U.S. Energy Independence is a Plausible Possibility
Not very long ago, the idea of the United States achieving energy independence seemed out of reach. This was disappointing, given the fact that most countries the U.S. imports oil from differ greatly in terms of interests and ideals. However, the shale and oil gas revolution over the past twenty years or so has made the idea of American energy independence come closer to reality as OPEC’s oil revenues continue to fall.
Back in 2005, the U.S. imported 65% of the oil needed for daily demand. Five years later, that number dropped 10 percent. As of last year, the number made a dramatic fall all the way down to 28%. Experts estimate that the number could fall to as low as 11% percent by 2020. At that point, importation needs could be met entirely by Canada and Mexico, allowing the U.S. to cut ties with countries in the Middle East that they have an unstable relationship with.
It is important to note that these predictions are contingent on predictions of future oil prices and demand. The Energy Information Administration, or EIA, provides two scenarios for how the oil situation could turn out.
Under the baseline scenario, the U.S. would not be fully energy by 2040, although it would be very close.
However, if shale production increases, the U.S. could become a net exporter of oil by 2024. Additionally, if oil prices rapidly increase over the next few years, to the tune of $100 per barrel or more, the U.S. could become fully independent by 2022.
Another factor that could push the nation towards full energy independence is the increasing fuel efficiency of American automobiles. Regulations on car-makers have caused a downward shift in American demand for oil as cars are starting to not need as much fuel to operate. Less demand means even less dependence on foreign nations since the country could more feasibly meet its own needs.
Energy independence does not mean that U.S. energy prices would cease to be correlated with global prices. Unlike in the 1970’s, today’s market is truly global. An outage in Canada could potentially impact prices in Kuwait because it affects the global supply of oil.
Instead, what energy independence would accomplish is a decrease or perhaps complete elimination on the reliance of foreign governments. Nations the U.S. has shaky relationships with such as Saudi Arabia would not necessarily need to continue.