 U.S. oil dependence 2014: Is energy independence in sight?David L. Greene and Changzheng Liu Energy Policy, 2015, vol. 85, issue C, 126-137 Abstract: The importance of reducing U.S. oil dependence may have changed in light of developments in the world oil market over the past two decades. Since 2005, increased domestic production and decreased oil use have cut U.S. import dependence in half. The direct costs of oil dependence to the U.S. economy are estimated under four U.S. Energy Information Administration Scenarios to 2040. The key premises of the analysis are that the primary oil market failure is the use of market power by OPEC and that U.S. economic vulnerability is a result of the quantity of oil consumed, the lack of readily available, economical substitutes and the quantity of oil imported. Monte Carlo simulations of future oil market conditions indicate that the costs of U.S. oil dependence are likely to increase in constant dollars but decrease relative to U.S. gross domestic product unless oil resources are larger than estimated by the U.S. Energy Information Administration. Reducing oil dependence therefore remains a valuable goal for U.S. energy policy and an important co-benefit of mitigating greenhouse gas emissions. Keywords: Petroleum dependence; OPEC cartel; World oil market; Oil price shocks; Oil price elasticity; Energy security (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:85:y:2015:i:c:p:126-137 DOI: 10.1016/j.enpol.2015.05.017 Access Statistics for this article Energy Policy is currently edited by N. France More articles in Energy Policy from Elsevier |
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