EIA expects that the United States will import more crude oil to fill the widening gap between refinery inputs of crude oil and domestic crude oil production in and EIA expects the rising price of crude oil, which started in the fourth quarter of , will contribute to more U.
EIA forecasts monthly domestic crude oil production will reach These values are increases from the most recent monthly average of The State Department cites oil-related violence in particular as a danger in Nigeria , where more than 54 national oil workers or businesspeople have been kidnapped at oil-related facilities and other infrastructure since January Attacks by insurgents on the U.
Our oil dependence will also be increasingly harder and more dangerous to satisfy. Burning oil is one of the largest sources of greenhouse gas emissions and therefore a major driver of climate change, which if left unchecked could have very serious security global implications.
Recent studies found that the gravest consequences of climate change could threaten to destabilize governments, intensify terrorist actions, and displace hundreds of millions of people due to increasingly frequent and severe natural disasters, higher incidences of diseases such as malaria, rising sea levels, and food and water shortages.
The U. Global warming-induced natural disasters will create emergencies that demand military aid, such as Hurricane Katrina at home and the Indian Ocean tsunami abroad. Developed countries will be responsible for aid efforts as well as responding to crises from climate-induced mass migration. Military and intelligence experts alike recognize that global warming poses serious environmental, social, political, and military risks that we must address in the interest of our own defense.
The Pentagon is including climate change as a security threat in its Quadrennial Defense Review, a congressionally mandated report that updates Pentagon priorities every four years. The State Department will also incorporate climate change as a national security threat in its Quadrennial Diplomacy and Development Review.
As of , OPEC member countries held When there is less oil, it increases oil prices to maintain stable levels of production. OPEC's monopoly over oil prices seems to be in danger of slipping. The discovery of shale oil in North America has helped the U. Shale is also gaining popularity beyond American shores. For example, China and Argentina have drilled more than shale wells between them in the last few years.
The Iran-U. Other factors that impact the price of oil include the budgets of Arab nations, which need high oil prices to fund government spending programs. In addition, demand continues to increase from developing economies, such as China and India, further influencing prices in the face of constant production. The dynamics of the oil economy are complex, and the oil price determination process goes beyond the simple market rules of demand and supply, though at its most primal level the market is the final arbiter of the price of oil.
Theoretically, oil prices should be a function of supply and demand. When supply and demand increase, prices should drop and vice versa. However, the reality is often quite different. Oil's status as the preferred source of energy has complicated its pricing. Demand and supply are only part of the complex equation that has generous elements of geopolitics and environmental concerns. Regions that hold pricing power over oil control vital levers of the world's economy.
The United States controlled oil prices for a majority of the previous century, only to cede it to the OPEC countries in the s. Recent events, however, have helped to shift some of the pricing power back toward the U. As oil prices rise, U. Historically, OPEC's production cuts had devastating effects on global economies, although this is no longer always the case. The U. There may come a day when OPEC loses its clout but that day is not yet here.
Organization of the Petroleum Exporting Countries. Energy Information Administration. Business Insider. British Petroleum. Why our oil addiction is unsustainable. Americans need fuel choice. Funny how with ethanol blended at 10percent in 87 octane we actually burn 1. Fuel Freedom is a non-profit with a simple mission: break America's oil addiction by bringing competition to the U. We'd like to hear from you. If you have any questions, ideas or feedback, please send all inquiries to: [email protected].
That means we have to import foreign oil to feed our addiction.
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