The oil and natural gas boom in the U.S. may have sparked a worldwide energy revolution, as world powers like China and Britain look to hydraulic fracturing.
The United States and China have partnered on hydraulic fracturing, or fracking, to unlock vast amounts of natural gas buried under Chinese soil. The deal was agreed to after Vice President Joe Biden visited Asia this month to promote shale gas development. Environmental Protection Agency administrator Gina McCarthy also visited China this month to discuss environmental protection and global warming.
European nations are also embracing fracking. Britain recently opened up nearly half the country to oil and gas drilling, and is in the midst of an effort to block new European Union environmental rules from crippling energy development in Europe. Britain has the support of other nations including the Netherlands, Romania and Poland — all of which have large shale reserves.
Fracking has allowed the U.S. to unlock vast oil and natural gas reserves and have put it on the path to surpassing Russia and Saudi Arabia as the world’s top oil and natural gas producer. Low natural gas prices have sparked a manufacturing boom as well in the U.S. According to the International Energy Agency (IEA), the natural gas boom has caused U.S. gas prices to fall to one-third of European prices and one-fifth of Japanese prices.
“By around 2020, the United States is projected to become the largest global oil producer,” wrote IEA’s chief economist Fatih Birol. “The result is a continued fall in US oil imports, to the extent that North America becomes a net oil exporter around 2030.”
“The United States, which currently imports around 20 per cent of its total energy needs, becomes all but self-sufficient in net terms – a dramatic reversal of the trend seen in most other energy-importing countries,” Birol added.
More importantly, the shale revolution has caused the price of natural gas to plummet in the U.S., meaning lower energy costs for families. Not every country has been so lucky, as European nations face much higher gas costs than the U.S. does. Fracking would help alleviate this pressure.
The UK Telegraph reported this summer that if Poland, Britain and Romania began fracking it would push other countries to do the same and dramatically lower gas prices. This is especially crucial for countries like Poland that are forced to pay high prices for Russian natural gas — which is also used by the Russian government as a bargaining chip.
“We think the price of gas is going to come down from $11 [per million metric British thermal units] to around $6.50, and this will make a huge difference because high gas prices are killing Europe,” Oisin Fanning, head of the AIM-listed driller San Leon Energy, told the Telegraph.
The U.S. natural gas boom is expected to continue for years to come, but Republican lawmakers worry that it could be stymied by President Obama’s policies which have kept large tracts of federal land of limits to energy development.
“This energy revolution is creating jobs and revitalizing local economies, but this progress is occurring in spite of federal policies not because of them,” Colorado Republican Rep. Cory Gardner told The Daily Caller News Foundation in a statement.
“In fact, virtually all of the oil production increases over the past five years have taken place on federal lands,” Gardner added. “To fully realize America’s energy potential, we need to replace outdated policies of energy scarcity with policies that reflect America’s new energy abundance.”
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