270 PETROLEUM TECHNOLOGY, ECONOMICS, AND POLITICS
Petroleum Reserve, or government controlled stocks, to lessen the
impact of an energy crisis is subject to debate. In fact, the premature release of oil stocks from the Strategic Petroleum Reserve may
exacerbate an energy crisis as it depletes the stocks while shortages
still exist since it can lead to stabilized or even lower prices and
increased consumption (Alhajji and Williams, 2003).
Dependency and vulnerability to oil imports in the United States
and, for that matter, in other oil-importing countries can be reduced
by diversification of suppliers and by energy diversification. In addition, diversification of suppliers has the potential to lower the relative
impact of supply disruption on most countries. The political instability that swings back and forth in countries such Venezuela, Nigeria,
and Iraq emphasizes the need for diversification of suppliers and so
removing the reliance on a small number of oil-producing countries.
9.6 Energy Security
Energy security is the continuous and uninterrupted availability of
energy, to a specific country or region. The security of energy supply conducts a crucial role in decisions that are related to the formulation of energy policy strategies. The economies of many countries
are depended by the energy imports in the notion that their balance
of payments is affected by the magnitude of the vulnerability that
the countries have in crude oil.
The Hubbert theory of peak oil (Chapter 8) assumes that oil
reserves will not be replenished (i.e. that abiogenic replenishment
is negligible) and predicts that future world oil production must
inevitably reach a peak and then decline as these reserves are
exhausted. Controversy surrounds the theory since as predictions
for the time of the global peak is dependent on the past production
and discovery data used in the calculation.
For the United States, the prediction turned out to be correct
and, after the US peaked in 1971 and thus lost its excess production
capacity, OPEC was able to manipulate oil prices. Since then, oil
production in several other countries has also peaked. However,
for a variety of reasons, it is difficult to predict the oil peak in any
given region. Based on available production data, proponents have
previously and incorrectly predicted the peak for the world to be
in years 1989,1995, or in the 1995 to 2000 period. Other predictions
have chosen 2007 and beyond for the peak of oil production.
Petroleum Reserve, or government controlled stocks, to lessen the
impact of an energy crisis is subject to debate. In fact, the premature release of oil stocks from the Strategic Petroleum Reserve may
exacerbate an energy crisis as it depletes the stocks while shortages
still exist since it can lead to stabilized or even lower prices and
increased consumption (Alhajji and Williams, 2003).
Dependency and vulnerability to oil imports in the United States
and, for that matter, in other oil-importing countries can be reduced
by diversification of suppliers and by energy diversification. In addition, diversification of suppliers has the potential to lower the relative
impact of supply disruption on most countries. The political instability that swings back and forth in countries such Venezuela, Nigeria,
and Iraq emphasizes the need for diversification of suppliers and so
removing the reliance on a small number of oil-producing countries.
9.6 Energy Security
Energy security is the continuous and uninterrupted availability of
energy, to a specific country or region. The security of energy supply conducts a crucial role in decisions that are related to the formulation of energy policy strategies. The economies of many countries
are depended by the energy imports in the notion that their balance
of payments is affected by the magnitude of the vulnerability that
the countries have in crude oil.
The Hubbert theory of peak oil (Chapter 8) assumes that oil
reserves will not be replenished (i.e. that abiogenic replenishment
is negligible) and predicts that future world oil production must
inevitably reach a peak and then decline as these reserves are
exhausted. Controversy surrounds the theory since as predictions
for the time of the global peak is dependent on the past production
and discovery data used in the calculation.
For the United States, the prediction turned out to be correct
and, after the US peaked in 1971 and thus lost its excess production
capacity, OPEC was able to manipulate oil prices. Since then, oil
production in several other countries has also peaked. However,
for a variety of reasons, it is difficult to predict the oil peak in any
given region. Based on available production data, proponents have
previously and incorrectly predicted the peak for the world to be
in years 1989,1995, or in the 1995 to 2000 period. Other predictions
have chosen 2007 and beyond for the peak of oil production.