Mark Perry today has a nice post celebrating Earth Day from an economist's perspective, including a chart showing how the U.S. economy today uses far less energy per unit of output than it did in 1950. To complement his post, I offer the following charts which focus on oil consumption.
These charts offer powerful proof that people and economies respond to price incentives. Since 1970 the inflation-adjusted price of crude oil has increased by a factor of 10. Faced with the problem of increasingly expensive oil and oil by-products, the U.S. economy responded by reducing its reliance on oil and becoming more energy efficient. As the second chart shows, the U.S. economy today uses over 60% less oil than it did in 1970 to generate a unit of output.
As the chart above shows, the U.S. economy now consumes about 19 million barrels of oil per day. That is the same as it consumed in 1978, despite the fact that the economy today is two and a half times larger than it was in 1978. It's a remarkable achievement.