Oil Imports Have Their Consequences

Professor of psychology at New Mexico Tech Robert Holson draws three critical conclusions about the impact of the oil demand-supply crisis.

Published: 17-Dec-2007

SOCORRO, New Mexico -- We have seen that a global peak in oil production is imminent. This peak will herald in a permanent global oil shortage, as production declines at a rate of 1 percent to 2 percent per annum. Now this small annual decrease may not seem like much, but it will inevitably be magnified greatly in larger reductions in importable oil. Such reductions will be devastating to the major world industrial powers, all of which are currently heavily dependent on oil imports.

A handful of countries provide the bulk of importable oil, while the United States, Europe, the Asian economic powers and the rapidly industrializing mega-giants China and India are all import-dependent. The reader will note several important points about the oil exporting nations.

First, of the 10 top exporting nations, the United States has unsatisfactory relations with at least three – Russia, Iran and Venezuela. Second, supplies from several of these states are currently imperiled by internal chaos or external threats (Nigeria and Iran). Third, many of the these major suppliers are at or very near their own production peaks. World exports are dominated by two countries, Saudi Arabia and Russia. Russia is very near a peak, perhaps around 2010, while as we have seen Saudi Arabia may already have passed its production peak.



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