America’s Unstoppable Energy Infrastructure Boom

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America’s Unstoppable Energy Infrastructure Boom

We are happy to remind people that Trends began trumpeting the North American Energy Revolution when most “experts” still preached “the gospel of peak oil.” Already, the explosive growth of oil and gas from U.S. shale deposits has fundamentally transformed global energy economics. How?

  • By dramatically reducing the global cost of energy by roughly 50 percent and starting a new surge in global demand.
  • By driving petrostates like Saudi Arabia, Iran, and Russia toward bankruptcy; Saudi Arabia could be broke as early as 2018.
  • By undermining the economic case for near-term deployment of green technologies like solar, wind, and biofuels; just remove the subsidies and those industries are essentially dead-in-the-water.
  • By reenergizing U.S. manufacturing competitiveness. Today, American production costs for many categories of goods are at parity with China, and the situation is likely to improve further.
  • By enhancing national security concerns related to foreign energy dependence.
  • By reducing the U.S. balance of trade deficit via increased exports of refined products and decreased imports of crude oil.

As a result, in 2015, the United States is far and away the world’s largest producer of energy. And this lead is only going to grow, even as countries like China and India surpass us in terms of demand.

As explained in the September 2015 issue of Strategic Wealth Advisor, the Saudi decision to keep oil prices above $100 a barrel after the financial crisis was perhaps the worst strategic decision since Japan launched its attack on Pearl Harbor in 1941.1

Just as the Japanese underestimated the ability of American industry to overwhelm their military resources, the Saudis underestimated the ability of American entrepreneurs (armed with state-of-the-art technology) to redefine the economics of oil and gas.

Far from killing the North American Energy Revolution, the recent OPEC-triggered oil glut has motivated U.S. producers to innovate even more, driving down costs and increasing volume.

Today, the world’s “conventional oil” petrostates are on a collision course with bankruptcy. Why? Because they cannot balance their budgets at the prices dictated by U.S. shale producers.

In twenty years, the total energy output of the United States and Canada is forecast to be roughly 50 percent larger than today, while prices in constant dollars are likely to be even lower than now...

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