Our Top Facts on the Oil Price Crisis
What is the key role of oil in the U.S. and global economies?
March 10, 2000
Not since the Persian Gulf War has the United States been so concerned about oil. At stake is the disruption of the U.S. economy’s record 108 consecutive months of economic growth. Our collection of facts illustrates the key role of oil in the U.S. and global economies.
How dependent is the U.S. economy on oil?
Following the first Arab oil embargo, the United States imported 30% of its oil in 1975. By 1999, the United States imported 50% of its oil.
(Wall Street Journal)
How much oil does the United States consume?
As of 2000, the United States consumed 20 million of the 75 million barrels of oil — 27% — burned in the world each day.
How does U.S. oil consumption compare to that of the next biggest economies?
For each dollar of 1997 GDP, the United States used 36% more energy than Germany — and 58% more than Japan.
How expensive is oil for the Unites States?
In 1998, oil expenditures accounted for only about 3% of U.S. GDP — a decrease from nearly 9% in the early 1980s.
(Wall Street Journal)
Do U.S. car manufacturers worry about fuel consumption?
As of 2000, the average U.S. car was about 5% more fuel-efficient than in 1990 — and 50% more fuel-efficient than in 1973, at the start of the first Arab oil embargo.
Why did fuel consumption still increase?
Between 1970 and 1997, travel by car rose 130% in the United States, while fuel consumption increased by half that, or 65%.
How do today’s prices compare historically?
From its current price of $30 a barrel, the price of oil would have to rise to nearly $90 a barrel to match the inflation-adjusted peak prices of early 1980.
How does that break down for the people refilling their cars at gas stations?
In January 1999, the price of gasoline in the United States averaged about 96 cents a gallon. By January 2000, a gallon of gasoline cost an average of $1.39 — an increase of 45%.
(U.S. Department of Energy)
Has fuel become cheaper over time?
Meanwhile, between 1982 and 1999, the average price of gasoline rose by 7% — far below the 71% increase in the general U.S. inflation rate.
What about the rest of the world?
Between 1973 and 1998, world oil consumption increased by 25% to 26 billion barrels a year.
(New York Times)
Why does OPEC have a monopoly position?
In 1999, the 11 OPEC countries produced 45% of the world’s oil — a level it has traditionally required to control market prices.
Do we need to worry about oil reserves right now?
Between 1973 and 1998, the world’s total of proven oil reserves increased by 50% to 1 trillion barrels.
Who is the biggest oil exporter?
Although it is not a member of OPEC, Norway is the world’s second largest exporter of oil after Saudi Arabia.
How much do some oil producing countries on depend on oil revenues?
As of 1999, Iran — one of the major OPEC oil-producing countries — earned 85% of its budget revenues and 90% of its hard currency from oil exports.
The “U.S. as beggar,” says the Energy Secretary
“It rather bothers me that we’re reduced to sort of a … beggar’s position in trying to talk them into lower prices or increased production so we can stay alive.”
(U.S. Energy Secretary Bill Richardson, February 2000)