A recently released report from the U.S. Energy Information Administration provided good news about the future of US energy dependence. Net imports of energy now account for just 22% of US energy consumption. This number stands in stark contrast to the 30.8% share that imports held in 2005.
The drop in net imports is credited to a combination of increased domestic production, an expanding use of alternative fuels and a decrease in demand. Cheaper natural gas in particular is gaining a greater share of the energy market. Advances in extraction technologies have also boosted domestic production, reducing the need for imports.
In addition to expanding domestic production, the composition of energy exporters to the U.S. has shifted significantly. In 1990, the US imported approximately 1.3 million barrels of petroleum per day from Saudi Arabia. By 2005 the number had risen to 1.5 million; however, by 2010, imports had fallen to 1.1 million barrels per day. By contrast imports from Canada totaled 934,000 barrels per day in 1990. In 2010, the number had risen to 2.5 million.
As political controversy continues to embroil the Middle East, it is an encouraging sign that the US economy is relying on less on foreign sources of energy. The foreign sources that do still provide significant imports are more "neighborly" and less likely to involve US energy consumption in political turmoil.
Since oil is a globally traded commodity, the US will still be exposed to some foreign supply price risk, but the farther our energy demands move toward natural gas and domestic oil supply, the further we protect ourselves from that risk and provide the fuel we need for continued economic growth.