~~~~ Full Report: ~~~~ www.fe.doe.gov/programs/reserves/publications/Pubs-NPR/npr_strategic_… (PDF, 1.1MB)
~~~~ Extract: ~~~~
The growing dependence of the United States on foreign sources for its liquid fuels has significant strategic and economic implications. The United States has been a net importer of oil for more than 50 years, and today, imports nearly 60 percent of its liquid hydrocarbon needs (Figure 1). The U.S. Department of Energy (DOE) projects that U.S. imports may double, to 19.8 MMBbl/D by 2025. By then imports will exceed 70 percent of demand, the vast majority coming from Organization of Petroleum Exporting Countries (OPEC). As imports rise, America’s vulnerability to price shocks, disruptions, and shortages will also increase1.
The expected increase in demand for imported oil comes at a time when other consuming countries are also increasing their demand for oil, primarily from OPEC. Is such a growing dependence on imports and on OPEC accept able? Is it even possible for OPEC to meet the ever-increasing world demand for oil? And if it is possible, is increasing dependence on OPEC oil in the best long-term interests of the United States?
Adding urgency to these questions is the indication that world oil production may peak sooner than generally believed, accelerating the onset of inevitable competition among consumers (and nations) for ever-scarcer oil resources. Figure 2 illustrates the supply peak concept, first espoused by Dr. M. King Hubbert (Ref. 1), and now being debated by a number of respected petroleum experts (Ref. 2, 3, 4, 5, 6, 7, and 8). All of these experts agree that world petroleum supply will peak; the question is when? When the petroleum production peak occurs, the consequences will be severe if import-dependent nations have not prepared for it.