By Victor Davis Hanson
Published July 6, 2017
Less than 10 years ago, America’s energy future looked bleak.
World oil prices in 2008 had spiked to more than $100 per bar rel of crude.
“Peak oil” — the theory that the world had already extracted more crude oil than was still left in the ground — was America’s supposed bleak fate. Ten years ago, rising gas prices, spiraling trade deficits and ongoing war in the oil-rich Middle East only underscored America’s precarious dependence on foreign sources of oil.
Despite news of a radically improved but relatively old technology called “fracking” — drilling into shale rock and injecting water, sand and chemicals at high pressure to hydraulically “fracture” the rock and create seams from which petroleum and natural gas are released — few saw much hope.
In 2012, when gas prices were hitting $4 a gallon in some areas, President Obama admonished the country that we “can’t just drill our way to lower gas prices.” That was a putdown of former Alaska governor and vice presidential nominee Sarah Palin’s refrain, “Drill, baby, drill.”
Obama barred new oil and gas permits on federal lands. Steven Chu, who would become secretary of energy in the Obama administration, had earlier mused that gas prices might ideally rise to European levels (about $10 a gallon), thereby forcing Americans to turn to expensive subsidized alternative green fuels.
But over the last five years, frackers have refined their craft on private properties, finding ever cheaper and more efficient ways to extract huge amounts of c rude oil and natural gas from shale rock.
In 2017, despite millions of square miles being off-limits to drillers, America is close to reaching 10 million barrels of crude oil production per day, the highest level in the nation’s history. The U.S. may soon surpass Saudi Arabia as the world’s largest petroleum producer.
When American natural gas (about 20 percent of the world total) and coal (the largest reserves in the world) are factored into the fossil fuel equation, the U.S. is already the largest producer of energy in the world.
While environmentalists worry about polluting the water table and heightening seismic activity through hydraulic fracturing, fracking seems to become more environmentally sensitive each year.
When OPEC and other overseas producers tried to bankrupt frackers by flooding the world with their supposedly more cheaply produced oil, the effort backfired. American entrepreneurs learned to frack oil and natural gas even more cheaply and undercut the foreign gambit. The result is a windfall for all sectors of the American economy.
From 2014 to 2016, fracking helped cut the price of gasoline by $1.50 a gallon, saving American drivers an average of more than $1,000 per year.
Due to the fracking of natural gas, the United States has reduced its carbon emissions by about 12 percent over the last decade, (according to the Energy Information Administration) — at a far greater rate than the environmentally conscious European Union.
Fracking and cheaper gas are allowing a critical breathing space for strapped American consumers, as alternative energy production and transportation slowly become more efficient and competitive.
Fracking has created a national savings of about 5 million barrels of imported oil per day over the last decade. That translates to roughly $100 billion in annual savings by avoiding foreign oil.
Fracking has allowed the U.S. to enjoy some of the lowest electricity rates and gas prices in the industrial world. The result is that cheap energy costs are luring all sorts of energy-intensive industries — from aluminum to plastics to fertilizers — back to the United States, with the potential of creating millions of new, high-paying jobs.
Fracking has given America virtual energy independence, freeing it from the leverage of unstable and often hostile Middle East regimes. The result is less need to interfere in the chronic squabbling in the oil-rich but unstable Persian Gulf.
Fracking has reduced oil prices and radically weakened America’s rivals and enemies. Desperate oil exporters like Iran, Russia and Venezuela are short about half the oil income that they enjoyed 10 years ago.