The Potential for Diversifying Oil Imports by Accelerating Worldwide Oil Exploration and Production

GAO examined the potential for the United States to diversify its sources of imported oil and the incentives and disincentives for private U.S. oil companies to diversify their individual foreign oil sources in order to reduce dependency upon the Middle East and North Africa. Diversification does not mean abandoning traditional oil sources; it means reducing reliance upon them by supplementing them with other sources to the point that dependency upon insecure regions is sufficiently reduced so that a supply disruption would not be critical to national security. Although few oil companies have been able to significantly reduce their dependence on Middle Eastern or North African oil sources, recently their oil exploration activities have been concentrated elsewhere. The areas which hold the most promise for future oil discoveries are the Arctic areas, Antarctica, Mexico, the North Sea, China, and certain developing nations in Latin America and Africa. The United States has one official program which directly influences petroleum exploration in other countries, the Overseas Private Investment Corporation, and participates in a number of international organizations which have or are developing programs to stimulate petroleum exploration and production in developing countries.