Abstract:Transportation uses more than one-fourth of all energy consumed in the United States, almost two-thirds of all oil, and more oil than all developing countries combined use for all purposes. Changes in U.S. transportation energy use can have major effects on world energy markets. However, in this paper the converse question is addressed: What effect will the changing energy markets of the future have on the U.S. transportation system through 2020?

The answer is "a great deal, and very little." A great deal in that there will be a tightening of the petroleum market during this period, with the attendant rise in market power of a few producers. The resulting higher prices and economic vulnerability will heighten the need for improved efficiency and begin to generate viable markets for alternative energy sources. A great deal in that much will have to be done to advance the technology of transportation energy use both for alternative energy sources and the efficiency of motor fuel use. Indeed, real activity in alternative energy sources is expected before 2020 in the form of significant regional or niche markets, which will be the precursors of the transition to a non-petroleum-based transportation system.