U.S. expects big drop in oil imports

Despite the recent drop in crude prices, the rising cost of a barrel of oil will boost the use of renewable energy and help slow greenhouse gas emissions.

NEW YORK (CNNMoney.com) — Despite the recent rout in oil prices, the government expects crude to shoot back up over the long term. That is expected to result in a drastic drop in oil imports and a greater use of renewable energy.

Oil imports – which currently make up 60% of all the oil consumed in the U.S. – should drop to about 40%, the Energy Information Administration said in its long-term energy outlook on Tuesday.


The drop will largely be the result of higher oil prices encouraging conservation and an expanded use of home-grown biofuels.

In making its predictions, EIA used an average crude price of $130 a barrel in 2030. That price is nearly double the projections for 2030 made last year – $70 a barrel.

Although the report was not meant to predict oil prices, EIA analysts say increased demand and limited access to new supplies will push crude prices up in the long term, despite crude’s recent plunge.

The upward revision in price is a major shift in the government’s long-term views on oil supply and demand. Limited access to new oil sources – particularly in OPEC countries – is a major reason why prices should increase.

CNN