The Vindicator | February 21, 2017 | Doug Polk
The nation’s energy security is stronger than it has been in decades. U.S. oil and natural gas production – thanks to the shale revolution happening in states like Ohio – has surged. We are now the world’s largest combined producer of oil and natural gas, but we remain beholden to the uncertainties of the global energy marketplace.
A supply disruption from one major oil-producing nation such as Iran, Russia or Venezuela, can send the global price of oil through the roof. We may be more energy-secure than we have been in the past, but our economy remains vulnerable to price shocks for oil. President Donald Trump now has the opportunity before him to counter that.
The Trump administration would be wise to unleash the full job-creating and economy- boosting potential of the nation’s oil and natural gas industry. Doing so should begin with giving our energy producers greater access to both our onshore and offshore resources. Consider that 94 percent of federally controlled offshore acreage is off-limits to energy exploration.
Allowing greater access to our resources will better allow our energy producers to shift the center of gravity of energy markets away from unstable regions of the world. More oil and natural gas produced in the U.S., a bastion of stability, is not only better for our economy but for the global economy as well.
Global energy demand is expected to rise another 50 percent by 2040, and fossil fuels are expected to meet nearly 80 percent of that demand, according to the U.S. Energy Information Administration. The world needs more energy production, and we must have policies that allow us to step up to the plate.
If we embrace the energy opportunity before us, the benefits could be enormous. Take the economic benefits delivered from the shale revolution: Americans saved $550 on gasoline on average in 2015, according to AAA thanks to increased U.S. energy production. The National Association of Manufacturers reported that the average American household is saving more than $1,337 per year thanks to lower energy costs.
Our manufacturing sector has benefited as well. Lower natural-gas prices, in particular, are spurring manufacturing investment in energy-intensive industries like steel and petrochemical production. U.S. industrial electricity costs are 30 to 50 percent lower than those of our foreign competitors. That means manufacturing costs in the U.S. are now 10 to 20 percent lower than they are in Europe and are projected to fall below manufacturing costs in China by 2018, according to the Boston Consulting Group. This is a competitive edge we must not take for granted.
Read the full op-ed here.
Douglas Polk is the vice president of industry affairs & North American communications at Vallourec USA and NOIA Secretary.