Is There an Energy Crisis?
N E W Y O R K, April 23, 2001 -- From all the talk about an energy crisis, you'd think it's time to start hoarding cans of gas and candles. But is there really a crisis? Most experts don't think so.
That's not the official line from the White House, however. Since taking office in January, President Bush has repeatedly said the United States is in the midst of an "energy crisis."
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And Energy Secretary Spencer Abraham warned of one last month, adding, "The failure to meet this challenge will threaten our nation's economic prosperity, compromise our national security and literally alter the way we live our lives."
Coming from such high sources, "crisis" talk represents strong language indeed, evoking images of the country's last dire energy shortage, in the 1970s. Then, the oil embargo by the Organization of the Petroleum Exporting Countries led to seemingly endless lines for motorists at the gasoline pump, and contributed to the recession and rampant inflation that plagued the decade.
But are Bush, Abraham and Vice President Dick Cheney — the head of the administration's energy task force, which is rolling out a sweeping policy proposal in early May — using the term to justify new policies favoring the administration's backers in the energy industry? That's what some critics charge.
Troubles Abound
Certainly there is no shortage of troubling signs for American consumers.
Clickable State-by-State Energy Map
Gas prices could reach more than $2 per gallon in the Midwest for the second straight summer, and California continues to be hit by unprecedented power woes that will force rolling blackouts in the months to come. On the East Coast, a warm summer could mean more air conditioning and a sharp spike in utility bills.
Additionally, the price of crude oil has also risen sharply in the last two years, from around $10 a barrel to a peak of $37. The current rate has settled at about $26 per barrel, and home heating costs have risen as well.
But many energy analysts, while willing to apply the term to California, say the nation as a whole is not in the throes of a crisis. They note that oil imports continue unabated and say the current price problems come from shortcomings in the transmission of energy to companies and consumers.
'We Have No Crisis'
"I don't think I would use the term 'crisis,'" says Bob Ebel, director of the Energy Program at the Center for Strategic and International Studies in Washington. "That may have been used to capture the public's attention. But we don't really have a supply shortage. What we have is an infrastructure that is already operating at 100 percent, and our inventories are very, very low."
Ebel added: "If we had another outbreak of war in the Middle East which led to a severe and sudden decline in oil supply, then we would have a crisis."
"We have no crisis," says John Lichtblau, president of the Petroleum Industry Research Foundation, a non-profit group in New York. "There is an energy crisis in the West Coast, but that's entirely a domestic crisis. In fact it's a regional crisis, and it has nothing to do with the petroleum markets."
"In my way of looking at it, a crisis implies a sudden event you have to deal with, whereas we have long-term infrastructure problems," adds Guy Caruso, executive director of the Strategic Energy Initiative at CSIS. "We're operating so close to the margin in terms of capacity in a number of areas, including refining, transmission, and pipelines, that it wouldn't take a big disruption to cause a short-term crisis."
David Doniger, a senior attorney for the Natural Resources Defense Council in Washington, and a former official in the Environmental Protection Agency during the Clinton administration, takes a similar view. "To say there's an overall energy crisis, that's hype."
Do You Think the U.S. Energy Supply Is in Peril?
Then and Now
But if there is no energy crisis in the United States, what are the differences between now and the last ones in the 1970s?
For one thing, even though OPEC prices have gone up in recent years, the United States is not as dependent on the Middle East as a source of imported oil as it was then. According to energy department statistics, 70 percent of U.S. oil imports in 1977 came from OPEC countries, compared to 46 percent in 2000.
And the country does not use oil as an across-the-board source of energy the way it used to. Oil has been replaced as a source of electric power and is used less in manufacturing than it was in the past.
But are Bush, Abraham and Vice President Dick Cheney — the head of the administration's energy task force, which is rolling out a sweeping policy proposal in early May — using the term to justify new policies favoring the administration's backers in the energy industry? That's what some critics charge.
Troubles Abound
Certainly there is no shortage of troubling signs for American consumers.
Clickable State-by-State Energy Map
Gas prices could reach more than $2 per gallon in the Midwest for the second straight summer, and California continues to be hit by unprecedented power woes that will force rolling blackouts in the months to come. On the East Coast, a warm summer could mean more air conditioning and a sharp spike in utility bills.
Additionally, the price of crude oil has also risen sharply in the last two years, from around $10 a barrel to a peak of $37. The current rate has settled at about $26 per barrel, and home heating costs have risen as well.
But many energy analysts, while willing to apply the term to California, say the nation as a whole is not in the throes of a crisis. They note that oil imports continue unabated and say the current price problems come from shortcomings in the transmission of energy to companies and consumers.
'We Have No Crisis'
"I don't think I would use the term 'crisis,'" says Bob Ebel, director of the Energy Program at the Center for Strategic and International Studies in Washington. "That may have been used to capture the public's attention. But we don't really have a supply shortage. What we have is an infrastructure that is already operating at 100 percent, and our inventories are very, very low."
Ebel added: "If we had another outbreak of war in the Middle East which led to a severe and sudden decline in oil supply, then we would have a crisis."
"We have no crisis," says John Lichtblau, president of the Petroleum Industry Research Foundation, a non-profit group in New York. "There is an energy crisis in the West Coast, but that's entirely a domestic crisis. In fact it's a regional crisis, and it has nothing to do with the petroleum markets."
"In my way of looking at it, a crisis implies a sudden event you have to deal with, whereas we have long-term infrastructure problems," adds Guy Caruso, executive director of the Strategic Energy Initiative at CSIS. "We're operating so close to the margin in terms of capacity in a number of areas, including refining, transmission, and pipelines, that it wouldn't take a big disruption to cause a short-term crisis."
David Doniger, a senior attorney for the Natural Resources Defense Council in Washington, and a former official in the Environmental Protection Agency during the Clinton administration, takes a similar view. "To say there's an overall energy crisis, that's hype."
Do You Think the U.S. Energy Supply Is in Peril?
Then and Now
But if there is no energy crisis in the United States, what are the differences between now and the last ones in the 1970s?
For one thing, even though OPEC prices have gone up in recent years, the United States is not as dependent on the Middle East as a source of imported oil as it was then. According to energy department statistics, 70 percent of U.S. oil imports in 1977 came from OPEC countries, compared to 46 percent in 2000.
And the country does not use oil as an across-the-board source of energy the way it used to. Oil has been replaced as a source of electric power and is used less in manufacturing than it was in the past.
But many energy analysts, while willing to apply the term to California, say the nation as a whole is not in the throes of a crisis. They note that oil imports continue unabated and say the current price problems come from shortcomings in the transmission of energy to companies and consumers.
'We Have No Crisis'
"I don't think I would use the term 'crisis,'" says Bob Ebel, director of the Energy Program at the Center for Strategic and International Studies in Washington. "That may have been used to capture the public's attention. But we don't really have a supply shortage. What we have is an infrastructure that is already operating at 100 percent, and our inventories are very, very low."
Ebel added: "If we had another outbreak of war in the Middle East which led to a severe and sudden decline in oil supply, then we would have a crisis."
"We have no crisis," says John Lichtblau, president of the Petroleum Industry Research Foundation, a non-profit group in New York. "There is an energy crisis in the West Coast, but that's entirely a domestic crisis. In fact it's a regional crisis, and it has nothing to do with the petroleum markets."
"In my way of looking at it, a crisis implies a sudden event you have to deal with, whereas we have long-term infrastructure problems," adds Guy Caruso, executive director of the Strategic Energy Initiative at CSIS. "We're operating so close to the margin in terms of capacity in a number of areas, including refining, transmission, and pipelines, that it wouldn't take a big disruption to cause a short-term crisis."
David Doniger, a senior attorney for the Natural Resources Defense Council in Washington, and a former official in the Environmental Protection Agency during the Clinton administration, takes a similar view. "To say there's an overall energy crisis, that's hype."
Do You Think the U.S. Energy Supply Is in Peril?
Then and Now
But if there is no energy crisis in the United States, what are the differences between now and the last ones in the 1970s?
For one thing, even though OPEC prices have gone up in recent years, the United States is not as dependent on the Middle East as a source of imported oil as it was then. According to energy department statistics, 70 percent of U.S. oil imports in 1977 came from OPEC countries, compared to 46 percent in 2000.
And the country does not use oil as an across-the-board source of energy the way it used to. Oil has been replaced as a source of electric power and is used less in manufacturing than it was in the past.
"In my way of looking at it, a crisis implies a sudden event you have to deal with, whereas we have long-term infrastructure problems," adds Guy Caruso, executive director of the Strategic Energy Initiative at CSIS. "We're operating so close to the margin in terms of capacity in a number of areas, including refining, transmission, and pipelines, that it wouldn't take a big disruption to cause a short-term crisis."
David Doniger, a senior attorney for the Natural Resources Defense Council in Washington, and a former official in the Environmental Protection Agency during the Clinton administration, takes a similar view. "To say there's an overall energy crisis, that's hype."
Do You Think the U.S. Energy Supply Is in Peril?
Then and Now
But if there is no energy crisis in the United States, what are the differences between now and the last ones in the 1970s?
For one thing, even though OPEC prices have gone up in recent years, the United States is not as dependent on the Middle East as a source of imported oil as it was then. According to energy department statistics, 70 percent of U.S. oil imports in 1977 came from OPEC countries, compared to 46 percent in 2000.
And the country does not use oil as an across-the-board source of energy the way it used to. Oil has been replaced as a source of electric power and is used less in manufacturing than it was in the past.
And the country does not use oil as an across-the-board source of energy the way it used to. Oil has been replaced as a source of electric power and is used less in manufacturing than it was in the past.
"Americans would be misled if they thought that we can conserve our way to energy independence," said Abraham last month. "The growth of our energy usage over the next 20 years can be moderated, but it cannot be reversed. And that means we're going to have to have more supply to meet that increasing demand."
But Doniger disagrees, saying the Clinton administration provided effective incentives for companies to manufacture environmentally-friendly appliances, among other products. "The [Bush] policy is being tilted very heavily toward supply and away from efforts to tamp down the demand, which can be done without sacrifice," says Doniger.
The Bush administration is currently reviewing those policies and other efficiency regulations, with its decision likely to be announced when Cheney's task force releases its report. Still, the administration's stances so far represent a vast change from the days when former president Jimmy Carter wore a cardigan in the White House to encourage Americans to use less heat.
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