Publication

This paper explores how increased domestic oil production could affect the overall trade balance of the United States. The author argues that, though falling oil imports could have significant short-term effects, any improvement in the oil trade balance is likely to result in a stronger US dollar and larger trade deficits in other goods and services over the long-term. He goes on to say that rather than increasing the production or reducing the consumption of oil, the way to achieve a smaller deficit is to adopt measures that raise the national saving rate.