Most U.S. oil comes from the Middle East.
Don’t believe that!
A major concern among Americans is our country’s dependence on the volatile Middle East region to supply our energy needs. But, this shouldn’t be a worry because it’s not true and never has been!
The top ten oil-rich countries in the Middle East make up a little more than 3% of the Earth’s land surface, but contain nearly half of all known oil reserves and nearly 40% of natural gas reserves. Oil was first discovered in Persia (now Iran) in 1908. The importance of these energy reserves to the 20th century industrial world would eventually make the rulers of these countries immensely rich and influential.
According to a 2014 poll, nearly three-fourths of respondents believed that the U.S. imports most of its crude oil from somewhere in the Middle East. Given the facts above, this is understandable.
The United States actually produces the majority of its own oil, 60%, from domestic sources. According to the most recent statistics from the U.S. Energy Information Administration (EIA), the largest importer of crude oil to the U.S. is… Canada, at 14%. A distant second is Saudi Arabia, at 7%, followed by Mexico and Venezuela.
The U.S. has been increasing its domestic production and decreasing its reliance on imports for a number of years, but at no time in history did the Middle East supply more than 15% of America’s crude oil consumption.
America’s vulnerability to the Middle East stems not from supply dependence but rather the power of OPEC to control energy prices. The Organization of Petroleum Exporting Countries (OPEC) was established in 1960 and comprises countries from the Persian Gulf, Africa and South America. OPEC sets production targets for its member nations and thus has a powerful influence on the crude oil market price. Given that U.S. crude oil consumption is approaching seven billion barrels a year, this pricing power in turn has a significant impact on the U.S. economy.