The oil and gas industry has long profited from the views of Daniel Yergin, and a new essay, published by Yergin a week ago, is bound to keep his reputation intact.
Writing in the Washington Post, Yergin claimed the world is about to experience a shift in perspective, with the outline of a "new world oil map" emerging: one centered not on the Middle East but on the Western Hemisphere.
"The new energy axis runs from Alberta, Canada, down through North Dakota and South Texas, past a major new discovery off the coast of French Guyana to huge offshore oil deposits found near Brazil," Yergin claims.
"This shift carries great significance for the supply and the politics of world oil," Yergin states, observing that it is unplanned and a product of "unrelated initiatives and technological breakthroughs that, together, are taking on a decidedly hemispheric cast."
The new outlook
According to Yergin, the new hemispheric outlook is based on resources that were not seriously in play until recent years—all of them made possible by technological breakthroughs and advances.
"They are 'oil sands' in Canada, 'pre-salt' deposits in Brazil and 'tight oil' in the United States," said Yergin, who claims that these three developments will "radically alter" the global flow of oil.
The Western Hemisphere will still require supplies from the rest of the world, but not to the same degree—and certainly nowhere near the growing amounts forecast just a few years ago.
"The need could fall by as much as half by 2020, which will mean declining imports from the Middle East and West Africa," says Yergin, who claims that the shift in oil flows will have a corresponding shift of responsibility in the global security umbrella.
"Oil that would have gone west from those regions will instead flow in increasing volumes to the east—to the booming emerging markets of Asia," says Yergin.
The significant question
"All of this points to a major geopolitical shift, with Asian economies having an increasing stake in the stability of Mideast oil supplies," says Yergin.
"It also raises a very significant question over the next several years: How will responsibility be shared among the great powers for the stability of the Persian Gulf?" Of course, something has been overlooked here: views from the region itself.
Indeed, Yergin's question has already emerged for leaders in the gulf, as exemplified by Bahrain's Foreign Minister Sheik Khalid bin Ahmed Al-Khalifa, who commented on America's planned withdrawal from Iraq.
"Now the game is different," Sheikh Khalid said, adding, "We'll have to be partners in operations, in issues and in many ways that we should work together."
More Oil & Gas Journal Current Issue Articles
More Oil & Gas Journal Archives Issue Articles
View Oil and Gas Articles on PennEnergy.com