Shale gas development or change the global political and economic system
June 20 11:01:06, 2025
The U.S. oil and gas revolution has sparked intense debate over whether it will reshape global patterns. Historically, the U.S. has been one of the world's top oil consumers and importers. Its voracious appetite for oil has been both a blessing and a curse for American leaders. Not only does it dominate global markets, but it also heavily influences U.S. foreign policy. Currently, the U.S. consumes around 18.7 million barrels of oil daily, with roughly 20% of its energy needs being met through imports. However, advancements in shale oil and gas technology could soon transform this dynamic. Over the next decade, the U.S. might achieve energy independence, drastically reducing reliance on foreign oil. The International Energy Agency predicts that by 2025, the U.S. could surpass Saudi Arabia to become the world’s largest oil producer. This shift could redefine geopolitics.
Fatih Birol, the IEA’s chief economist, stated, "By 2015, the U.S. will overtake Russia as the largest natural gas producer, and by 2017, it will become the world’s largest oil producer." Could this energy revolution truly alter the global landscape? And what environmental consequences might arise from developing shale gas?
The Paris-based IEA noted in its World Energy Outlook report that recent increases in oil and gas production are transforming the U.S. energy market. The U.S. is experiencing an oil boom, largely due to high global prices and innovative techniques like hydraulic fracturing, which make shale oil and gas extraction commercially viable. The U.S. holds vast shale gas resources across 48 states. In 2000, conventional natural gas production could cover roughly 12 years of consumption. The success of shale gas has significantly reduced U.S. dependence on imports from Russia, Venezuela, Iran, and Saudi Arabia. Between 2008 and 2011, U.S. crude oil production rose by 14%, while natural gas production increased by 10%.
The IEA projects that U.S. natural gas prices will rise from $3.5 per million British thermal units (MMBtu) to $5.5/MMBtu by 2020. Despite this, the agency estimates that 93% of domestically produced natural gas will still meet domestic demand. Increased oil and gas production benefits the U.S. economy, particularly in reducing the trade deficit and creating high-paying jobs. These industries are centered in states like North Dakota, Wyoming, and Texas. Shale gas is reshaping the energy landscape, influencing petrochemical industries and potentially lowering electricity costs for other sectors, creating up to 600,000 jobs.
However, IEA Chief Economist Birol cautioned that this revolution is still young. "Our understanding of tight oil resources is limited. If new discoveries aren’t made post-2020 or if prices drop, Saudi Arabia might reclaim its position as the leading oil producer."
This energy shift could lead to significant geopolitical changes. A self-sufficient U.S. might no longer prioritize defending the Middle East's oil routes, such as the Strait of Hormuz. By 2035, nearly 90% of Middle Eastern oil will flow to Asia. Rising global energy demand, driven by China, India, and the Middle East, will outpace declines in developed economies. Global demand is expected to grow by over a third by 2035.
Qatar’s CEO of International Petroleum Company, Nasser, sees U.S. energy independence as an opportunity. He believes it will boost Qatar’s oil and gas exports to Asia. Even if the U.S. becomes the world’s largest oil producer by 2035, the Middle East will remain the "global oil hub," with OPEC's share of global oil production increasing from 42% to 50%.
Despite these projections, uncertainty remains. Some analysts argue that U.S. energy independence won't alleviate global energy pressures. High oil prices will persist, impacting consumers worldwide. Environmental concerns also loom large. Hydraulic fracturing involves injecting chemically treated water into shale formations, raising fears of groundwater contamination and seismic activity.
In response, the U.S. has introduced regulations to curb air pollution from shale gas extraction. By January 2015, all wells using hydraulic fracturing must install equipment to reduce volatile organic compounds and hazardous air pollutants. Meanwhile, European nations like France and Bulgaria have banned shale gas mining due to environmental concerns. Germany remains cautious.
As the global energy map evolves, the U.S.’s shale revolution will undoubtedly play a pivotal role, but its long-term impacts remain uncertain.