CHATTANOOGA, Tenn. — While United States dependence on imported petroleum has increased since the 1973 Arab oil embargo, the threat to consumers has diminished, a University of Tennessee economist said Tuesday.
Dr. Ziad Keilany, Guerry Professor of Economics at UT-Chattanooga, said oil companies have developed more sources outside the Persian Gulf region.
In 1973 about one-third of the United State’s oil supplies were imported. So far this year, imports have accounted for about 55 percent of U.S. consumption, with one-fifth coming from the Persian Gulf.
“The oil sources are more diversified,” Keilany said, citing Latin America, Africa, the Middle East, and the Central Asian republics of the former Soviet Union.”
U.S. dependence on imported oil will continue because domestic oil production has declined and consumption is increasing.
The strong economy has given Americans more purchasing power to buy gas, fuel-efficiency of vehicles is declining, and the population is increasing, Keilany said.
Keilany also said the recent drop in gasoline prices of about six cents per gallon since early September reflects a seasonal adjustment in supply and demand.
“Prices will rise again, modestly, as we move from fall into winter, and demand for heating oil increases,” Keilany said.
Contact: Dr. Ziad Keilany (423-755-4116)