NCPA - National Center for Policy Analysis


February 9, 2006

A truly integrated energy market, with robust competition across the board, could allow us to replace more than 75 percent of our oil imports from the Middle East by 2025, says Peter Huber of the Manhattan Institute.


  • The United States annually consumes about seven billion barrels of oil (BBO), and 11 BBO equivalents (BBOE) of coal, gas, uranium and hydroelectric power.
  • Over 80 percent of the total comes from North America. The United States, Canada and Mexico -- our three largest suppliers, in that order -- supply about 60 percent of our oil. Persian Gulf states send us less than one BBO.
  • To reach the 75 percent target today, we would have to shift only about 5 percent of our consumption from the oil to the not-oil side of the 18 BBOE energy ledger.

We could do that quite easily, says Huber. For example:

  • Wind and solar energy combined currently deliver about 0.02 BBOE a year; however, we use about seven BBOE of coal, uranium and natural gas to generate electricity.
  • Cars and SUVs currently burn three BBO a year, but plug-in hybrids offer a reasonably near-term promise of a second major bridge between the grid and the highway.
  • The United States uses over 10 percent of the annual corn crop to produce an amount of ethanol equivalent to 0.05 BBO; however, production could be multiplied tenfold if crops were grown on another 40 million acres that we currently pay farmers not to cultivate.

Moreover, over the long run, hydrogen might emerge as a third bridge between the electric and transportation sectors, but that hydrogen comes either from natural gas, or from water split apart with electricity, which lead us back again to coal and uranium, says Huber.

Source: Peter Huber, "Crude Awakening," Wall Street Journal, February 3, 2006.

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