Environmental Engineering Reference
In-Depth Information
in Libya sent oil markets into convulsions. h ey happen every time U.S.
leaders consider intervening in a part of the world where oil is also at
stake. U.S. decision making seems to be hopelessly entangled with oil.
It is liberation from this crushing constraint on U.S. freedom of action
abroad that the biggest enthusiasts for higher domestic oil production
hold out most tantalizingly. “To not be concerned with where our oil
is going to come from,” Pioneer Natural Resources CEO Scot Shei eld
told the
New York Times
in early 2012, “is probably the biggest home
run for the country in a hundred years.”
48
Yet for all its promise, larger U.S. oil supplies probably wouldn't do
that. We've already seen that the U.S. economy would remain vulner-
able to price spikes even if it produced all the oil it consumed. Nor
would those price spikes be muted for domestic oil: for example, the
price of U.S.-produced oil jumped just as much during the Libyan crisis
of 2011 as the price of oil from the Middle East did. Even a technically
independent America would still be vulnerable to oil market vagaries (if
somewhat less so than it has been for the last few decades) and hence
still restrained in what it could do abroad.
h ere is one potential exception to this logic, but it would come into
play only under extreme circumstances. A United States that produced
as much oil as it consumed could wall itself of from global oil mar-
kets in a crisis by temporarily banning exports of crude. (Otherwise, if
the price of oil shot up overseas but not in the United States, people
would ship oil from the United States to other higher priced markets
where they could make more money, until prices in the United States
rose similarly.) h is would give it more room to maneuver abroad. But
it would be an immensely dii cult step to take. Blocking oil outl ows
during a crisis would in practice mean denying oil and inl icting severe
economic damage on others, some of whom might be allies. h ose on
the receiving end might well retaliate by barring U.S. imports of other
critical items, undermining the intention of U.S. policy in the i rst place.
In a war for U.S. survival, these caveats might be set aside, but such a
i ght is highly unlikely, at least in the coming years. h e sorts of con-
tingencies that American policymakers have typically grappled with in
recent decades are ones where closing the U.S. borders to crude oil is
almost unimaginable. In any case, so long as U.S. production is even
Search WWH ::
Custom Search