Cost of Oil: 1861 to Present

Natural Gas Prices

The cost of oil affects the costs of other commodities

What we pay for in a gallon of gas

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People use less electricity when it costs more

Hidden Costs of Oil: Tax Subsidies to Oil Companies (Percentage depletion allowance, nonconventional fuel production credit, expensing of exploration and development costs, enhanced oil recovery credit, foreign tax credits, deferral of foreign income, accelerated depreciation allowances, state and federal tax code interactions and tax rates, Taxpayer Relief Act of 1997, etc.) (Source: International Center for Technology Assessment)

Hidden Costs of Oil: Government Spending Subsidies (Transportation Infrastructure, DOE Research and Development, US-funded multilateral development banks, Army Corps of Engineers Civil Program, regulatory oversight, response to oil contamination, environmental liability)

Hidden Costs of Oil: Protection (US Military costs ensuring oil availability and continuity, Strategic Petroleum Reserves, police, fire, and emergency response)

Hidden Costs of Oil: Environmental, Health, and Social Costs

(Air pollution, human mortality and morbidity, agricultural crop losses, loss of visibility, pollution damage to buildings and materials, global warming, water pollution, oil spill cleanup, roadway de-icing and runoff, hydrologic impact of roadways and parking lots, noise pollution, motor vehicle waste disposal, environmental impacts of sprawl, etc.)

Hidden Costs of Oil: Other Costs (Oil import dependence and spike susceptibility, travel delays, uncompensated damage for accidents, subsidized parking, weather-related financial loss, etc.)

Hidden Costs of Oil: Total

The marginal cost of oil production is the point below which it becomes uneconomic to bring new oil projects to market. Above the marginal cost of production, oil can be extracted and sold at a price that will return to investors an acceptable after-tax capital return adjusted for risk (now at about $90-100/bbl).

Costs of Electricity: Remain Low

Costs of Energy:

Costs of Energy (from Energy Information Administration) ($/MWhr): (Doesn’t include hidden costs)

Costs of Electricity: 2011

The source of electricity around the country is driven by the cost, which is often a result of geography

Change in German Total Energy Sources:

Energy and Conflict

Iraqi forces set 700 Kuwaiti oil wells on fire. Fires burned for more than 10 months. About 6 million barrels of oil burned each day, for a total of 1.5 billion barrels (The total oil from the Deepwater Horizon spill was about 5 million barrels)

Gulf War in Kuwait

US Budget: $3.7 trillion proposed for 2013

2013 Budget:

US Proposed Energy Budget: 2013

Energy as a part of all science funding: 2009

World Total Defense Spending: $1.53 trillion

World Total Defense Spending: Change from

US Military Spending: Per Person

Total US Petroleum Imports ( 2011)

Iraq Oil Production

Iraq/Iran Oil Production

Global Hotspots: Straits of Hormuz (DOE): “The world’s most important oil chokepoint” 20% of the world’s supply of oil passes through here – 17 million barrels of oil a day Any sustained blockage in the strait could trigger a 50 percent increase in the price of oil and trigger a full-scale global recession or depression

Global Hotspots: Straits of Hormuz Iranian Government has threatened to blockade the Strait with continued oil embargoes by the west US Military is focused on this region

Global Hotspots: South China Sea Multiple countries have competing claims on various offshore oil and gas resources China has claimed them all

Global Hotspots: South China Sea Most other countries in the region have joined the ASEAN (Association of Southeast Asian Nations), which has the full support of the US

Global Hotspots: Caspian Sea Basin

Global Hotspots: East China Sea Japan and China are clashing over who owns the oil and gas fields in the East China Sea

Future Scenarios: