Energy independence will depend on economy’s overall health

Experts unanimously agree that the United States’ ability to supply its own energy needs is growing, but how self-sufficient it will be in the next decade or two is still up for debate.

The federal government’s own information source, the U.S. Energy Information Administration, has tried to quantify this range in supplements to its Energy Outlook 2013, issued on Monday.

The supplements show how assumptions on such as the growth of labor, the amount of capital invested and availability of tax credits could shape supply and demand for different forms of energy decades down the road.

“By varying the assumptions and presenting different scenarios, we are not necessarily making a prediction of the future but we are illustrating the sensitivity of the long-term energy outcomes to changes in the underlying assumptions,” said Jonathan Cogan, an analyst at the U.S. Energy Information Administration. “If you change assumptions about key factors, it can have a very significant impact on the long term projections.”

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The agency’s 2013 Outlook, for example, bases its projected price for a barrel of West Texas Intermediate oil at $145 (in nominal dollars) in 2025, using the assumption that the gross national product will grow less than three percent on average from 2011 to 2025. However, with high economic growth this price would lower to $142; with low economic growth, it would rise to $165.

Other studies, including the energy-think tank IHS and those done by private companies, such as ExxonMobil, have made slightly different assumptions, which accounts for the range of projections floating around on future oil prices and future energy independence.