Shipments of Prudhoe Bay crude were moving slowly again last week, five days after the worst tanker spill in American history had stanched the flow of Alaskan oil. But the deeper shocks of the frontier disaster continued to reverberate through the U.S. oil industry. The 500-square-mile area of Prince William Sound fouled by the North Slope crude served as a chilling reminder of America’s increasing reliance on foreign oil. Domestic oil supplies have been declining because the depressed prices of the early 1980s have discouraged exploration by U.S. oil companies. At the same time, American consumers have been guzzling gasoline again as though the gas-pump lineups of the 1970s, after the Organization of Arab Petroleum Exporting Countries cut off supplies, had never happened.
Foreign suppliers have taken up the slack. Overseas oil accounted for a daily average of 37 per cent of U.S. consumption during 1988, compared with 28 per cent
five years ago (the peak was 46.5 per cent, in 1977). And imported oil would be pouring into the United States at an even faster rate if production from Prudhoe Bay, which supplies about 12 per cent of U.S. oil needs, had remained shut down following the Exxon Valdez incident. Said Richard Carl, an oil analyst with Merrill Lynch Canada Inc.: “The possibility of Alaskan production grinding to a halt drove home just how vulnerable America’s energy supply really is.”
One way for Washington to counter the trend is to introduce incentives to spur exploration. Last month, a U.S. Senate committee approved a bill that would allow oil and gas drilling in the Arctic National Wildlife Refuge, one of the largest remaining wilderness areas in the country. But analysts now say that the
giant Alaskan spill—and Exxon Corp.’s inept handling of the disaster—will provide strong ammunition for environmentalists fighting to save the Arctic from further exploitation. And it could even help environmentalists who are trying
to clamp down on oil and
gas development in Canada’s Mackenzie Delta area. Said Foster Mellen, an analyst with Energy Security Analysis Inc., a Washington-based petroleum consulting firm: “This means development of the refuge reserves will be pushed further down the road—if at all.”
Even if additional Alaskan reserves are discovered, analysts say that a decline in U.S. oil production likely cannot be stopped, just slowed. Facing the prospect of even greater foreign influence over its energy supply, Washington's only real option is to search for alternatives to crude oil—or to find a way to make Americans stop stepping on the gas.
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