Question

6. Discuss the pros and cons of American corporations conducting business with rogue regimes and nations like Equatorial Guinea, a third world, West African, oil rich nation, for their natural resources. Discuss America’s dependence on foreign oil. Discuss and offer alternative energy solutions to our crude oil crisis.

Answer 1

The America is the largest producer and consumer of oil. There is prices pressure in the home country and it creates losses for the oil producers. The American Corporations involve in the trade with rogue regime countries for gaining competitive advantage in global trade. These countries supply natural resources and give the opportunity to the companies to reduce the prices for the consumers.

The companies get the natural resources at cheaper prices from the countries as compared to the domestic suppliers. This hampers the growth of local producers. But, with the Trump’s tariff imposition rule, the import of goods will be affected to great extent.

America is the biggest producer but the production quantity is not able to meet the demand for oil which leads to the UD dependence on foreign oil.Also, there is limited availability of oil which can be extracted and make it expensive also. But the US dependence on foreign oil has declined since 1949. The pattern of foreign dependence for oil has been changed a lot from the year 2000.

The main reasons for the oil crisis are overconsumption, rising population, costly oil reserves, wastage etc. It is always advised to move to the renewable sources of energy. The public should resort to participate in the installation of alternative energy systems which are environment friendly and economical also. There is a need to take immediate actions on the energy crisis.