US energy: state of (semi-) independence

http://www.guardian.co.uk/commentisfree/2013/jan/09/us-energy-state-of-independence

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The spotting of security threats and diplomatic tensions is a job usually left to intelligence services and military analysts. Yet the most suggestive geopolitical guidance so far this year comes not from a spook or a general, but a forecast issued this week by the US Energy Information Administration.

It predicts that net imports of oil and gas will fall next year to their lowest level since 1987, when Ronald Reagan occupied the Oval Office. As recently as 2005, Americans relied on the rest of the world to supply nearly two-thirds of all the crude, gas and other fuels they consumed; but by 2014 that proportion will have fallen to less than a third. If that is true, then the US is entering a new era: one defined not by chronic energy dependence but by a state of semi-sufficiency. And while the consequences are as yet barely discussed outside the circles of Washington insiders, they are likely to be huge – not just for America but the rest of the world, too.

The EIA gives two big reasons for why the US is importing less energy. The first is simply because slump-bound Americans are using less. But it's the other that's especially interesting: booming domestic production, especially of shale gas. Towards the end of last year, the Paris-based International Energy Agency predicted that the US could become the world's biggest oil producer by 2017. Again, this marks a massive turnaround in a very short time. For years, presidents have vowed to make America "energy independent": no longer reliant for their fuel on autocracies in the Middle East or eastern Europe. George Bush even used America's record-high imports as an excuse to encourage the burning of foodcrops and turning them into biofuels – a drive that sent world food prices rocketing in 2008, causing starvation and sparking riots in countries as far flung as Egypt and the Philippines.

If these predictions are borne out (and there are sceptics), then the relationships that America has with the rest of the world are bound to change both in scale and in intensity. Some of the biggest impact will probably be felt in Saudi Arabia and Russia: energy-rich autocracies that haven't developed their economies but relied instead on flogging fossil fuels. They may be about to lose one of their biggest customers. And if the Caspian Basin or the Persian Gulf is no longer so economically vital to the US, they will surely grow less militarily important too.

This doesn't mean that the US Fifth Fleet will be home for next Christmas, but over time the presence of energy-dependent Beijing or Delhi may well become more marked in fuel hotspots. We could be at the start of a major geopolitical negotiation. And, sadly, it may well be that climate change doesn't assume such importance in those discussions.