America’s oil boom and the collapse of its energy security paradigm

Gal Luft39. Economic Conference

America’s oil boom and the collapse of its energy security paradigm

Dr. Gal Luft

Zurich, September 17, 2014

The title of my lecture is an oxymoron. America is in the midst of an unprecedented energy boom. Due to the shale revolution, its oil and gas production are the highest in decades and the country is well on its way to becoming an energy exporter after years of energy vulnerability and deep dependency on imported energy. Only in 2007, Fed Chairman Alan Greenspan lamented in a Congressional hearing that America was in a midst of a natural gas crisis and fourteen gas import terminals were built along America’s coasts to address the crisis. Seven years later and the U.S. is drowning in cheap gas and is well on its way to becoming a major natural gas exporter on par with Qatar. To illustrate the degree of the change that occurred consider the case of North Dakota. With a population equivalent to that of Frankfurt, the upper Midwestern state has been until recently a non-player in America’s energy landscape. Today it is the second largest oil producing state after Texas, surpassing traditional energy giants like Alaska and California.

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