Loosening Our Belts to Consume More Oil
There is a favorite saying among transportation planners that building more freeway lanes to fight congestion is like loosening your belt to fight obesity. This idea comes to mind when considering the most recent Mitt Romney plan to achieve energy independence in the United States. Romney proposes drilling our way out of foreign oil dependence despite the fact that the math is not on our side. As New York Times editor Robert Semple points out, the U.S. holds less than three percent of the world’s reserves but consumes more than 20 percent of the world’s supply. How sustainable is that?
We have to keep in mind that the oil market is word-wide. Flooding the market with more oil (as happens, for instance, when Saudi Arabia ramps up its production) puts downward pressure on price everywhere which, in turn, creates more demand. The U.S. itself is far from immune from the temptations of using more oil. Cultivating a growing demand for oil increases the odds that long-term U.S. demand for cheap oil will exceed the domestic supply. So, how would expanding the amount of oil available in the world market, and potentially increasing the amount of oil consumed domestically, promote energy independence?
Oil dependence means no independence.