U.S Energy Vulnerability in the 1990s: A Reassessment
The oil price collapse of 1986 and its effect on the world oil market were the original impetus for the study assessing U.S energy vulnerability during the 1990s. While lower oil prices benefit the economies of oil importing nations, they also accelerated longer-term trends that increase our exposure to a supply interruption-increased oil demand and concentration of production among low-cost producers in the Persian Gulf. Energy vulnerability refers to the degree to which an energy supply and distribution system are unable to meet end-use demand as as result of a sudden, rare, unanticipated event of large magnitude. An assessing vulnerability, we include exposure and susceptibility to sudden shocks, not just the shocks themselves. In relative terms, vulnerability grows with increases in either the likelihood of damaging shocks or the damage that would result from a shock.