World Leader by 2015

As bad as the economy is, it's all poised to turn around if we don't kill the goose laying the golden eggs before the bird has a chance to deliver its blessings.

I'm talking about the fact that the United States is projected to become the world's largest producer of oil in two years. This could have enormous economic benefits for Americans, especially for the poor and the middle class, but the windfall will only last for a couple of decades because only private and state lands are currently open to oil drilling, and the drilling is being done largely by fracking of which the Obama administration takes a dim view. The administration has, moreover, refused to open federal lands to drillers and has also refused to expand offshore wells. If, however, people less in thrall to environmental extremism than is the current administration are elected in 2014 and 2016 the bonanza could be extended for another fifty or sixty years.

Here are some excerpts from a McClatchy report on what lies immediately ahead:

The United States will surpass Russia and Saudi Arabia to become the world’s largest oil producer in 2015, the International Energy Agency forecasts.

But the IEA’s long-term energy outlook, released Tuesday, predicted the Middle East will retake its position a decade later as the dominant source of global oil supply growth.

American energy production is skyrocketing, led by Texas and North Dakota, as oil companies use the techniques of hydraulic fracturing and horizontal drilling to tap oil and natural gas trapped in shale rock. “Technology and high prices are unlocking new supplies of oil, and of course also gas, that were previously thought to be out of reach,” Maria van der Hoeven, the IEA’s executive director, said Tuesday.

The International Energy Agency, which advises governments on energy issues, said America’s ascendancy as the world’s oil king is coming sooner than expected, and that North America’s need for oil imports will all but disappear by 2035.

This means that we won't be vulnerable to extortion by OPEC, we won't be sending our money to nations where it's simply redirected to wealthy sheiks and terrorists, we won't have to fight wars for oil in the Middle East, and fuel prices will remain relatively low helping all Americans enjoy a better standard of living than we otherwise would.

But the Middle East, boosted by a surge in Iraqi production, is expected, starting in the mid-2020s, to take back its role as the world’s oil powerhouse as America’s shale oil output peaks and then starts a decline.

The International Energy Agency forecasts that “sweet spots” in America’s top shale oilfields will run out and that the drilling will move to less productive areas that struggle in cost competition with other nations. But the agency added that it could be wrong about a U.S. decline.

“United States performance has consistently overshot most projections to date and it is possible that more resources will be found and developed to sustain production at a higher level and for longer than we project,” the IEA report said. “Especially if oil prices hold up, technology advances continue and environmental concerns are allayed.”

And, of course, if Washington permits more offshore drilling and environmentally safe petroleum extraction on federal lands the predicted decline could be postponed till closer to the end of the century.

The revenues this would generate would go a long way toward paying down our national debt, restoring us to fiscal health, and would be an enormous benefit to those who struggle to pay bills, every one of which rises directly with rising energy costs. The benefits would ripple through the economy, creating jobs and providing states with the wherewithal to address the manifold needs of their citizens.

There's light at the end of the tunnel, if only the federal government would get out of the way and let us get there.

There's more at the link.