As we move into the holiday season in earnest, here’s a little takeaway that indicates global tension and the world’s energy competition may not be so cutthroat as you might be led to believe.
Towering Oil and Gas Achievements
The decade is coming to a close, and when it comes to the United States energy sector, the last ten years have been filled with ups and downs. After a near-cataclysmic dip in price and production in 2014, the United States oil and gas market has exploded into an era of production not seen before.
According to the EIA, the United States has increased petroleum and natural gas production by 16% and 12%, respectively. It’s the culmination of a years-long push to outpace the world’s energy superpowers. And it’s working. At the moment, the United States produces more petroleum and more natural gas than Russia and Saudi Arabia, the nation’s two closest competitors.
The Oil-Based Economy
To hear the media tell it, soaring production in the United States threatens to destabilize several nations (like Saudi Arabia) whose economy gathers most of its strength from oil and gas. These smaller nations are seeing severe declines in their annual GDP as production in North America siphons oil and gas clients day after day.
In those terms, the current back and forth in the energy sector seems like a matter to get blood boiling throughout the world. That may be the press using dramatic license, however.
‘They Didn’t Do Anything Wrong’
At the end of the first week in December, OPEC’s most significant players had a meeting to discuss the global supply of oil and gas over the next year. On leaving the meeting, Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman spoke briefly with CNBC. The energy official wasn’t just polite and political when talking about the recent U.S. shale phenomenon. He was outright complimentary.
Shale producers, explained Abdulaziz, “didn’t do anything wrong, they produced more barrels, they put the U.S. on the map in terms of its energy requirements, they are growing the economy, they are creating jobs.”
Rather than act to curtail U.S. energy production, Abdulaziz indicated that the best path forward for Saudi Arabia was to get in bed with United States oil and gas. The Sultan underscored that sentiment when he explained that the Saudi energy program would go “more and more international” in the future.