Posted January 5, 2016
There are many ways to gauge the current strength of American energy. The U.S. is producing nearly twice as much oil as it did less than a decade ago, which, combined with natural gas output, has made America the world’s leading producer.
Yet, the real-world impact of America’s energy revolution offers a more meaningful picture. New tensions are roiling the Middle East, yet global crude markets have remained relatively calm – unimaginable a few years ago. Meanwhile, a tanker carrying U.S. crude oil left port headed for Europe – the first since the lifting of America’s 40-year-old ban on domestic exports. There’s the reach of our energy revolution.
In his State of American Energy remarks, API President and CEO Jack Gerard focused on the growth of U.S. energy and its benefits – and also the opportunity to sustain them with sound energy policies based on facts and science. Gerard said current events in the Middle East and the lack of skyrocketing crude markets show how the world energy balance has changed:
“I think the American energy renaissance is the key driver in that. As you look around the world today, the geopolitics of energy has changed significantly over the last decade. The United States now is the world’s No. 1 producer of oil and natural gas. So it’s the fundamentals of the laws of supply and demand taking out a lot of the risk that we’ve seen historically. Why? Because what’s happening is the market’s looking at that situation and they’re saying it could have an impact, obviously, within those significant producing nations. But there are alternatives today, the United States being one. … . So the global market today is very different. Those who had significant influence over pricing, if you talk to analysts they’ll tell you that dynamic has shifted. … It’s very significant what’s happened.”
The ability for U.S. producers to export domestic crude is an opportunity, Gerard said:
“Our ability to compete in those global markets is a game-changer. The world as we’ve known it for the last 30 or 40 years is evolving, it’s realigning. While we’ll have ups and downs, all we ask for is an opportunity. The companies we represent don’t want government intervention, we don’t want government support. We just want an opportunity to compete, and the market will find its equilibrium.”
Other highlights from State of American Energy:
- The energy revolution has produced lower costs for U.S. consumers and a real boost for the economy. Gerard said that according to the U.S. Energy Information Administration (EIA), consumers saved, on average, $700 in 2015 on transportation fuel costs.
- Increased energy production has been accompanied by lower U.S. greenhouse gas emissions. According to EPA, emissions in 2013 were 9 percent below 2005 levels despite rising population, energy use and economic growth, Gerard said.
- With the right energy policies in place, a Wood Mackenzie study estimates the oil and natural gas industry could support as many as an additional 1 million U.S. jobs in 2025 and as many as 2.3 million by 2030.
Gerard said EIA estimates fossil fuels will account for 80 percent of the energy Americans use through 2040, which argues for policies that foster safe, responsible development. He was critical of “an ardent few” who hold that keeping the country’s abundant energy resources in the ground is a “credible and viable energy strategy.” Gerard said the U.S. model of rising production and falling emissions is one that works and should be an example for the rest of the world. He cautioned against regulatory overreach and opponents of needed energy infrastructure. Gerard:
“Much of these limitations are the result of a dangerous combination of outdated policies and anti-fossil fuel political ideology that continues to prevent American companies from investing in tomorrow’s pipelines, marine terminals and other energy infrastructure projects. Emboldened by their ability to stop the Keystone XL pipeline, anti-fossil fuel advocates have set their sights on all energy infrastructure projects. Their arguments against this energy infrastructure project were not based on its economic merits or true environmental impact.”
“The demonization of the Keystone XL pipeline remains a powerful cautionary tale of the dangers of energy policy driven by ideology rather than economic reality and has a chilling effect on expansion efforts for our nation’s energy infrastructure. That’s not just bad national energy policy. It is also bad news for our nation’s economy.”
Gerard pledged that API’s 2016 Vote 4 Energy initiative will focus on common interests and goals and the “fact that smart, responsible pro-energy policies mean more American jobs, a stronger U.S. economy, a better environment and continued global energy leadership.” Gerard:
“Energy is fundamental to our society, and thanks to American innovation and entrepreneurial spirit, the United States stands among the world’s leaders in energy production and environmental improvement and will remain a global energy leader only if we get our nation’s energy policy right today. … In this New Year let us all resolve to work together toward a shared vision of a world where everyone – without regard to zip code, state, nation, continent or hemisphere – has access to reliable, safe and affordable energy.”
“[T]he reality is that, no single source of energy will alone solve our problems or is the source of all of our woes. Moreover, no group holds all of the answers or the solution to the challenges we face. What history has taught us is that America prospers most when we work together for the common good.”
ABOUT THE AUTHOR
Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.