U.S. Oil Independence by 2020?

Forecasts that the USA will achieve zero net oil imports by 2020 appear to be on-track. While the U.S. Energy Information Administration (EIA) and a number of media pundits (notably on the left side of the political spectrum) take a more cautious -- or even downright negative -- view, the US-EIA's own data gives good reason for hope.

Between 2006 and 2013, the United States cut its net imports in half. If this trend continues, zero net imports will occur in late 2019 or early 2020.

Whether this desirable goal is reached will be determined almost entirely by policy and sheer political will, and less by real physical or economic limitations. If local, state, and federal administrations are able to come together on removing all practical barriers to increased oil production while continuing to move forward on sensible energy conservation strategies, the required production increase can likely be achieved.

Would zero net oil imports reduce oil prices in the USA? Some claim it wouldn't because oil is traded on the global market. This is an oversimplification. Regional oil price differences do occur -- as with the so-called Canadian oil discount in the American heartland due to a supply glut. If the United States achieves net zero import capacity and then chooses to restrict export options while continuing to increase production, oil prices could be decoupled from the world market and forced downwards. Of course, oil companies won't want this to occur, so watch for increasing resistance on this front if and when the zero-date approaches.