Energy-independence types like to say that America is the Saudi Arabia of coal; developments of the past year reveal that the Americas may also be the Saudi Arabia of… oil! The NYT has a remarkable piece on the effects of new technology and massive oil discoveries throughout the Western Hemisphere.
Brazil has begun building its first nuclear submarine to protect its vast, new offshore oil discoveries. Colombia’s oil production is climbing so fast that it is closing in on Algeria’s and could hit Libya’s prewar levels in a few years. ExxonMobil is striking new deals in Argentina, which recently heralded its biggest oil discovery since the 1980s.Up and down the Americas, it is a similar story: a Chinese-built rig is preparing to drill in Cuban waters; a Canadian official has suggested that unemployed Americans could move north to help fill tens of thousands of new jobs in Canada’s expanding oil sands; and one of the hemisphere’s hottest new oil pursuits is actually in the United States, at a shale formation in North Dakota’s prairie that is producing 400,000 barrels of oil a day and is part of a broader shift that could ease American dependence on Middle Eastern oil…“This is an historic shift that’s occurring, recalling the time before World War II when the U.S. and its neighbors in the hemisphere were the world’s main source of oil,” said Daniel Yergin, an American oil historian. “To some degree, we’re going to see a new rebalancing, with the Western Hemisphere moving back to self-sufficiency.”
This is big, exciting, good news for the United States, and something Via Meadia has been keeping a close eye on. The more oil we get from our own hemisphere, the deeper our structural advantages in world politics. Our interest in volatile countries and unsavory regimes becomes less of a concern as our energy sources move away from capricious cartels and other unpredictable regimes on the other side of the world.There may, however, be a downside to all this independence. Decreasing our reliance on Middle Eastern imports could diminish domestic tolerance for maintaining a large military presence in that part of the world – where we currently have large bases and troop presence not only in Iraq but throughout Kuwait, Bahrain, Qatar, UAE, and Oman as well, primarily to safeguard Persian Gulf and Saudi oil fields from an Iranian threat.Right now surprisingly little U.S. oil is imported from the Middle East; we supply about half our own needs and get much of the rest of it from Canada, Mexico, and Venezuela already. Mideast oil is going primarily to Europe, Japan, and increasingly India and China. Our interest in the Middle East has less to do with the acquisition of oil for ourselves and more to do with ensuring stability in global oil prices, the global economy — and preventing other powers from trying to dominate the region.American policy makers in the future may have a slightly tougher time explaining to taxpayers why the US maintains such an interest in a faraway region that we don’t need for oil, but the advantages of a secure oil supply in our own hemisphere are still something to welcome.