Analysis of Imported Oil Case

In: Social Issues

Submitted By huahualala
Words 580
Pages 3
Why does the U.S. Import a lot of oil?
Over the course of the past few years, a great deal of media attention has focused on the not only the cost of oil but the availability of oil. Citizens of different countries around the world, including those in the United States, have become increasingly concerned about the cost and availability of fuel oil.
With that in mind, many people have expressed concern about:
• the growing dependence of the United States on oil imports
• the stability of the major oil producing nations
• the remaining proven oil reserves still existing on the planet
We know the U.S. actually gets most of its imported oil from Canada and Latin America. And many Americans might be surprised to learn that the U.S. now imports roughly the same amount of oil from Africa as it does from the Persian Gulf. African imports were a bit higher in 2010, while Persian Gulf oil accounted for a bit more last year. But why does the U.S. imported oil too much?
That is because the US wants to keep its reserves for use when no one else has them and to sell them at exorbitant prices or to face ridicule because humanity has found other fuels.
The United States has oil absolutely. This oil can be fairly easily divided into different categories based on how difficult, and expensive, it is to extract. As a general rule, the cheapest oil is already being extracted.
Meanwhile, other nations are sitting on large quantities of "easy" oil. They can produce oil much more cheaply, relative to their opportunity costs, than the United States can. Many of these nations are desert nations with no other major industries. They have historically been among the poorest nations, before they were able to make money by selling oil to the rest of the world.
In short, oil is their specialty, and they have few options besides oil for making money off of their own resources. This makes…...

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