U.S. Oil Supply Post-Macondo
SAFE analysis shows security benefits of increased domestic oil production
SAFE has issued original analysis examining the drivers and impacts of the recent surge in U.S. oil production. The report finds that high oil prices and innovative development techniques are combining to place substantial new resources on the table in the United States, with potentially game-changing consequences for economic and national security. The report makes a series of recommendations designed to safely expand the production of domestic oil resources, including a series of regulatory reforms.
The SAFE report, “U.S. Oil Supply Post-Macondo,” highlights a number of positive trends supporting future U.S. oil production growth, both onshore and offshore. However, the report also details a series of existing and emerging regulatory barriers facing the domestic industry. Among other things, the report finds that policymakers could do more to promote domestic oil production while safeguarding the environment, specifically through a series of pilot programs designed to leverage technology to minimize the industry’s development footprint in frontier areas of the Outer Continental Shelf and the U.S. Arctic.
The report argues that the current regulatory uncertainty surrounding hydraulic fracturing poses an emerging risk to production of both shale gas and shale liquids, and it calls on industry as well as state and federal regulators to provide a more comprehensive framework for development.
Top among the reasons to boost domestic oil production are reasons of economic and national security. “From a national security perspective, increased self-reliance would help minimize the exposure of the United States to a crippling disruption in oil supplies brought about by turbulence in the Middle East or any other oil-supplying region,” states to the report. With the U.S. trade deficit in crude oil and petroleum products on pace to surpass $300 billion in 2011, producing more domestic oil would also minimize the transfer of U.S. wealth abroad.