Society of Petroleum Engineers 6200 North Central Expressway Dallas, Texas 75206

THIS PAPER IS SUBJECT TO CORRECTION

American Institute of Mining, Metallurgical, and Petroleum Engineers, Inc.

Abstract

The Arab Embargo of 1973–74 reduced U.S. liquid petroleum supplies by less than 10%, yet — coupled with panic legislation and regulations — panic legislation and regulations — resulted in severe supply dislocations, great inconvenience to most Americans and actual hardships for others. Today, an effective OPEC embargo could reduce liquid supplies by 40% and would disrupt a substantial segment of the American economy as well as seriously curtail the individuals' freedom to travel and drastically reduce the nation's standard of living.

This paper details the geographical areas and industries that would be most adversely affected by another embargo. The effects on the standard of living, as measured by the Gross National Product and the reduction in the number of jobs, are calculated. It is concluded that the results of such an embargo would be unacceptable to the American people.

Alternatives to military action are presented in the form of an analysis of available domestic energy resources, the state of the technology utilized in converting these resources to usable fuels, the time necessary to bring on additional supplies in meaningful quantities, the required capital investment and the prices necessary to generate such investments. Finding that the alternative, although subject to an appreciable time lag, is technically and economically feasible, the restraints hindering the timely development of adequate domestic energy sources are investigated.

These restraints are found to be primarily economic and environmental, primarily economic and environmental, including restricted access to public lands. Although they arise from actions of the public, environmental zealots, alleged consumer advocates, regulatory agencies and the judiciary, their efficacy stems from legislation and their elimination and/or reduction is shown to be dependent upon the legislative process. A method whereby those with expertise and interest in solving our energy process can effectively influence this process is presented.

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