WASHINGTON, June 30, 2011 /PRNewswire-USNewswire/ -- A new policy brief from the Peterson Institute for International Economics evaluates the ability of recent policy proposals, from offshore drilling to vehicle efficiency standards, to make America more energy secure. America's Energy Security Options by Visiting Fellow Trevor Houser and Rhodium Group's Shashank Mohan finds that a comprehensive approach, comprising eight to ten major components, is required to significantly alter the country's energy future. Such a strategy could cut U.S. energy inputs in half over the next fifteen years but even then the United States will remain vulnerable to international oil market disruptions with the attendant economic and national security consequences.
The study provides a detailed analysis of the ability of various measures proposed by President Obama and currently before Congress to curb U.S. oil imports, reduce gasoline prices, increase American resilience to global oil market disruptions and improve U.S. national security. The authors find that there is no panacea for the energy security challenges facing the United States. Rather than debate whether expanded domestic production, improved efficiency, or development of oil alternatives is the right course to take, the United States needs to pursue all three simultaneously.
The authors conclude, for example, that taken together the various individual proposals under examination would have a meaningful impact on U.S. oil production and consumption. In addition to the near-term supply relief from increased Gulf of Mexico production, total domestic oil output would increase by roughly 1 million barrels per day (bpd), about 10 to 12 percent, between 2021 and 2035. Oil demand would be reduced by 2.2 million to 2.8 million bpd during that period, or 12 to 15 percent. Together, increased domestic supply, efficiency, and fuel substitution would curb U.S. oil imports by 3.1 million to 3.8 million bpd by 2035. In an upper-bound (high) scenario, this would cut overall net U.S. oil imports to 4 million bpd, reducing U.S. dependence on imported oil (measured in physical terms) to its lowest point in the past 40 years. America's annual bill for imported oil would fall by between $127 billion and $148 billion between 2021 and 2035, taking a significant bite out of the country's trade deficit.
Contact:
Katharine Keenan
202-454-1334
kkeenan@piie.com
SOURCE Peterson Institute for International Economics
