Since 1945, the per capita global demand for oil has quadrupled to about 4.5 barrels of oil per person per year. When combined with a 2.8 fold increase in the world’s population, we see more than a 12 fold increase in world oil consumption over the past 68 years. This energy resource fuels the transportation sector globally, but also requires a massive transportation infrastructure to move the resource from where it is extracted to where it is ultimately used.
The United States (U.S.) remains the world’s largest oil consumer. In 1960, it claimed more than one third of world oil consumption and even today the U.S. uses nearly 21% of the world’s oil. Once a net exporter of oil, the U.S. oil production peaked in the early 1970’s and for the past 40 years, the U.S. has relied on foreign supply chains to provide up to 67% of their oil demand.
Over the past 10 years, Canada has become the largest source of imported oil to the U.S., providing up to 2,400 thousand barrels of oil equivalent per day (kbbl/d) in 2012. This change is but one signpost in a major transformation that seems to be occurring in the supply and demand for oil within North America (NA).
Such transformations in the past have acted as ‘bookends’ for 30-35 year eras in the North American and global marketplace for oil. This paper begins by looking at the past two eras and then considers the forces that are acting on the North American energy system today. We argue that these forces are transforming the energy system in North America, reshaping the oil supply chain and defining a new era in oil supply and demand: one based on an insecurity in market access.