The U.S. is the closest it has been in almost 20 years to achieving energy self-sufficiency, a goal the nation has been pursuing since the 1973 Arab oil embargo triggered a recession and led to lines at gasoline stations.
Domestic oil output is the highest in eight years. The U.S. is producing so much natural gas that, where the government warned four years ago of a critical need to boost imports, it now may approve an export terminal. Methanex Corp., the world's biggest methanol maker, said it will dismantle a factory in Chile and reassemble it in Louisiana to take advantage of low natural gas prices. And higher mileage standards and federally mandated ethanol use, along with slow economic growth, have curbed demand.
The result: The U.S. has reversed a two-decade-long decline in energy independence, increasing the proportion of demand met from domestic sources over the last six years to an estimated 81 percent through the first 10 months of 2011, according to data compiled by Bloomberg from the U.S. Department of Energy. That would be the highest level since 1992.
"For 40 years, only politicians and the occasional author in Popular Mechanics magazine talked about achieving energy independence," said Adam Sieminski, who has been nominated by President Barack Obama to head the U.S. Energy Information Administration. "Now it doesn't seem such an outlandish idea."
The transformation, which could see the country become the world's top energy producer by 2020, has implications for the economy and national security -- boosting household incomes, jobs and government revenue; cutting the trade deficit; enhancing manufacturers' competitiveness; and allowing greater flexibility in dealing with unrest in the Middle East.
David Fuller's view Once George P Mitchell pioneered the fracking method for extracting shale gas at a very commercial rate in the late 1990s, the seemingly unobtainable 'holy grail' of energy independence for the USA became a practical possibility. When this game-changing technology was adapted for the successful extraction of shale oil, the previously unthinkable prospect of the USA as the world's largest producer of energy became a probably for the next decade.
This will require none of the expensive subsidies thrown at ethanol and various inefficient renewable technologies. The USA is blessed with the world's largest known reserves of shale oil and the second largest known reserves of shale gas. Moreover, American innovation created the means for extracting this vital resource - a technological breakthrough that other countries are now scrambling to achieve.
The article above is cautious about the impact of increasing energy self-sufficiency on the US economy but Fullermoney maintains that it is a game-changer. Comparatively cheap natural gas has already lured Dow Chemical back to the US and other companies will follow. Billions of dollars which previously flowed to foreign energy suppliers will increasingly remain in the US. Foreign policy overreach, not least regarding the Middle East, should become less of a priority.
Obviously none of this will transform the US economy overnight but the trend of America's economic decline, both real and perceived, is beginning to change.
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