Wednesday, April 4, 2012

Energy Independence And High Gasoline Prices

Politicians want voters to think that American energy independence should produce lower prices at the pump, when in fact it is high pump prices that could produce American energy independence. It seems our country’s oil and natural gas reserves are much bigger than we thought in the past, and also that energy imports are decreasing as a percentage of consumption. In 2005 oil imports were 60% of American consumption, and in 2011 they fell to 45% of consumption, as we also approach self sufficiency in liquified natural gas.

In 2000 America’s natural gas reserves were thought to be only 1 quadrillion cubic feet, while current estimates are more than double that figure. With annual natural gas consumption running about 24 trillion cubic feet, that supply should last over 80 years. The National Petroleum Council estimates our nations oil resources – “proved reserves” plus what other recorses can likely be recovered economically – at 274 billion barrels. Plus, we have easy access to Canada’s 300 billion barrel tar sand resources. With consumption running at about 7 billion barrels annually here, these oil resources should last for at least the same 80 years.

So, today’s pump prices put greater economically feasible energy resources at our command, and also serve to restrict future growth of demand, making the Obama administration’s “all of the above” energy policy seem about right to carry us into the next century.

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