Overemphasizing the shift in the energy markets since 2005 is hard. Had you predicted the shift that was to come, you would have been widely deemed a lunatic. But let me take you back there for a moment and remind you of where we stood, and what played out over the next decade.
U.S. oil production had seemingly peaked in 1970 at 9.6 million barrels per day (BPD), and by 2005 had declined for 35 years. Production in 2005 stood at 5.2 million BPD, and crude oil imports had reached 10.1 million BPD -- just under 50% of total U.S. petroleum consumption. The U.S. economy was in a precarious situation, highly dependent on oil imports from countries like Venezuela and Saudi Arabia; countries whose interests weren’t always aligned with our own.
Concerns about oil supplies weren’t limited to the U.S. In 2005 energy investment banker Matt Simmons published Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy. Simmons helped set off a fierce debate about whether Saudi Arabia -- and the world as a whole -- had reached a global peak in oil production. This thesis gained traction over the next three years, as oil prices surged past $100/bbl and helped push the world into recession. The U.S. desperately needed a miracle to reverse decades of growing energy dependence. Actually one was in the works, unbeknownst to most Americans.Read the rest of this article by clicking here.
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