U.S. set to become a superpower in global energy market
The emergence of the United States as a global energy leader was hardly imagineable even five years ago. In the past two years, U.S. production of crude and natural gas liquids has jumped by 27 percent — more than 2 million barrels a day — making us the world’s leading natural gas producer and putting us on track to surpass Saudi Arabia as the leading producer of oil by next year. Our trade balance has shifted — with imports dropping from 60 percent of supply 10 years ago to a projected 25 percent of supply by 2016, according to Energy Information Administration statistics.
Our newfound energy abundance promises to erase one of our greatest economic vulnerabilities while fundamentally altering the geopolitical landscape — but only if we take full advantage of our resources.
The addition of more American energy to the global supply is already providing stability to world markets, potentially diminishing the influence of less stable regions and exerting downward pressure on prices. Increased U.S. production also allows, in the words of former Obama administration National Security Advisor Tom Donilon, “greater maneuvering ability to pursue our national security priorities.” Case in point: Iran. While we can’t yet predict the outcome of current negotiations, Donilon credits tough energy sanctions with bringing Iran to the table to negotiate a freeze of its nuclear program — sanctions only possible because “American production had gone up to such a degree that it actually substituted for the Iranian production that has been taken off the market.”
We also have the opportunity to exert positive influence in Central and Eastern Europe, as nations line up to buy American. Demand is so great that more than a dozen nations are joining to lobby for greater access to U.S. natural gas exports.
The sooner the Obama administration approves applications for liquefied natural gas (LNG) export facilities, the greater our ability will be to support our allies overseas and create jobs here at home. According to a study conducted by ICF International, exporting 16 billion cubic feet per day of LNG could generate significant economic benefits nationwide — with average net job growth of up to 452,000 jobs between 2016 and 2035 and up to $73.6 billion increase in GDP annually.
America’s energy revolution is already an economic juggernaut, helping the U.S. add 600,000 jobs between 2009 and 2011 for a total of 9.8 million jobs supported. Shale energy alone will support a projected 3.9 million jobs by 2025, including 500,000 manufacturing jobs, many of them here in Texas. Looking ahead, investment in midstream and downstream infrastructure could generate an estimated $1.14 trillion in capital spending between 2014 and 2025 and support up to 1.15 million average annual jobs over the same period.
Smart policies such as expanding offshore access, implementing market-based export policies and updating energy infrastructure can generate even greater economic growth and job creation — in particular for minorities.
A new IHS report finds minority employment in the oil and natural gas and petrochemical industries is on the rise — increasing from one-quarter of total jobs in 2010 to one-third in 2030. Of the nearly 1.3 million projected job opportunities in these industries by 2030, the report projects almost 408,000 positions — 32 percent of the total — will be held by AfricanAmerican and Hispanic workers while women could gain 185,000 jobs over the forecast period.
Sixty-three percent of new job opportunities are projected to be in blue-collar professions, suggesting tremendous opportunity for workers with a high school diploma and some postsecondary training. To lower unemployment and shrink the income-inequality gap without spending a dime of taxpayer money, President Barack Obama should look to the oil and natural gas industry, which pays average wages significantly higher than the national average.
We have the natural resources and — through hydraulic fracturing and horizontal drilling — the technology to be a global energy superpower with all the economic and national security benefits that entails. But taking our place as a world energy leader requires making the right choices. By basing policy decisions on current production realities and sound science, we can ensure a bright energy future.