Testimony before the Senate Foreign Relations Committee March 30, 2006. Reprinted with the permission of the author.
Open Access Article Originally Published: April 03, 2006
My name is Milton R. Copulos, and I am president of the National Defense Council Foundation.
I would like to thank Chairman Lugar for giving me the opportunity to speak with the Committee today and I would also like to commend him for his leadership addressing our nation’s perilous energy dependence.
A Headlong Rush Into Disaster
America is rushing headlong into disaster. What is worse, however, is that it is a disaster of our own design.
More than three decades have passed since the 1973 Arab Oil Embargo first alerted the nation to its growing oil import vulnerability. Yet, despite this warning, we are now importing more than twice as much oil in absolute terms than we did in 1973, and the proportion of our oil supplies accounted for by imports is nearly double what is was then. What makes this dependence even more dangerous than it was three decades ago is the fact that the global market has become a far more competitive place with the emerging economies of China, India and Eastern Europe creating burgeoning demand for increasingly scarce resources.
Indeed, over the past decade the Chinese economy has grown at a frenetic pace, officially estimated at 9.2 percent in 20095. India’s growth rate for that year was 7.1 percent. In Eastern Europe, Belarus grew at 7.8 percent, the Czech Republic at 4.6 percent and the Ukraine at 4.4 percent. This compares with 3.5 percent for the United States, 2.1 percent for Japan and 1.7 percent for the European Union.
As a result of this explosive growth, oil consumption in the developing countries is expected to increase at a rate of 3 percent annually over the next two decades. But even this figure may severely understate the problem. Indeed, China alone has accounted for 40 percent of the total increase in world oil consumption over the past several years. Moreover China plans to add 120 million vehicles to its automobile fleet over the next decade, ultimately requiring 11.7 million barrels per day of new crude oil supplies. India, too, is expected to continue to require increasingly large amounts of oil with a projected increase of 28 percent over just the next five years.
Even conservative estimates suggest that nearly 30 million barrels per day of new oil supplies will be required by the year 2025 just to service the developing world’s requirements. When Europe and the Americas are included the requirement is closer to 40 million barrels per day. It is doubtful that new supplies sufficient to meet this skyrocketing demand will be found from conventional sources.
Uncertain Suppliers
Nor is it just the potential physical shortfall of resources that is a source of concern. An even greater concern lies in the instability of U.S. sources of oil imports.
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Reader Comments
7 comments so far...
08-Apr-2006
17426
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The value of this article is to underline the dangers in dependence on foreign oil supplies, especially those from unfriendly or unstable countries. It shows the insupportable burden petrol consumption is putting on us economically, and the compulsion it places on us to secure petroleum supplies by military entanglements. It shows the future pressures on the US as China and India "gas up".
The story also mentions the tremendous amount of fossil fuel in the form of methane hydrates, or clathrates, in deposits near our coastlines. The problem is, as stated in a comment above, that this does nothing to wean us from our dependence on polluting, global warming fossil hydrocarbons. We must decrease our energy WASTE by using more efficient housing, factories and transportation means. We must supply our nation with energy from non-polluting, renewable, carbon neutral sources. External costs have to be paid, and we are lying to ourselves if we think we can have cheap $3.00/gallon gasoline, when we are burning $12.00/gallon gasoline in reality. The cost should be paid at the pump, not at the tax return. If (WHEN) gasoline costs $12.00/gallon, not only will hybrids make economic sense, but wind, solar and ocean thermal energy will be so appealing that they will happen.
Posted by: Richard Easton
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04-Apr-2006
16797
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Milt didn't seem to include reneqwable energy or efficiency. He also thinks Uranium is good which is nuclear that has been a disaster in cost over runs , safety, decommissioning, insurance and disposal of all the tons we already have.
Maybe he just needs a few more pages to really get into an answer without more problems. Solar, Wind and Hydro are our best sources of power. Efficiency is the only smart thing to do in every area.
At least he mentioned hybrids and plugin hybrids. He just needs to ride in a new EV to understand the ultimate vehicles.
Posted by: Jim Stack
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04-Apr-2006
16828
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Why do you not mention straight EVs? Why are there only hybrids? I think GM used to make an electric vehicle but they took it off the market.
Posted by: Paul LeRoux
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04-Apr-2006
16836
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GM's EV was the EV1. Honda had the EVPlus, Toyota had the RAV4EV, and Ford had the Ranger EV. All gone. Sad.
Posted by: Sledge _
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04-Apr-2006
16858
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Milton indicates we should use our 1,430 trillion cubic feet of domestic gas reserves. According to the EIA, the US has proved reserves of around 200 trillion cubic feet. In general, production of natural gas in the US has been declining since its peak in the early 70's, even though we are drilling more natural gas wells than ever before. The tripling of natural gas prices over the last few years underscores the existing supply and demand gap (and the shutdown of many petrochemical plants which used NG as a feedstock --- we now have to import a large portion of NG based agricultural fertilizers) Also, we are moving forward with many LNG projects to overcome expected shortfalls in meeting basic domestic gas demand. Looks like we need to conserve our natural gas to even meet existing usage. Wonder where he got the big reserves number?
Posted by: bud rice
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04-Apr-2006
16861
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I think he should have said "Making" instead of "Design". The impulse to alliterate betrayed him.
Oil mostly fuels transportation these days. We will not run out of electricity if the oil imports end tomorrow. Instead, we will run out of food. We need substitutes with comparable energy densities.
Posted by: Bob W
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04-Apr-2006
16943
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There are four elements to the problems posed by the over-use of fossil fuels in general and oil in particular. 1) Financial, 2) security, 3) Health, and 4) global warming.
The author says a lot of things to illustrate the financial and security problems, which are very compelling. But his proposed solutions are doomed to be short term and disappointing to our children (and probably even to us). Most of all, his solutions do not address the last two elements of the problem, and they must to be of real value.
This kind of stuff is the same old resource exploitation and consumption thinking. He might have as well said "Only if you can dig it up and hold it in your hand, it's worth something."
If and when the miracle occurs that we as a society simply stride forward and take advantage of the renewable energy bonanza staring us in the face we will look back on this era with the same bemusement as we did of "a time before the invention of the airplane", or electricity, or indeed, the automobile. Our energy future is that much better than the one we have, if we will only act upon the potential.
Posted by: Kevin Hill
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