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US Oil Imports

Introduction

Just like days come and pass, seasons start and end, years begin and end similarly, life on this earth in the reflection of human beings come in this world and go. But, one thing that remains attached with this change is the requirement and needs. God has bestowed a number of blessings on us to fulfill our needs that we want to live on this earth. God has given us a number of blessings such as water, minerals, salts, oil, gas etc. One thing that is stigmatized with these resources is that of scarcity. In a nutshell, scarcity can be defined as limited availability of a resource whereas the demand of that resource is unlimited. This means that these major resources have unlimited want and limited availability. In order to deal with this issue and issue of similar nature scientists, scholars and practitioners have devised the phenomenon of alternative energy sources. The purpose of this research is also to talk about one of the natural resources and alternatives that are available for that natural resource. The natural resource that this paper aims to talk about is oil. The following part of the paper describes oil imports and alternatives available.

Issues that are Detrimental about Importing 60% of our oil

As the import of oil in US has reached up to the 60% it is also causing many disadvantages. The most important detriment of import of oil is one the continuous increase in the prices of the oil.

Increased Prices

As a result of completely relying on the imports to fulfill the needs of the public raises the prices of the oil. As the import of oil is increasing it is also increasing the prices of the oil. In 2001, the oil price was around $2, and it has increased up to $4 in the year 2008. Following chart briefly describes the alteration in the oil prices (IEA, 2008).

Year

Price

1958

$2.32

1968

$2.18

1978

$2.22

1988

$1.81

1998

$1.39

2008

$3.34

2011

$3.51

Currently the price of the oil is fluctuating, and this is the critical issue for many oil companies as well as for consumers. Out of frustration consumers ask the reason behind this fluctuation in the price of oil. The phenomenon of demand and supply causes great impact on the price of oil. Oil prices increases when there is more demand than the supply and less investment in the field of development. According to Mouawad, “The demand of oil imports will be quadruple by China and India by the year 2030”. This is a huge increase in the demand which in turn would increase the price (Mouawad, pp. 6).

Measures to Reduce Detriments of relying on Import of Oil

Transportation, heating, power generation, the plastics, pharmaceuticals and synthetic fiber industries are the main ways in which oil is consumed. Demand for oil is greater in the developed nations rather than the developing economies. The costs of exploration of new oil sources are very high, and that is the reason why demand always exceeds the supply. In order to counter this issue, they are trying ...