America is on track to produce all the energy it needs at home.
UNTIL the late 1950s America produced all the coal, oil and natural gas that its citizens could burn. But as they grew rich and bought cars as big as whales, America began to suck in fuel from beyond its shores. It now accounts for nearly a fifth of world energy consumption. China may be the world’s biggest consumer, but each American burns three and a half times as much as the average Chinese person.
Demand has more than doubled since America was last able to satisfy its energy needs from domestic sources. Nevertheless, there is a growing belief that it can do so again. During the election campaign, both presidential candidates suggested that "energy independence" was attainable. And indeed, the idea is no longer far-fetched. On November 12th the International Energy Agency (IEA), the rich world’s energy club, forecast that America could become the world’s largest oil producer by 2020, outstripping Saudi Arabia and Russia. It could also be more or less self-sufficient in energy by 2035.
The last time America was the world’s biggest oil producer was a decade ago. Thanks to a boom in unconventional energy, America could be churning out 11.1m barrels a day (b/d) by 2020. More than one jubilant media outlet has crowed about "Saudi America".
Drilling in shale beds has made America all but self-sufficient in natural gas. A shoreline dotted with vast and expensive, but mainly idle, plants to import gas in liquid form is a testament to this rapid transformation. So much gas has been fracked that its price has plummeted, and American drillers have started to use the same technology to extract oil, which is still costly, from shale beds.
Even as plenty more American oil gushes out of the ground, and biofuels and natural gas fill more tanks, cars are getting more efficient. So demand is waning: by 2035 the IEA expects American oil imports to have fallen to a third of current levels--just over 3m b/d. By then the country will be exporting roughly the same amount of energy, in the form of coal and gas.
Currently America exports only a little gas. The government has granted one import terminal a licence to convert its machinery so that it can turn gas into liquid for export. Another dozen want to do the same. The White House is unsure about this. Sending gas abroad might raise prices at home; though of course it would also generate pots of money.
The IEA’s forecasts look bold. But other analysts are even more optimistic. Plenty of Americans would be glad not to rely on pesky foreigners for oil and gas. But they should not imagine that they can separate themselves from world markets. Oil prices are determined by global supply and demand, and gas is going the same way. Will America be self-sufficient? Maybe. Independent? No.
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