US Energy Independence? Don’t Hold Your Breath
From CBS Money Watch
By Erik Sherman
Gaining energy independence would be an enormous boon for the U.S. No other country could use a threat of cutting off supply as a geopolitical weapon, as OPEC did in the 1970s. A major contributor to the nation’s trade imbalance would disappear, boosting the economy. Improved supply might even allow U.S. needs to become a priority in a world where such developing countries as China and India aren’t in competition for energy sources.
But while there has been considerable talk lately about rising U.S. oil and production, energy independence is likely to remain a case of wishful thinking for the foreseeable future. Technical limitations in drilling, along with a little common sense, further make the idea of energy freedom more a matter of conjecture than a practical goal.
To be sure, there’s no doubt that the U.S. has made strides in fulfilling its own energy needs. Oil production is the most robust it’s been in 15 years, while gas production and inventory hover at record highs.
The more such energy comes from local sources, the less it must be procured from geopolitical hotspots or “frenemies” such as the Middle East, Nigeria, Venezuela and Russia. As research firm Capital Economics points out in recent report, in 2012 U.S. energy production satisfied 83 percent of domestic consumption, a vast improvement from 2005, when production covered only 69 percent of consumption.
According to U.S. Energy Information Administration projections, the percentage covered by local production could hit 92 percent by 2040.
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