If I had to pick the economy’s likeliest spoiler this year, it would be oil prices. Whether it’s Iran trying to close the strait of Hormuz or the Arab Spring wafting through Saudi Arabia, I have no idea; but nothing matches the track record of oil in delivering nasty economic surprises.But over the long run, something important is happening to the role of imported oil in the American economy: it’s shrinking. This comes through quite strikingly in the outlook released today by America’s Energy Information Administration. The remarkable expansion of U.S. production from shale gas and unconventional oil sources such as the Bakken formation in North Dakota are relatively well known. There is, however, less awareness that American consumption is barely growing (see the nearby chart). The EIA has sharply revised down how much liquid fuel it reckons America will consume in 2035, to 20m barrels a day, from 22m it projected last year, which would be below the 2005 peak. Couple that with rising domestic production, and America will rely on net imports for just 36% of its liquid fuel needs in 2035, compared to 60% in 2005.Several factors are at play. Factor one (unfortunately) is lower economic activity in the aftermath of the recession. Factor two is upward pressure on the price of oil from emerging markets demand. The EIA reckons by 2035 it will average …
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