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U.S. Foreign Oil Dependency
President George W. Bush said in his speech on Feb. 1, 2006 "America is addicted to oil"[1], which quickly became a favorite quote in the press recently. Both sides of the political aisle seem to agree with him (a rare scene in the current political landscape) and vowing to reduce the dependency to foreign oil has quickly become one of the major popular political strategies for the 2008 campaign to the White House. But to what extent the US depends on the foreign oil is quite much debatable.
Popular Belief
The famous Texas oil man business tycoon T. Boone Pickens claimed in his Pickens Plan and TV commercial[2] that US imports a total of 700 billion dallors worth of oil from different parts of the world annually — mostly from the Middle East countries; and this is the biggest transfer of wealth in the history of mankind.
Government Data Source
According to the DOE (Department of Energy) data source,[3] the total US dailly consumption is 12 million barrels of oil per day, from which 70% is imported from foreign countries.
The 700 Billion Dollars Question
Based on the current oil price of $100 to $130 per barrel (assuming it reaches $150 dpb by the end of 2008), the total worth of imported foreign oil is:
12,000,000 bpd × 70% × 150 dpb × 365 dpy ≈ 448.6 (billion dollars per year)
where
bpd = barrel per day
dpb = US dollars per barrel
dpy = days per year
Where do the rest of 250 billion dollars come from?
In the Pickens Plan, Mr. Pickens projected that oil price will reach more than $200 dollars per barrel in not so distanced future. For more information please check with the Pickens Plan and related reference[2][4].
Reference
- ^ Herald Tribune, Feb. 1, 2006
- ^ a b Pickens TV Commercial on YouTube
- ^ DOE Webside Article — How Dependent Are We on Foreign Oil?
- ^ North American energy independence