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(Un)Reliable Energy Supplies – Transportation

The views expressed are those of the author and are not necessarily those of Scientific American.


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The world’s level of dependence on petroleum for its transportation needs is concerning for a number of reasons, including the reliability of this energy supply. Even with recent reductions in fuel imports, half of the oil used in the U.S. transportation sector today is produced in other countries. This introduces questions regarding the reliability of our energy supply, and what we might do if our existing supply systems fail.

A reliable energy supply is one that is available when we want it – it is not prone to failures, outages and disruptions. And, ideally, this system is also resilient, meaning that if disruptions do occur, the system can recover quickly. A reliable energy supply does not have to be domestic, but it has to have a high probability of being a predictable and stable resource.

Without including unconventional resources, the world’s top 17 countries (in terms of oil reserves) have an estimated 1.2 trillion barrels of oil in the ground [1] or more than to more than 100 years at current consumption rates [2]. The majority of this crude oil is found in the Middle East, though there is some uncertainty regarding the validity of these data given the strong interest that this region has in maintaining its perceived reserve superiority.

Figure: World Oil Reserves by Region [3]

What is certain is that oil is a non-renewable resource (at least on the timescale that we live in). It is also true that the oil that being produced around the world is becoming increasingly difficult to get out of the ground. A century ago, companies could skim oil from surface seeps. Now, they drill miles into the ground from floating platforms in the ocean. And, with each level of increasing difficulty, the oil that they produce becomes more expensive.

Even if there is enough available and economic oil in the world’s reserves to continue a steady supply of oil into global markets in the near-term, there are still reliability concerns. These concerns stem from the fact that crude oil is largely not produced where it is consumed, which has created a world market that is susceptible to a wide array of disruptions. Today, crude oil is produced all over the globe, with Russia, Saudi Arabia, and the United States topping the list.

Figure: World’s top oil producers (thousands of barrels per day) [4]

This oil is consumed all over the world, primarily in the United States, China and Japan. Noticeably, there is a mismatch between the world’s top oil producers and oil consumers. And, while the United States ranks in the top three on both lists, it only produces about half of the crude oil that it would need to supply its demand. The same is true for Chinese demand, with more than 50% of its oil demand being supplied by other countries, in spite of the fact that China’s consumption is less than half of the U.S. consumption.

Figure: World’s top oil consumers (thousands of barrels per day) [5]

This mismatch between oil supply and demand leads to concerns surrounding supply reliability, as it removes direct oil supply control from the countries that use it. This lack of control introduces doubts regarding the stability of the supply, especially when many of the world’s oil exporting nations have unpredictable and unstable government structures.

In the United States about half of the petroleum that the nation demands is imported from other nations [6]. Of these imports, about half (49%) comes from the Western hemisphere. The remaining oil is imported from Africa (23%), the Persian Gulf (18%) and an assortment of other nations (10%).

Figure: About ½ of U.S. petroleum is imported, and about ½ of these imports come from the western hemisphere

In the United States, we have tried to hedge against the risk of supply disruptions in two main ways: by reducing our demand for imported fuels and by maintaining emergency fuel reserves.

Reducing U.S. Demand for Imported Fuels

U.S. demand for petroleum imports peaked in 2005, due in part to reductions in consumption of both gasoline – in favor of domestically produced biofuels – and, more broadly, transportation fuels. Three years later, with the economic downturn in 2008, oil demand continued to decrease. This latter reduction was in part due to efficiency improvements, including federal mandated fuel economy standards, and changes in consumer behavior. Shifts in economic growth patterns also played a role, as the nation responded to rising unemployment and a stagnant national economy. This overall reduction also coincided with an increase in domestic oil production, resulting in a significant drop in petroleum imports.

Figure: U.S. Petroleum net imports have dropped since 2005

The United States currently maintains a domestic refining capacity of 17.7 million barrels per day, its highest capacity since 1982. The U.S. added more than 1 million barrels since 2001. Almost half (49%) of these refineries are located along the Gulf Coast, a convenient fact given the location of the nation’s petroleum reserves, as we will discuss in a moment.

Figure : Crude Oil Refining Capacity at U.S. Refineries in 2001 and 2011 by region

These refining facilities convert crude oil into many end products, including the gasoline, diesel and jet fuel that are used by the nation’s transportation fleet. While a portion of this crude oil is from domestic resources, imported petroleum still represents the majority of the U.S. crude oil supply. So, the nation has responded to this vulnerability by maintaining a reserve of oil for emergency situations to buffer the nation against supply disruptions.

U.S. Emergency Fuel Reserves

The fear of disruptions in the nation’s oil supplies are very real, and have left the nation to take steps to protect itself. The U.S. Strategic Petroleum Reserve (SPR) is a crude oil storage system maintained by the Department of Energy in order to avert economic shutdown in emergency situations that threaten the nation’s access to oil [7]. Consisting of a series of 62 underground caverns (within salt deposits) along the Gulf Coast, the U.S. SPR currently holds more than 700 million barrels of oil [8]. At the current U.S. consumption rate of about 20 million barrels per day, the SPR and its 700+ million barrels of oil could supply the country’s fuel needs for just over a month without conservation efforts or restrictions [9].

Photo: U.S. Strategic Petroleum Reserve sites are located along the Gulf of Mexico from Texas to Louisiana [9]

These reserves have not eliminated the potential reliability problems associated with heavy dependence on imported energy resources. But, it has provided the nation with a small amount of backup to buffer the impact of disruptions to the world’s oil supplies.

Even with the nation’s recent reductions in oil imports and its existing reserve capacity for crude oil, the U.S. transportation fuel supply is still susceptible to disruptions. Today, the nation has a limited ability to control its oil supply chain, leaving it dependent on many other nations. Until we figure out how to establish a reliable fuel supply for the U.S. transportation fleet, we will be faced with the difficult question of “what can we do if our existing supply systems fail?” – and the answers to this question aren’t easy.

References:

[1] U.S. Department of Energy, Energy Information Administration (EIA) http://www.eia.gov/international/reserves.html
[2] International Energy Agency (IEA) Annual Statistical Supplement http://omrpublic.iea.org/omrarchive/sup2010.pdf
[3] U.S. Department of Energy, Energy Information Administration (EIA), Oil and Gas Journal (2007)
[4] Graph of the world’s top oil producers by Sheril Kirshenbaum and published on her blog, Culture of Science, on 8/17/2011. Used with her permission.
[5] Graph of the world’s top oil consumers by Sheril Kirshenbaum and published on her blog, Culture of Science, on 8/17/2011. Used with her permission.
[6] U.S. Department of Energy, Energy Information Administration (EIA) http://www.eia.gov/energy_in_brief/foreign_oil_dependence.cfm
[7] The Energy Policy and Conservation Act Section 3 and 161, as summarized by the Department of Energy’s U.S. Petroleum Reserves website. http://www.fe.doe.gov/programs/reserves/spr/spr-epca.html
[8] U.S. Department of Energy – Strategic Petroleum Reserve website, directory http://www.spr.doe.gov/dir/dir.html
[9] U.S. Department of Energy, Energy Information Administration (EIA) http://www.eia.gov/energyexplained/index.cfm?page=oil_home#tab2
[10] U.S. Department of Energy – Strategic Petroleum Reserve website http://www.spr.doe.gov/

Photo Credit:

1. Graphic of oil barrel © by Amiralis and used under this creative commons license.

 

Melissa C. Lott About the Author: An engineer and researcher who works at the intersection of energy, environment, technology, and policy. Follow on Twitter @mclott.

The views expressed are those of the author and are not necessarily those of Scientific American.





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  1. 1. jerryd 5:29 pm 09/16/2011

    The answer is rather easy just big auto, oil won’t do the things needed. And what is needed is small and very small commuter EV’s and semi’s and other trucks, cars converted, be built for NG.

    Personally if I owned a truck fleet I’d be using NG because it’s cost is 50% of oil.

    Myself I got tired of waiting and built my own EV’s and drive them for a tiny fraction of a gas vehicle of the same type.

    Link to this
  2. 2. sofistek 7:07 pm 09/16/2011

    I hate meaningless phrases like. “at current consumption rates”. It’s meaningless because, of course, current consumption rates will not continue and because rates of production cannot possibly be maintained until the last drop of accessible oil is extracted. Not only that but a simple calculation will show that 1.2 trillion barrels does not equate to over 100 years at current consumption rates. The world uses roughly 30 billion barrels of oil per year. 1.2 trillion barrels would last only 40 years if it could be extracted at 30 billion barrels per year.

    The US does not produce nearly 9 million barrels of crude oil per day, as this blog entry claims. Crude oil production is about 5.6 million barrels per day, with various amounts of other oil-like substances, which can’t be referred to as crude oil. Check this article: http://www.theoildrum.com/node/8367

    Oil is more than just a fuel, of course, it is a raw feedstock for lots of other stuff that we use and it is present or used, in one way or another, in just about everything we touch or eat. The notion that other fossil fuels can take up the slack is absurd (not least because they also have their depletion curves, as, effectively, non-renewable resources). Oil underlies all other resources we consume (without thought of limits) and so it is not just an energy problem but a predicament brought about by unthinking economics and a complete denial of limits.

    Link to this
  3. 3. electric38 5:29 am 09/17/2011

    Good reasons to promote consumer owned rooftop solar. These rooftop units can also power electric cars. Cost after initial expense = 0. Free energy from the sun is worth looking into. Too bad the wealth and (paid) political power is firmly in the hands of existing monopolies.

    Strategic reserve capability? I dunno, how much sunshine will be there tomorrow…

    Link to this
  4. 4. gunt 9:44 am 06/17/2012

    concerning oil import the situation in Germany is such, that about all the oil consumption has to be imported – the biggest import quota is coming from Russia.
    The major part of the oil import is used for gasoline and diesel production – about 60 Million tons per year.
    Right now there is no real plan what to do about this situation in the future.
    So right now we convert valuable food stuff into ethanol and diesel but this is just a trickle in the overall gas and diesel flow.
    Then there is research going on in fuel cells and in hydrogen generation. But – as Germany has decided last year to replace nuclear with wind and solar energy – the needed electricity ( CO2-free) for a massive increase in hydrogen production will just not be available.
    Research is done in second generation biofuels (using plant residues) – but we are not even sure if the energy balance is positive (that is, more energy contained in one gallon of second-gen fuel than the energy needed in its production process).
    Then research is going on in artificial leaves, in breeding hydro-carbon producing microbes, and probably in a dozen of other exotic research areas.
    Then our politicians are dreaming of electro mobility – in the meantime this turns out to become the buzz word of the year. But when you ask the car companies you find out that by 2020 at most about one million e-cars are believed to be on the German roads – out of to-day’s 45 million cars.
    What I want to drive at is, that we are spending millions of Dollars (Euros) on all kinds of exotic stuff, while there exists a well established industrial process converting hydro-carbon fuels out of syn gas, a mixtrure of hydrogen and carbon monoxide (CO) – the Fischer-Tropsch synthesis.
    Originally – this process was used to gasify coal, generate CO , extract the hydrogen from water, and synthesize this gas mixture to hydro-carbons such as gasoline and diesel.
    During the second world war Germany used this process to produce the needed gasoline.
    Instead of using coal one could use directly the CO2 from air, crack it to CO , and mix it with hydrogen to syngas for the syn fuel generation.
    All the processes are well established and used under special conditions in various countries. The problem is, it requires a lot of (cheap) CO2-free energy.
    For one ton of diesel oil you have to convert 3,2 tons of CO2 into CO requiring between 25 and 30 Megawatthrs of energy.. Add to this the energy required to generate 5000 cubicmeters of hydrogen out of water for this one ton of diesel. Instead of using electrolysis the hydrogen could be also directly generated out of water in high-temperature nuclear reactors (remember the Fukushima problem last year, where water was split into hydrogen and oxygen when coming in touch with the overheated reactor rods).
    So – where are we now ?
    We need lots of cheap CO2-free energy to replace oil by synfuels.
    And the only source of cheap CO2-free energy in such large amounts is nuclear.
    No chance in our countries in the northern hemisphere to provide this via windmills or via solar.
    And why use synfuels instead of using hydrogen directly ?
    Because all our to-day’s infrastructure for fuels from oil can be used also for synfuels.
    So – let’s go back to the drawing boards for advanced nuclear reactors.
    Think about the large Dollar sums going to the oil sheikhs when importing their oil.
    Let’s use this money for our independece from them (and – in Germany’s case – from Russia).

    Link to this

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