Perhaps whistling past the graveyard, the Saudi Oil minister had this to say about the prospects of U.S. oil independence from our friends the Saudis:
"Newly commercial reserves of shale or tight oil are transforming the energy industry in America -- and that's great news," he told an audience of policy makers and academics at the Center for Strategic & International Studies in Washington.How realistic is the prospect according to those in the know? Here's a CNBC story on that:
"It is helping to sustain the U.S. economy and create jobs at a difficult time."
"I welcome these new supplies into the global oil market," he added.
On the other hand, he said, it was not realistic to believe this would help the U.S. eliminate imports of oil, a goal of some Americans who argue energy independence is crucial for the country's security.
Despite the domestic production gains, U.S. imports of Middle East oil in the second half of 2012 were higher than any time since the 1990s, Naimi said.
The U.S. "will continue to meet domestic demand by utilizing a range of different sources, including from the Middle East. This is simply sound economics.
"I believe this talk of ending reliance is a naive, rather simplistic view."
As detailed in the first two installments of Power Shift, an NBC News/CNBC special report, the United States is reaping the benefits of an energy boom created by new drilling technologies that have unlocked vast domestic oil and natural gas reserves. Coupled with decreasing demand due to energy efficiency and continued cultivation of alternative energy sources, an increasing number of experts believe the U.S. could achieve energy independence by the end of the decade—realizing a dream born during the gas crisis of 1973.
Why would the Oil Minister dismiss the chances of such an eventuality? Doesn't take Sherlock Holmes to figure that one out. From that same story:
"A dramatic expansion of U.S. production could … push global spare capacity to exceed 8 million barrels per day, at which point OPEC could lose price control and crude oil prices would drop, possibly sharply," the U.S. intelligence community's internal think tank, the National Intelligence Council, said in its "Global Trends 2030" report in December. "Such a drop would take a heavy toll on many energy producers who are increasingly dependent on relatively high energy prices to balance their budgets."
With some analysts predicting that oil prices could drop as low as $70 to $90 a barrel—down from the current price of nearly $110 per barrel of Brent crude oil—a "scramble" among OPEC members for market share could ensue, said Edward Morse, an energy analyst with Citigroup and co-author of a recent report on titled "Energy 2020: Independence Day."
It would be nice to be in the catbird seat. Or as C.J. might put it: (skip the video to the 13:32 mark)
"One, two, three, four, make them sweat outside the door. Five, six, seven, eight, always pays to make them wait. Nine, ten, eleven, twelve, COME!"