "drop in the bucket" and "long-term projects," neither of which will lower your gas prices. I may post on this in the near future, insha'allah, but in the meantime I recommend that you read John McCain's Oil Scam over at Informed Comment (Juan Cole), and Drilling Our Way to... by Menzie Chinn over at Econbrowser.
References:
US Crude Oil Supply and Disposition (DoE)
US Crude Oil Imports by Country of Origin (DoE)
Notes:
* OPEC countries include Algeria, Angola, Ecuador, Indonesia, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the UAE, and Venezuela.
** Persian Gulf countries include Bahrain, Iran, Iraq, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates. However, Iran and Qatar export no oil to the U.S.
28 comments:
And I guess you think Obama's idea of even more taxation and regulation of the oil companies(Communism) will lower gas prices. We have vast reserves in the Gulf which haven't even been explored yet. I know. I'm from South Louisiana and I come from a long line of oil field workers. I am one myself. We have a huge reserve in Alaska. We have oil shale deposits and even more unexplored resources off the East and West coast. If we were tapping all of those resources we could easily make up that 30 to 35% that we are currently not producing which would leave us oil independent. It's too bad we have a majority congress that is rooted in socialist beliefs who want to completely regulate industry. They want gas prices high in order to destroy consumerism and the free market. Shame on you for believing in the would be communists in the white house.
And I guess you think Obama's idea of even more taxation and regulation of the oil companies (Communism) will lower gas prices.
Nothing is going to lower gas prices. Haven't you got that yet? The end of cheap gas is over.
We have vast reserves in the Gulf which haven't even been explored yet. ... We have a huge reserve in Alaska. We have oil shale deposits and even more unexplored resources off the East and West coast.
Well, until any "unexplored" reserves are proved, this is all just wishful thinking. In the meantime, as of the end of 2005, the US had 12 years left of proved reserves, assuming 2005's production rate. That was two years ago. The US has got a decade's worth of petroleum left. Granted, some of those "unexplored" reserves may be discovered, and companies will begin focusing more on the marginal oil sources, such as the oil shales. Oil production in the US won't stop for a loooong time. (Even some of the earliest wells in Pennsylvania still produce a tiny amount of oil today.) But until the US tames its ferocious appetite for oil, any American field production won't make a dent in the amount of imports coming into the country. The US will never be energy-independent with respect to oil.
It's too bad we have a majority congress that is rooted in socialist beliefs who want to completely regulate industry. They want gas prices high in order to destroy consumerism and the free market. Shame on you for believing in the would be communists in the white house.
Heh. Welcome to reality, pal. Republican name-calling of anyone who opposes their failed policies won't change the way things are. (And I will delete further comments that have any name-calling.)
The era of cheap gas, that is. :)
The "no drilling" crowd, which seems to be in the minority at this time, tells us that utilizing our own resources instead of imports will not reduce gas prices. Even if there were a small price reduction in gas or if it remained the same, there are other benefits of drilling our own oil that I never hear discussed. One being, the money to purchase American oil would stay in this country instead of billions and billions of dollars going overseas to a lot of countries that don't like us anyway. And then we sit idly by while these same countries buy up American businesses and real estate with our money. What kind of sense does this make when the main argument against drilling is only that gas may not be cheaper? Too many people are what I used to call a "typical customer". All they care about is what does it cost me right now, with no thought to the future. How about a little, no, a lot of discussion about what we realistically face if we don't wake up and smell the coffee.
A little food for thought for those who would like to see oil eliminated from our lives. I challenge you to make a list of things, especially those we all use every day, in which no oil (in one form or another) was used somewhere in the production process. Then look at your short list and consider if you could get along with everything that's NOT on it.
Misprint in previous post: "Consider if you can get along WITHOUT everything that's Not on the list"
The "no drilling" crowd, which seems to be in the minority at this time, tells us that utilizing our own resources instead of imports will not reduce gas prices.
First, it doesn't matter whether the "no drilling" crowd is in the minority or the majority, facts are facts. Gas prices aren't going to go down through increases in American oil production. American oil production peaked back in 1970! We are pulling smaller and smaller amounts of oil out of American soil (or ocean floors) year after year. There aren't any mythical huge oil reserves within America's borders; only small oil reserves that may not have been found yet. These will not be enough to lower the price of gasoline now or in the future to any significant degree. The only way to cut gas prices is to slash global oil demand, and because America, with 5% of the global population, consumes 25% of all the world's oil, it needs to act first. You can't persuade other people to do what you yourself aren't willing to do.
I would also recommend that people read this post as well, Robert Reich: "No" to Further Offshore Drilling.
Even if there were a small price reduction in gas or if it remained the same, there are other benefits of drilling our own oil that I never hear discussed. One being, the money to purchase American oil would stay in this country instead of billions and billions of dollars going overseas to a lot of countries that don't like us anyway.
This is partially correct. While a lot of money goes to the countries that own the oil, a lot of other money goes to various American companies that either explore and/or pump the oil out of the ground, or to other American companies who are involved in support industries (such as Schlumberger).
And then we sit idly by while these same countries buy up American businesses and real estate with our money.
You seem to forget; it's not your money anymore; you gave it up once you bought the oil. Don't want them to have your money? Don't buy the oil. The other countries are perfectly free to buy up American businesses and real estate with their money. That's called foreign direct investment, and everyone not only practices it, but they encourage people in other countries to buy their properties as well, including the U.S.
What kind of sense does this make when the main argument against drilling is only that gas may not be cheaper? Too many people are what I used to call a "typical customer". All they care about is what does it cost me right now, with no thought to the future. How about a little, no, a lot of discussion about what we realistically face if we don't wake up and smell the coffee.
I agree; see below.
A little food for thought for those who would like to see oil eliminated from our lives.
Personally, I'm not trying to "eliminate" oil from our lives. Oil is an extremely useful substance. However, we Americans are eliminating it all too quickly through our own consumption gluttony. My wife and I are expecting a baby within the next two months. Oil won't disappear in my lifetime, but by the time my baby becomes elderly, most oil on our planet will be gone. That's how fast the oil is running out.
I do thank you for your comments, Terry.
jdsg;
Yours is exactly the type of logical dailogue I hoped to see in response. Too many of these blogs are infused with emotion, ignorance and personal attacks, to the point they are useless to promote an intelligent argument. I was not clear about "our money". Been in business for 40 years and I understand what's mine and what's not. I should have said, "with what should have been our money". My reason for wanting us to drill our own resources now is not to reduce gas prices. I beleive we are now seeing about the lowest prices we will ever see. However, it is necessary to do something to tide us over and, perhaps, stall price increases until alternative energies and transportation can evolve to the point that they are readily available and affordable. This will take years, longer than to produce more oil. The first, important point is, as you said, use less and conserve. The mindset of the people of this country (me, too) and the Federal Government is "there's always more where that came from" and both share the responsibility for why we are in this position. (don't know which is the chicken and which is the egg, though). The second point is, we must all realize how long it takes for new ideas, products and the infrastructure to support them to be perfected and produced in large enough quantities and at a price the aversge Joe can afford. On the news the other day they touted the new Honda hydrogen car as our savior. Honda built 100 for the California market only, at a cost of $1,000,000 each. I am excited about this, but it will be many years before you and I could own one. That's why we need to produce more of our own oil in the meantime and then wean us off our gas guzzlers as more technologies come online. As a footnote, for the past few years, I've been working diligently with Captain Kirk on a transporter. We hope to have a working model bt 2110.
I like the measuring scheme of worst possible on one end and perfect on the other. If the US produced no oil its self it would still have domestic oil companies just as we have any other kind of business that risks its money to buy volume wholesale and sells small volumes retail.
If the US had no oil it would be forced to buy at what ever price the source wanted to charge if the US wanted oil. If the US produced volume equal to 100% of its own oil needs, oil companies could buy at home or some place else. Supply and demand would present a different set of pricing pressures.
Ask yourself where drilling for additional oil falls in that continuum.
If necessity is the mother of invention having a surplus certainly diminishes the pressures of necessity and therefore the pressure to improve our efficiency of turning forms of energy to rotational force.
For those who think the oil companies are making too much profit, its a free country start your own company. For those who think our leaders are making flawed decisions, its a free country, run for those offices because you obviously have a superior intellect and the voters will see that immediately.
To those who think they have a better solution, to know and not to have done yet, its not to know yet.
For the rest of us lets get to work improving efficiency in your home. If you have time to criticize your neighbor try marketing your better solution and make a few bucks so you can give them to those who less fortunate.
Jim
Terry: After reading your latest comment, I'd have to say that we're very much in agreement. The only quibble I have is with: "That's why we need to produce more of our own oil in the meantime..." If you look at the graph on my post yesterday about drilling in ANWR, you'll see that domestic production continues to take a dive from its peak back in 1970; we're almost down to the 50% level of what was produced back then, and I don't see the situation improving any time in the future. I'm almost at the point where I'd say just leave it in the ground; think of it as a strategic reserve. I do think that it will be eventually pumped out in time, but I'm not sure it's worth the bother to do so now.
Jim:
If the US produced volume equal to 100% of its own oil needs, oil companies could buy at home or some place else. Supply and demand would present a different set of pricing pressures.
Ask yourself where drilling for additional oil falls in that continuum.
Regardless of where the oil is from, even if the US could supply all of its own oil, that oil would still sell at the global market price. Let's say there are two prices for oil, domestic and foreign, and that the US can supply all of its own oil. If the foreign price of oil is higher than the domestic price, then the US would buy solely from domestic producers; this would cause the foreign price to drop until it matches the domestic price. If the domestic price is higher than the foreign price, then the US would buy solely from the foreign suppliers, once again forcing the domestic price to drop to meet the foreign price. Either way, the US (and everyone else) buys at the lower of the two equilibrium prices. If more oil is pumped out from additional drilling, then that helps to increase the supply (and lower the price). But the problems are that, 1) it's the oil that's already been pumped out of the ground that counts with respect to pricing, and 2) the additional amount of oil that comes out of the ground at any one time is very small in relation to the current production amounts. As a result, price changes are very, very small. Check out my ANWR post; I go over the numbers there. Even using the best case scenarios, the improvements are on the order of 1 to 2 percent. That's why I say it's almost not even worth the bother to drill ANWR.
BTW, your comments like "start your own business/run for office, etc." are the sort of things I've said in the past too. :) I completely agree with you there.
A few days ago, I commented that the U.S. should produce more domestic oil to keep more of the money at home. It didn't generate much concern. A news story this morning illustrates why I care about this. At the end of the cold war, Russia agreed to mothball a large portion of their nuclear missiles, but they couldn't afford it. So, the U.S. helped financially. Now, with oil at $135+/bbl, Russia has reinvested in updating and modernizing their nuclear missile system. Even though Russia is not even on the list of the top 15 oil importers to the U.S., we pay them $1 billion per week for their oil. Now, $52B/yr is not much in the larger scheme of things, but it bothers me that we helped them update. Whether or not increasing our oil production reduces the gas price is not the main point. The important goal is oil independence. There are many unseen consequences that will result from our inaction. This Russia deal is only one of them. This info on Russia is from a Fox News report this morning.
Lowering gas prices will only extend, what president bush even called, our "addiction to oil." The prices are high due to the basic law of supply and demand. Global supply is barely increasing while Global demand is skyrocketing.
President Bush's plans to thwart further price increases are all wrong. Instead of encouraging conservation and innovation (alternative fuels, electric cars) through tax incentives, grants and pushing manufactures for more efficient vehicles he plans to merely increase supply! But that increase in supply will not be big enough or hit the markets fast enough to have a real impact on lowering prices.
You will note that the Saudis just offered to increase their production by 0.5 million barrels a day, and the oil futures market just yawned. And that is in the real world, right now, not in some decade or two-decades-out in the future drilling scheme.
It takes years to build rigs, onshore and offshore, to drill for the oil, never mind the time for exploration before drilling and building of refineries to process the oil after drilling.
The world uses on the order of 86 million barrels a day of petroleum. That figure is expected to veer sharply upward as China and India use more automobiles and trucks. The United States uses nearly 21 million barrels a day of petroleum fuel, or nearly 25% of everything the world produces daily. The US has 5% of the world's population.
The US produces about 8 million barrels a day which is only about a third of what we use, so we import the rest. The lower 48 states produced about 4.4 million barrels of petroleum a day in 2006
I find the fact that we send over $300 Billion out of our country for oil completely disturbing. Not to mention all of the jobs our oil consumption has created all over the world for drilling, refining and managing. We send Saudi Arabia, Venezuela, Nigeria, Iraq and Kuwait over $132 Billion a year for oil.
In 2007, the U.S. imported a total of 3,656,170,329 barrels. Of those 3.66 Billion barrels, the U.S. imported from a total of 46 different countries. The top 5 importing countries were: Canada (18.61%), Saudi Arabia (14.50%), Mexico (14.07%), Venezuela (11.48%), and Nigeria (10.80%), for a total of 69.47% of all American imports. In contrast, imports from countries six through ten (Angola, Iraq, Algeria, Ecuador, and Kuwait) made up only 17.95% of the total; countries 11 through 46 made up the remaining 12.58%.
In 2007, imports from our friends in the OPEC (1) nations made up 53.85% of all U.S. imports, compared to the 46.15% from non-OPEC countries. With respect to the Persian Gulf (2), those countries made up 21.19% of the total imports ($64 Billion).
If all the known US offshore oil fields were drilled and panned out, the lower 48's oil production would be increased by 7%. That would be 300,000 barrels a day. 0.3 million barrels a day would make very little difference whatsoever to current oil prices even if it could be brought to market today. It would be a matter of a few pennies. And, in fact, if there were to be any impact of all of offshore drilling on prices, it would not come until 2020 or even 2030
A true alternative to this would be investment in alternatives. For example battery operated cars used in conjunction with alternative energy. solar, geothermal, wind.
one company has groundbreaking new technology that will be cheap enough and easy to install that every roof in America could be harnessing the sun's energy.
take a look http://www.nanosolar.com/
other innovative electricity generation projects use wave energy. http://www.wavedragon.net/
Wave Dragon is a joint EU research project, including partners from Austria, Denmark, Germany, Ireland, Portugal, Sweden, and the UK.
The US has NOTHING like this project and we should!
what i don't understand is how Congress has not passed bill H.R. 6049 — “The Renewable Energy and Job Creation Act of 2008,” which extends for another eight years the investment tax credit for installing solar energy and extends for one year the production tax credit for producing wind power and for three years the credits for geothermal, wave energy and other renewables.
These critical tax credits for renewables are set to expire at the end of this fiscal year and, if they do, it will mean thousands of jobs lost and billions of dollars of investments not made. “Already clean energy projects in the U.S. are being put on hold,” said Rhone Resch, president of the Solar Energy Industries Association.
Innovation is what America is all about.
Americans have been far too comfortable for far too long with internal combustion engine and coal fired electricity generation. It is time this country once again leads the world in innovation. Not to get political or advocate someone in November but one presidential candidate has the kind of ideas I am talking about. the possible candidate has proposed a $300 million government grant for anyone that can speed the development of battery technology. Those are the types of steps this country should be taking. Increasing alternative electricity production, creating modes of transportation to capitalize on our new abundance of electricity. Selling our innovative technology around the world causing all that oil money to flow into our country and countless jobs would be created all while our burning of fossil fuels is dramatically reduced.
I hope in my lifetime I see this come to fruition. I know times are tough and higher gas prices are hurting Americans, but it can really force amazing changes. Instead of someone buying a hummer maybe they realized they would be crazy to do so and buys a toyota prius.
I wish a detriot car manufacturer had a car with the efficiency of the Prius, but unfortunately there is none.
there is however a 100% electric car created by Tesla that is very innovative, but is a high performance and high priced car.
http://www.teslamotors.com/
0-60 in 3.9 seconds, range of 200 miles.
About Tesla Motors
One Thing We Can Agree On
Whether you‘re more concerned about global warming or about national security, there's one thing we can probably agree on: our dependence on oil is dangerous and costly.
Right now 58 percent of our oil comes from other countries, so it's practically inevitable our foreign policy principles will be held ransom by our need to maintain domestic economic stability. When you consider that 68 percent of our oil is used for transportation, we believe gasoline-free cars are an ideal solution to these issues. Even a hybrid car, which still burns gasoline and emits carbon dioxide, doesn‘t solve our oil-related problems, it just postpones them. If you look hard at the numbers, it's clear that an electric car is the cleanest and most efficient kind of car in existence. We have done exhaustive “well to wheel” energy and emissions analyses, and the numbers are undeniable.
Electric “Punishment Cars”
Historically, it seemed to us that electric cars had been designed by people who thought we really shouldn't be driving at all - but if we must, we should suffer every minute of it. Electric cars have had terrible range and embarrassing styling. To those who say electric cars have been tried and failed we say, of course electric cars won‘t catch on if no one actually wants to drive them.
Changing Perceptions
We needed to change perceptions of electric vehicles in a big way. To make electric cars a viable alternative, we set out to build one that was gorgeous and thrilling to drive.
Our first car, the Tesla Roadster, isn't a pipedream or a plan; this car exists now. It's a no-compromise driver‘s car that does 0 to 60 mph in less than 4 second and will hit a top speed of nearly twice what the law permits. With a range of about 220 miles on a single charge, you can use it all day long and not worry you'll run out of juice. Just plug it in at night the same way you drop your cell phone into its charger, and sleep well, without guilt.
Just the Beginning
While the Tesla Roadster's sticker price is in a league with other high-performance sports cars with similar specs, we recognize it's out of reach for a lot of people. We consciously chose to develop a high-end sports car as our first car in order to develop the “performance DNA” from which we could create other electric vehicles. Our next model will leverage the Tesla Roadster‘s technology, resulting in a less expensive sports sedan that we can sell at higher volume.
The Mission
Tesla Motors designs and sells high-performance, highly efficient electric sports cars — with no compromises. Tesla Motors cars combine style, acceleration, and handling with advanced technologies that make them among the quickest and the most energy-efficient cars on the road.
That was a pretty good ad for the Tesla car. I saw a piece about that car on the Science channel, I think. Very impressive. Having an automotive background, I can appreciate what they have done and what they are striving for. On the other hand, I am also realistic about the time they have already invested in this project and the years they will invest in the future in order to bring it to market. I don't remember how long they had been working on it since its inception, but they didn't just throw it together in the last year. If I remember correctly, the car presently carries only two people, is super light and, therefor, is not built strong enough to be legal for highway use in the U.S. As it is refined and designed to accomodate an average family safely, it will also become heavier which will decrease the range. That will require better battery technology to regain the range. It will be years and years before an acceptable version will be available to the masses at a price most can afford. Then think about infrastructure, throughout the country, to support this new technology. More time involved. Before anyone chastises me, let me say I believe in our persuit of alternatives. We must go forward and no one single idea will solve our problems. It has to be a combination of many. My concern is all those people who misunderstand and think all the answers are just around the corner. Think about this: after all the crap we are going through now, fifty years down the road, the transportation and energy tech will probably be different than what we are involved with now. One last thing. All of us in this country should be ashamed of ourselves for sitting on our hands for the last thirty years while fanatically overcompensating for the perceived threat to various single birds, frogs and plants. I've still got a box of Spotted Owl Helper in my pantry. (True)
jdsg;
You said "i'm not sure it's worth the bother to do so (drill our own oil) now". It is my understanding that the whole purpose of the exercises we are presently going through is to reduce our dependence on oil, especially imported oil. If we can supply any of our own and thereby decrease imports, how can that not be worth the bother? I don't understand. Please don't tell me you are one of those who wants to do nothing while we wait for some miracle to arrive tomorrow. And if you are, even being an ELO lover won't make things right.
If we can supply any of our own and thereby decrease imports, how can that not be worth the bother? I don't understand.
Because I believe that if you did a cost-benefit analysis, the benefits from drilling are, if anything, overstated. As I said earlier, I'd rather treat these reserves as strategic reserves, for when we really need the oil. Keep in mind that the changeover to a new form of fuel takes a number of decades (at minimum, 30-40 years). If we assume that we're on the leading edge of a cusp, changing over to a new form of fuel (whatever that fuel may happen to be), then we will be old before that changeover is completed. If ANWR were ready to drill today, how long would that reserve last? 20 years? Now you've got an additional 10-20 years (or more) to worry about your oil supplies before the transition has been completed. And ANWR has only satisfied 1-2% of all your oil needs to begin with.
Please don't tell me you are one of those who wants to do nothing while we wait for some miracle to arrive tomorrow.
No, I'm actually more pessimistic than that. I'm more fearful that the breakthroughs won't occur; in which case, what then? At least in that case, you still have the strategic reserves available to help out in the future; you hadn't drained them away earlier and they became a puff of smoke.
BTW, you might find this article in the Economist of interest:
The End of the Petrolhead This week's special report is on energy, and there are a number of different articles on alternative energies that you might find of interest.
Terry: Here's a post for you.
JDsg;
I don't agree with everything you say, but you do make a lot of sense. And thanks for that list of articles. Very informative and well written. I think anyone, no matter what their persuasion, would benefit from reading them.
JD, First let me applaud you on your research. Assuming your accuracy is on point, this is a well done analysis. As somebody who has worked on the fringe of oil and gas trading, I have an unresolved issue. Beyond the obvious classic supply and demand issues (Namely: China, India, U.S.) you don't seem to acknowledge the substantive role of traders in artificially driving up oil prices with their mercenary actions.
Anonymous: Thanks for the comment and the complements. With regard to traders, I haven't really tackled this topic due to reading some much better posts by other writers. You might want to check out the writings of James Hamilton (professor of economics at Cal-SD); for example, How big a contribution could oil speculation be making?
A listing of posts that cover this topic can be found here: Are Speculators to Blame for Oil Prices? Resources to Inform
"Nothing is going to lower gas prices. Haven't you got that yet? The end of cheap gas is over." Great prediction genius.
@ Anonymous (12/13): You know what? I still stand by that statement. The only reason why you have "cheap" gas prices now is due to the huge drop in demand for gas. It's only taken a major, major recession (and this might even be a depression) to significantly decrease demand. Don't forget, money's become a lot tighter for people after the economy lost over 1.2 million jobs in the past three months. People have decided that mass transit is a lot more attractive to them in order to save money getting around town. However, as we all know, mass transit is what economists call an inferior good. When the economy starts to improve once more, don't fear, the price of oil will begin to rise very quickly once more and you'll all be paying through the nose at the pumps. Once more, let me reiterate: "The era of cheap gas is over." Don't be so short-sighted.
Screw oil. Let's go nuclear. And I'm not talking fission that leaves behind radioactive waste for a century. I'm talking fusion. We already have unbelievably energy efficient facilities in the making (one was finished recently if my information is correct), and the reaction works. In its current state, leaving behind the waste it does, nuclear power is the ONLY source of energy we have that is responsible for 100% of its waste, and is by far the most efficient in terms of energy conversion. Obama pours so much of our government's money into regulation of business, socialist health care policies and "stimulating the economy" (using up more money than 7 years in Iraq ever did I might add). Consider, for a moment, if he instead spent a fraction of that on advancing fusion technology. We can already create the reaction, all that is missing is a safe way to harvest the energy efficiently. With the funds that Obama is dealing out like candy, we could probably obtain reliable fusion power more than a decade before expected. If we have about a decade before our "proven" sources of oil run out (even though the exact same thing was said in the 50's), then let's invest our money NOW into something that we know will work. Oil pollutes, is costly for everybody, and is limited. Fusion is unlimited, much more powerful, and leaves far, far less trace than any other source of energy in the world.
@ Anonymous (10/18): I too would love to see a commercially feasible fusion reactor go online, but we are most likely years, decades, perhaps even a century away (according to New Scientist magazine, back in 2006). I've got no problem with the government allocating more tax dollars to continue research into fusion power. But the bigger problem is simply that fusion power, even if online and commercially feasible, isn't going to replace America's dependence upon oil for our transportation needs. Unless you can devise a "Mr. Fusion"-type generator for cars (a la "Back to the Future"), oil's going to remain a vital and necessary source of fuel.
You have one of the most thoughtful, intelligent blogs on this subject ever! I enjoyed your well-written responses and just wonder why more people don't get it. I truly think it is how the information is presented. And in my personal crusade for energy independence I think that is the challenge. How do you take these very interesting but mundane facts and make them understandable to a public who yells "drill-baby-drill!"? The other question regards the energy conservation movement. How much can we realistically save in energy from our current usage from conservation measures? Because the cheapest energy is that which you never use. I think the first 5% is easy by just turning off the lights when we leave the room. 10% requires more insulation and caulking. 15% starts to hurt with changes in lifestyles. I ask because I am very interested in the emerging PACE or clean energy bonds. In fact I think there is a business in it. ;-) In the US and other parts of the world.
Why wake up and smell the coffee?
In about two years, if the "2012" conspiracy theorists are correct, there isn't going to be civilization left on the planet to keep bemoaning about the pain at the pump anymore.
Take your pick and spin the Wheel of destruction...Let's see:
Ungodly huge Solar Flare wiping out the US electrical grid, and possibly other countries grids...causing widespread panic and disorder...and The US as we know it goes "bye-bye," but then so does every other industrialized country on the planet...
Large Haldron Collider succeeds at making a miniature black hole, which sucks up the Earth in a nanosecond.
Huge earthquakes registering 8 or above shake the earth to smithereens....
Planet "X" coming too close....
Some dumb janitor pushing a broom, in a certain facility, bumps into THE BUTTON, and launches Iran's start of WWIII with Israel, and Ajad has to CYA, in front of camera saying "Yes I meant to do that all along...", and away from camera, wringing his hands wondering how fast the easterly wind from the Mediterranean will bring the fallout back toward him...if the response from the other nations won't get to him first...
Obama implementing his HealthCare bill...
I have a question and I really hope you can email me the answer. How much gas is imported to the United States from Iraq. Also if the amount has changed since President George Bush retired and President Obama came into power. I really hope you can get back to me.... thanks in advance.
Em
@ Em:
How much gas is imported to the United States from Iraq.
None. But that is not surprising as the US doesn't normally import gasoline. It imports crude oil, which is then turned into gasoline and a number of other petroleum products (like aviation fuel, fuel oil, kerosene, etc.) at refineries. So the question you should be asking is, "how much crude oil (and any other petroleum products) is imported into the United States from Iraq?" The number varies from month-to-month. Between 1997 and late 2003, the amount fluctuated wildly (you can see a graph at this link: Monthly US Imports from Iraq of Crude Oil and Petroleum Products). Starting in late 2003, you can see a definite trend where the amount went from about 21,000,000 barrels per month to about 15,000,000 barrels per month, where it is today. On an annual basis, the US imported 164,125,000 barrels of crude oil from Iraq in 2009 (see US Imports by Country of Origin - Annual (Thousand Barrels)
). In that same year, the US imported a total of 4,279,908,000 barrels of crude oil from around the world; thus, the percentage that came from Iraq is roughly 3.8%. Not very much. In comparison, the percentage for 2008 was 4.9%.
Also if the amount has changed since President George Bush retired and President Obama came into power.
The amount imported under the Obama administration has decreased somewhat, as mentioned above, but the overall trend with respect to Iraq has been going downwards (slowly) since 2004.
I hope this helps.
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