Replies

I guess you weren't around during the OPEC oil embargo.

Yes, I was standing in line at the gas stations in DC and NoVA.

Less dependence on hostile Middle East oil is a huge political bargaining chip. Canada is not a hostile trading partner.

You may not understand how the oil business works or how oil is moved around the world. The Middle East is still the world's largest exporter of oil and has the largest proven reserves of exportable oil. We actually sell oil from Alaska to Japan because of transportation costs.

If the supply of Middle East oil is interrupted, the global economy will suffer and the price of oil will go up. Unless we have fixed, long term contracts with Canada, Mexico, Nigeria, and Venezuela, they will begin selling their oil on the world market to the highest bidders. We can't insulate ourselves from a global oil shortage. We will have long lines at the pump.

Fungibility can also be applied to the power of states. Rogue / terrorist states can translate economic power derived from oil into military power or terrorist activity to disrupt the global market

With the exception of Saudi Arabia, no Middle East country has excess capacity. They are pretty much pumping out up to their limit. Iraq can produce more if its production facillities are modernized. With world demand rising, their will be no shortage of customers even if the US didn't get a drop from the Middle East.

In 2006, the Persian Gulf countries (Bahrain, Iran, Iraq, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates) produced about 28 percent of the world's oil, while holding 55 percent (728 billion barrels) of the world's crude oil reserves. In 2006, the Persian Gulf countries combined exported 18.2 million barrels per day (bbl/d) including about 17 million bbl/d via the Straight of Hormuz representing roughly one-fifth of world oil supply.

Crude Oil and Total Petroleum Imports Top 15 Countries

We actually sell oil from Alaska to Japan because of transportation costs.

Sigh... It amazes me how often this lie is told. If you just look at a map, you can see the much greater distance to Japan than the US West Coast Markets.

Map centered on Valdez, Alaska. Export Terminal for the Trans-Alaska Pipeline.

When first built the pipeline oil could not be exported; that was part of the deal to get the pipeline approved through congress. The ban against exporting Alaskan North Slope was lifted in 1996 yet 100% of Alaskan North Slope oil is kept in America. This has been the case for all but 4 years of the nearly 3 decades of Alaskan oil production. Between 1996-1999 5.5% of North Slope oil was exported to Asian countries. These exports were overwhelmingly supported by the US Congress and by the Clinton Administration to offset an oil glut in California at the time. In June 2000 Alaskan North Slope oil again ceased to be exported, and 100% of Alaskan North Slope production has stayed in America.

You can look at the export history from this area since the ban was lifted.

Exports, US West Coast including Alaska and Hawaii
http://tonto.eia.doe.gov/dnav/pet/hist/mcrexp51a.htm

Here you can see data from the California Energy Commission. They track the amount of oil brought into California from Alaska.

CALIFORNIA CRUDE OIL PRODUCTION AND IMPORTS
http://www.energy.ca.gov/2006publications/CEC-600-2006-006/CEC-600-2006-006.PDF

Here you can see from the Washington Government that 74% of the oil used in Washington State refineries comes from Alaska.

Washington State, Petroleum FAQs
http://qa.cted.wa.gov/portal/alias__CTED/lang__en/tabID__847/DesktopDefault.aspx

If you just look at a map, you can see