The world’s economic superpower is dreaming of a new kind of independence. But with domestic oil and gas production declining, America will have to look elsewhere for energy.
 | VulnerabilityDomestic U.S. oil and gas production is vulnerable to hurricanes. Thunder Horse, the world's largest semi-submersible platform, was tilting after Hurricane Dennis hit the gulf in July 2005. In December 2005, more than a third of all the oil and gas wells in the Gulf region remained out of operation (Photo: Reuters) |
For many U.S. Americans, energy security would mean producing more energy at home and relying less on unfriendly, undemocratic, and politically unstable oil exporters. The reality is that United States imports three-fifths of its oil, a share that is increasing. And among the top-five countries exporting crude oil to the United States, only Canada and Mexico can be considered friendly and democratic.
Saudi Arabia, which exports 1.5 million barrels per day to the United States, lacks democratic credentials and is accused of indirectly financing terrorism. Nigeria’s oil production is hampered by guerrilla groups fighting for a share of the riches. And Venezuela’s President Hugo Chavez has long embarked on a crusade against U.S. influence in South America and other parts of the world.
To counter the trend, U.S. President George W. Bush started the “Twenty in Ten” project attempting to reduce U.S. gasoline consumption by 20 percent in ten years. Some 15 percent of all gasoline consumed should be replaced by alternative fuels. Improving fuel efficiency is meant to provide another 5 percent of reduction.
The production of ethanol, a biofuel, has quadrupled from about 6.1 billion liters (1.6 billion gallons) in 2000 to an estimated 24.2 billion liters (6.4 billion gallons) in 2007. In 2005, the United States became the world's leading ethanol producer, and last year, the U.S. accounted for nearly half of global ethanol production.
 | Decreasing productionOil rigs in Texas - a symbol for the American Dream, but U.S. oil production has been declining since the mid 1980s (Photo: Reuters) |
Unfortunately, most ethanol produced is made of corn. Harvesting it to fuel cars instead of feeding men or livestock is one of the reasons that food prices all over the world have risen sharply. Energy security thus goes to the detriment of food security – a problematic bargain.
Another measure to strengthen energy security is to double the current capacity of America’s Strategic Petroleum Reserve (SPR) to 1.5 billion barrels by 2027. With a daily consumption of about 20 million barrels per day, this would allow for 75 days of energy independence.
State funds have also gone into wind power, solar energy, and hybrid cars that run on electricity and gasoline. But even with strong growth, renewables will only represent a tiny fraction of nationalenergy production. The Energy Information Administration (EIA) predicts that petroleum, coal, and natural gas will still meet 83 percent of total U.S. energy supply requirements in 2030, down only slightly from 85 percent in 2006.
Diversifying gas
While the energy security debate in Europe is focused on Russian gas, the debate in the U.S. is locked on foreign oil, despite the fact that more than half of all U.S. citizens rely on natural gas for heating.
For decades the U.S. has enjoyed easy access to gas in U.S. and Canadian fields. This blessing, however, is seen as a problem by experts like Didier Houssin from the International Energy Agency, because it creates dependence. If terrorists took out a key pipeline, bringing in alternative supplies from outside North America would be difficult and expensive.
Liquefied natural gas (LNH) transported with specialized supertankers could provide more diversity, but at a comparably high price. The U.S. is also building LNG terminals that will ease importing from abroad.
It does not even take terrorists to validate the threat to domestic sources of oil and gas. During 2004 and 2005, hurricanes destroyed 116 oil platforms in the Gulf of Mexico and severely damaged 56 more. In December 2005, more than a third of all the oil and gas wells in the Gulf region remained out of operation.
But the sheer size of the U.S. gas market helped insulate the country from any resource shocks. Even when hundreds of wells had to be shut-down because of hurricane damage, the U.S. fell back on other resources to provide gas to consumers in areas that were affected by the disruptions.
Read more:
Energy Security in Europe: From Russia with Love
Energy Security in China: Catching up with Growth
Energy Security in India: Suffering from Success
Energy Security in Brazil: The Next Oil Boom?
editor: Thilo Kunzemann
publishing date: May 27, 2008
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