PRESIDENT BARACK Obama has often stated that one of his highest priorities is to vanquish the "tyranny of oil" by developing alternative sources of energy and substantially reducing America's reliance on imported petroleum. But we will not be energy independent for the next thirty to forty years, even with a strong push to increase energy efficiency and spur the development of petroleum alternatives. During this time, America will remain dependent on oil derived from authoritarian regimes, weak states and nations in the midst of civil war.
Less and less crude will come from reliable suppliers in the Western Hemisphere. Given our continued dependence on imported oil, picking and choosing among our suppliers obviously would be ideal. But this is not an option. The oil market is thoroughly internationalized. Key traders draw on multiple sources of crude to satisfy the needs of refiners and retailers. Most importantly, a majority of the world's remaining oil is controlled by countries that are not democracies, do not honor the rule of law and are certainly not noted for their pristine human-rights behavior. If anything, our reliance on these producers is likely to grow as output in the older producing areas of the Western Hemisphere declines and more and more of the world's output is concentrated in Africa, the Middle East and the former Soviet Union.
In the past, the United States made an implicit bargain with our foreign energy suppliers; we will protect your government, supply arms to your military and overlook your human-rights violations in exchange for preferred access to your oil outputs. These arrangements reduce our political leverage, our moral authority and our ability to bargain with these states on other issues. We must accept the reality of our continued oil dependence and reframe our relationships so that the market, rather than guns, bloodshed and dictatorships, governs trade in crude. Contrary to popular belief, these petro-regimes need the United States more than the United States needs them. The tyranny of oil can be stopped.
ENERGY DEPENDENCE is our reality. At the beginning of 2009, the United States needed nearly three-fifths of its total oil supply to come from imports. To reduce this high level of reliance, most policy makers favor some combination of measures aimed at spurring conservation and expanding the supply of domestically produced fuels. These could include higher gasoline taxes, incentives for the acquisition of gas-electric hybrids or all-electric vehicles, the accelerated production of alternative fuels (such as liquids derived from shale, biomass and coal), the expansion of public transit and increased drilling in protected areas like the Arctic National Wildlife Refuge (ANWR) and the outer continental shelf. All of these proposals have their fair share of advocates and opponents. All, no doubt, will be examined closely by this and future administrations. But even if given a strong endorsement by Congress and the White House, every one of them poses significant obstacles of one sort or another, and so, no matter which menu of options is ultimately adopted, it will be several decades before they can achieve maximum effect.
Unfortunately, no amount of wishful thinking can get us around the facts. Much hope has been placed, for example, on the development of advanced biofuels that can be derived from nonedible plant matter like switchgrass and straw and that can be manufactured by chemical means, rather than energy-inefficient cooking. But no such refineries are now in operation and it will be a decade or more before fuel of this type is available in large quantities. The full-scale development of other petroleum alternatives, such as coal-to-liquids (CTL) and biodiesel derived from certain strains of algae, is expected to take even longer. Boosting wind, solar and nuclear energy to produce more electricity for use by plug-in hybrids, all-electric cars and high-speed rail will also require trillions of dollars in new investment and take several decades to achieve. Thus, even in 2030, the Department of Energy projects that biofuels and CTL will provide a mere 14 percent of the nation's liquid-fuel supply, with petroleum providing the remaining 86 percent. And, because of the long-term decline in domestic oil output, imports will have to provide about half of all that petroleum.
This is a crisis long in the making. U.S. domestic oil output reached its peak and began a long-term decline almost forty years ago. Back in 1972, America produced approximately 12.5 million barrels of oil per day and imported only 4.5 million barrels, so foreign crude constituted about one-fourth of the total supply. Since then, our oil consumption has continued to grow while domestic output has fallen, so the difference has had to be satisfied with ever-increasing quantities of imported petroleum. We crossed the 50 percent threshold of reliance on foreign oil in 1998 and have been heading toward 60 percent dependence ever since. Plans announced by President Obama to stimulate the development of petroleum alternatives will reverse this trend and possibly bring U.S. dependence back below the 50 percent threshold in a decade or so; but with domestic consumption continuing to rise, there will be no reduction in the actual volume of oil we must obtain from foreign suppliers.
WHERE, THEN, will this oil come from? It will not come from allies; crude will come from barely tolerable and increasingly unreliable tyrannies.
Until now, we have been very fortunate, securing a large share of our imported petroleum from more-or-less friendly suppliers in the Western Hemisphere-but these happy days are drawing to a close. In the fourth quarter of 2008, the United States obtained approximately 45 percent of its imported oil from Western Hemisphere sources, mainly Canada, Mexico and Venezuela. The more we look into the future, however, the less we can expect to rely on these countries to meet our import requirements. Canada's conventional oil output is expected to fall by half between now and 2030, from 2.1 to 1.1 million barrels per day, and while the production of unconventional fuels derived from tar sands (bitumen) could more than compensate for that decline, the high cost of producing these fuels and the various environmental hazards involved could cap production at but a few million barrels per day, limiting the potential benefit to America. Mexico presents a more ominous picture. Its net petroleum output is expected to fall below domestic demand by 2030, leaving zero oil for export to the United States. Venezuela will still be producing a surplus in 2030, but so much harm has been caused to its oil fields and production infrastructure by Hugo Chávez that the amounts available for export will not be sufficient to make up for the loss of Mexican supplies. Brazil is the one bright spot on this map. It is developing new fields in the deep waters off Rio de Janeiro that promise substantial additions to world supplies; however, Brazil is a fast-developing nation with huge energy needs of its own, so whether any of this new oil will be available for export to the United States remains to be seen. Bottom line, the Western Hemisphere's share of U.S. oil imports will shrink considerably over the next twenty years.
This means that more and more of our imported oil will have to come from producers in central Asia, the Middle East and Africa. And among these suppliers, we will find ourselves increasingly dependent on a small constellation of producing countries with the unique capacity to satisfy rising world demand in the decades ahead. Only a dozen or so countries are capable of providing a significant surplus for export markets: Algeria, Angola, Libya, Nigeria and Sudan in Africa; Iran, Iraq, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates (UAE) in the Persian Gulf; and Azerbaijan, Kazakhstan and Russia in the former Soviet Union. The Persian Gulf states alone are expected to provide 31 percent of the conventional oil supply by 2030, while the former-Soviet states will provide about 18 percent and the African states 16 percent. All other suppliers are either in decline (e.g., Indonesia and the North Sea countries of Denmark, Norway and the United Kingdom), need all their oil for domestic use (e.g., China) or are too insignificant to make a difference. Iran, which certainly has the capacity to provide oil, doesn't even figure into this dire equation as long-running sanctions cut off the American market-not that Tehran would be a desirable supplier in any case. So, whatever our preferences, we will increasingly rely on these fourteen key producers.
And this is where our problems begin. Although the United States maintains friendly relations with most of these countries, none are truly allies in the sense that Canada or Britain or Norway is a friend of the United States. Some are truly antagonistic-think Sudan and Russia-while others maintain "proper" ties with Washington yet allow the expression of virulently anti-American views by semiofficial voices within their territory; the government-financed Wahhabi clergy in Saudi Arabia is a perfect example. Factions within the Saudi ruling elite and those of the other Arab oil states have channeled funds to Islamic charities tied to al-Qaeda. Moreover, few of these countries provide adequate protection for basic human rights, and most remain hazardous territory for those speaking out on behalf of women or minorities. Although national elections are periodically held in a majority of them, none can be considered an authentic democracy. Corruption, cronyism and press censorship are almost universal.Image: Pullquote: Petro-regimes need the United States more than the United States needs them. They tyranny of oil can be stopped.Essay Types: Essay