A report released this week by the U.S. Department of Energy (DOE) illustrates the critical role that domestically produced oil and gas plays in the U.S. economy. The report also outlines how American innovation in energy technology is a key driver of economic success, and the cornerstone for sustaining American living standards now and into the future.
Deputy Secretary of Energy Mark Menezes announced the release of the report at an energy and manufacturing roundtable in New Mexico on Monday. “Oil and natural gas provide more than two-thirds of the energy Americans consume daily,” said Menezes. “In addition to meeting our energy needs, these fossil fuel resources are integral to our standard of living.” He said the report describes these resources’ importance for the United States, the technologies that rely on U.S. oil and gas, and opportunities for the future growth of the industry.
The report also ties in with President Donald Trump’s declaration of October as National Energy Awareness Month. In his proclamation, Trump described America’s natural resources as “God-given gifts,” and recognized the “preeminent importance of our Nation’s energy industry to the comfort of our daily lives and to our national security.”
— Dan Brouillette (@SecBrouillette) October 5, 2020
Produced by the Office of Fossil Energy at the DOE, the report, titled “U.S. Oil and Natural Gas: Providing Energy Security and Supporting Our Quality of Life,” states that other than oil and gas, nuclear energy (8 percent), coal (13 percent) and renewables such as hydroelectric power, wind and solar (11 percent) play significantly smaller roles in the U.S. energy mix.
According to the report, the U.S. oil and natural gas industries support almost 900,000 American jobs, while increased domestic supply also has the effect of lowering energy prices for American consumers. The report draws on research from the Council of Economic Advisers, which shows that “The lower oil and natural gas prices resulting from increased domestic oil and natural gas production provided $203 billion in annual savings to U.S. consumers—equal to $2,500 per year for a family of four. ”
The Office of Fossil Energy states that in addition to the significant savings to consumers and large number of well-paid jobs, the production of oil and gas in the United States leads a range of other, far-reaching benefits. For example, the industry contributes to state and local government revenue in the form of taxation, while U.S. oil and gas production also ensures a ready supply of the feedstock materials used by the chemicals, plastics, and fertilizer industries. While American fossil fuel production secures a degree of domestic energy independence, exports of American Liquefied Natural Gas (LNG) also help ensure that U.S. allies and trading partners enjoy greater energy security.
The DOE report also states that producing energy products in the highly regulated American petroleum and natural gas industry ensures that environmental impacts are minimized compared to less regulated oil and gas industries abroad.
— DOE Press Staff (@EnergyPress) October 5, 2020
“While the United States was once heavily reliant on oil and natural gas imports, we are now a major supplier in international energy markets,” said Assistant Secretary for Fossil Energy, Steven Winberg. “We will continue to foster relationships with industry, academia, state agencies, the private sector, and non-governmental organizations to drive innovation forward, to underpin U.S. economic growth and energy security.”
Securing Energy Trade Capacities
In a move to ensure the continued capacity of American oil producers to trade with neighboring countries, Trump issued presidential permits on Monday to ensure the continued operation of two petroleum product pipelines—one on the U.S.-Canadian border in Toole County, Montana, and one running underneath the Rio Grande between the United States and Mexico near Laredo, Texas.
In addition to crude oil, the permits allow the pipelines to carry a range of refined products to either Mexico or Canada, such as naphtha, liquefied petroleum gas, natural gas liquids, jet fuel, gasoline, kerosene, and diesel. At the Unleashing American Energy event in June of 2017 Trump said that the goal of such pipelines is to boost U.S. energy exports.
However, the pipelines are also significant assets in times of crisis from an energy security point of view, as they can be taken over for a time by the United States if the president decides it is necessary to ensure the national security of the nation.