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THE US DEPENDENCE ON FOREIGN OIL
In late 2004, the Hudson Institute conducted a survey with the following results:
* 75% of Americans prioritized "reducing our reliance on foreign oil" over "cheaper prices for oil and gas."
* 83% of Americans agreed that "reducing our dependence on foreign oil must be a top priority for the next administration."
* 91% of Americans concurred that "when it comes to energy, we need an America that relies on its own ingenuity and innovation-not the Saudi royal family."
How much oil we depend on from foreign sources affects our economy and our national security. Today, we import more than half of the oil we use, and it will increase as we use up domestic resources. The majority (65% to 75%) of the world's oil reserves are in the Middle East and are controlled by the OPEC oil cartel. The US depends on oil for most of its transportation needs – up to 95%. Until alternative energy vehicles start becoming more commonplace, our dependence on foreign oil will only grow.
In the past, dependence on oil has cost our economy dearly. Oil price shocks and manipulation by OPEC between 1979 to 2000 cost the US around $ 7 trillion, nearly as much as was spent on national defense over the same period and more than the interest payments on the US national debt. An economic recession resulted from each major price shock, so with increasing dependence on OPEC oil, continued price shocks will continue to cost the US economy.
In late 2004, oil prices charged toward $ 50 a barrel as hurricanes slowed petroleum output from the Gulf of Mexico and rebels threatened Nigerian oil facilities. Not only did that create a surge in gas prices at the pump, but increased the dependence of the US on oil from the middle East. "Higher oil prices could trigger a global recession," according to Purnomo Yusgiantoro, President of OPEC. Analysts reported surging demands from a booming Chinese economy as the cause of putting global demand only slightly below global supply. Most OPEC nations are already producing at full capacities.
All the oil beneath the surface of the earth formed in more than 200 million years, yet in 200 years half of it has been consumed. At that rate, remaining oil resources would be depleted in 40 years. We would still have other fossil fuels like coal, shale oil, tar sands and natural gas. Currently, many of these energy resources are too costly to use, and their conversion to transportation fuels for use in alternative energy vehicles would produce harm to the environment. Investigation is ongoing to find new fuels to develop economically and without environmental damage.
Ultimately, the solution to our dependence on oil lies in our technological progress in developing alternative energy vehicles that are more environmentally friendly and use energy more efficiently. Research continues to find or create new energy sources to replace petroleum cleanly and inexpensively. As people embrace hybrid cars and other alternative fuel vehicles by asking for and purchasing them, automakers will be encouraged to produce more energy efficient, clean cars and to continue their technical advancements.