“As of today it is at least theoretically possible to scenarize a world oil shock at least equal to the so-called ‘Arab oil embargo’ of 1973-74 in terms of oil export supply cuts from several key regions and producer states – Russia, Iraq, Libya, Syria, Yemen and possibly the GCC Arab Gulf exporters,” reports oil voice (via Instapundit).
That’s a scary thought. Another sort of Carter-era energy shortage on top of what has been an anemic economic recovery for the United States would be a bitter pill to swallow.
Which is why we can be thankful that the blow of any sort of international disruption will be softened by America’s increased domestic oil production, thanks to a shale oil and gas boom set off by hydraulic fracturing.
As Professor Mark Perry points out, thanks to the shale oil boom in America the percentage of petroleum products imported into the United States is in steep decline:
Any shift in world oil supplies is going to have an impact on energy markets, obviously. But that impact will be less dramatic here in the United States thanks to increased domestic oil production. And, one could argue, this is why America should drop restrictions on exporting unrefined crude.
Wouldn’t the world be better served by more oil from a stable polity such as the United States? As opposed to oil from a chronically chaotic region like the middle east?
On the political front, I’ve written before about the irony of President Barack Obama, a political leader who is demonstrably hostile to fossil fuel energy development, being helped to re-election by the economic impacts of a boom in fossil fuel energy production.
Now it seems that Obama’s America may have some insulation from the domestic impacts of middle eastern instability thanks, once again, to the oil and gas boom Obama’s administration has been no friend of.