reserving natural gas for space heating and special applications in industry, oil for transportation and petrochemicals, and coal for generating steam and electricity. While the allocation of increasingly scarce fuels could probably not be left entirely to the market in an emergency situation, care must be taken to prevent distortions of the price mechanisms that result in false signals to consumers and producers and thus aggravate the long-term problem. Any allocation system should preserve a reasonable balance between household use and industrial or commercial use; giving households absolute priority in natural gas, for instance, may lead to avoidable unemployment and loss of nonenergy output.

It has already been argued that a vigorous program of conservation and enhanced domestic production is required, with the overall aim of reducing U.S. dependence on imported oil and gas as much as possible over the coming decades. However, even those members of CONAES who are convinced that the oil and natural gas era is coming to an end feel that improved domestic production is essential to permit a transition to sustainable long-term energy sources. For reasons of national security, minimizing dependence on imported oil should be accorded prominence in national energy policy comparable with other foreign policy goals related to energy, such as avoiding the proliferation of nuclear weapons. The social, economic, and political prices this country pays for oil imports are likely to become less and less acceptable over the next 10–20 years. How critical this problem may yet become will depend in large part on how seriously it is taken by the government and the people of this country.



1. Richard Nehring, Giant Oil Fields and World Oil Resources (Santa Monica, Calif: Rand Corporation (R-2284-CIA), June 1978).


2. American Petroleum Institute, Basic Petroleum Data Book, Section III, Table 10, Supplement (Washington, D.C.: American Petroleum Institute, 1978).


3. National Research Council, Energy Supply Prospects to 2010, Committee on Nuclear and Alternative Energy Systems, Supply and Delivery Panel (Washington, D.C.: National Academy of Sciences, 1979).


4. National Research Council, Alterative Energy Demand Futures to 2010, Committee on Nuclear and Alternative Energy Systems, Demand and Conservation Panel (Washington, D.C.: National Academy of Sciences, 1979).


5. Ibid.


6. Supply and Delivery Panel, op. cit.


7. William A.Johnson and Richard E.Messick, “The Supply and Availability of Imported Oil Through 2010,” preliminary report for the Supply and Delivery Panel (Available in CONAES public file, April 1977).


8. International Monetary Fund, International Financial Statistics (Washington, D.C.: International Monetary Fund, January 1979), pp. 36–37.

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