"We have to stop sending $700 billion a year to countries that don't like us very much," Republican John McCain said again Wednesday night during the candidates' final debate.
Democrat Barack Obama joined the refrain recently, declaring at a Wisconsin rally that a push for alternative energy "will stop us from sending $700 billion a year to tyrants and dictators for their oil."
The claim, however, wildly exaggerates the amount of money going to unfriendly nations. It also significantly inflates spending in general on petroleum imports, especially considering recent dramatic declines in oil prices.
The number appears to have originated with Texas oil mogul T. Boone Pickens, who's campaigning hard to displace some of those imports with windmills and domestic natural gas.
An examination by The Associated Press of government oil import costs in 2007 and the first seven months of this year, the latest figures available, indicates the $700 billion overstates total spending by nearly one-third - and possibly as much as one-half. And only about a fourth of the imports come from countries that might be considered unfriendly, such as Venezuela and Iran, and from the politically volatile Persian Gulf.
According to government agencies that track energy imports, the U.S. spent $246 billion in 2007 for all imported crude oil, a majority of it coming from friendly nations, including neighboring Canada and Mexico. An additional $82 billion was spent on imported refined petroleum products such as gasoline, diesel and fuel oil. A majority of the refined products came from refineries in such friendly countries as the Netherlands, Canada, the United Kingdom, Trinidad and Tobago and the Virgin Islands.
Oil prices zoomed in the first seven months this year, but even then the cost of oil and refined product imports totaled $283.6 billion from January through July, according to Foreign Trade Division of the U.S. Census Bureau - a hefty amount but not near an annualized $700 billion.
So where did the number come from?
Brian Rogers, a McCain campaign spokesman, noted in an e-mail response that Obama had used it, and that Pickens had cited the $700 billion figure. "It's in fairly wide circulation," Rogers said.
Nick Shapiro, an Obama spokesman, said he's not sure where the number originated.
No official government or industry statistics on oil imports confirmed the annual $700 billion expenditure, much less the claim that the U.S. is sending that much money for oil to politically volatile or unfriendly nations.
In all likelihood, the number had its genesis with Pickens, who since June has been promoting his "Pickens Plan" for U.S. energy independence that relies heavily on expanding domestic wind energy and natural gas projects.
Pickens, who has cited the $700 billion figure for imported oil on his Web site, in TV commercials and testimony before Congress, plans to invest $58 million to promote his plan to build wind farms and expand natural gas production with an aim to reduce reliance on foreign oil. He has leased hundreds of thousands of acres in West Texas where he plans to erect 2,700 wind turbines to produce power for Dallas and Fort Worth.
But his Web site makes clear the oil reference is to all petroleum imports, not just from nations that, according to McCain, "don't like us very much."
According to the federal Energy Information Administration, last year the U.S. imported nearly 4.9 billion barrels of oil and refined products, 16 percent of it from the Persian Gulf and 10 percent from Venezuela, whose president has been hostile to the United States. Neighbors Canada and Mexico, by comparison, accounted for 30 percent of all such imports with Canada at the top.
Brian Bradshaw, who works with Pickens in Dallas, confirmed that the Pickens group produced the $700 billion figure to "draw attention to how big a problem this is."
Pickens' analysis is based on calculations that sharply overstate the cost of petroleum imports, both crude oil and refined products.
For example, the calculation used a crude oil price of $145 a barrel - the peak price of premium, light crude on the New York Mercantile Exchange late last June. Oil prices on that exchange hovered around $70 a barrel Thursday.
The Pickens group simply multiplied the $145 a barrel New York exchange cost of crude oil and daily costs of refined products by 365 to get an annualized number. The result was about $670 billion and "we rounded up to the even number," recalled Bradshaw.
But much of the country's imports are heavier crude that doesn't cost nearly as much as the West Texas premium crude traded on the New York exchange. The price of imported oil last June, for example, often was $13 to $28 a barrel cheaper than what was traded on the New York Exchange, the AP found.
At the time the Pickens group made its analysis, at the peak in June, actual spending on oil and refined product imports for that month was $46 billion, according to government import figures, equivalent to an annual $552 billion.